Board of Directors Meeting   4/26/2021

Welcome to our April 26 meeting of the Virginia Passenger Rail Authority Board.

It's good to see all of you.

Hopefully we'll be able to see each other in person soon.

No news yet on when that can happen, but I do hope that we'll be able to start organizing some in-person meetings in the not too distant future.

So just a few reminders, as always, keep your devices muted.

Our moderator does have the ability to mute people if there's too much background noise.

This meeting is open to public viewing and it is being recorded.

The recording will be available on the DRPT YouTube site to our YouTube channel tomorrow and the link will be posted to the DRPT website as soon as possible.

If you have any technical difficulties during the meeting, please feel free to let me know or log off and try logging back into the meeting.

And there will be a designated public comment period coming up as well.

You can sign up ahead of time by emailing DRPT PR

at DRPT.virginia.gov.

You can share your feedback at that time or provide comments post-event to the same email address, DRPTPR at DRPT.virginia.gov.

So now I'll read the following statement about virtual public meetings.

On November 19th, Governor Ralph Northam signed House Bill 5005, Virginia's revised biennial budget, which includes new language for meeting electronically.

Okay, Joy, if you're there, I think.

Go ahead and roll call vote.

That'd be great.

Jennifer, this is Bridget.

I'll jump in.

Emily Stock, I think the feedback might be coming from your line.

All right, I'll go ahead with the roll call vote.

Ms. Bulova?

Present.

Ms. Butler Painter?

Present.

Mr. Cardwell?

Ms. Dorsch?

Mr. Fisette?

Mr. Hall?

Present.

Mr. Moorman?

Mr. Nichols?

Ms. Zimmerman.

Present.

Thank you.

Now I would like to ask for a motion to approve the minutes for the March and also the April 2021 Special VPRA Board Meeting.

Thank you.

Okay, thank you.

I just want to confirm who seconded.

I did.

Yeah, DJ, I think we may need you guys to mute.

I think I hear some background noise there.

Okay, I'll proceed with the roll call.

Mr. Cardwell.

Ms. Dorsch.

Mr. Fisets, absent.

Mr. Hall.

Aye.

Mr. Moorman.

Mr. Nichols?

Ms. Zimmerman?

Aye.

Madam Chair, that concludes the roll.

You have a quorum.

Excuse me.

The motion passes.

That's all right.

Thank you so much.

Ms. Dorsch, I saw your email and I'm going to, I'm asking our technical host to make sure that your phone is added in so that you can participate.

I know you're here on the meeting, but are dialing in by phone.

We are, it does seem like we're having more technical

difficulties today than normal.

Well, hopefully we will get, hopefully we'll be able to get all those fixed quickly.

You'd think all this would get easier after so many months of it.

Okay, so now I believe we are moving into our public comment period.

Yes.

All right, if you have a comment to share at this time, please raise your hand in the participant panel.

If you are calling in, you can press star three to raise your hand.

We will unmute your line when it's your turn to provide comment.

We ask commenters to keep their comments to three minutes or less.

If you have a comment at this time, please raise your hand in the participant panel and I will go on and say everything else if there is somebody to comment.

We will give it a few seconds just in case somebody is lagging with our issues this morning.

Okay, thank you, Haley.

Okay, so I'll move on to my board report.

And first of all, I would like to welcome DJ Stadler, who is here.

Today is officially his first day as Executive Director of the VPRA.

He's actually been spending quite a bit of time with us over the past two weeks.

So it doesn't feel like his first day, but I think this is his first day for which he'll actually be paid.

So

Again, we're thrilled to have DJ on board.

As you know, he was a former Executive Vice President at Amtrak for Finance and also as the Vice President of Operations and the Chief Operating Officer.

He also served as the Executive Vice President of Administration at Amtrak.

He oversaw 18,000 employees at one point and was responsible for operating over 300 daily trains and attracting and retaining loyal customers resulting in the growth

of Revenue and Ridership.

Very excited to have him on board.

A few other announcements is that today is also the first day for Steve Pitter, who I know I've announced previously we have hired as the new Chief Financial Officer of VPRA.

He comes to us from the Chief Financial Officer for DRPT.

Obviously, he brings a lot of continuity, institutional knowledge to this position, and he has been working on this already for quite a few months.

Very excited to have him on board on his first day.

And today is also officially the first day for Mike McLaughlin serving as Chief Operating Officer of VPRA as well.

So I know you all know Mike very well from his time reporting to you and speaking with you while he was the Chief of Rail here at DRPT.

But really thrilled to have this team on board at the helm to get the VPRA mobilized and up and running.

Please join me in congratulating all of them.

And I'd like to also announce that Jeremy Latimer, who was our manager of rail programs, is now going to be serving as our interim chief of rail during this transitional period, after which we do intend to open up the chief of rail position for advertisement as we're moving through this transition period over the next couple of months.

A few other announcements on our Transforming Rail in Virginia program.

I know you're all

by now very well aware of the announcement that we had on March 30th, and that was with Secretary Pete Buttigieg, as well as the Governor, the CEO of CSX, James Foote, and also the CEO of Amtrak as well, and the CEO and Board Chair from VRE.

That announcement was to signal that we have signed our definitive agreements for our CSX agreements, our Amtrak agreement, and VRE agreement.

I think it's a total of nine agreements, actually,

between all the parties.

So very big occasion for us to be able to announce that.

After that, we were able to go to financial close with CSX on April 14th.

In that time, we did also get approval and approve our host agreement between DRPT and Amtrak, as well as a host agreement between Amtrak and CSX, which we needed before we could go to financial close.

Quite a bit of milestones that occurred over the last several weeks related to transforming rail in Virginia.

We also did go to our Commonwealth Transportation Board for approval for survey work as well to be able to begin the surveys on the RF&P line that will allow us to transfer the properties over to the Commonwealth on a gradual basis.

We are kicking off our statewide rail plan.

You're going to have a presentation from Emily Stock

about that later today.

You'll be hearing a lot more about that over the next several months.

This is something that we are required to do every five years.

So we are now starting it so that it can be approved in 2022 by the Federal Railroad Administration.

And as you may recall, DRPT will continue to retain responsibilities for statewide rail planning, but that will be done very closely hand in hand with the VPRA, who will then

also be working as the implementing agency for projects in that plan.

Another announcement I have is that we have reached an agreement with the Federal Railroad Administration to begin an amendment to our 2019 DC to RBA section 106 agreement related to the National Historic Preservation Act memorandum of agreement.

And that is an agreement that we have between us

Federal Railroad Administration, and the Advisory Council of Historic Preservation.

We finalized an amendment in early April to add the Federal Highway Administration as a signatory to this, related to some segments up in Northern Virginia where they have some approval authorities.

But we'll now be working on a second amendment that will be looking specifically at changes to an important historic resource here in the city of Richmond.

which is the Shockoe Hill Burying Ground Historic District.

There's been some changes in that since the agreement was originally opened up.

So we are beginning that process as well.

Emily Stock from DRPT is leading that and that will commence with some public engagement and we'll continue to keep you updated on that too.

I know Ms. Zimmerman's very involved in this process and there's a lot about this project too.

So we'll be bringing more updates to you as we move forward through this process.

and as far as Amtrak ridership and service goes, Amtrak is lifting their 50% capacity restrictions on all of their trains in May.

They've moved from their travel restricted to travel allowed phases in March.

