Steam & Excursion > C&TSRR Commission Meeting Notes - 2/4/10

Disclaimer: I’ve been an employee of the Cumbres & Toltec Scenic Railroad for nearly a year (February 9th), I’m a member of the Friends, and I have a HUGE commitment to making the Cumbres & Toltec the best darn Railroad in the world – bar none.

(I would be remiss if I didn't recognize the incredible efforts of the Shop Crews on each end of the Railroad, as well as those of the Track Crew and the office and administrative personnel. I apologize in advance for not knowing everyone's names, but your efforts must be recognized along with those of the Chama team of Tommy Garcia, Ed Beard, Jose Torrez, Glenn Avery, Freddie Aguilar, Antonio Lujan, Desi Manzanares, Luis Lopez, Bob Sullivan, Tracy Caraway, Joe Martinez, Archie Vigil, and Donald Martinez. Each person did - and are doing - what needs to be done for the Railroad, rain or shine, day or night. Make sure you remember them when you ride the train, take your photos, or visit the yards.)

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I attended the Commission meeting last Thursday, and knowing the interest people have in the goings-on at the Railroad, I typed up these notes. Please note that these are “notes” and NOT the official Minutes of the meeting. Quotes (where quoted) are verbatim, and not all replies to questions/statements were recorded. There will be gaps in the proceedings, so courteous and rational comments and/or corrections are welcome.

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Notes From The February 4th Cumbres & Toltec Scenic Railroad Commission Meeting

Hotel Santa Fe, Santa Fe, New Mexico


Per the Commission’s agenda:

Items 1-6 – Call to Order, Introductions, Approvals and Reports:

The meeting was called to order by Commission Chairman Lenny Martinez.

After requesting the approximately thirty individuals present to introduce themselves, Chairman Martinez expressed his thanks to all who contributed the 2009 operating season. He stated that his goals for the 2010 season were for safety and stability, and that he expected an exciting and challenging year ahead.

Chairman Martinez also recognized the upcoming 40th Anniversary of the Cumbres & Toltec Scenic Railroad, as well as the State of New Mexico’s centennial celebration.

In his remarks, Commissioner Lon Carpenter commented on an EDA grant request of $300,000 with a possible match of $200,000 that would go toward track work. Commissioner Carpenter also reported on the audit generated by Martinez & Associates. The question was raised whether the audit would be assessed at the next Commission meeting. This action is to be determined.

Item 7 - Report of the C&TSMC:

7A: C&TSMC President Elmer Salazar reported that the Railroad performed a good technical job, and that Tim Tennant was filling the positions of Vice-President, Treasurer, and Secretary.

President Salazar also related that the Management Company was originally to be in place for only one year, but had performed the management function for the past three years.

While recognizing that the ‘employees make the Railroad run’, President Salazar also stated that the Management Company had not performed to the Commission’s expectations. In offering his/the Company’s mea culpa, he requested help from the Commission and from the Friends of the Cumbres & Toltec Scenic Railroad in future endeavours.

In other comments, President Salazar related that the Railroad needed to carry approximately 52,000 passengers to reach the ‘break even’ point; that the Friends are NOT in the operations of the Railroad (emphasis is the writer’s), and acknowledged the existence of ‘malicious’ and ‘irresponsible’ websites.

With regard to the filling the General Manager position presently held by interim GM Marvin Casias, President Salazar stated the intent of the Corporation to first recruit internally. Commissioner Randall recommended that an internal and external search be performed simultaneously, an idea that was agreed to.

It was agreed by the Commission and the Corporation that a consultant for mentoring should be both external (to the Railroad) and neutral, with Chairman Martinez adding that ‘stability of the enterprise’ was paramount. (Later in the meeting this item was readdressed, with the understanding that activities related to mentoring would be secondary to actions essential to the operation of the Railroad.)

C&TSMC Board membership: Per President Salazar, under consideration to fill Board vacancies are former Friends Chairman and attorney Bob Craine, and Bill Hume, a(n ex-?)staffer to New Mexico Governor Bill Richardson.

President Salazar related that 2009 was a challenging year, but pointed to the successes of the two parlor cars and the engineer/fireman schools. He also stated that the Board is open to receiving questions via e-mail, but the questions must be professional, e.g., questions related to personal information can not be asked.

