Posts Tagged ‘Corridor Capital’

Corridor Capital Out as Hoosier State Operator

November 11, 2014

Corridor Capital is out, Iowa Pacific may be in and Amtrak is standing by in the ongoing saga of who will operate the Hoosier State.

The Indiana Department of Transportation broke off contract talks with Chicago-based Corridor Capital, which had submitted the winning bid to operate the Chicago-Indianapolis train beginning on Oct. 1.

However, Corridor Capital and IDOT were unable to reach an agreement by that date and Amtrak is continuing to operate the route through January.

INDOT is now seeking information from Amtrak about continuing to operate the quad-weekly Hoosier State beyond Jan. 31, 2015.

However, INDOT is also negotiating with Iowa Pacific, raising the prospect that the Hoosier State might be a joint venture of sorts.

INDOT spokesman Will Wingfield said his agency “is requesting pricing from Amtrak to continue as operator after Jan. 31, minus certain elements of the existing service that Amtrak is providing, such as rolling stock, on-board services, and marketing.”

INDOT has not confirmed it is talking with Iowa Pacific Holdings Inc., which had been the runner-up to Corridor Capital, company spokesman Michael Hicks told Trains magazine that “we believe there are opportunities to work with Amtrak and the state of Indiana to make substantial improvements in Hoosier State service over the next year, and we are engaged in discussions with INDOT.”

Amtrak spokesman Marc Magliari told Trains that it “continues to work closely with the State of Indiana on the continuation of daily service between Indianapolis and Chicago. Amtrak submitted a contract renewal in April 2014 for the current service model and has offered to work with the state on other viable models used in other states.”

Although INDOT has not said why it broke off talks with Corridor Capital, Trains reported that a major sticking point was financing the costs of getting the equipment in shape for the service.

Corridor Capital said that as late as last Wednesday it continued to provide resources and personnel to meet the demands of the Federal Railroad Administration emergency services contingency plan, which must be submitted to the agency no later than 60 days prior to commencement of any new service.

The company had thus far declined to reveal the specific passenger cars and locomotives that it planned to assign to the Hoosier State service.

It has only said that it “has had modern Amtrak certified equipment ready for retrofit and deployment” since June.

Trains reported that INDOT sent an email notification to Corridor Capital on Friday “rejecting the proposal” it had accepted in June and a certified letter would follow. That email message reportedly did not explain that contract negotiations would be terminated.

Corridor Capital claims that it only learned negotiations had been cancelled after reading a story in the Lafayette Journal & Courier on Saturday evening.

Amtrak spokesman Magliari noted that “Amtrak submitted a contract renewal in April for the current service model and has offered to work with the state on other viable models used in other states. However, time is growing short to resolve many open questions for daily passenger rail service to continue from Feb. 1 and onward.”

Railway Age magazine reported that Amtrak executives privately fumed over Indiana’s intent to farm out the Hoosier State to Corridor Capital.

Amtrak President and CEO Joe Boardman travelled the route in a special train on Oct. 1 from Indianapolis to Chicago during which he announced that Amtrak would provide free Wi-Fi, a business-class car and light snacks as a goodwill gesture during the last three months of the contract extension.

INDOT, Tippecanoe County. and the cities of Indianapolis, Lafayette, West Lafayette, Rensselaer, Beech Grove and Crawfordsville have collectively  committed $2.7 million toward funding the Hoosier State since Oct. 1, 2013, to keep it operating after Congress eliminated federal funding for Amtrak routes shorter than 750 miles.

Last July news reports said Indianapolis said it will not renew its funding.

INDOT has said its goal was to continue the service and find an independent contractor that could overcome constant delays, run trains at more convenient times, provide amenities such as Wi-Fi, attract more riders, and operate the train more cost effectively than Amtrak.

However, Railway Age reported that numerous rail observers and rail advocates have questioned whether any company could offer even the modest economies of scale Amtrak can lend the underperforming Hoosier State, which runs four days a week.

Combined with the tri-weekly Chicago-New York Cardinal, the Indianapolis-Chicago route is served by one train each way per day.

Trains reported that if Iowa Pacific wishes to provide passenger cars and locomotives to be operated by Amtrak crews, that equipment must meet Amtrak safety requirements and Amtrak must be indemnified against lawsuits resulting from use of the equipment.

Arvid Olson of the Greater Lafayette Commerce has touted the economic benefits of keeping the Hoosier State going, but he lamented the latest developments.

“It creates genuine pressure on INDOT and the stakeholder’s ability to improve the Hoosier State beginning on Feb. 1, 2015,” he said.