Soon we'll be moving to the travel encouraged phase in May 2021, which I think we can agree, all agree is going to be great for ridership and as health conditions improve

hopefully bring more and more people back to Amtrak service.

We've also announced that we are going to begin offering an option for riders to take their bikes on Amtrak trains.

This was a demo project that was being led by I believe New York DOT and also North Carolina DOT where riders can bring on their bikes using the luggage cars in each train and it will allow people to

They have to take their front tire off, but it means that they won't have to put their bikes in a baggage car.

And we only have right now one route that actually has a dedicated baggage car.

So we're very excited about this.

The service is going to commence on May 1st, which is also the beginning of National Bike Month.

And I know this is something that we've had a lot of advocates interested in this service.

So we're very pleased that we'll be able to announce that as well.

The newest round of the Stimulus Act, the American Rescue Plan Act of 2021, which is being referred to as ARPA, provided new stimulus funding to Amtrak in the total of $1.7 billion.

$175 million of that is going to help offset state-supported services.

Of that amount in Virginia, we expect to receive about $12.6 million to help us offset our subsidy costs for state-supported service.

as we've seen these ridership declines over the past year.

Amtrak also is going to be fully restoring their long distance service between May 24th and June 7th.

Here in Virginia, that means that our long distance routes, the Crescent, the Palmetto, the Silver Meteor, and the Silver Star will all be scheduled to restore by June 7th.

We will have some changes in our Roanoke route

On our weekend schedule, our weekend northbound train is now going to depart Roanoke at 855 a.m., which is 15 minutes later than our current schedule, which means they'll be arriving at New York Penn Station just after six o'clock, again, 15 minutes later than its current schedule.

That change is being made in order to reduce some conflicts with other long-distance service in the corridor.

We will also be looking at restoring our Washington to Richmond route and potentially with an extension of that route to Richmond Staples Mill Station sometime in 2021.

That is something that we are working on right now with Amtrak to determine when we can restart that line.

As far as ridership goes, our March ridership for 2021 is down about 60% compared to March of 2019.

However, this is a

Improvement over where we were in February, we actually had our March 2021 ridership was about 53.4% higher than last month's ridership in February.

And so, excited to see that ridership is building up.

We're also starting to see increases in bookings as well, indicating that we expect to continue to see ridership increasing over the next couple of months.

So with that, does anyone have any questions about those items in my report?

Nope.

Okay, great.

Great.

Thank you, Jennifer, and good morning, everyone.

Just wanted to reiterate what the Board Chair said.

We're thrilled to have both Mike and Steve on board as COO and CFO.

It's an exciting team, and we're looking forward to really transforming rail with the projects we have in front of us.

Just a little bit of what you can expect over the course of the

next month between now and the May board meeting.

Mike, Steve and I are getting together on the hiring plan and we're going to come back to the board in May with a more detailed hiring plan to include the prioritization of positions, who comes first and when that will all cascade out.

So you'll see that in May.

Additionally, we're also going to be developing a set of standard reports that we'll be sharing at every board meeting to include operating statistics, ridership, revenue, financial update, and also updates on projects.

That way you can see every month, you can see the same information in the same format.

I'll be reaching out to each of you separately over the course of the next few weeks just to get a sense for

What you think of our draft and to get some feedback from you.

We want to make sure that these reports are comprehensive and also give you the information that you need.

and then finally on day one we're going to be quickly prioritizing the policies and procedures that we need to put into place.

Right now obviously a brand new authority we only have one policy and we're looking to get those guidelines in place quickly so we can run them by the board and ensure that we've got the rigor in place to mitigate risk and make sure we've got processes in place that we can all follow.

So that's what you can expect over the next month.

Again, day one, I'm excited to be here.

Everybody's been fantastic.

The last couple weeks have been getting briefings and just being indoctrinated to the team.

And it's just it's exciting and I'm thrilled to be here.

Great, thank you.

So our next presentation is going to be on the statewide rail plan, and I'm going to invite Emily Stock, our DRPT's manager of...

All right, never mind.

We're going to start with Jeremy's presentation.

We've had a lot of questions related to ridership and also fare policy.

how that's set and also the role that the state plays in marketing.

So Jeremy is going to be giving this presentation with Haley Glynn as well to discuss, get into more depth on some of those topics.

All right.

Thank you and good morning.

So Haley and I will be talking about ridership and we're really going to focus on what happened during the pandemic, but we're going to kind of give you some background there.

If you have any questions during the presentation, feel free to stop me.

We'll do my best to answer your questions or get you those answers later.

And also, I have asked DJ if he has any insights from being at Amtrak that he wants to offer during the presentation and would be welcome.

So we're going to talk first about balancing ridership and revenue.

And it's not just a platitude, though it sounds really good, but it's actually data-driven strategies with marketing efforts, which those marketing efforts have to be dynamic and evolve as trends evolve.

And so when we talk about ridership and what drives demand, the list here is not exhaustive.

Many factors go into it, but if you look at the Venn diagram, that's a place to start and just see how some of these factors not only affect demand, but also work together and influence demand.

So if I'm going to go to Washington, DC, that's a destination that served.

If there was a destination that's not served, obviously the train isn't going to enter the equation.

But once I know where I'm going and the train is an option,

We're going to look for schedules that are convenient that get me there about when I need to be there, not three hours ahead of a meeting or not three hours after a meeting to get me home.

And then also not too close so that we have to worry about on-time performance and that last mile of connectivity if I have to jump on the metro.

And then of course ticket prices are an important factor because if we're talking about personal travel and I'm

booking in advance, booking vacations or something like that, it might be a bit more price sensitive than if I'm getting reimbursed for business travel where the price might not be as important in the equation.

So many things can affect demand.

When it comes to revenue drivers, there are many different price points and we can target those price points based on various factors such as demographics or the time of the purchase.

Typically, there's more choice when you're purchasing in advance.

And Amtrak tickets in Virginia, if you purchase 14 days in advance, you're going to get 25% cheaper tickets than you would if you were to purchase after the 14-day window.

That's also going to be something that marketing strategies look at.

They're going to include discounts for various demographics or various other reasons, flash sales.

but also they're going to make sure they're advertising to the right market and making sure they know that the train is an optimal choice for their travel.

And I just wanted to also mention that we have some of our own marketing efforts that we coordinate with Amtrak.

We have quarterly meetings where we get reports from Amtrak on their national strategy.

And so if Amtrak's making ad buys, say radio time up in DC and Northern Virginia, which is a pretty expensive market, then

we may opt to focus our efforts, say, in the Northeast to let people in the Northeast know that you can travel to Virginia by train.

So we want to make sure we're coordinating on the national and state level as well.

In 2017, Virginia, or DRPT, began a fair analysis report with AECOM, and this was in part due to some changes that Amtrak had implemented.

They had eliminated or reduced some discounts.

Amtrak

Of course, they are concerned about ridership, but they were on this track to maximize their revenues and show a profit, which I believe they were intending to do before the pandemic changed the outlook for Amtrak.

But states such as Virginia and some other states were very focused on ridership as well.

And that's something that came out of presentations with the Commonwealth Transportation Board

You know, as we're looking at this fare analysis report, another reason for this was that we did have an off year with some ridership and that was large part due to weather events.

We had not just the typical snow events that can cause cancellations and services, but we had a particularly wet summer which caused some washouts.

