From the Shortlines group in Yahoo!: Skunk bidders differ on RR future By Claudia Reed/ The Willits News Tuesday, November 25, 2003 There are four potential buyers for the California Western Railroad, affectionately known at the Skunk Train, each with a different vision of the railroad's future. On Dec. 16 a bankruptcy court judge in Santa Rosa will choose among the four according to their ability to pay existing debts, to improve and maintain the railroad, and to provide public benefit. Sierra Railroad, Inc. is offering a million dollars, a steam train run between Willits and Fort Bragg, a regular "car ferry" between the two cities, and an hourly excursion run between Willits and the Summit depot. If the north/south Northwestern Pacific line is reopened, freight service may be added to the mix. Company president Mike Hart said the car ferry might be served by an additional train depot along Highway 101. After decontamination, the Remco site would be an "ideal" location, he said. The ferry itself would consist of flatcars prepared to transport vehicles as large as buses. "What were looking at is I hate Highway 20,'" Hart said. "Any vacationer (headed for the coast) has got to negotiate 20." While their vehicles are being towed, Hart said, drivers will be able to enjoy the rest of the train, including observation and dining cars. "They'll have a wonderful, scenic railroad experience without having to see it twice." The steam and hourly excursion trains from Willits would leave from the existing depot. The hour-long short runs, he said, would give travelers the opportunity to add a train ride to their vacations without having to commit an entire day to it. Regarding freight service, Hart is not discouraged by the closure of mills and logging operations that once made use of the Skunk line. If necessary, he said, his company would find ways to bring new rail shipping industries to both Willits and Fort Bragg. Sierra is familiar with the local situation, Hart said, in part because company vice president Robert Pinoli was former vice president of the CWR. Sierra currently runs excursion trains, dinner trains, and Christmas trains in Oakdale, Sonora, Jamestown, Woodland, and Sacramento, as well as service trains at the Concord Naval Weapons Station and McClellan Air Force Base. "We have the largest fleet of track maintenance equipment in California," Hart said. More information on Sierra is available at www.sierrarailroad.com Napa Valley Wine Train, Inc. is offering $750,000, regular runs to Willits and improvements to both the cars and the midpoint Northspur stop. The midpoint is a clearing in the woods where passengers were once able to buy souvenirs and food from small kiosks. "Northspur is a major stop and has to be made very attractive," said Vine DeDomenico, president of the popular 21-mile excursion run from Napa to Saint Helena. The trains stopping at Northspur and chugging on to Willits will be locomotives, he added, not the later-made diesel-fueled engines. DeDomenico called past failure to run the big steamers "one of the reasons why Willits end of line was deteriorating." "We'd run to Willits every day, one train there for sure," he promised, "depending on the time of year and traffic, two times a day." The long-range dream, DeDomenico said, is connecting the Skunk Train with the Wine Train by way of the NWP tracks. "The track from here to Willits is not functional," he said. "It's going to connect one of these days. We're waiting for the powers that be." The wine train in the Napa Valley currently offers big-name band concerts in the depot, lounge cars with drinks and gourmet meals, shuttle service to local hotels, and special holiday packages and events. Old 45, LLC, which is offering $1.4 million was created by local investors in order to "maintain the integrity and heritage of the California Western Railroad," according to a release by Neil Bagaus. Bagaus, with 18 years of experience in the operation of excursion trains, would become manager of the CWR if Old 45 is the chosen buyer. He was brought in by bankruptcy trustees to manage the Skunk last summer and greatly increased the profitability of the line. He was not permitted, however, to run the train through to Willits because of the high cost of related track repair. Old 45 plans to restore a regular Willits run "from the very beginning," said Fort Bragg investor Ron Van Assen. "This includes refurbishing the car fleet yet retaining its 1920s look," Bagaus added. The investor said he would contribute his personal carpentry skills as owner of Fort Bragg's Van Assen Cabinets to restoration of the historic train depot in Willits. Last summer, he built a concession car used on the Fort Bragg to Northspur Skunk run. "My goal is just to restore everything as nicely as we can," Van Assen said. "We want this to be a local passenger train," he said. "There are other possibilities, but they will have to wait." Fort Benton Funding, LLC of Oregon, is offering $1.3 million, promises a run to