Ridership on the Hoosier State during fiscal year 2014, which ended on Sept. 30, fell 8 percent and revenue dropped 10 percent.

Boardman Makes Pitch to Keep Hoosier State

October 11, 2014

Amtrak President Joe Boardman took to the editorial pages of the Lafayette, Ind., Journal & Courier this week to fire the latest salvos in the battle to operate the Hoosier State.

Ostensibly, Boardman was seeking to correct what he termed “inaccuracies and misinformation regarding Amtrak’s operation of the Hoosier State train service under a contract with the Indiana Department of Transportation.”

Boardman said Amtrak can offer several different service models for the Hoosier State, but he called on the state of Indiana to decide what it wants and what it is able to pay for.

Whatever that might be, Boardman made a pitch that Amtrak continue to operate the Hoosier State.

“Amtrak believes it remains Indiana’s best long-term choice for safe, reliable intercity passenger rail service,” he wrote. “Amtrak brings proven expertise in delivering passenger rail service, railroad operations, safety and security, equipment maintenance and repair. We want safe and effective passenger rail service to succeed for the benefit of Indiana’s people, businesses and communities. Let’s get this done.”

Currently, Amtrak operates the quad-weekly Chicago-Indianapolis train under a contract with INDOT that will expire in late January 2015. The train is funded by INDOT and local governments along its route.

Earlier this year, INDOT said it has chosen Chicago-based Corridor Capital to operate the train. Although Corridor Capital was supposed to take over operations this month, that didn’t happen.

Instead, Amtrak agreed to operate the Hoosier State for four more months.

Trains magazine reported on Friday that Corridor Capital and INDOT have still not reached an agreement to operate the Hoosier State.

“The primary reason is that state officials failed to actively engage Amtrak in negotiations for track-access rights with the freight railroads until weeks before the new operator was to take over this fall,” the magazine reported. “With the clock ticking on a four-month Amtrak contract extension that expires Jan. 31, 2015, those discussions are finally underway.”

Boardman last week rode a special train to whistle stop along the route to make a pitch for Amtrak to continue operating the Hoosier State.

His op-ed piece in the Journal & Courier may have been the latest ploy in those efforts or it might have been part of a larger public relations campaign to deflect blame away from Amtrak if the Hoosier State is discontinued in February.

During last week’s journey, Boardman visited with various Indiana officials and also announced the rollout of food service and WiFi service aboard the Hoosier State.

The service amenity upgrades, which have since been implemented included adding a food-service car with business class seating.

However, the car does not have an attendant and business class travelers are limited to consuming complimentary beverages and pre-packaged pastries that are left on the counter for them.

“I learned a lot during the tour about community desires for this service, and I believe the community representatives gained some valuable insights into the challenges and complexities of operating a safe and efficient passenger rail service,” Boardman wrote in his op-ed piece.

Without naming it, Boardman took another shot at Corridor Capital.  “The leasing company designated as Indiana’s vendor claims to have ‘indestructible’ railcars that are ‘available now,’ but it was unable to meet the Oct. 1 deadline to assume the service.”

A Corridor Capital spokesman told Trains that he could not reveal what passenger cars and motive power will be used. “Three parties, each with much at stake, are at the table discussing their respective roles and public disclosure of (those details) would be premature,” the spokesman said.

In its bid proposal to INDOT earlier this year, Corridor Capital said it expected to use Amtrak conductors and engineers.

But Amtrak has since insisted that it will deal only with INDOT as a primary contractor and not a subcontractor of another party.

Amtrak has also raised the issue of whether the equipment to be used by Corridor Capital would comply with Amtrak and Federal Railroad Administration standards, and, because the Hoosier State crosses state lines, Environmental Protection Agency and Food and Drug Administration rules.

“Operating passenger rail service is no small task, especially for the inexperienced,” Boardman wrote. “Recently, a private operator providing trains in New Mexico lasted only four months before failing — on a route much shorter and less complicated than the Hoosier State. The complexity of the challenge along the Indianapolis-Chicago route is much greater. Amtrak stands ready to work with INDOT and the communities to prevent a similar outcome with the Hoosier State.”

Trains also reported that Herzog Transit Services, which also bid to operate the Hoosier State, told INDOT in a June 6 letter that “the right of access … must belong to the state of Indiana, not a third party operator” as required by the Passenger Rail Investment and Improvement Act of 2008.

However, INDOT officials have been expecting that Corridor Capital would be responsible for obtaining access to railroads over which the Hoosier State operates as well ensuring that it was in compliance with FRA operating and safety regulations.