And then combined the things like track work and things just in the elimination of some of the discounts all conspired to have a down ridership year.

So this fair analysis was to understand Virginia's ridership trends and demographics and recommend some of those, some discounts and marketing efforts going forward.

It involved four different groups over 12 days.

That group was dispersed around Virginia, so we marked here the train stations that were, I guess, the nearest train stations to some of those folks that were involved in the study.

and had a lot of data points and asking them about what influences their decision to ride the train.

What came out of that study, we had some existing promotions.

We had flash sale discounts, which are some of your best discounts out there.

You get up to 30% off during a flash sale.

Of course, that's very targeted.

If you don't know you're going to travel and you don't want to take that risk in purchasing it, then you're not going to do it.

But in many ways, that actually has boosted ridership

We also have the advanced purchase discount, which I had mentioned, you get within 14 days or more of your departure date, you can get a 25% off price.

And then we were looking at the idea of some additional promotions.

The intro Virginia discount is something that is in place.

Anytime you book within Virginia, and that includes Washington DC, you would get 15% off your trip.

We wanted to look at reintroducing the student discount that had been eliminated.

We looked at prepaid student ticket packages so if parents are dropping off kids and if you've been there and I know either you were a student or you've done this with your kids that you're writing big checks as you drop them off and so would parents want to go ahead and buy those tickets in advance so that the kids can come home during certain times of the year.

We wanted to explore that as new options instead of just a discount.

and then we also wanted to look at some of the promotions that had been eliminated or reduced, and specifically some of the demographic discounts, including students, but also seniors and military.

What we ended up with was the Intro Virginia, the student discount.

We also looked at their influence on ridership.

We also, I just wanted to mention this, is like in 2019, we had our 10 year anniversary of starting services, and so we offered $10 in the

First 10 days of October to get actually new riders, right?

Maybe riders that hadn't been on the train before.

Let's reach out and have the price is just too good to miss and get some new riders on there as well.

So looking at the influence of on ridership of some of these, we saw the flash sale had a kind of a good bang for its buck, but the intro Virginia discount particularly stood out as improving ridership with a minimal hit to our revenues.

The demographic discounts we did, Amtrak did reinstate some of those, and then the student discounts to the multipack, we actually ended up with a 25% discount for students in Virginia.

And I just wanted to kind of benchmark that, that in fiscal year 2018, we had 844,000 riders.

So we talk about ridership in a year,

We also need to know that ridership's gonna fluctuate throughout the year, it's gonna fluctuate between years, and there's also gonna be major events.

So fluctuating seasonally is something we expect.

January and February are typically our low ridership months, February being the shortest month as well.

That's usually when we see a lot of the weather events.

Then wherever spring break is gonna fall, either that March or April, we typically start to see ridership climb, and as weather gets warmer, we see more people are traveling, going on vacation,

that June, July, August, September period being the maximum ridership for vacation time.

But then we have the holiday season where around Thanksgiving, December, we have very large spikes in travel as well.

So we expect the high seasons.

We expect some influences from weather events in some months.

We try to track that from year to year.

So we know if one month was off, we go back and look and see why that month was different than the month previously.

What was the reason?

Try and pin that down.

But it's also going to fluctuate annually and that can be influenced by the customer experience.

It can be influenced by reliability trends on time performance.

One of the things that we've been working throughout the Transforming Rail Scheduling Initiative and VRE has also been working with us on this is scheduling in order to account for slow orders in the summertime, especially when

and the Richmond to DC corridor when there's large fluctuations in temperatures or it's very hot, they have to slow trains down for safety reasons.

And so that can affect schedules and on-time performance.

And so we want to schedule so that people get there when we say we're going to get there and account for those events if they happen regularly.

And then major events I wanted to point out.

Of course, we're going to go through what the pandemic has done that has been a historic

So, there are no questions on kind of

level set, what ridership and revenue and balancing that means.

I want to go through the pandemic and some of the impacts on service.

And this is really a history over the past year, which, you know, going back through all the emails and calls and weekly updates with Amtrak and the performance reports that they've been sending out, you know, pulling all this together, it was an interesting year with a lot of changes.

So everybody was really trying to grasp what this means.

as we were moving through it.

So pre-pandemic, things were looking really good.

Ridership was really high.

March 4th, 2019, we started that second Norfolk service that exceeded expectations.

Ridership in fiscal year 19, you remember in FY18, it was 844,000.

In 19, it was 924,000, so it was a huge increase.

Revenue was $41.5 million.

in October, November, and December of 2019 were the three highest individual months ever for the 10 years that Virginia State supported service have been in operation.

We had marketing strategies in place as a result of the study.

And so we have flash sales and student discounts and intro Virginia discount and group tickets had also changed in order to try and reach out to large groups and families.

And then multi ride fares had also been adjusted to at least match the price line of those purchasing in advance.

And so

Looking at the map here, the long distance service is in orange.

You have in the Carolina blue, the North Carolinian, the Carolinian train out of Raleigh, North Carolina that comes through Virginia and stops at Virginia stations.

And then the Virginia State supported service in navy blue.

So in March 2020, when we started to see people were staying at home and a lot of policies going in place,

You know, there was initially the CARES Act funding, which came out pretty quick and early on in the pandemic, where the states and Amtrak, and a lot of collaboration, and there was a request for $239 million to support the states for any loss in ridership and revenues associated with the pandemic and stay at home orders and that sort of thing.

The legislation said that states would owe 80% of the fiscal year 19 operating costs.

They capped how much we would owe, and then they provided $239 million to fill the gap.

In March 2020, as we were seeing ridership decline, working with Amtrak, and a lot of this is, you know, Virginia services go to Washington, DC, and then they continue into the Northeast Corridor, very much tied to the Northeast Corridor service.

It's heavily influential on the success of our service because of DC and the New York and Philly destinations.

So coordinating with Amtrak, we decided to cease one round trip from Newport News as ridership was falling.

Amtrak had waived their change in cancellation fees, and some of our train consists were reduced in size because of the reduced ridership.

And I'll just kind of toggle back and forth to show you that as the map changes.

So we just reduced that one daily round trip out of Newport.

In April 2020, we really saw ridership decline quickly.

Ridership dropped by 95.7% compared to April 2019.

Restrictions were implemented without clear federal guidance.

A lot of reaction from different states.

States started canceling services.

Some states were just reducing services.

It was a lot of coordination, a bit frenzied.

But Amtrak began weekly update calls for states and stakeholders.

started coordinating on what this means to cancel service.

And as you can see, we stopped the additional Norfolk train and the Carolinian service operation at that time.

So we also stopped one of the Richmond trains.

So by May 2020, when ridership had really fallen, Amtrak

sees their long-distance service, which, as you can see, long-distance service is a big part of Virginia's overall service offerings for intercity passenger rail, and although the auto train remained in service.

At this time, there was also some track work, so there were some cancellations south of Richmond that were already planned, but overall, you saw a drastic reduction in intercity passenger rail service, and we acted on Amtrak's recommendations to reduce service

Again, coordinated with the Northeast Corridor as ridership continued deployment.

So May was really when we saw our least amount of service with one round trip out of Roanoke, one out of Norfolk, one out of Newport News, and nothing out of Richmond.

Though Richmond still benefited from state supported service through Norfolk and Newport News, there were no long distance services offered.

So by June 2020, long distance service was restored with restrictions and safety protocols in place.

