What portion of our total costs should be considered? I am active in a museum that preserves, restores, and interprets the history of electric railroads. The best way we know to interpret the history of the electric railroad is to take people in an accurately restored rail car on an accurately restored railroad. The costs of maintaining that car and the infrastructure it runs on probably should be part of the cost per ride equation. But, the car deserves restoration and preservation even if it never carries a passenger. Are those costs part of the cost per ride calculation? We are about to receive three modern (well, 50 year old) rapid transit cars. These cars are historically very important and we are right to preserve them. They will never turn a wheel in revenue service for us for many reasons including an incompatible track gauge. Are their preservation costs part of the cost per ride calculation? I don't know how we should do our calculations, but I know that for the serious museum simply dividing the annual budget by passenger trips does not answer the question, "How much does it cost to offer interpretive rides to the public?"

A part of what enters into the equation is whether or not rides are routinely offered as part of the "museum experience" or not.

I've seen museums where a ride on the trolley or train (or even unlimited riding) is included with admission; I've also seen them where the train ride is an additional fare atop an admission. There are pros and cons with both approaches; being asked to pay additional may rub some folks the wrong way, but having to build that into the admission price when I visit on a day when rides aren't offered rubs ME the wrong way (except for my willingness to support the mission, so I shut up and pay.....). There may be some places that offer a discounted admission when the train/trolley isn't running.

As usual... Illinois Railway Museum is an excellent example. They have different prices for weekdays and weekends when there is a different amount of equipment operating. (weekdays is electric cars only, weekends is electric cars and either a steam or diesel train, plus trolleys on the loop).

As far as how to calculate - any organization can calculate it the way they want to but it's going to be tricky. For example, any museum needs insurance, but insurance to operate trains is going to be more than for a static museum, but it's not like there is a blanket policy that costs x for 1 and y for the other - you won't truly know what the difference is since each organization is unique.

We all know COVID did a number on nearly every oublic function, and I don’t want to get into politics. The idea of having to close for a year or more for unforeseen causes, however…hiw do you plan for that?

Besides the plague, anything affecting a museum area, from a severe weather outbreak shutting down a city, a la Hurricane Katrina, to an earthquake on a fault that is certain to go off at an unpredictable time with severe results, to a huge widfire or God forbid a war, has the potential to shut down tourism even if the property is unaffected.

Do you have a plan in place should such a thing happen? Interruption of business insurance used to be possible. I’m wondering whether it has taken a giant price jump like other policies or whether it’s still available at all.

The Museume I am part of stayed in the black even though we were shut down. We got our Insurer to lower our premium, and we rent out unused space.

Your obvious prototypes: The Wilmington & Western (washed out twice in short order by tropical storms) and the B&O Railroad Museum (roof collapse in a snowstorm).

The latter carried "loss of business insurance," which as I understood it paid basic ongoing expenses such as utilities, administration salaries, overhead, etc. to keep them alive while things were sorted out prior to reopening. And when they did reopen, admission prices rose on the order of 50% or more.......

Whether you are a non-profit or a not-for-profit, the likelihood exists that you MAY be eligible post-disaster for government grant programs meant to "bail out" affected victims, such as FEMA grants and the now-controversial, heavily-abused federal ones for small businesses during COVID. (In spite of such bail-outs, a lot of businesses dealing in hospitality and services have found that the traffic never returned to "normal" after COVID shutdowns, and I have brewery and restaurant closings crossing my feed weekly. As a result, I would see it as likely that such programs may be more heavily scrutinized in the future.)

A further note: It's become routine for insurance to specifically NOT cover what is statistically likely to eventually catch up with you: tornadoes in "Tornado Alley," hurricanes in Florida and Galveston, Texas (take note), snow in Maine, etc. Figure out if such insurance is available or even possible, and at what costs.

Cost of running a museum?

Most of what I'm seeing is cost of running trains, locomotives and maybe property maintenance.

How about costs of administration, etc. Is the bookkeeping done by a volunteer or is the bookkeeper being paid? The cost of the annual audit? Is there a museum store, is it volunteer staffed or is someone being paid to manage it or just staff the counter? Is there a paid general manager, or similar position?

Make sure you include the utility costs. Water, gas, propane, electricity, telephone, and maybe even an internet connection?

And then there are other costs if you are a museum. Developing displays for the public. Do you have photographs and old documents -- there are preservation costs? Do you have equipment that is not in a regular train that you need to restore, maintain, protect, and display. Should the train ride help pay for these?

Edit: And add insurance into the costs.

Ironically, another post I was just reading made me think of this question, at least in part.

So, a real number..... Oil burning Steam locomotives burn about 10 gallons of fuel per mile. The Recycled Vegetable Oil we are using is around $5 or $6 per gallon, delivered. Last I heard, used crankcase oil that a lot of operations are using was running about $2 per gallon, probably depending upon the supply locally. And as for diesel fuel, you should have a pretty good idea of the current price. (Remember for RR use, red dye diesel is used which doesn't include the taxes that you would get at the local filling station)

I understand coal is typically cheaper per BTU, again, depending upon your local supply availability.

And as for water, figure 100 gallons per mile. If the water source is coming from the local municipality, costs can vary. In my residential community, it's about 1 cent per gallon. When the region was in a drought and the lakes were running dry, we had to have water for the steam locomotive hauled in by truck from a neighboring community with a well, and that cost 5 cents a gallon, for water with high calcium.

Something else to consider in addition to costs to running a museum is the risk management associated with said costs.

What is the risk in annulling one or two trains (out of, say, five) per day when the breakeven point is not achieved in ticket sales? Is it worth making attempts to transfer advance reservations to another train? You might lose 20% of passengers who are traveling through the area and constrained to their schedule.

Is there a reaction plan in place for situations such as this?

There is no sense in firing up your steam engine for five trips that day, if you had a four-foot snowfall the night before and your passengers cannot make it to the depot for the scheduled departures. You'll have 90% cancellations... And now your costs just went through the roof because you have three passengers who braved the roads to make it for a train ride... While they pay the same cost.

How do you manage the operating strategy against the PR image of the operation?

Food for thought.

In a business world, these indirect costs are part of the overhead costs - the money has to come from somewhere. If you receive dedicated grants or donations for them, that is one thing. However, if they are stored in a barn at the facility, then the storage costs, insurance, and maintenance again have to be covered.

The general rule is that you have a total cost for the organization. Those costs have to come from somewhere - memberships, donations, and revenues are the typical revenue sources. What bills are left after the memberships and donations need to come from any operating or attendance charges. Plus, don't forget emergency funds that you want to build up for any sudden opportunities or disasters.

Bart