Wednesday, January 22, 2020

Board Governance as it relates to the Downeaster

Just so you know, we submitted this letter today to the NNEPRA Staff and Board, and other related offices in Augusta.
We expect strong indifference will follow, no doubt immediately. ========================================


To: John Melrose; Bruce VanNote; Charles Large; Mary Anne Hayes

cc: Patricia Quinn; Sen. Bill Diamond; Rep. Andrew McLean; Office of the Governor (Thomas Abello)


From: P. C. Schaeffer


Subject: Comments on NNEPRA Board Governance and Meeting Conduct


Date: 22 January 2020



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I've recently attended a number of regularly scheduled NNEPRA Board Meetings, and have read numerous Board Meeting packets over the years, each of which usually includes minutes of the prior Board Meeting. (Additionally, I have obtained numerous documents detailing various aspects of NNEPRA operations via Freedom of Access requests. These requests span five years at least.)


Upon reflection, my conclusion is that the “Public Session” in each Board Meeting is largely a perfunctory exercise, reviewing budget status and ridership statistics, and only rarely departing from a pro-forma update of the prior month's report.


Since members of the public are excluded from Executive Sessions, which regularly begin every Board Meeting, I have no knowledge of just how forthcoming NNEPRA Staff is at reviewing the details of the complex passenger rail operation for which they are responsible. Nor is there visible indication that Staff relies on the Board to provide direction and oversight in policy and execution of responsibilities. The impression one gets from seeing only Public Sessions is that the Board plays a mostly superficial and ceremonial role.


If these impressions are correct, significant changes and upgrades in NNEPRA governance are called for. NNEPRA and its Board are entities of Maine State Government, and residents and taxpayers have a right to expect best efforts and practices in all things they undertake.



Operational Considerations


It's obvious to those of us who have tracked and studied such operations for years that there are subject areas of real significance that should be rigorously overseen by NNEPRA Staff as part of their professional responsibilities, and that more importantly, should be reported regularly in detail to the Board. Without such knowledge, the Board cannot fulfill its fiduciary obligation to act as the taxpaying publics' representatives, ensuring that Maine's passenger rail operation is overseen and managed to the highest standards.


NNEPRA is a third party agent in the operation of the Downeaster. It negotiates and oversees operating agreements with Amtrak, PanAm Railways, the MBTA, Concord Coach Lines, station communities, and various other providers of equipment, facilities, and services that are part and parcel of the Downeaster operation. NNEPRA is, in effect, the general contractor for the Downeaster, and it engages a number of sub-contractors that must seamlessly integrate into the totality of passenger rail service offered to the public.


Paramount among these providers are Amtrak, which provides the actual train sets that comprise the Downeaster, and Pan Am Railways and the MBTA, which own the rail systems upon which the train sets operate. It is important to note that the MBTA operates passenger rail service, and as such, is bound by FRA passenger service obligations for track inspection and maintenance, while Pan Am Railways operates only freight services, and has no inherent obligations to comply with passenger level track standards, other than as imposed via agreements with NNEPRA.


Since NNEPRA's largest operating expense is for Amtrak equipment, operating staff, and related maintenance and supplies, and this equipment is among the oldest and least technically advanced in the Amtrak inventory, regular detailed reporting on its inspection, care, and operation should be the highest priority for Staff and Board tracking and reporting.


Note that the original 20 year operating agreement between The National Railroad Passenger Corporation (Amtrak) and NNEPRA expires in December 2021, and it would seem prudent to have plans and strategy for a successor agreement as a top Staff and Board priority. Especially since there is significant chatter in Washington about restructuring Amtrak operations, especially as they relate to curtailing shorter routes. Nothing seen so far in Board packets indicates that attention is being given to this critical item.


As to conditions of the track upon which the Downeaster operates, FRA regulations require twice weekly inspections. The results of these inspections, which directly affect safety and schedule compliance, as well as service interruptions and initiating necessary repairs, should similarly be reported in detail to the Board as a matter of course.


Slow orders are a regular part of track inspection and maintenance, and are meant to directly govern train set operations in real time “in the cab.” They are vital to guaranteeing safe operations of the Downeaster.


Slow orders, in my understanding, exist in two categories. The first is permanent, where track geometry, impaired visibility, and other cautionary factors necessitate reduction in operating speeds. These reduced speeds vary from order to order.


The second type of slow order is temporary; it stays in effect until such time as the deficiency is remedied and inspection certifies that maximum speed for that track span can be resumed.


Simply put, the slow orders in effect at any juncture, and constant attention to their remediation, are absolutely vital to safe and reliable operation of the Downeaster. In the past, I have requested and received summary data for slow orders in effect. The data I received was voluminous and substantially redacted as to location and details, so it was hard to generalize as to the overall system status they depicted.