The Hoosier State uses six railroads to travel between Indianapolis Union Station and Chicago Union Station.

Way Cleared for Michigan Talgo Purchase

September 22, 2014

Legislative opposition to Michigan’s purchase of two sets of Talgo trains has been smoothed over and the state is now expected to proceed with the acquisition.

That acquisition was the subject of a summer-long probe in the Michigan Senate after some lawmakers raised concerned about a one-bid contract.

But the senators who expressed concern about that are now are willing to let the deal proceed, said Senate Transportation Committee Chairman John Pappageorge.

“It was appropriate to look into it because that didn’t look right,” Pappageorge said. “Digging into it, we came to the conclusion that Talgo was the right answer — not a perfect one but adequate.”

The Talgo trains that the Michigan Department of Transportation wants to buy were built in and for Amtrak service in Wisconsin.

But Wisconsin Gov. Scott Walker canceled the deal not long after he refused to accept federal runs to be used to develop service between Milwaukee and Madison. The Talgos have sat idle in Indiana while the Spanish company that built the Talgos and Wisconsin battle in court over money that the company claims Wisconsin still owes it.

Although some Talgo equipment built in Milwaukee later entered service in Oregon, the Talgos built for Wisconsin have yet to enter revenue service.

The Wisconsin Talgo trains have since been moved to Amtrak’s shops in Beech Grove, just outside of Indianapolis.

Pappageorge said Michigan needed to act quickly to acquire the Talgos because federal funds were available.

The $58 million for Michigan’s two train sets is to come from $200 million in federal funds for Amtrak improvements in Michigan and other states, mostly in the Midwest.

Michigan plans to assign the Talgo equipment to the Chicago-Detroit (Pontiac) route where it will replace the current Amtrak rolling stock being used.

The Talgos are capable of top speeds of 110 miles an hour and, in a few years once the tracks used by Amtrak’s Wolverine Service trains are rebuilt passengers will be able to travel up to two hours faster between Chicago and Detroit.

State officials also hope to improve Amtrak’s on-time service performance for the Wolverine Service, which ranged from 6.5 percent to 52.3 percent in July. Amtrak’s website reports on-time rates for Wolverine Service have ranged from 21.5 percent to 39 percent in the past 12 months.

Patronage of the Wolverine Service route has steadily has been building back toward a 20-year peak of nearly 504,000 passengers in 2010.

The Talgo equipment is expected to serve during a transition period. Eventually, Michigan Amtrak routes will be assigned “next-generation” passenger car and engine sets that are about to be built.

Michigan Department of Transportation railroad chief Tim Hoeffner said the state will own the cars.

Hoeffner said the Talgo purchase is pending an evaluation of the equipment’s suitability for Michigan’s needs. That inspection combined with the Senate investigation has meant that the Talgo equipment won’t be in service by October as originally proposed, he said.

The Talgo equipment will replace 30- to 40-year-old Amtrak cars on two of the three daily Chicago-Detroit roundtrips.

“The difference between them is like the difference between the car I learned to drive in the 1970s and the cars my kids learn to drive now,” Hoeffner said. The Talgos are similar to sleek, modern trains that run in Europe and Asia.

The Horizon coaches now used lack modern amenities and are deteriorating because Amtrak has no budget to overhaul them, according to MDOT. They have institutional decor, lack carpeting, contain harsh lighting and lack hot water in restrooms, the department says.

The Michigan Senate investigation also was triggered by a challenge from Chicago-based Corridor Capital, which claimed the process seemed to favor Talgo. The state’s bid specifications were so narrow only one company could meet them, Corridor Capital said.

U.S. Rep. Joe Schwarz of Battle Creek, a train buff and volunteer adviser to Michigan Gov. Rick Snyder on rail issues also raised questions about whether Talgo’s equipment can meet Michigan’s needs — a criticism Corridor Capital continues to press.

“They didn’t meet the minimum requirements,” said Lansing public relations specialist John Truscott, who represents Corridor Capital. “If they did qualify, this would have been an easy decision. We (still) feel it would be just as easy for MDOT to do the right thing and open this back up (for rebidding).”

But Pappageorge said members of the Senate’s Transportation and Appropriations committees found the bid process was handled properly. They also concluded Talgo’s equipment is adequate, based on hours of testimony about train car specifications, he said.

Corridor Capital didn’t help its case when its equipment wasn’t ready to enter service. Hoeffner said Corridor Capital sought a state contract under which it would take over the entire state rail service, not just supply rail cars. It has reached a similar deal with Indiana to operate the Chicago-Indianapolis Hoosier State.