The Carolinian was also restored.

We remain at what we now call 50% service level.

So we have that one route trip out of Roanoke, Norfolk, Newport News, and nothing out of Richmond.

For June ridership was 79,000.

That was down 84% compared to June 2019.

And I just want to mention that as I kind of report what ridership was, we often remember we're offering less services and there's a lot going on with restrictions and people not traveling anymore.

So with weak demand, Amtrak lowered prices 25% on the Saver fares, which is most restricted, and then also the 20% on the value fares, which have a little bit more flexibility.

But again, Amtrak had waived their cancellation and change fees.

So I'm just trying to toggle back and forth.

So we had May where service is drastically reduced.

We regained long distance service.

Carolinian came back online.

Richmond or Virginia service still operating at 50%.

By September 2020, we went to what we call 80% service level.

So the only state supported service not in operation as of September 2020 was the Richmond service.

And that was mainly because we have two out of Norfolk and two out of Newport News that serve Richmond.

September ridership was 76,000.

So that's down 71% compared to September 2019.

and we started to hear a lot of talk about Amtrak going after furlough and layoff employees and buyouts.

CARES Act funding was coming in.

It was anticipated to run out by the end of the year, so there were already discussions about additional federal support because we saw that ridership really was not coming back very quickly, though it had somewhat stabilized, but it was very, very low at like 25% of the prior year.

So the states and Amtrak were requesting $350 million of federal support, and additional fare adjustments were made, again, with weak ridership, multi-ride ticket prices were lowered, cancellation fees were reinstated, but the change fees were still waived so that people could make their reservations essentially risk-free because you could just keep a credit and change your trip as necessary.

So by October 2020, and this was something that had been discussed throughout the summer and fall, that Amtrak was looking to reduce their long distance service.

And there was a lot of talk among states worried about, you know, sometimes when a long distance train is canceled, that can be a benefit to Virginia ridership, because that means some people who have ridden on that service are now going to ride on ours.

But overall, it reduces the options for folks to travel.

So seeing long distance service go to three days a week,

worrying that that is not a very convenient schedule to bring ridership with some of what was discussed.

But FY21, so federal fiscal year 21 begins in October and we started with about 25% of fiscal 2019 levels.

And that's kind of where things hovered for a while.

Ridership overall for fiscal year 20 was 510,000.

So remember in fiscal year 19 it was 924,000.

And we were

into a healthy February when this all really took place.

So we had a good number of months under our belt.

It's really that second part of the year that was really weak on ridership that brought us down, $510.

And revenue, of course, was much lower as we were lowering ticket prices and not getting customers as well, so $22.2 million compared to the $41.5 million in fiscal year 2019.

So our fiscal 20 operating agreement actually has an extension clause that we are operating under because we typically get ridership forecasts and revenue forecasts and a lot of the things that during the pandemic it was anybody's best guess where this was going.

So we're operating under an extension clause while we're figuring that out.

We do have forecasts now.

We are going to do a fiscal 21 agreement.

But marketing, and Jennifer mentioned this in her talking points and Haley's going to go into some more detail, but marketing was under the travel restricted phase.

Prices remained low and the CARES Act funds remained to help with operational relief.

By March 2021, so we kind of like we're stable from October, due to the holidays, we kind of ramped up for the holidays with state supported service and we have long distance service back.

But by March, Amtrak had restored the Silver Star and the Silver Meteor because those two had been combined, but long distance services were still

three days a week.

Federal relief was provided to the states in December 2020.

There was another 175 million passed.

Now we had asked for 350 million and the thought was there's going to be more legislation in the beginning of 2021.

So at the time in December 2020, some of you all remember during our budget discussions for the VPRA, we budgeted very conservatively for operations because we didn't know what federal legislation would actually materialize in for the state supported services.

By March 2021, we did receive another $175 million towards state supported services.

So combined between those two, Virginia is going to have $25.2 million in relief to support reduced operations loss and ridership revenues.

So comparing where we ended up during the pandemic and where we are, the blue line is an average of the three years before the pandemic.

and the orange line is fiscal year 20.

So you can see in February where we were above average for the three years and then things fell apart and by April we had our lowest point.

And then we steadily climbed back up and where we've hovered now is about that 25 to 30 percent of fiscal 2019 ridership.

But I will also mention, it's not so bleak as we're saying bookings are definitely picking up.

And as we're reporting in March, we saw ridership was much higher, 53% higher than it was in February.

So we're starting to see some of those ridership gains.

Just to summarize again where we are with federal relief, the CARES Act provided 239 million, Virginia's share was 22.5.

And then the two subsequent federal relief bills, CRRSA and ARPA, they

provided an additional $12.6 million to Virginia State supported services, respectively.

Those efforts were a large part, in large part due to coordination through Amtrak and the Federal Road Administration, SAPIR-C.

They all work together on that state.

SAPIR-C stands for the State Amtrak Intercity Passenger Rail Committee, which is the group of states that sponsors state supported service with Amtrak.

and there were also advocates through the states for passenger rail group to advocate for that additional funding.

Originally, federal support was intended to keep reduced services running, but later funder, later federal funding was intended to restore services, especially the Amtrak long distance services from three days a week back to full schedules and rehire Amtrak employees that had been laid off.

So here we are in traveled aloud.

It just seems to be a smaller window because we're going to quickly move towards travel encouraged.

But for a long time in FY20, we were under travel restricted where we were supporting the community and remaining engaged with travelers.

But we were not encouraging travel.

A lot of our discounts and things were not promoted.

Now, and I mentioned this before, that we have to kind of pivot and be dynamic and look for new trends.

Haley's going to talk about that.

We have some stir-kate crazy travelers that want to travel again.

We're starting to see the bookings pick up.

And as Haley will talk about, I think there's some opportunities.

We think there's some opportunities for engaging and getting new ridership.

And that has been in coordination with Amtrak, who is very much looking towards the future and grabbing as much of that travel ridership as they can.

So travel restricted was really from March 2020 through February 2021.

So through March and April, we're kind of looking at this travel allowed phase, we're in transition and we're planning.

And then starting in May 2021, when the 50% capacity is going to be lifted on trains and Amtrak Thruway buses, we're going to move into the travel encouraged phase.

April 2020, Amtrak had limited the capacity of trains to 50% and added a capacity indicator.

So when you're booking your ticket, you can see how full the train is.

That'll remain in place even though the 50% restriction is going to go away on May 23rd.

Pricing remains reduced at this point because of weak ridership and cancellation fees are still waived through Labor Day 2021, but we still have the waiver and change fees.

All right.

Thank you, Jeremy.

Sorry, Haley.

One moment.

Any questions for Jeremy?

I know there's a lot of information we just presented there.

Nope.

Okay, great.

All right.

Thank you so much, Jeremy.

And good morning.

My name is Haley Glenn.

I think before now, all of you knew me as the voice behind this platform.

but I am the public relations and marketing specialist for DRPT.

And this morning I will be giving a brief overview of Virginia Amtrak marketing strategy and how we've really had to adapt to a really changing environment throughout the pandemic.

A change that has kept us on our toes, thinking differently about

what the rider in the next normal is going to think, feel, say, and do, and how they are going to affect their ridership and their motivations for traveling.

We are seeing traveling sentiment move towards a more hopeful and optimistic direction, which is appealing to a different group where we are looking at that pinup demand, as Jeremy was mentioning.