Commissioner Randy Randall inquired about the budget for the parlor cars (discussion notes not available), and mentioned the communication problem between the Board and the Commission. President Salazar proposed status reports to the Commission on the 10th, 20th, and 30th days of the month.

7B: Recently-appointed C&TSMC Treasure Tim Tennant stated that he’d been in the Treasurer’s position for only a few days but was working on the specifics of the Board’s financials. The Board has a February 11, 2010 due date for reporting this information to the Commission. Commissioner Randall cautioned about fixing the financials of the Railroad at the expense of operations.

11. With consent, Railroad lobbyists Tom and Jeremy Rutherford addressed the meeting regarding their efforts and those of the New Mexico legislature. Between $3.75M (LFC) and $3.82M (Executive) have been requested for operating funds; this amount includes $90K in ticket revenues. There is no answer yet on a $1.1M request, $1M for track, and $100,000 for the Railroad Visitor Center (source of money unknown).

Chairman Martinez asked what concerns the Rutherfords had. Jeremy Rutherford replied that they were ’taking hits’ as were the rest of the (NM) requests, but remained enthusiastic.

Commissioner Carpenter reported on efforts in Colorado. $561M will be cut from the Colorado budget this fiscal year, with an additional $1.7B (billion) to be cut in the next fiscal year. $1M in ‘Stimulus I’ money was received by Colorado, but ‘Stimulus II’ money for job-creating/shovel-ready activities was to be determined. Also, there are three anti-tax bills on this November’s ballot, all of which may impact money available to the State and thereby to the Railroad.

Mentioning Colorado Senators Schwartz and (name unknown), Commissioner Foster reported the Commission’s trip to Denver in 2009 was paying off.

7C. In Chama, Interim General Manager Marvin Casias reported that drive boxes for Locomotives 484 and 487 had been ordered and were due on March 12th; running gear, bushings, and pins were in work in the machine shop; and #487 was being prepared for its hydro test on February 8th. Both locomotives should be ready by April 15th. Work on passenger car #517 was continuing, and the problem with the water cistern had been resolved.

In Antonito, six passenger cars are ready to go, four passenger cars are receiving ABW brakes to replace the K-brakes to allow cars to run through from Antonito to Chama and vice versa. Repairs on the ballast cars are continuing, with four cars soon to be available.

Track work is on its winter hold, and in the office, the reservation system is coming up.

7D. In Marketing, Chris Czmyrid reported the website is running and being updated by Roger Hogan. Television, radio, and print media efforts are continuing, including a 6-days-per-week buy with KZEZ (740-AM) in south Colorado Springs. This year’s run of 125,000 brochures will focus on the Railroad’s machinery. Television ads in the Albuquerque area are awaiting the end of the political campaigns and the commensurate drop in advertising costs.

The Railroad’s 40th Anniversary is to be part of the advertising campaign; Commissioner Randall inquired whether the 40-year anniversary is part of the formal marketing plan, stated that the “Chrome Bike” movie is now fully funded with the Railroad being one of the 'stars’, and reiterated the need for three operable locomotives for Opening Day.

8. Capital Projects - Leo Schmitz reported that the Railroad appreciates the Friends’ financial support of the 463 Project, 7000 ties are ready for the track crew, and bids are going out/have gone out for the section house water system. Research of the ballast mining proposal indicates that ballast can be mined for $8-10/ton vs. $22/ton.

9. Friends of the C&TSRR – Tim Tennant reported the Friends’ banquet will be March 12 in Santa Fe; the next regional members’ meeting will be in April in Southern California; and Ed Lowrance and John Engs are working on the plans for the 2010 Work Sessions. Grant requests have been made for $50K to the National Trust for Historic Preservations and/or Save America’s Treasures, and for $75K from (name unknown). The archaeological survey for the Railroad Visitor Center has been approved, and SHPO input is expected in early March.

Locomotive #463’s boiler is in Alabama and being worked on by Bob Yuill’s Historic Machinery Services. Bob is working with Ralph Gutierrez of the FRA for a scheduled boiler delivery to Chama in April.

Commission Randall expressed a concern with the results of grant-writing efforts, i.e., are the results the Railroad is getting worth the time spent.

Tim Tennant introduced Craig McMullen, the new Chairman of the Board of Directors of the Friends of the Cumbres & Toltec Scenic Railroad. Mr. McMullen spoke briefly, and stated - and re-stated - that the Friends have no interest in operating the Railroad.

