Lebanon officials to determine fate of city's scenic railroad company

A popular southwest Ohio tourist attraction with roots to the City of Lebanon may be forced to move if city officials don’t renew the city's longstanding contract with a private company next year.

Lebanon officials will decide in April if the city should continue to support the Lebanon Mason Monroe (LM&M) Railroad’s operation of a tourist excursion train on the city-owned line. The rail line, which consists of five miles of track and five bridges, costs the city an average of $200,000 each year to maintain. 

“It’s a quarter of a million dollars that we have taken from taxpayers to subsidize one private company, and I’m not sure that’s the role of government,” said Wendy Monroe, a Lebanon city council member, who opposes the city’s contract with the railroad company.

That’s the conversation that’s divided Lebanon city council members for years. Should the city indirectly support a private company with taxpayer dollars?

"There are people on council who feel as if we are writing a check to a business privately, and that is not the case because we own that land.  We have a responsibility to maintain that land whether it's active or not," said Matthew Rodriguez, a Lebanon City Council member who wants to keep the contract with the company. 

Supporters of the city’s contract with LM&M, which expires on Dec. 31, say the annual 40,000 train passengers bring in essential revenue that keeps some local businesses alive. Opponents say the track maintenance costs more than the railroad company brings in, and the thousands of dollars spent to maintain the tracks should instead be allocated towards the city’s other needs.  

"It's not common for a small community to own and operate a rail line," said Lebanon City Manager Pat Clements. "We have a business  model where the full cost of the line has to made up with only the value we're generating with the tourist operation because [the track] is not being shared."

The rail company is the sole operator on the city’s line, and the track cannot support sustained freight traffic, according to a 2011 rail bridge load rating report. 

Clements  previously advised the council members in a 2008 staff memo to not make additional infrastructure investments in the rail line due to projected deficits, insufficient cash reserves and the lack of guaranteed sustained operation of the passenger train service. 

In a November 2012 staff summary, he wrote that maintaining the light-weight track has cost the city $793,600 since 2008 -- a cost that includes inspection services, bridge repairs and rail tie replacements. Track maintenance cost $105,300 in 2013, but a $25,000 grant from the Ohio Rail Development Commission helped the city cover the costs, Clements said. 

In his November 2012 memo to council, he added that a $200,000 increase in road resurfacing funding -- which is the average annual cost of maintaining the city-owned tracks -- would allow Lebanon to resurface an additional 0.8 center line miles of roadway annually.  

City council members will have access to data about the train's local impact to help make their decision this year for the first time. In a 4-2 vote in June, officials approved a $40,100 contract with Stone Consulting, Inc. to conduct an independent analysis of the costs and benefits of continuing to maintain the rail line to facilitate the tourist excursion train. 

The train, which came to Lebanon in the early 2000's, operates on 16 miles of track between Lebanon, Mason and Monroe. Most of its scenic trips, however, run just 4.4 miles south of Lebanon to a picnic grove along the track at the back property of the Southwest Golf Ranch. It's best known for attracting Tri-State residents to its seasonal train rides like the Easter Bunny Express, the North Pole Express, the Pumpkin Patch Express and Thomas the Tank Engine. 

“I have met people who have bought houses as a result of coming to the community from the train, they have decided to move here because of its intrinsic nature. I know people who have bought businesses here and who live on the fact that we have trains here,” Rodriguez said.

The consulting company has administered ridership surveys to the passengers on board, asking questions like why they use the train, where they're staying, what they do while they're in town and if they're likely to come back.

Bill Kilimnik, general manager at the historical Golden Lamb hotel in the heart of the city's downtown, said he meets many train customers who stay at his hotel -- and some who come just for the train. 

"There's more than just a sales impact of this train. There are people who get shifts scheduled. There are indirect jobs impacts. When the train runs on the weekends, it impacts us. We staff accordingly," he said. 

Carolyn Abbott, general manager of LM&M, said the railroad company is pleased with the city's decision to conduct the study, and she said the company has worked closely with the consultants to provide financial information about their business. 

"Our goal is to stay here in Lebanon," said Abbott. "It's a concern. Part of the draw [with the train] we have found with people is to come visit the community and to come to this area."

But Abbott said the company will still be able to function from another location, and she said they've already considered Mason as their next option. 

Some local business owners are anxious, as they await a decision from city council. 

Susie Alexander, owner of the Village Ice Cream Parlor and Restaurant in downtown Lebanon, said the train brings in 25 to 35 percent of sales at her family owned business. 

"Maybe the passengers won't come that day, but the railroad brings them in and they keep coming back. People don't just ride the train once. They ride it two or three times a year. We shutter to think about what it's loss could do to our business," she said. 

Kilimnik said the Golden Lamb, although a destination-driven property, would take a hit too. 

"It would have a significant impact on our business should it stop running," he said.

Rodriguez is convinced that some local business would actually be forced to close if they no longer get their customers from the train, but Monroe doesn't think that would happen. 

"I'm just not convinced that it's having that much of an impact on our local economy," she said. 

Once the council members decide whether to continue their lease agreement with LM&M, they will decide what to do with the tracks. 

Council members like Rodriguez want to expand train service on the city's tracks.

"I have a problem with the fact that we're only using that train as a tourist attraction when, in fact, it could be utilized as an inter mobile," he said. "We're not using it to its full potential."

Other council members have plans to abandon the tracks and spend the money elsewhere. 

For more stories by Taylor Mirfendereski, visit www.wcpo.com/Mirfendereski. Follow her on Twitter at @TaylorMirf.

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