Iowa Pacific’s proposal for Nickel Plate Railroad gets highest score

The Hoosier Heritage Port Authority has ranked a proposal from Iowa Pacific Holdings as the top choice among those submitted by potential operators of the Nickel Plate Railroad line.

On Tuesday night, the Port Authority publicly released the five responses it received to its request for proposals. Four out of the five proposals outlined plans to use the full 37-mile stretch from Tipton to Indianapolis, despite plans from local governments to rip up a major section of the rails for a recreational trail.

The Port Authority is searching for a company to handle operations on the line because it terminated its policy-of-use agreement with the Indiana Transportation Museum in March 2016 amid concerns about the not-for-profit’s financials and maintenance of the tracks.

The owners of the track—Fishers, Noblesville and Hamilton County—announced plans in February to convert 9.2 miles of the track into a pedestrian and bike path called the Nickel Plate Trail.

But officials with the Port Authority, a quasi-government agency that oversees the railroad, said the trail is not a done deal and released a request for proposals for a new operator in April.

The Port Authority collected submissions until June, and a committee made up of five of the six Port Authority board members and one representative each from Fishers, Noblesville and Hamilton County scored the responses.

The Port Authority voted Tuesday night to send the top two scoring proposals to the railroad owners for further review and possible interviews.

It will be up to the railroad owners to make a final decision.

The highest scoring proposal came from Chicago-based Iowa Pacific, which previously operated the Hoosier State service that runs from Indianapolis to Chicago. Iowa Pacific took over operations in July 2015, and while it increased ticket revenue, it saw a decrease in overall passengers.

The Indiana Department of Transportation ended the partnership on the Hoosier State line with Iowa Pacific on March 1. Amtrak now operates the service.

Iowa Pacific’s proposal for the Nickel Plate line would include using the entire corridor for passenger trains, freight and railcar storage. The plan is dependent upon reconnecting the railroad with the Norfolk Southern line in Tipton to allow access to freight and railcar transportation. The Nickel Plate line was separated from the Norfolk Southern line in Tipton in 1997 and has been isolated from other rail lines since 2007.

Iowa Pacific says it has nearly 200 passenger cars and locomotives in its possession and it would provide excursion trains, dinner trains and holiday trains along the Nickel Plate. In 2016, Iowa Pacific carried more than 400,000 passengers on holiday trains in the United States and United Kingdom, according to the proposal.

The company also suggested pursuing a rails with trails development that would allow the communities to add a pedestrian trail without removing the railroad. That idea has been suggested by local railroad supporters, but officials have not been supportive of the proposal.

Iowa Pacific requested a 10-year agreement with the Port Authority. It said it expects ito reinvest $2 million in the corridor over a five-year period and provide $380,000 per year for capital investments. Other estimated financials were not made public.

The second-highest scoring proposal was submitted by Hamilton County Tourism Inc. on behalf of Arcadia Arts & Heritage Depot and Atlanta Pacific Railroad LLC.

That plan calls for using only a 8.5-mile section of the railroad from Tipton to Arcadia as a tourist attraction. A not-for-profit called Nickel Plate Heritage Railroad Inc. would oversee the programming and the Atlanta Pacific Railroad, which is owned by the former president and CEO of the Indiana Rail Road, Thomas Hoback, would operate the trains.

“The Nickel Plate Heritage Railroad model is one like those in the airline industry,” the proposal says. “A railroad operation company will manage the equipment and track for the company that manages the programming and schedule, as well as marketing and ticket sales.”

Atlanta Pacific Railroad would acquire several locomotives and passenger cars with a minimum capacity of 200, which would cost an estimated $750,000.

The groups requested a 5-year agreement with the Port Authority, and provided financials that estimated a small operating surplus every year. Funding would come from grants, ticket sales, sponsorships and gifts.

The plan predicts the themed excursion trains would attract 25,000 passengers per year and operate 75 days out of the year, mostly on Fridays and Saturdays.

The Indiana Transportation Museum also submitted a proposal, and it was ranked third, but nearly all of its proposal was marked proprietary and confidential so it was not made public. Only a cover sheet and introductory letter were shared.

According to the letter, the plan involves using the entire corridor for excursions such the Indiana State Fair Train and Polar Bear Express, plus other year-round attractions.

Museum leaders have said they didn’t think their proposal would be considered fairly by the authority.

The fight between the museum and local officials has escalated over the past few months as the parties argued about the status of the tracks and best future usage of it.

The museum has filed a federal lawsuit against the Port Authority, Noblesville and Fishers in which it accuses the government of unjustly interfering in its operations, causing a critical loss of more than a half-million dollars in revenue.

The museum recently sought a temporary restraining order against the Port Authority in that lawsuit so it could regain use of the Nickel Plate in time for next month’s Indiana State Fair, but a federal judge ruled against that request Thursday.

The other two responses for the railroad were received from the Indianapolis Metropolitan Railway Co. of Indianapolis and Hoosier Heritage Railroad Inc. of Fishers. Both called for operating the entire railroad corridor.