10. Grant Writing: Leo Schmitz gave a brief report on grant writing and commented that federal earmarks might be one source of revenue for the Railroad.

11. Legislative Activity: (See earlier in this report.)

12. Public Input: Cas Heuer of the Chama Valley Rotary spoke of the North Rio Grande Heritage Foundation and their efforts to establish a railroad display in Santa Fe and in Espanola. Leo Schmitz stated that he had been informed of the Foundation’s efforts.

Jay Wimer of Chama thanked the Commission for their work, and stated that he was with the “Colorado Time Table”, the “North Country Bulletin”, and the “Dead Goat Saloon” website. Regarding C&TSMC President Elmer Salazar and internet weblogs, Mr. Wimer stated that the “Saloon” website received 1200 visits per day, were “not muckraking’, and ‘we're learning to be professional journalists.”

In response to Mr. Wimer’s comments, Friends Chairman Craig McMullen made several statements regarding the content of Mr. Wimer’s website. Chairman Lenny Martinez quickly restored the meeting to order.

Ted (last name unknown) commented on the amount of transparency regarding the Railroad, and stated that where 40 to 50 Chama residents once attended the Commission meetings, the majority of the audience was now made up of members of the Friends.

Maria Schmitz stated her long-term experience and support of the Railroad, and expressed her concern with the adverse commentary and ‘muck-raking’ that had been taking place.

Jay Wimer spoke regarding Item 14C on the agenda, ‘Approval of Narrow Gauge Caterers Retail Inventory Loan”. Stephen Flowers stated that he tried not to compete with merchants in Chama and in Antonito, selling on the train only those items that pertained to safety, comfort, thirst, or illness, e.g., coffee, safety goggles, etc. Mr. Flowers also commented on his efforts in Osier to sell on consignment some items by local merchants, taking into account the limited sales space he has in that location.

Matthew Abby introduced himself as the new General Manager of the San Luis and Rio Grande Railroad in Alamosa. He stated his interest in passenger service and offered support to the cumbres & Toltec.

13. Unfinished Business: Los Pinos Siding Access – Leo Schmitz reported that discussions with the property’s owner were continuing.

14. New Business

14A. C&TSMC Performance Expectations: Chairman Martinez opened by saying this item was added to the agenda because of what had happened at the Railroad over the past several months. He stated that he had diminished confidence in the Management Company, that there were communication problems, and that trust had to be earned.

The Chairman then opened the discussion to the other Commissioners.

Commissioner Randall: The Railroad’s employees are ‘our folks’; the management void could have been better addressed, and the Company could have been more flexible in dealing with personnel issues. A lack of trust exists from the Commission to the Board, and there was disappointment in the lack of communication between the two entities. The problem was not with the Management Company, the problem was the contract didn’t allow enough latitude for the Commission to have greater input into the functioning of the Company. The Commission had not been ‘sitting back’ while the issues of the past few months had been going on, and losing Soni Honegger and the support of the community was ‘almost criminal’. The Commissioner had intended to move that the contract with the C&TSMC be cancelled, but agreed to a review of the Company’s actions after thirty days.

Commissioner Carpenter: Everyone should recognize the accomplishments of the Management Company over the past three years, but challenges are ahead for everyone to contribute to the success of the Railroad.

Commissioner Foster: Had trouble finding his ‘footing’ on this issue, and had Commissioner Randall moved to cancel the contract, he would have seconded the motion. He stated that he had had communication from Directors Tennant and Cordova, but none from Directors Turner and Salazar. Trust was indeed an issue, and he agreed to the thirty day review period.

Chairman Martinez: Had read everything related to the past few months, had withheld (his) judgment, but would have voted against cancelling the contract. While agreeing the contract with the Management Company could have been better, the Commission had not been punitive, and in giving the Company ‘room to run”, that flexibility had been allowed to run its course. He approves of the thirty day review period, but expressed the need to move quickly.

It was agreed that in the next seven days (from the meeting), Commissioners Martinez and Randall will review the contract, offer suggestions to Commissioners Carpenter and Foster, submit those changes to the Management Company, and receive comment(s) from the Company. In the ensuing discussion, C&TSMC President Salazar requested the Commission not ‘ruin the relationship’ between the Commission and the Board; Commissioner Randall replied that it was the Commission’s intent to ‘repair the relationship’.

