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2012 Was a Great Year

ELY, NV — As 2012 now comes to an end, its time to look back and see how far we have come. Our 2007 Strategic Plan now needs updating. As we move into a new year, this is the ideal time to reflect and plan for the future. The short version is that we have blown by some of our goals, on others we have hit the target, and on a few we missed.

Taking stock of where we are now, it’s been exciting. I think the biggest news is the new shop and classroom complex is open and will graduate its first class in Heritage Industrial Arts this spring.

This program, in cooperation with Great Basin College, is an Associates Science Degree program that teaches the thought process of working with metal, especially when there is little or no documentation. These problem-solving skills are core to the program. It covers all aspects of working with metal: welding, casting, forging, blacksmithing, and machining. The machining portion of the program is maybe the crown jewel. Students learn on everything from belt driven machines to the latest programmable machine tools and lasers.

In the beginning, many people thought this program was just about maintaining steam locomotives. Nothing could be further from the truth. The program teaches working with metal and solving problems. It takes on projects where you need to develop your own processes. As a side benefit, our antique locomotives, cars, and machinery just happen to be the perfect canvas to teach with. Already it appears that 100 percent of the first graduating class has jobs and most of these jobs are in industry with only two staying in the heritage railroad field.

The impetus to build the new shop classroom complex started at the 2007 Strategic Planning Session. The overriding question was how to make the Nevada Northern Railway National Historic Landmark complex self-sufficient. At that time, the complex was twenty-three years old and had only been in the black once since its’ founding. Revenues could cover expenses but the need for capital to invest in utilities, buildings, locomotives, rolling stock, and infrastructure was overwhelming.

A decision needed to be made which path did the railroad need to take. The choices were to try and exist at 2007’s ridership and revenue which would mean cuts across the board (and frankly we’d be loosing ground) or to develop the tourist aspect of the operation to hit 100,000 riders a year. Another option was to hit a target of 40,000 and develop additional programs that would bring in revenue from other sources. The other sources identified were outside projects and the Heritage Industrial Arts programs. The last option was chosen to pursue.

It was chosen because where revenues topped over $1.2 million for 2007, the revenues just barely covered expenses. Staff and volunteers were stretched very, very thin—some would say to the breaking point. Bottom line, operating revenues in actuality didn’t really cover costs. And then the capital needs of the complex still needed to be addressed.

It was felt that 100,000 riders a year could be reached, but in doing so we would not be taking advantage of the attributes of the railroad. In fact, just the opposite: we would morph from a historical venue to almost a commuter rail operation. In addition, the pace would be very detrimental to the equipment and infrastructure. So this option was rejected.

The last option of holding ridership to around 40,000 a year, emphasizing our specialty trains and events, soliciting outside contracts, and developing the Heritage Industrial Arts program seemed to make the most sense for our historic complex. And it proved to be the just the ticket. We have two years of stable revenues.

And as it turned out, 40,000 riders a year demonstrated to be very practical. To reach that goal required a full-time marketing and group sales person who traveled around the area doing presentations on the railroad and soliciting business. A side benefit is our very successful school program. Where it’s not a big money maker for us directly, it serves to introduce railroading to the youth. This is building the foundation for our future.

Along with group sales, our website is the most complete, interactive and dynamic one around. We’re now finding over 60 percent of our ticket sales and gift shop sales come from the web. This is major advantage considering the remoteness of Ely.

Gift shop sales have been helped immensely by the development our own product line, Foamerific© products. This unique product line produces revenues two ways: first on our own branded products, Old 93 Condensed Steam (bottled water), Track Ballast (chocolate candies), You Know Someone Bad (coal for Christmas) and Hobo Rock Soup (think pet rock with a railroad twist.); secondly, we also provide the product line to other railroad gift shops branded for their operation.

Another revenue source was the creation of print on demand historic railroad textbooks and manuals. We undertook this project because we needed manuals that were now over a century old. And we didn’t want to use the originals in the shop. So it stood to reason if we needed these books then others in the industry would also. Rather than print the books the traditional way, we would store the electronic files and then print out books when needed. We even took it one-step further and made it possible for John Q. Public to print out the book using their printer and paper. So our investment was just creating the electronic file.

The success of our print on demand books, eBay store, and gift shop sales generated combined sales that almost exceeded our revenue from excursion trains.

Another success is the Building and Grounds Department. Over the past five years over $1 million dollars has been invested in the complex. Working with the Commission on Cultural Affairs, we have been able to expand the department from just one person to a crew of four. By being our own contractor, we have been able to stretch every dollar that we have invested in the buildings.

Most of the wages of the building and grounds department is covered by grants. Since most of our buildings are wood, a side benefit is in that in winter we use these same people to work on our historic wooden equipment. By developing this expertise in-house, we are training personal that are flexible and sensitive to our historic structures and rolling stock. Also, the walking trail through the complex was finished in 2009. This made the property more accessible to the public and does a great job in explaining the significance of the complex.

On the equipment front, tremendous progress has been made on the steam locomotives. Locomotive 81 received its ground up restoration and now is our workhorse. 81’s restoration was funded in part because of a PBS television series. The entire restoration was filmed. The resulting program was a cross between Orange County Choppers and from Rust to Riches.

Both locomotives 40 and 93 received extensive repairs to their running gear. We now have three solid steam locomotives. It was very expensive; we invested over $1.5 million on the steam locomotives. And there is a disappointment, Steptoe Mining and Milling 3 is still not done. Received from Niles Canyon in 2007, it is still in pieces, and it keeps getting pushed back.

