One thing that I haven't heard very much about here is how much does it indeed cost to run a railroad museum. I know financial data is available as most of them are 501c3s but the data available doesn't get into the nitty gritty. Recently on a trip to the Connecticut trolley Museum I was shocked when one of the crew members stated that it cost $100 per trip on their line which is only a few miles. Last I heard it the Shelburne Falls trolley Museum it cost 25¢ to go down and back on our ¼ mile line. When I was on my honeymoon at Walt Disney World I was also shocked to hear how much fuel their steam locomotives burn. So and if you have any of the cost data on your organization?

How much have you got? That's how much it costs.

Expenses always increase to use up available funding.

Well... what do you define as running cost? If you take all of the expenses including marketing, insurance, maintenance, etc. and divide it up by each trip it's going to get expensive in a hurry!

What does that mean? Tickets cost $100? Or it costs the organization $100 every time they make a trip? (I would have figured it was much more than that).

It cost the organization $100 every time they make a trip.

It depends on exactly how far you want to take the accounting.

Let me take into account one day's running on one excursion line of six miles out and back, maybe two or three round trips that day. Let's see how many things I could add into the cost. Let us assume ALL labor costs are volunteer and unpaid, just for fun.

There's the diesel fuel or coal/fuel oil cost, or the electricity for a trolley operation. Even with a 44-tonner or SW1 that's maybe $50-200 depending on how much you actually run it. Got something big like a GP30 or Alco C425? That can be as much as a gallon a mile, depending on load.
We could average out the cost of paint over the passenger cars' operational lives, maybe $1 every time the car runs. Maybe add in 25-50 cents per run for window frames or panes over each trip.
Don't forget the cost of running and maintaining lighting, air-conditioning/heating if needed, the PA system, etc. Plus the cost of maintaining any concessions, from sodas to first-class dining to a "Ales & Rails" Train.
You have track to maintain. Safe to assume every new spike costs $1 even in bulk. Ties, maybe $25-50 each by the truckload, depending on quality and your location/need (wet or dry climate?).
Don't even ask about rails. Even just one perfectly-sized compromise joint bar pair can set you back $250.
Wear and tear on wheels and flanges. Reprofiling a worn wheel takes pros, even if you're using a lathe bit strapped to the rail under a jacked-up loco.
Are you leaving from a junky gravel lot, or do you have a depot to maintain? Is it "earning its keep" with rentals for parties or events, or is it something that has to be painted, re-roofed, cleaned, etc.? Is there landscaping to make the place look attractive?
You got utilities? Electric, gas, water, sewage/septic?
Is there a security system in the station/enginehouse?
Have all the tools been donated, or do they need to keep on hand power tools, a MIG welder, chainsaws, welding torches, whatever?

How trivial can this get?
There's one museum of my acquaintance where the entire property gets mowed on a regular basis by one volunteer. He loves it, he maintains mowers for other non-profits, keeps a riding mower in the enginehouse, and every week or two takes it out for a run both all over the station and up at the turnaround loop. When that guy got COVID and nearly died they were stuck for a while finding another volunteer, and finally got some landscaper to donate a couple passes with the big riding mowers like you see in public parks or golf courses. They did the work so fast they're now looking at acquiring a used big mower, which can do the job in minutes rather than hours. That's about $4-6,000. Plus gas. Used, maybe $2K. Divide that over ten years, maybe, and $600 by how many riders a year?

How was that calculated?
1. Annual average cost i.e.: annual budget divided by number of trips
2. Fully allocated direct costs
3. Marginal cost i.e.: Direct cost of a single trip without allocating fixed costs

I could go on, but I suspect you would be more interested in how various organizations actually do the calculation.

I should point out that if you are a 501c3 and/or a state registered charity this is something your accountant should have a handle on.

GME

Sigh.

As a retiree from the Trackfixerupper side, it is really important to know if such a simple statistic covers the long, middle and short time costs of simply keeping the wheels of those fabulous rusting hulks up out of the dirt.

I remember an old time observation that certain steam locomotive operators were "strip mining" their locomotives because they were not setting aside any money for the inevitable long term overhaul that WILL be needed. This was well before the regulatory changes that happened after a certain Gettysburg Rail Road incident.