14B. New Mexico Centennial and C&TSRR Promotion: Per Commissioner Randall, the Cumbres & Toltec Scenic Railroad is one of the attractions for the State’s Centennial celebration. The Railroad has the Commission’s support for a free train, details to be determined.

14C. Approval of Narrow Gauge Caterers Retail Inventory Loan: Stephen Flowers stated his appreciation for the loan of $25,000 for the retail operation at Osier. This loan allowed Mr. Flowers to purchase inventory, repay the loan plus $10,000 in interest, for a total of $35,000 returned to the Commission. A loan of up to $30,000 for 2010 was approved. (See also the entry regarding Item 14C above.)

14D. Approval to Participate in the New Mexico Surplus Property Program: Leo Schmitz stated this program was available to the Railroad. Colorado may have a similar program, but the transport of items from Denver would need to be addressed.

14E. Other Business: Commissioner Randall inquired about the loan of rider boxcars to the Georgetown Loop. After a brief discussion the Commission agreed the next meeting would be on March 3rd, 2010, in Chama.

In attendance: Commissioners Martinez, Randall, Carpenter, and Foster; Executive Director Leo Schmitz; Maria Schmitz; C&TSMC Board Members Elmer Salazar, Amos Cordova, and Tim Tennant; General Manager Marvin Casias; Matthew Abby, Dick Cowles, Steve Forney, Cas Heuer, David Lee, Jean Leonard, Alan Loomis, Ronnica Lopez, Michelle Martin, Craig McMullen, Jim Poston, Teresa Smith, Paul Uhland, Jay Wimer, and several other unknown individuals.

Thanks Jim for posting this. Looking forward to video from Steve Forney.

SV

Jim;
Thanks for taking the time to give the fans of C&TSRR such a complete report. In doing so you answered a number of questions that have lingered in my mind.
I hope to see more of the same in the future.
Dave Wolven
Hemet Ca.

Thanks very much for this, Jim! And, for your great comments at the beginning of your post.

I'm at my office and can't read your notes in full yet, but wanted to send thanks and also ask if Joe is still working as night engine watchman?

Thanks again!

John Bush
Omaha

Troubling news about the C&TSRR over at the 'other' board (the usuual narrow gauge sources).

Even putting things into perspective, $155K over budget is something that needs to be addressed.

SV

You're welcome, everybody. Typing isn't my strong point, but I thought it was important for fans of the Railroad to hear what happened at the meeting.

John, Joe Martinez retired after last year's season. He told me he'd worked for the Railroad for over twenty years, and I always enjoyed talking with him. I occasionally see him around town driving his vintage Ford pickup.



Edited 1 time(s). Last edit at 02/09/10 20:38 by JimPoston.

A friend sent me a link to this post from the website. I thought it was very enlightening to those of us out here in cyberspace who aren't close to the incredible politics and history of the issue. I only post it here as part of the ongoing discussion with no comment:

C&TS Management Corp. Developments

Posted By: Craig McMullen <bod@cumbrestoltec.org>
Date: Feb 9, 2010

Message to the Friends Membership concerning recent developments with the C&TS Management Corp.

I know there has been lots of concern and questions regarding the resignation of Soni Honegger, the general manager of the C&TS RR. I would like to provide the Membership with my understanding of the events and circumstances which lead to his resignation. I do not claim to know all the details, but I do know a lot of speculation and misinformation has been spreading around from various sources.

First, I would like to review the relationship between the Friends, the Management Company and the Commissioners. The C&TS Railroad Commission represents the owners of the railroad, in this case the States of CO and NM. The commission has entered into a contract with the C&TS Management Corp to manage and operate the railroad on a daily basis. This includes hiring and managing all staff, including a General Manager. The employees answer to the General Manager, who is employed by CTSMC, which in turn has a contract with and answers to the Commission.

While the Friends have a legitimate and long-standing interest in the continued operation of the historic steam railroad, we have no direct involvement in its operations. Some historical perspective may be helpful. Five years ago when RGRPC ceased to be the operator, the Commission at that time asked the Friends to assist with the organization of a new management company. With a goal of assuring the continued operation of the railroad, the Friends and its officers and directors participated (including providing limited amounts of initial funding) in the planning and organization of CTSMC. However, the Friends have no legal or economic relationship to or control over CTSMC or its management, with the exception that the Friend’s President and CEO, Tim Tennant, serves as an officer and director of CTSMC, and Tim also served as general manager in 2006-2007. Prior to his resignation from the board of CTSMC, Richard Tower was a director of the management company; he is the spouse of Friends director Caroline Tower. As you are well aware, the Friends coordinate and cooperate with the Management Company in connection with our preservation, restoration and other projects.