Plans are going forward to recreate locomotive 21. This started as a controversial project. It wasn’t understood why we needed a fourth locomotive or why we couldn’t just rebuild any old locomotive. The 21 project was seen as solution to a couple of different problems. Locomotives 93 and 40 are now over a century old. Locomotive 81 will join them in the century club in five years. Every time you fire up a locomotive, you consume it. 40 and 93 could be argued to be the most historic locomotives in the country because they have been here for a century. So every time we heat them up, we consume them and they are expensive to operate. The 21 project was seen as the answer to three very pressing problems: 1) save our historic locomotives; 2) have a steamer ready for the public at almost anytime by building a modern locomotive costing less to operate; and 3) the long shot business opportunity of actually constructing modern 4-6-0’s for other railroad museums such as the V&T. TRAINS magazine last year ran an article on how the six coupled locomotive was an ideal locomotive for tourist and museum applications.

The diesel locomotives are in good shape. Due to purchasing spare parts from the California State Railroad Museum in 2007, the future of 105 and 109 are bright. Locomotive 801, our Baldwin VO is in service and is the star attraction for our diesel photo shoots. The Baldwin S-12 is still out of service. We have been frustrated in our attempts to retrieve locomotives 201 and 401 and bring them home.

On the rolling stock front, we have four solid passenger coaches for excursion service, the Ely, Ruth, McGill and the Nevada. Flatcar 23 has been named the Copper Flat and has been joined by our second open-air car Kimberly. All of the cabooses are in tiptop shape except for the little four-wheel bobber.

Our heritage passenger equipment 05, 06, and 20, are in excellent shape after extensive work. We have just started the restoration on Coach 2. This is expected to be a three-year project and cost $400,000. After Coach 2, we intend to start on Combine 05. The heritage freight equipment is in good order. Every year a few more pieces are brought into service. The steam crane is still in operation and is the hit of the photo shoots. Work still hasn’t started on the rotary snowplow—maybe next year.

On the building front, we have had some major successes and one failure. The failure was the blacksmith shop located across from the RIP. The heavy snows of 2009 were too much for the building and down it went. On the bright side, most of the buildings in the yard have received roof repairs and repairs to their doors and windows so the building envelope is weather tight. The paint shop is back in business and it’s being used for car repairs. This project started in 2007 and proved vital to the museum.

The McGill Depot is another success. Now a vibrant part of the museum, it serves as an anchor to the north end of the line. And it also serves as the headquarters of the swimming hole program.

The program was initiated in 2010 and is very successful. The track to depot was repaired and trains can now reach the depot. Bicycles were purchased from the Las Vegas Police auction and painted orange with green polka dots. Swimming passes were sold and now kids can ride the train to McGill and then ride one of the bikes to the swimming hole. They just need to remember to make it back to the depot before the last train of the day departs. Back in the 1920s, the railroad provided school trains to the community; now almost a century later we’re providing swimming trains. This program will only become more popular with the introduction of the Edwards Motor Car. This is scheduled for 2013. Most people don’t know that the railroad was considering purchasing a railcar for the school trains. The railcar, loosely, could be called a bus on rails; it is just the ticket to increase service to McGill for less cost and a couple of trips a year to Shafter.

The other exciting news was the opening of the track to Shafter this past year. It was a long time in coming but now trains from Ely can run all of the way to Shafter. This connects us with the world. In 2013, the mine will start shipping concentrate by rail. The lower transportation costs were a big plus in the decision for the mine to switch. With the opening of the line, the mine will be able to receive bulk materials by rail. So in addition to ore trains, freight trains will also be using the track. The first power plant is in operation and coal trains are now running. Ore trains, coal trains, freight trains, and passenger trains will be using the track 2013.

Also on the track front, the track improvement program was competed on the excursion tracks in 2009. This allowed for ties, ballast, and tamping. Now the entire excursion track is in pretty good shape.

Another area where progress has been made is in curation. We now have all of the major artifacts cataloged properly. This was a massive undertaking. We still have the smaller artifacts to go and we need to finish the building inventory. In 2008, 2009, and 2010 there was big push to scan and archive all of the drawings. This has finally been accomplished and is available online.

Working with the State of Nevada, progress is being made on an archive/library center. This is a desperately needed project. The goal is to consolidate all of the paper on the complex in one place. The second phase would be to do go through all of the paper and scan everything into a digital archive. It’s estimated that will take decades.

Finally, membership is still increasing. We have over 3,500 dues paying members scattered throughout the country. This source of support has allowed us to undertake many little projects that enhance the property.

With twenty-seven employees and one hundred thirty-seven volunteers, the future of the museum looks very bright. We still have a lot of work ahead of us. But we have managed to put the museum on solid financial footing and we saved the buildings and equipment. With a vibrant training program, we have the opportunity to live up to our potential.

Well it is obviously not 2012. Time is speeding up as I age, but thankfully, it isn’t going that fast yet—we still have five years to go. The report is a vision of what the museum could become. We have issues that will cost millions of dollars. The current staff and volunteers are miracle workers. But they need help. The reason for this piece is the Management Board is working on its strategic plan. This is just one possibility on how the museum may look in five years. As the plan is created, we’ll post it on our website. You’ll be welcomed to comment on and add your ideas.

Eventually, we will have a roadmap for our future growth and development.

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Monday - Saturday | 8AM - 5PM
Sunday | 8AM - 4PM

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1100 Ave A, Ely, NV 89301

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