I understand a lot of smaller airplanes have a specific cost per hour of usage which includes the need to rebuild the engine after so many hours of clock time.

Brian

I guess now that I'm part mechanic, part electrician, and lately, part accountant, I could speak on this a bit.

25 cents to run a trolley down 1/4 mile of line, sounds plausible for the electrical cost alone. Slow speeds, limited distance. But it doesn't include the rest of the costs.

ADM has it right. EVERY cost that goes into that car, should be counted, then divided by the number of trips. The paint, the grease, the upholstery, light bulbs, the window that kid knocked out last June. Ideally, you would try to include shop costs, storage costs. The first trip might be a couple hundred thousand! But after a couple of years, the number will be more realistic. It should be a known number, because like the aircraft example, you ideally should be charging enough to cover rebuilding the car, when it needs rebuilding. Otherwise, you ARE literally strip mining equipment with the end result of scrapping out the remnants.

Now that you know the cost is $100 per trip, and you've also hopefully tracked your ridership, say it's 13.7 passengers a trip average, you now know your tickets have to be $7.30 each just to barely break even, and that last trip on Sunday afternoon that never has more then 3 passengers, should probably be cut off the schedule.

When the grocery store price of eggs shot up steeply about two years ago, all kinds of idiots started saying "I'm gonna grow my OWN backyard chickens and save money!"

We who actually keep flocks of "backyard chickens" kept repeating to anyone who would listen:

"That first egg will cost you $1,000."

Of course, it goes downhill from there, but that's the coop, the layer feed, the raising from chicks, the chick feed, the waterers, coop bedding, secure fencing, etc.

The same mentality has to apply to that first brewpub beer, that first bottle of wine from a winery, and that first train excursion.

Also, when you have chickens and chicken feed, you may also end up with rats!
A friend ran a restaurant. I said to him one time, you seem to have a good customer flow, things must be doing well. He said it might look that way, but at the end of the day, I am not taking any money home! He is no longer in the restaurant business.
Private rail operators need to be "taking some money home" at the end of the day.

We get the occasional mouse.

Dirty little secret: Chickens will kill AND EAT mice.



If you read or listen to the accounts of major restaurant owners, brewery start-ups, etc., that is an incredibly common theme for the first year or two. As well as occasionally sleeping in the business, kiting checks between multiple accounts to stay one half-step ahead, getting mercy from suppliers who believe in you and don't cut off your deliveries, etc. I'm reading the fifth "how to start a microbrewery" book that recounts such tales.

Can confirm you’ll never get eggs to be as cheap as factory farmed, even when the price doubles. The best you can hope for is a steady supply of eggs most of the year. They might not cost you $1000 if you’re a good scrounger of used fencing, coops etc and you have a good eye for feed sales, plus a lot of yard for them to pick over.

Any kind of equipment is the same way. If it’s humanly possible, when you pay off a car you never stop taking the payment from your monthly income. You’ll need it for repairs or a down payment on the next vehicle.

Given my druthers, I’d require any government grant or project to be half for the build and half set out for maintenance so the project doesn’t fall into the “too big, too old an$ too beat up” trap. Politicians show up for grand openings, not to celebrate the repaved parking lot or the replacement vending machines.

As the owner of a condominium in a high-rise building, I'm grateful that California law requires our homeowner's association to have a reserve account to accumulate funds to maintain our building's infrastructure.

For example, if our elevator is expected to last 30 years and cost $30,000 to rebuild at that time, we are required to put $1,000 per year into the reserve account so that we have the money ready and do not have to impose a special assessment to pay for the job.

I think museums should use a similar strategy. Parking lots need re-surfacing, roofs wear out, air conditioners fail, ties rot, etc.. It's nice to have the money on hand rather than stealing from other parts of the budget to pay for something we know will be needed.

Some insight for running costs might be obtained by comparing COVID period with pre-COVID. The difference would be those unavoidable costs such as insurance, and property taxes (if non-exempt) phone, internet and other miscellaneous costs. Fuel for track maintenance during COVID might be greatly reduced. I realize utilities might also be reduced and perhaps a pre-COVID figure could be compared to a COVID period figure. I once was the Treasurer for the PLA in Niles Canyon, but I am not an accounting professional. Some food for thought.