So what is marketing's role in the pricing equation?

discounts, flash sales, and strategic marketing efforts are helping us and customers make potential, basically looking at their advantages of the exchange for purchasing the service.

And DRPT is really basing our marketing on research focus groups, and we are regularly using different marketing approaches to further test how they will affect the demand and usage.

Throughout the pandemic, we have been focused on meeting people where they were, but also reminding them that we are available when and if they're ready to travel.

We have really focused more on the essential travel needs versus leisure or business, how we were prior to the pandemic.

But we are now, so DRPT is evaluating optimal pricing

of Amtrak tickets to increase ridership on Virginia state-sponsored routes, which are managed through the operating agreement with Amtrak, the Northeast Corridor pricing, and our marketing efforts come at the expense of the agency.

We have taken numerous steps in recent years to further understand the complex issues of ticket pricing and to keep our fares moderate to maximize ridership.

Optimal pricing strategies must recognize factors that determine customer demand, including demographics, destinations served, trip links, reasons for traveling, level of service, when a ticket is purchased, and other transportation options, as Jeremy had mentioned.

Generally speaking, though, Amtrak controls ticket pricing, but our marketing strategies can help maximize ridership and impact the bottom line.

We do compete with Amtrak's long-distance services.

However, we do see the Amtrak brand as a complement to all of our state-sponsored services, and they do benefit the overall mobility of Virginians.

Next slide, please.

So we followed

Amtrak's phased recovery where there was a travel restricted, travel allowed, and travel encouraged.

We've remained in the restricted or partially allowed phase for a while, but I do like how this roadmap kind of set us up for safety first, safety plus, and enjoy the journey.

So what is the new normal?

We have followed the phase recovery for Amtrak,

and as travel sentiment shifts to a more optimistic outlook, we're excited to pivot our marketing efforts as well to help ramp up ridership.

So I'll be discussing each of these stages as we go through this presentation, and if you have any questions, please let me know.

Next slide, please.

So our marketing efforts went dark between March and June 2020 when the stay at home orders went into effect.

People were strongly encouraged to stay home and traveling was strongly discouraged.

From June to September, we did focus on awareness and top of mind messaging to ease back into our campaigns.

When you're ready versus a two sales pitch, assuming people were traveling,

We really wanted to make sure that we were sensitive to rider sentiment around travel as well as Amtrak National and the CDC guidelines.

We did do a few different flash sales during this time as we were moving into a travel allowed restricted phase.

They really did not do very well.

People just were not ready to travel.

We did a kid's BOGO sale in October and then a Track Friday sale after Thanksgiving.

But we did see a lot of cases in COVID rising during that time.

It was a pulse check that we realized that this just is not the appropriate time to be continuing these marketing efforts.

But we do see that that kind of correlates to how everyone's feeling about traveling.

Next slide, please.

So these marketing efforts were centered around safety messages and encouraging Virginians to take the train when it was safe and they were ready to do so.

Primarily, we focused on the essential trips versus leisure travel.

And then when we did a new sale, we did the Valentine's Day sale, which performed strongly.

And that was matching with data trends that were showing that people were starting to look at travel again, they were engaging more and more travel focused messaging.

So it was hopeful.

that really helps set the tone for our marketing plans in the future months, knowing that we have an accurate pulse on how people's sentiment towards travel was starting to become more optimistic and hopeful.

Next slide, please.

Next slide.

Sorry.

As we moved into the travel allowed phase, we still focus on safety and softer calls to action.

Prior to the pandemic, our CTAs were really focused on getting people to go and book now, but we really wanted to make sure that our call to actions were soft and that they portrayed how people were feeling.

So instead of book now, maybe it was learn more or something along those lines.

Our cell phone law campaign was running this month in April to coincide with the Distracted Driving Awareness Month.

And we really wanted to just focus more on efforts that that made people aware of the service but not necessarily pushing people onto the trains.

Next slide, please.

As we move into a travel allowed phase, we are focusing on different messages that are definitely more hopeful and fun.

So if you look at these ones, I love the, you're still going to be wearing a mask, but you're going to be smiling under it.

So, you know, people that have had this pent up demand for travel and they're starting to really

look at booking and they are dreaming about traveling.

So those are the people that we're appealing to now and making it a way that you're easing back, taking those baby steps where some people might not be ready to get on a plane and travel across the country, but a train is a really great alternative to travel within the state.

Next slide, please.

So looking into the future, we know that people are eager to get back out and explore.

So as we are planning for our next marketing campaigns, we are looking at that pent up demand for travel.

Moving forward, we recognize that there's been a shift in traveler sentiment and mindset and the need for travelers due to the pandemic.

People really, you know, even if,

You weren't a big traveler before the pandemic.

Because we've been stuck at home, there is a large market for people that are ready to travel.

So as we move into the travel encouraged phase, we will continue to see comfort levels evolve, but we want to meet people where they currently are and building upon that pent up demand and reminding Virginians of the wonderful destinations that are right at their fingertips with Virginia trains.

Next slide, please.

So if you see these strategies, so this is our next campaign that we will be launching as we move into that travel encouraged phase, really focusing on this new day feel that it is a bright future and that we can really capture all of these people that have been waiting to travel.

We're focusing on that resurgence in travel with optimism and hope.

getting out and exploring Virginia via train.

And we really do believe that this will be a great market share that we can capture as people start to get back out there.

Next slide.

So a big thing that we have seen is a shift in our demographic of riders.

So what's

What's been the big trend, especially on our routes and the Northeast Corridor has been younger travelers and a lot more new travelers.

So people that have never considered the train prior to the pandemic, we're seeing just a different group.

So these people that are getting out and exploring the train that have never ridden a train before.

So these younger riders and

were shifting away from our traditional ridership, which was traditionally leaning towards the older age category.

Next slide, please.

So our marketing objectives moving forward will be focused on attracting more of this younger audience, but also still capturing and maintaining our current ridership.

We do see that

You know, these new riders are more about experience and different types of traveling, not necessarily just riding the ride, but getting out there and doing it as an experience versus just a travel or mobility option.

Next slide, please.

So this is really the new persona of the new audience that we're trying to capture as we move into this new normal.

These are people that we, as in us and Amtrak, are terming them explorers.

So it's the curious minded person, the people that they don't just see traveling as point A to point B.

It's an adventure and

a way to recharge.

These are not the people that just see travel as a means from getting from one place to another.

So throughout the pandemic, they've spent more time dreaming of travel than actually traveling, but they are looking for opportunities to get away.

They are active and social and

Basically, they've been burdened by the pandemic, that it's kept them inside and they are ready to get away.

One of my great friends falls into this category and she's always traveling.

And I spoke with her over the weekend and she said, this has been the longest time that I've not gone anywhere and I'm just itching to get away.

And she falls into this perfect category of the people that we're now trying to meet with this new normal.

Amtrak is typically not on the radar of these people, but now with their curiosity and seeking different means of travel, they are discovering the train.

Next slide, please.

So our new marketing efforts will marry this new persona with our traditional travelers to expand service reach and marketing opportunities and Amtrak

Not only the better way to travel, but it is an experience.

So looking at data trends currently, I did want to put this in as a cap to the presentation just so that we're aware of what current marketing sentiment is and how people are feeling.

We are seeing that more Americans consider themselves ready to travel.

I think that

As the pandemic has progressed, we don't really know where people's mindsets are.