Michigan transportation analysts believe an “incremental approach” is more prudent. Hoeffner said the goal is to continue building ridership on the Chicago-Detroit route, the busiest of Michigan’s three intercity rail passenger corridors, through faster service and nicer cars.

The state also funds Amtrak’s Chicago-Port Huron Blue Water and the Chicago-Grand Rapids Pere Marquette.

“All customers want to know is: When do I leave, when do I arrive and is it convenient?” Hoeffner said.

The trip now takes about 6.5 hours, but Hoeffner said that MDOT’s goal is to cut the travel time to four hours, which is about the same amount of time needed to drive the route between the two cities.

The state has purchased the tracks used for much of the Wolverine Service route within Michigan and has launched a track rebuilding program that should be completed in late 2017 or early 2018.

Hoosier State in Trouble if Indy Pulls Funding

July 26, 2014

Amtrak’s Hoosier State appears to be doomed after the City of Indianapolis decided to cease helping to fund the quad-weekly service between Chicago and Indy.

Indianapolis was one of a handful of communities served by the train that agreed to help fund it last October after a new federal law took effect that shifted more of the burden of funding the losses of short-haul trains onto state and local governments.

“They have told me they are not interested in doing it next year, and take that as a final no,” said Bob Zier, director of multimodal program and planning for Indiana Department of Transportation.

The news comes shortly after INDOT selected a Chicago company, Corridor Capital, to take over management of the train in October.

Corridor Capital officials have been talking about trying to boost ridership on the service, which is among the least patronized of Amtrak’s short-distance trains by assigning differing equipment, providing modest food service and instituting Wi-Fi service.

In the one-year deal approved last fall, IDOT agreed to provide half of the money, about $1.4 million, to keep the Hoosier State operating. Local governments in Indianapolis, Beech Grove, West Lafayette, Lafayette, Crawfordsville and Tippecanoe County, kicked in the other half.

Ryan Vaughn, an aide to Indianapolis Mayor Greg Ballard, said that funding the Hoosier State doesn’t make financial sense for the city. The aide said the city’s participation hinged on improvements for Union Station, which is in desperate need of repairs.

Vaughn said it’s hard for the city to take on funding rail service when the needs at Union Station are so great.

He said if Indianapolis can get a federal grant to help with improvements at Union Station, the city might be able to help fund the Hoosier State.

But the deal would need to be done by Sept. 30 although INDOT can apply for one four-month extension.

That Indianapolis wants to end its funding of the Hoosier State doesn’t surprise Crawfordsville Mayor Todd Barton. “We had a sense Indianapolis wasn’t fully on board from day one,” he said.

Barton doesn’t think the Hoosier State can survive without Indy’s contribution.

“If you look at their contribution, do the math. It doesn’t work out,” he said. “Theirs was a diversion of INDOT funds that they were getting from INDOT anyway. It wasn’t like Crawfordsville, Lafayette, West Lafayette, Tippecanoe County and Rensselaer putting cash on the table.

“I think we’re all confident it can be self-sufficient once you get over the hump, but it will take a year-and-a-half to two years, and it will cost a little more with a private provider. I don’t think the rest of us can make up that difference.”

Lafayette Mayor Tony Roswarski agreeds that losing the support of Indianapolis might be a death blow for the Hoosier State.

“Without them in that financial mix … there’s a very strong possibility it would mean … the end of the Hoosier State,” he said.

Still, some Indiana officials are holding out hope that the train can be saved and turned over to Corridor Capital.

“We’re all trying to put together a scenario where we can implement the new train service,” Zier said. “I’m still optimistic. I think this is going to happen. It’s just a matter of getting everything to fall into place.”

However, it seems unlikely that Lafayette, West Lafayette, Crawfordsville and Tippecanoe County will agreed to commit more money toward the Hoosier State to make up for the loss of the contribution from Indianapolis.

“We certainly cannot kick in more funds,” said Tippecanoe County Commissioner Tom Murtaugh.

Roswarski, Barton and West Lafayette Mayor John Dennis agreed that their cities don’t have additional money to subsidize the rail line.

Dennis is not as optimistic as Zier, but still has hope that a deal with Indianapolis or other investors might save the Hoosier State because, he said, in the world of politics, things aren’t always as they seem on the surface.

Also holding out hope is Crawfordsville mayor Barton.

“I don’t think it’s final, now. I’m hopeful,” Barton said. “INDOT is still working very aggressively to pull something together, but in all honesty, if we do not secure it by Sept. 30, it’s probably gone forever.”