However, when asked and when needed over the past ten or more years, the Friends have contributed significantly to the operation of the railroad in ways that go beyond preservation and restoration of the historic equipment and structures. Examples include, but aren’t limited to, the following: we loaned Tim Tennant to the railroad to serve as its GM for almost two full years, and we have continued to subsidize his work for the railroad as an officer and director of CTSMC; we have provided leadership, passion and continuity when those things were lacking in other parts of the railroad enterprise; we have provided thousands and thousands hours of volunteer labor, materials and equipment to the operating railroad, including assisting and leading the building and repairing of rider gons, cabooses, parlor cars and other revenue equipment; we organized the grants and funding for the re-build of 463; we have provided direct cash subsidies to the railroad to fund the winter work program in prior years, we have secured grants for the railroad. In short, the Friends are always there to help support the continued operation of the railroad and to preserve and restore it, and we will continue to be.

The current Management Company has been operating the C&TS for the past four+ years very successfully with very little controversy. Considerable improvements have been made to the track and infrastructure. One year ago Soni was hired as the General Manager , At the end of that year the Management Company felt he had done very good at the technical aspects of the job, but felt he could use some improvement in the administrative and management areas. CTSMC devised a program which was designed to help Soni grow, develop and improve in these areas. After the initial effort to implement this program with Soni met with no success, they were followed by hours of talks and explanations of the goals of this program. Ultimately Soni decided he didn’t want to continue as the general manager under the proposed conditions and he resigned in late January.

At the Commission meeting on February 4, 2010 CTSMC was taken to task for the handling of the situation and considerable distrust has developed between the Commission and CTSMC. The Commission is currently considering changes to propose to the operating agreement to increase the Commission’s level of oversight, and those changes will be addressed at the next Commission Meeting in 30 days. The search for a new GM (both inside and outside the current staff) will be initiated soon.

The Friends have enjoyed a good relationship with, and we continue to support, both the Commission and the Management Company, The Friends will continue to lead the preservation, restoration and interpretation of the railroad we love, and we’ll continue to support the needs of the operating railroad in any way we can.

Craig


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Carol Voss
Bakersfield, CA

Jim's notes are very complete but cannot convey the tone of the meeting. For that you need to have been there (I was not). However, a complete video of the entire meeting has been posted at YouTube. If you only have time to listen to a few segments, start at agenda item 14A (part 1).

http://www.youtube.com/profile?user=n0dmt#g/u

Commission members from left to right:

Randy Randall
Peter Foster
Lon Carpenter
Lenny Martinez Chairman
Leo Schmitz executive Director
Maria Schmitz (recorder)

In item 14a, last segment, the person talking, who is almost out of range,with the glasses, is Elmer Salazar



Edited 2 time(s). Last edit at 02/10/10 08:46 by Cumbresfan.

You've read Jim's notes, possibly viewed the videos and maybe read the ABQ Journal story last week. Below is a teaser and the link to today's Rio Grande Sun article:

Railroad Commission Threatens To Pull Company's Contract

By Joe Crawford
SUN Staff Writer
Published:
Thursday, February 11, 2010 10:05 AM MST
2/11/10

The Cumbres and Toltec Scenic Railroad Commission has threatened to fire the railroad’s management company.

Commissioners held what amounted to an informal vote Feb. 4 in Santa Fe on whether they supported terminating the contract with the Cumbres and Toltec Scenic Railroad Managing Company in light of recent instability at the Railroad.

Soni Honegger announced his resignation as the railroad’s general manager Dec. 31 after a year and a half on the job, and Managing Company Board member Richard Tower quit Jan. 22. Both Honegger and Tower cited problems with members of the Managing Company’s Board of Directors when they resigned.

Two Commissioners — Randy Randall and Pete Foster — suggested at the meeting Feb. 4 they might be willing to vote in favor of terminating the contract with the company. The company has managed the Railroad, which is owned jointly by the states of New Mexico and Colorado, since 2006. The Railroad runs between Chama and Antonito, Colo., and draws thousands of tourists to Chama each year.

http://riograndesun.com/articles/2010/02/11/briefs/doc4b73341be8e26277469915.txt