But recent data is showing that people are moving towards the readiness to travel and we really do want to capture that.

Their comfort levels are also on the rise.

There's more acceptance of people even.

So if you're looking at

Tourism or people coming to your communities.

People are actually accepting of that.

They're looking at wanting visitors to come to their area.

Let's see.

People are talking about planning their trips.

They're excited about going on trips now.

And I saw something recently that said summer 2021 is on.

I think that it was saying 80% of Americans are either have already planned a trip or they are

wanting to plan a trip.

So it's definitely, again, something that we are moving towards.

About half of travelers would be comfortable with a vaccine passport being required to participate in public activities or traveling.

I really don't know how that will work in the future, but also many travelers are seeing a return to normal.

As more and more people are vaccinated,

We're seeing that people are feeling more comfortable getting out in the public.

Next slide, please.

So in summary, as you know, prior to the pandemic, we were looking at historic highs as Jeremy had mentioned, but we do want to recapture that momentum as we move into the summer months and people start planning their vacations, we will continue

using Amtrak National and CDC guidance as we plan our marketing efforts for the future.

Our marketing will be designed to be agile and adaptable in case we see a resurgence in COVID cases, but we do hope that we're going to be moving in a more optimistic mindset as we go into the summer months.

We will continually keep our finger on the pulse to ensure that the current travel sentiments are reflected in our outreach and our marketing efforts.

And overall, we have had to be very, very agile and pivotal throughout the pandemic just to make sure that we were not tone deaf in our marketing efforts and that we weren't putting out anything that was not in

the safety interest of our riders.

One thing I did want to touch on before we wrap up the presentation was our Virginia Anytime Fair that Jeremy had mentioned.

I did see something that showed that our study correlated that it would result in a 6% increase in ridership, but only decrease revenue by 1.3%.

So when we are looking at

marketing efforts and flash sales and discounts, we are also making sure that we are maintaining a moderate pricing point that is going to maximize revenue and not lose too much of our overall bottom line.

All right, so next slide, please.

And I believe that's the last one.

So as we shift our focus from discouraging travel to encouraging it, what restrictions do we think stay in place as far as capacity?

things like that.

Clearly wearing a mask is still required and will be, I imagine, for some time.

So on May 23rd, Amtrak will be lifting their 50% capacity, but there will still be a capacity indicator when you book your trip.

So you'll be able to

Go online, book your trip, and see how full the train is.

So that will be the one thing that will still remain.

We're not sure how long masks will be required, but I would assume that we will be wearing masks for the unforeseeable future.

Other than that, they do still have the air filtration system that rotates the air every five to six seconds.

And let's see what else.

Great.

All right, well, thank you, Jeremy and Haley.

As DJ mentioned earlier, we are going to be providing with much more regular updates on Amtrak ridership and friends as well going forward.

But if you do have any questions about marketing or ridership, let us know and we'll be happy to fill you in some more too.

Thanks.

So before we move on to the next presentation, we do have a guest with us today, our new auditor, as Steve Pittard has reported,

to you all before we did engage in a procurement for an auditor for VPRA.

And he is here with us today, Rob Churchman.

Thank you, Madam Chair.

As Jennifer just alluded to, we conducted a request for proposals and a detailed solicitation to hire an auditor for the passenger rail authority.

I worked with the finance committee, developed the RFP document, and then the auditor of public accounts actually ran the procurement and worked with us on the team to make the selection.

We had a very good response to the solicitation, and we've made the award.

We felt very good about the pricing.

We feel very good about the quality of the team that we've selected.

and as Jennifer mentioned, Cherry Becker is the firm that we've selected and Rob Churchman is the lead partner that will be working with us throughout the engagement.

Rob has over 30 years of public accounting experience.

He was a partner with a big six firm and now with another national firm at Cherry Becker

and I have the utmost confidence working with Rob and look forward to that.

I'm hearing audio at least.

Thank you, Steve.

All right.

There we go.

Let's see if that works.

Good morning to all of you.

Thank you so much.

I know from your agenda, you have a full meeting apart, but I did want to come in and introduce myself to you this morning.

I'll tell you that we are, Terry Becker is very excited to be serving this just

Amazing new organization because I'm an Amtrak-er.

I mean, I told Steve during the interview process.

I've sent many a day north of the Long Bridge, waiting for CSX to get out of my way so I can get home and see my family on a Friday evening.

But we're excited to help be your service provider, as Steve alluded to.

And you weren't part of our proposal process.

You may not have seen our proposal we submitted, but we are top 25 firm in the nation.

I personally serve Ms. Bolova right now.

It's Fairfax's audit partner.

I do nothing but serve Virginia's local governments, some state agencies and so forth.

And we're excited because we see what this is going to do to Virginia.

And you're going to be flowing through all of our clients.

It would be from Arlington down here to Chesterfield and Henrico and Hanover, going out east to my client New Bernou

New Bernese or York County and down to the beach and so forth.

So we're happy to be here.

We think you've got a great mission and we're just excited to be part of someone who's going to help you achieve your goals.

Now, all I'm going to do is give you an audit opinion, but that's important in achieving your goals because it impacts capital markets and it impacts funding and so forth.

I'd be happy to answer any questions right now for you.

Again, I know you're all so busy and I didn't want to take a lot of your time because you've got a full agenda.

but I did ask and Steve was nice off the ground.

We had just a couple seconds to come here and just introduce myself.

We've already started planning with Steve for the audit.

This year is going to be different because it's new, you know, so we're going to work together and team up and get the report out by the September 30th deadline and, of course, report to you our results on the fair presentation of the financial statements.

Again, I'd be happy to answer.

but I know you all are all busy and don't need an auditor out anymore.

You want to I know I know I don't take a tax season and all that kind of stuff.

Great.

Rob, it's great to see you here and thanks so much for joining us.

Jennifer, if I may, I was just going to add that welcome board, Rob.

I'm excited to have your team on.

I feel very confident.

and I just wanted to also add that the reason the Audit Republic Council is involved, the Passenger Rail Authority is a part of the Commonwealth of Virginia's annual report.

It's a blended discrete component unit and per the code, we're actually required to have this audit done and required to get a full, cruel set of financial statements to them by September 30th because it's a very big report they're putting together of hundreds of different entities.

by December 15, I think is their final date.

So just wanted to mention we are part of a bigger entity.

Thank you.

All right.

Thank you again, Rob, for being here today.

Look forward to working with you.

All right, so we are now going to return to our regularly scheduled agenda.

So Emily, I see that you've got

Who profiles up?

Is one your phone?

Yes.

Okay.

See if I can.

I cannot move that one over.

Yes.

Yes, I can.

Pardon me.

You're good.

Thank you.

Yes.

Awesome.

Thank you.

Okay, so I am Emily Stock and Manager of Rail Planning for DRPT.

And thank you, Madam Chair and members of the board for inviting me to speak today and Executive Director Stadler.

I'm here to talk about the statewide rail plan, which we are kicking off

right now.

And Nick Ruiz, who is our project manager for rail planning is actually managing this effort.

So he's on the line too if we have questions.

Next slide.

So the rail plan is required by the Federal Railroad Administration every four years.

And the last

statewide rail plan we had was adopted by CTB in 2018.

And I'm going to turn off my phone here.

Okay, and the FRA approved plan makes state eligible for federal rail planning funding and just federal funding in general.

