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SALT LAKE CITY — An iconic Utah tourist attraction is facing major financial challenges that could put its future in jeopardy.
The Heber Valley Historic Railroad has carried thousands of passengers on nostalgic journeys through northern Utah for decades. But stark economic realities have created an environment of uncertainty for the historic train.
The executive director of the HVRR said that while the independent agency isn’t technically losing money, increasing maintenance costs and depreciation are effectively putting it "in the red."
"It's very touch and go," he said. "We've been operating off of our ticket sales … and we need some help."
He said the railroad is in dire need of reinvestment to ensure its long-term viability.
He said the railroad has generated approximately $136 million in revenue for the state since 1992, while sustaining itself with little funding from the state.
"We have struggled along since then," he said. "We haven't gone back for operating funds."
Lacey said over the years, operating costs have been met with leveraged grants from the North American Railway Foundation and money received from donors. But to continue operating, the agency will require much more.
"We started out with equipment that was in marginal condition and we've done our best to make it mechanically safe to keep the locomotives operating," he said. "But it's been really difficult, especially with the economic challenges of the last three years."
He said the railroad has taken out a credit line to help meet operating costs and make repairs. In-house costs to repair steam engines can run between $700,000 and $900,000, he said.
Direct expenditures to operate the railroad tally to approximately $12 million annually.
"If we were earning $12 million a year, it would be a whole lot easier," Lacey said. "But instead, we're just struggling and limping along."
According to the HVRR website, the trains first began running in 1899, taking pioneers throughout the valley. Then, in the early '70s, the railroad became the “Heber Creeper,” a tourist passenger train that operated seasonally.
More recently, Lacey said the HVRR has operated as a year-round, non-profit organization focusing on tourism, education and the restoration of historical railroad equipment since 1992.
A bill under consideration in the Utah Legislature would remove the HVRR from the auspices of the Department of Community and Culture and create a totally independent agency. Lacey said the agency has pretty much been doing so since the 90s, but if HB287 is approved, the distinction would be official — though it would have little material impact on operations.
Today, vintage and restored coaches are pulled through the Heber Valley by locomotives, including two 1907 Baldwin steam locomotives and three vintage diesel electric locomotives. The track route travels the original Denver & Rio Grande Western rail line along U.S. Highway 189 and the Provo River to Vivian Park.
During operation, the agency employs 10 to 15 full-time workers along with "well over 100 seasonal employees."
He said the cost to maintain the locomotive engines is "astronomical."
"The cars are over 100 years old," he said. "The newest car we have is 81 years old."
Lacey said that ideally HVRR would like to develop a fundraising strategy that would infuse between $2 million and $4 million annually — either through public or private funding.
The HVRR Authority board is working to examine ways to locate a funding source, preferably a public source.
Until that time, they railroad will operate as best it can with the slim resources it has — which are ticket sales for its various train tours, he said.
Currently, the HVRR is on hiatus until May while mechanical work is performed on its locomotive engine.
"Right now, our plans show us operating through the end of the calendar year," Lacey said. Whether or not the trains will keep running beyond 2011 is yet to be determined, he said.
E-mail:jlee@desnews.com
