The nonprofit’s contract with the city expires next year, and on Tuesday, Lebanon City Council is expected to approve a new eight-year contract.
For the past several months, Kammer and City Manager Scott Brunka have been renegotiating a new contract which reflects a new rail bridge replacement plan and replaces the current agreement.
Brunka said the city acquired the rail line in 1981 after Penn Central railroad abandoned it. Under the current agreement, the city is responsible for rail maintenance, which has cost about $127,000 a year. The city has also averaged about $40,000 in ridership fees, he said.
“The train generates significant economic impact for the city,” he said. “We did an impact study in 2014 that said the train had an economic impact of about $2.5 million a year.”
The 2021 rail bridge inspection report noted two of the five rail bridges, Bridge 4.10 and Bridge 2.10, need to be replaced in the near future, Brunka said. The cost to replace the bridges has been estimated at $1.3 million each.
The new agreement also includes adding a facility use fee of $1 on each ticket sold in calendar years 2022-2024. That fee will increase to $1.25 for calendar years 2025-2026, then to $1.50 for 2027-2030. Those charges will be placed in a fund for future rail infrastructure repair and replacement projects.
The LM&M also will make an annual payment of $3,000 for the rail line and restroom, as well as continuing to pay the property taxes.
The railroad will be responsible for coordinating, scheduling and funding routine and periodic track inspections, and for regular track maintenance up to $6,000 a year, according to the proposed contract.
The city will be seeking an $800,000 State Capital Improvement Project grant as well as using $250,000 in city ARPA funds and $250,000 in county ARPA funding to replace Bridge 4.10 in 2022/2023. City officials hope to address the replacement of Bridge 2.10 in 2025/2026 with $600,000 in city reserve and replacement funding and $700,000 from the additional LM&M revenues.
“We’ve done multiple surveys and the railroad is iconic and unique to Lebanon,” Brunka said. “It’s a source of community identity for our downtown.”
Kammer said the proposed contract is “a win-win for everyone because it’s an economic wheel that brings visitors to the city.”
He said the nonprofit loves the city, the local businesses and working with the city. Kammer also said any profits made go back to the preservation and maintenance of the historic railroad equipment.
“It’s been a great thing for everyone involved,” Kammer said. “2021 was the best year in our company history. “We’re really excited about it.”
Kammer said the train, which operates March through December, is planning more events. He said the North Pole Express holiday train was sold out by Dec. 1 and he expects the increasingly popular Easter Bunny Express to have many riders.
Rebecca Strole, executive director of Main Street Lebanon, said the train plays an important role in the success of downtown businesses. The downtown nonprofit has 150 members.
“This unique and historic tourist attraction brings thousands of visitors to the downtown Lebanon shopping district,” she said. “Main Street Lebanon and our members, many of which own businesses in the downtown corridor, directly benefit from the influx of tourists that come to eat, shop, and explore our community.”
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