And so it contains data points and metrics that can be replicated and compared from plan to plan, state to state.

So it's pretty prescriptive, but that's by design so that we can have that continuity.

And it also shows a four year and 20 year planning horizon and group of projects and priorities come out of it.

So next slide.

So I mentioned the fact that this is a plan that's able to be replicated with some standard points.

We are going to change things up a little bit this year.

This is the third plan that I've been through as a member of the DRPT team and so we have a little more experience with it now and we're trying to make it our own while still fulfilling the requirements of FRA.

We plan to use a more easy to follow format this time.

We want to develop some specific freight and passenger rail policies to guide us and to guide VPRA decisions, help with VPRA decisions.

And we'll be doing it in conjunction with other statewide rail plans to show how future rail projects can move through the implementation pipeline.

but of course it'll still contain all of those FRA required metrics for freight and passenger rail and will be presented to the CTB for adoption.

Next slide.

Next slide.

The plan will be aligning with DRPT's mission

And as with all good plans, we're starting with a statewide rail plan process with a vision statement.

We're still in the process of developing that.

The state rail plan vision from our last plan is here on the screen.

It's a little hard to read.

The message to take away from this slide is that the DRPT rail plan will align with DRPT's mission.

and the vision and goals of V-Trans.

And V-Trans is the overarching multimodal statewide transportation plan.

And their focus is economic competitiveness and prosperity, accessibility in connected places, safety for all users, proactive system management and healthy communities, and sustainable transportation communities.

And we'll talk a little bit more about V-Trans on the next slide.

So as I mentioned, V-Trans is Virginia's multimodal transportation plan that lays out overarching vision, goals, and needs adopted by the Commonwealth Transportation Board.

And we're actually on one more slide forward.

Next slide.

I'll just keep their key.

There we go.

Awesome.

So, this slide shows a little bit about VTRANS and how DRPT statewide rail plan relate.

So, as I mentioned, VTRANS is Virginia's multimodal transportation plan.

And it's shown the milestones for this plan are shown in the columns on the bottom of the

The slide lays out its vision, guiding principles and goals.

It also has a midterm needs and prioritization process.

And we're finished that up just recently.

And now they're looking at long term needs and needs identification, and then strategic actions and recommendations.

And along the top here, we have information about the rail plan.

And in green, I'm showing here how the statewide rail plan process and trans relate to one another.

So we'll be guided by some of the same visions and guiding principles.

will be addressing midterm needs and long-term needs, and then informing the strategic actions.

V-Trans is led by the Office of Intermodal Planning and Investment, and there is a V-Trans Steering Committee.

I'm a member of that committee and work very closely with that group, so I'll be reporting back to them on our progress.

Next slide.

You're already on it.

Perfect.

Actually, we are on slide six now.

Rail planning policy topics.

So we've identified a number of rail planning policy topics that keep coming up from year to year.

And most are perennial issues that the Commonwealth has more control over now that Transforming Rail in Virginia has changed the landscape for rail ownership.

So some of those are planning in partnership with the VPRA because this is a new situation and freight rail preservation and access, Amtrak and VRE fare pricing policy, service expansion and development as we get more and more interest and ridership, station development, station area development,

rail banking, abandonment, discontinuances for trails and other adjacent uses.

So those are some of the topics we'll be looking into.

We'll be looking for feedback from you, from the CTB, from the public and other stakeholders as this moves ahead.

Next slide.

So the plan structure, here are the nuts and bolts of the rail plan.

which, as I mentioned, will vary some from the previous versions.

And what's driving us on this plan, Nick Ruiz, who is managing the effort for DRPT, has described this as a people-focused plan.

So this means that we want to look at the data.

Are the people and goods moving in Virginia?

Are they expected to move given expected demographic shifts?

And how can we prepare?

So we will be looking at

Standard Rail System overview and the baseline of rail in the state, and then looking at what our guardrails are, so to speak, and through the planning process in Virginia with V-Trans and DRPT, and then considering continuity and change as make recommendations.

So we'll be looking at current and future trends and the changes in the data, goals, objectives, and policies will help drive some of our recommendations.

We'll do a service development plan, which I'll talk more about in a minute, and then propose some passenger and freight rail projects in coordination with VPRA for four and 20-year horizon.

Next slide.

and DRPT gets requests from time to time from the General Assembly to study specific issues, specific rail projects, and one of those was to study the Commonwealth Corridor.

So Commonwealth Corridor is a cross-state passenger rail service that's being contemplated that would connect Hampton Roads through Richmond in Charlottesville,

and west eventually to the New River Valley.

And so it would take part of the Buckingham Branch Railroad.

So it would be examining how the service could integrate with service on the Western Rail service and then also the I-95 corridor.

And so it would be an opportunity to develop those Commonwealth passenger rail corridor expansion policies

and we will be doing some public outreach integrated with the statewide rail plan.

This is to be wrapped up about the same time as the rail plan.

It will be an element of the rail plan.

We also have other studies that the General Assembly has asked us to do.

One of those is for Bristol Rail Extension.

So we'll be looking at that as well, and also looking at Bedford, Clifton Forge, bus service, and Gainesville to Haymarket is one study that we're working on right now.

So those will be separate from the rail plan, but the Commonwealth Corridor, and next slide, we have a map here.

The Commonwealth Corridor study will, because it's really statewide, is something that we'll be looking at with the rail plan.

And I do, as we're looking at this map right here, I wanted to point out that in the eastern part of the state, we do have on the books a Hampton Roads Tier 1 environmental impact statement that was completed in 2012 with the FRA that recommends service Hampton Roads to both Norfolk and Newport News along each of those corridors.

So I mentioned a service development plan.

This is a component of the rail plan.

It's an element that incorporates the people focused nature of the analysis.

It's based on demand and demographic data.

We'll pull together information and methodology from recent studies, including the Transforming Rail in Virginia phase one and phase two service on the RFMP corridor, the service proposals in the western part of the state, also looking at VRE service and the potential for Mark run through

and other services and how to integrate other services like the Virginia Breeze.

And so we'll be incorporating our policies that are developed through the statewide rail plan process, demographic data, and this will really be the latest and greatest to help inform a vision for medium term and long term horizons and for the service for those horizons.

Next slide.

So we have a robust public stakeholder outreach plan started and we're doing some initial scoping meetings in May of this year.

And of course, we'd like to come back to you, VPRA, very soon to talk more about the rail plan.

We will be talking about some of the short-term and long-term recommendations in the fall

and we hope to finish things up early 2022, spring 2022 and go out to the Commonwealth Transportation Board.

Next slide.

So that concludes this presentation.

Thank you, Emily.

Okay.

Seeing none, then we are going to transition into Emily's next presentation.

which is related to station policies, needs assessment, and our prioritization strategies for station funding.

And as a point of background, this was actually a topic of great interest to our Commonwealth Transportation Board as they were reviewing the VPRA budget.

And I know there were some questions about what kind of funding has been set aside for station upgrades, whether they be state of good repair upgrades or access

improvements or expansion improvements as well.

We are still in the process of doing some of that planning.

But in the meantime, as we are updating our statewide plan, we'll also be taking another look at the station policy as well.

Alright, so I'll be talking about DRPT's rail station policy.

This is one of those policy items that I mentioned that the rail plan includes, and so this will be included with that effort.

I'll specifically be talking about station needs assessment and prioritization strategies for station funding.