Willits, and has expressed interest in establishing such related local businesses as car rental facilities at the end of the line and a machine shop specializing in railroad parts. According to David N. Chandler, attorney for the trustee, the monetary offers could change before the hearing or in response to input from the judge. He stressed that the amount offered will be balanced against demonstrated ability to restore and maintain long-term train service when the judge reaches a decision. The judge in the Dec. 16 hearing, which begins at 10 a.m. in northern district bankruptcy court, will accept testimony only from the attorneys of entities with regulatory authority regarding Skunk Train operations, Chandler said. City manager Ross Walker, who is also an attorney, is expected to testify on behalf of Willits' interests. _________________________________________________________________________ Published Thursday, November 20, 2003, in the Santa Rosa (CA) Press Democrat: http://nl.newsbank.com/nl-search/we/ 4 bid to take over Skunk Train Bankruptcy judge to choose new operator for historic Mendocino County line By Bob Norberg The Press Democrat The historic Skunk Train would survive as a tourist railroad under new owners and its creditors would be paid 25 cents on the dollar in a reorganization plan to be submitted Friday to the U.S. Bankruptcy Court in Santa Rosa. Four potential purchasers, including the Napa Valley Wine Train and the Oakdale-based Sierra Railroad, have submitted bids ranging from $750,000 to $1.4 million for the tourist train, which filed for bankruptcy protection almost a year ago. The court can take into account the public interest and select the buyer with the best chance of keeping the railroad running, even if it is not the highest bidder, so it won't have to go through bankruptcy in the future, when it might be lost forever, said bankruptcy trustee Michael Meyer. "I believe the railroad can survive this bankruptcy, but I don't think it could survive the next bankruptcy," said Meyer. The four potential buyers and bids are the Napa Valley Wine Train, $750,000; Sierra Railroad of Oakdale, $1 million; Fort Benton Funding LLC of Grants Pass, Ore., $1.3 million; and Old 45 LLC of San Francisco, $1.4 million. Meyer said the buyer would also have to invest about $2 million to improve the rail line to keep it operating. The two bidders that operate successful excursion trains are the Napa Valley Wine Train and Sierra Railroad. The Fort Benton LCC is an Oregon investment group, and Old 45 is a partnership of rail enthusiasts headed by a San Francisco doctor. Bankruptcy Court Judge Alan Jaroslovsky will be asked to choose a purchaser on Dec. 16. Meyer said his goal as trustee is to preserve the Skunk Train as an operating railroad because of its enormous historic value in the North Coast logging region, while some studies indicate that it generates an estimated $11 million in tourism income for the North Coast. Meyer said he also believes that a competent owner can make money. "Absent some catastrophe, an operator familiar with a railroad, who has economy of scale and who knows marketing, I don't think there is any doubt that you could be profitable," Meyer said. Bankruptcy attorney David Chandler said the Skunk Train needs $2 million in renovation. The Skunk Train, founded in 1885 to haul logs to a Fort Bragg mill, runs through 40 miles of scenic and remote countryside between Fort Bragg and Willits. In the past six years, however, its owner, the California Western Railroad, piled up huge operating losses before filing for bankruptcy last December with a reported $2.4 million in assets and $2.6 million in debt. California Western officials blame the loss on the collapse of its freight business, which had annual revenues of $300,000, as leading to the bankruptcy. The assets include the Fort Bragg station, $1 million, Willits station, $500,000, and engines, cars, equipment, rails and ties, $575,000, according to the trustee. Under the plan, $768,000 would go to administration, attorneys fees and taxes. The remainder of the purchase price, plus $132,000 in cash on hand, would be prorated to West America Bank, which is owed $1.2 million, and John Mayfield and Robert Rodriguez, who have a $360,000 note on the Willits station. Capital Crossings, owed $350,000, and Economic Development, owed $125,000, and the 140 unsecured creditors, who are owed $257,000, would receive no money under the plan.
It's nice to read that there are multiple interested parties! Just this fact makes me feel much, much better. Awaiting further news! Boxcab E50
It is my understanding the Sierra RR won the bid. Can anyone in here advise me who the President / CEO / owner of the SierraRR is?
Bill Go to Altamont Express for more info on Sierra Railroad, Here is a link to the news page of Dec 22. http://railroadnews.net/news/12-22.html
I hope there will be no snags in the process. So they'll have all possible time available for upgrades before the new season. Boxcab E50
