Re: What Can Be Done Differently

One thing to remember is that CHS did not adhere to the requirements given in the RFP - once the bids were in, there was a tremendous amount of "backroom" negotiation. (Remember when the operator would have to supply their own $10M single incident and an almost impossible composite loss insurance policy?) Under the original constraints the contract operator would have had to ask CHS before replacing a broken piece of rail. Also, recall that the RFP called for the operation to be much more of a museum operation than the financially self-sustaining tourist railroad, that Steve has indicated they are trying to achieve today. The original RFP was essentially thrown out and the final deal cut made the operation half viable, but terribly cumbersome. Unfortunately, any lawsuit to remedy the CHS's illegal practice would have cost $500K+ and only afforded the prevailing party the opportunity to work with the very people they had just sued.
There is still somewhat of a blur between what CHS originally intended to operate and what has actually manifested - the Railstar Loop is akin to a hybrid between a business and a state taxpayer (or gambling revenue) supported concession.
When those of us still in the business tilt our head and try to make sense of the situation, we forget that "making it" is not at stake here, as it was in the other railroads we have operated on...there will always be more money to shore up any shortages that may occur in this railroad's cash flow. They do not have to pay back investors or loans (with interest) for equipment purchases or other capital outlay. They did not have to "build" anything - they essentially inherited a ready made operation. Payroll will always be met no matter how many operating days they have. Everything except getting trains loaded and up and down the hill has been outsourced.
If Railstar cannot make a go of it with all the financial and administrative support CHS is providing, I would be very suprised. All they really have to do is show up every day and keep the shiny sides up and the greasy sides down.