The number of such orders issued and in effect are a fundamental descriptor of rail system condition, and the changes from month to month are indicative of system dynamics – from decay to remediation. While the data can be overwhelming to review and absorb, it is incumbent upon staff to develop effective monitoring and reporting formats. Without such information, how can the Board be expected to ensure that swift and efficient action is prioritized and under way to ensure safety and optimization of Downeaster operations? Certainly no one further up the chain of command in Augusta has any specific interest or better view into these conditions. In particular, the Joint Standing Committee on Transportation is inattentive and uninformed as to such details.


Coupled with regular reporting on the state of the leased Amtrak equipment, I can't imagine any two higher priorities for regular reporting and examination by Board members, and the public should be extremely interested as well. The Downeaster is, after all, a public conveyance, and is subsidized to the tune of $10 million a year in taxpayer funds.


We have no way of knowing what is covered in the regular Executive Sessions with the Board. Having reviewed the statutory language for such exceptions though, I can see no passage that would provide for reporting on the items just mentioned in sessions closed to the public. So I conclude that these items are not reported on at any level to the Board, and if they were, it would be in violation of applicable statute.


In summary, while seeing monthly ridership totals, on time performance, and performance to budget may have relevance to NNEPRA's top-line operation, it amounts to superficial, in the rear-view mirror reporting about which nothing much can be done.


And it is a poor substitute and distraction for what should be the real priorities of Board oversight – the effectiveness, safety, and reliability of Downeaster system operations, and Staff focus on the underlying factors that influence them.



Policy Considerations:


The foregoing treats issues of Downeaster operation. There are, of course, policy issues that should be of interest to NNEPRA's Board as they represent the interests of Maine taxpayers and residents who gave birth to and sustain NNEPRA and its passenger rail operations.


Perhaps the most obvious of these policy concerns is why neither New Hampshire or Massachusetts State Governments subsidize Downeaster operations on a fair share basis with Maine State Government. These states are arguably the greatest beneficiaries of the Downeaster since stations in their states are typically the most active from a passenger count basis. Does anyone really believe that the Downeaster could survive as a Brunswick to Kittery passenger rail service? Does anyone believe that Brunswick's economy has derived benefit from the service, especially when compared to the Consultant projections paid for to justify beginning the service? Does anyone think that the Brunswick extension is vital to the service provided to our two neighbor states to the south?


Accurate reporting of station pair traffic counts would go a long way towards clarifying utilization of the Downeaster, but these statistics, occasionally provided in the past, have disappeared from public view.



Capital Projects


It appears from published data that the Royal Junction Siding Project has been slipping regularly as to meeting commitment dates. Does the Board conduct oversight via Project Review in such matters? If so, it is not apparent. If such reviews are masked by review in Executive Session, why is this so? Public money is being spent, and the public should be able to tell whether those it expects to oversee the projects are capable of doing so effectively and rigorously.


The Royal Junction Siding completion is at least one year beyond the original schedule. If it was so necessary for 5 round trips to Brunswick, which began more than a full year ago, how could this even be possible? How can the schedule survive such problematic situations? The answer is that the premise of the project was unworthy from the get go, and a detailed look at schedules shows that the possibility of conflict of northbound and southbound Downeasters is nearly non-existent, and in the one case per day where it could happen, other existing passing options could serve the purpose.


As to service expansions, any of which would involve enormous capital outlays and years to create, why doesn't the Board establish as standard practice that before contemplating any such expansions, motor coach service should be employed on a pilot run basis to validate rider demand? Expanding Downeaster service from Portland to Brunswick cost in excess of $60 million in non-recurring costs, and by all accounts adds to operating losses on a recurring basis. The projected economic benefits of the expansion are virtually negligible in comparison to the huge amounts projected by consulting “professionals.”



Conclusions and Recommendations


As a matter of respect to the attending members of the public, the regularly scheduled Executive Sessions should be held after the public session of the Board Meeting, when all other business has been completed. Placing them at the start of the meeting may well discourage public attendance. Given that NNEPRA's main constituency is the full compliment of taxpayers who fund it, not just the relatively few Mainers who ride it, anything that encourages public attendance at meetings should be SOP.


Board Meetings should receive regular status reports on train set status and maintenance issues, and detailed track system condition. In particular, slow order adjudication should be a primary reporting items at each meeting. The Board should embrace its obligation to be fully cognizant of these vital aspects of NNEPRA stewardship, and be ready to intervene when appropriate attention is lacking.


Accordingly, I implore you to change the operating model of the Board and the regular Board Meetings to be more in line with the needs and interests of Downeaster riders and the taxpayers that subsidize it. Make your positions on the Board as meaningful as they should be. Do all you can to ensure that the meetings are actually productive management events, instead of falling into the trap of routine dog and pony shows.


Recognize and act upon your primary position in authority and governance of the Downeaster passenger rail service.


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