The end of the Hoosier State would not mean the end of rail passenger service in any of the affected communities. Amtrak’s tri-weekly Cardinal, which operates on the days that the Hoosier State does not operate, would continue to run between Chicago and New York.

Corridor Capital Talks Hoosier State Upgrades

July 22, 2014

The company that will take over management of the Chicago-Indianapolis Hoosier State is talking about making major improvements in the route, including the addition of Wi-Fi and a faster schedule.  However, food service is not necessarily among the plans.

Fritz Plous, the director of communications for Corridor Capital, spoke of his company’s plans to improve the Hoosier State during a town hall discussion in Crawfordsville, Ind.

In the short term, Corridor Capital needs to boost ridership, which is now about 85 passengers a day aboard the quad-weekly train.

“We need to see it at double that,” said Plous said, adding that such amenities Wi-Fi and information screens could draw more passengers.

“That’s the first step towards legitimacy: Get people a nice, new train,” Plous said. But, “the funding has to be there.”

Another priority will be reducing the current running time of 5 hours and 10 minutes from Indianapolis to Chicago to about two hours less. Plous did not provide any details as to how that could be accomplished on the train’s circuitous route.

“We won the beauty contest,” Plous said. “We don’t know what mojo made INDOT choose us.”

The Indiana Department of Transportation chose Corridor Capital from among four bidders to improve manage the Hoosier State.

Tim Maloney of the Hoosier Environmental Council said that Indiana has $2 billion in reserves and can afford to fund the train.

“We have the money,” he said. “But it depends on what our priorities are.”

Crawfordsville Mayor Todd Barton urged community members to lobby elected officials to boost the train.

“At the end of the day, you have to have some quality of life that attracts residents to your community,” Barton said. “We all recognize that. Once a line is gone, it’s going to be difficult to get it back.”


Chicago Firm Tapped to Manage Hoosier State

June 27, 2014

The Indiana Department of Transportation has selected Corridor Capital LLC as the preferred vendor to manage and operate a passenger rail route between Chicago and Indianapolis.

The Chicago-based passenger rail development company would take over the service on Oct. 1. Currently, Amtrak operates the quad-weekly Chicago-Indianapolis Hoosier State over the route along with the tri-weekly Chicago-New York Cardinal. The trains do not operate between Chicago and Indianapolis on the same days.

Last fall the Indiana Department of Transportation along with local governments based in communities served by the Hoosier State agreed to provide funding to keep the train rolling for another year.

Earlier this year, InDOT issued a request for proposals to take over the service. INDOT officials said that proposals were submitted by Corridor Capital, Herzog Transit Services and Passenger Transportation Specialists, Iowa Pacific Holdings, and Railmark Holdings. Amtrak also submitted a proposal.

Corridor Capital is now in discussions with InDOT and the online communities about taking over the Hoosier State. Once Corridor Capital takes over, the train is expected to continue to operate with Amtrak conductors and engineers. Corridor Capital will provide equipment and maintenance.

Still being negotiated are such details as costs, ticket pricing, café car service, and business class amenities. The Hoosier State would use some of the 50 former Santa Fe Hi-Level equipment owned or controlled by Corridor Capital.

“We’re working together to open this up to competition to hopefully develop a plan and seek out innovations that will allow this service to improve and be more financially self sustaining,” said InDOT spokesman Will Wingfield.

Trains magazine reported that Corridor Capital plans to hire Railplan International, a Baltimore-based designer of modular interiors, to retrofit luggage towers and modular bathrooms “to make them fit for daily intercity operation and be responsible for maintenance.”

Railplan holds maintenance contracts for commuter services Virginia Railway Express and MARC in the Washington, D.C., area, and recently took over maintenance of North Carolina’s intercity passenger trains.

Founded in 2005, on its website, Corridor Capital describes itself as “a passenger-rail development company that assembles and integrates the multiple elements needed to provide a successful intercity passenger-train service.

“The company owns uniform passenger rolling stock and commands the professional skills of several dozen veteran passenger-train professionals, including civil and mechanical engineers, passenger-car and locomotive builders, station and terminal managers, locomotive and car maintenance specialists, planners, financiers, information technologists, travel-marketing and ticketing specialists and contractors providing on-board food, beverage and hospitality services.

“At Corridor Capital, the train-and-travel package once delivered by a multitude of individual railroad companies has been reinvented and reassembled by a professional passenger-rail development company.  Just as a real-estate developer brings architects, engineers, planners, lawyers and financiers together to create a new office, residential or commercial project, Corridor Capital brings its own agile cadre of specialists together to create the ‘project’ America is waiting for: successful passenger trains.”

More information about Corridor Capital is available at its website at