There might be a little bit of a delay.

So we're on slide two.

There it is.

Okay, so our current passenger rail stop policy is shown on this graphic here.

It's been about four years since we developed this.

And as we've

And since we've put this together, we've gotten a lot more requests for service and new stations.

So we're revisiting the current station stop policy and considering a needs assessment and prioritization strategies for station funding because so much has happened since the last policy was written.

We have new needs and really a new paradigm for all facility ownership.

Our new funding structure

has come along through the Commonwealth Transportation Fund.

Previous concept of ownership has changed with stations and platforms to be transferred to the ownership of the Commonwealth from CSX as part of Transforming Rail in Virginia.

And of course, the VPRA has been established.

The old policy assumed that DRPT

had the responsibility for stations and now future station improvements will actually be implemented by VPRA.

This slide shows a baseline of current station responsibilities between Amtrak and the Commonwealth.

Virginia currently doesn't operate any stations.

We're not responsible directly for O&M.

We're billed by Amtrak, and so is VRE for those stations that share the Amtrak service.

The Commonwealth is responsible for capital improvements for tracks and platforms, however.

So the bottom line here is that Virginia responsibilities will change as a result of ownership changes brought about by Transforming Rail.

DRPT is in the process of working out how things will change.

And we're developing this new policy and prioritization to spell it out based on our recent agreements with CSX, Amtrak, and VRE.

Next slide.

In 2019, we did a station needs assessment.

It's separate from the station policy, separate from the last rail plan.

And we wanted to get a baseline idea of station assets with the goal of a more consistent statewide customer experience.

We found that about half the needs are considered state of good repair and maintenance needs, and the other half are to accommodate higher capacity

brought about by busier stations and more ridership, more service as we experience growth.

And I just want to note the context for the numbers that you see here on the slide.

These are planning level cost estimates.

Yeah, I was just wondering for FTA state of good repair, I can't recall.

So the cost estimates that you're seeing here are not an assumption of VPRA responsibility or DRPT responsibility.

Next slide.

Yeah, you're going in and out a little bit, but why don't you continue?

I think you might have a delay of a couple seconds.

We can actually see the slides when they come up.

I can at least, I'm not sure about everybody else.

Okay.

Okay.

So this is another result of our station needs assessment.

It shows the needs station by station listed based on ons and offs.

Once we have better estimates and an agreement with FRA on our plan for funding the improvements needed for ADA compliance, we'll be able to work through this list and really get some better estimates and a plan together.

So, we plan to use

some of the funding that we have in the SIP from DRPT for planning and engineering to get better cost estimates and identify needs.

But our first priority is ADA compliance at platforms that we own.

The second is to deal with any unsafe conditions due to state of good repair needs, and that includes improvements at the etric station.

and these decisions will be based on an objective criteria.

And then once we have some better estimates and an agreement with FRA on our plan for funding and improvements, VPRA may need to consider putting additional funding into the budget.

I understand there is funding in the budget right now for this, but there may be some additions or some changes.

there and ultimately it'll be the VPRA board allocating those funds.

They're also seeking funding from others like Amtrak, FRA, localities to help fund the high priority improvements.

And with regard to that potential funding prioritization, as I mentioned, the guiding philosophy is really to

So how this relates, this is slide eight, how this relates to the statewide rail plan

The rail plan will help establish data-driven priorities.

So, you all are familiar with that.

So I mentioned some of the new station rolls already.

and this mentions our statewide rail plan that will really help with establishing data-driven priorities.

So we'll get some information from the rail plan on where people and goods are going, and we'll have the latest and greatest info on that to guide the list of priorities for stations.

Next slide.

So Virginia and Amtrak have initiated some station upgrades already to promote a consistent customer experience as new Virginia sponsored service was brought on.

To keep those improvements going, Virginia should prepare to continue leading them and seek out federal funding to offset costs.

And this is a list of some of those projects that are already in the pipeline at Ashland,

We are developing a concept for Bedford, Charlottesville, Roanoke, Trick is active, Newport News, there's construction underway for a new station, and then Staples Mill, we're looking at improvements there through a planning process.

So our new policy will help find how to go about this.

and our station needs assessment developed to help identify those needs for state-led improvements.

And the next slide show a list of all the stations in Virginia that will have some shift in ownership.

So, the varying degrees, the parking lot, platform, land where the station is going to be,

is shifting ownership in some way for these stations that some of which are Amtrak only, some of which are combination Amtrak and VRE.

Next slide.

Next slide shows a list of a subset of that list.

These are stations where we know that Virginia will be responsible for ADA improvements by virtue of owning the land.

So per the lease agreement that was finalized with Amtrak earlier this month, as a landowner, the Commonwealth will have the obligation to provide Amtrak facilities that can be used.

And this includes making ADA improvements for those stations that are not currently compliant.

And a station lease agreement also requires that Amtrak maintain state of good repair.

but now the Commonwealth will have the right to fix things at the stations if Amtrak fails to main station facilities.

And then of course, Virginia can elect to partner with Amtrak for mutually agreed upon capital improvements as well.

I think we will have more information going forward in the future about this issue of ADA compliance in particular.

Where we did take station ownership, we are inheriting some ADA compliance responsibilities.

And I believe I sent out, we sent out a matrix to you on Friday afternoon, which does include some information because the patchwork of the station ownership is different across the state

We thought it would be helpful for you all to have some sense of the context of the different ownership structures.

And because that does also affect maintenance responsibilities, but also ADA compliance responsibilities.

Maria?

Yeah, thank you.

Thank you for sharing that and a couple of questions slash comments.

I would suggest there's maybe two other important elements in sort of the philosophy that would be nice to see reflected.

One is the notion of connected.

which how are we really prioritizing multimodal connectivity to these stations, part of which the state will be a partner.

But as we've learned from major transit investments, like these are substantial investments and you can get better ridership returns when we're thinking about those multimodal connections.

And so to the extent that we're really elevating and explicit around our philosophy and our

preferences and partnership with local communities to make sure these stations are connected to the community.

I think that's consistent with what you laid out, Emily, but I think it should be elevated more than it is.

And then the other thing I didn't see mentioned in there that I would hope is maybe part of how we define state of good repair is issues around resiliency and energy efficiency, even within the stations that there's cost savings, but there may be some upfront costs for that.

I would encourage us to think about that and maybe that's something we can hear more about as things get over way and thinking about the state ownership and how that fits not just with the station but with parking lots and solar panels and all kinds of things.

And then I saw on one of the slides there was some potential funding available through CRF for station planning assistance and just really was excited to see that because I think particularly

for new stations coming online, that will be really important for the community, again, to think about how these projects link in with local development and connectivity.

Great, thank you.

And actually, I'm going to call on DJ real quick, because I know, DJ, this was an area that you were very engaged in when you were with Amtrak.

Is there anything you just want to add to

I do actually, thank you.

And just three comments on that.

First and foremost, the ADA was passed in 1990, so we're over 30 years late on that.

Making these stations compliant is going to be a top priority because really rail transportation is the preferred mode of transportation for folks that have special accessibility needs.

And the fact that we can provide them that transportation is just

is a huge, huge gap in our system.

So we're forgetting about the compliance with the law, and we should never forget about compliance with the law, but it's just the right thing to do for the community and for the train service.

So that's going to be a top priority.

Your second comment, and I'm not sure I have these in order, sustainability is also going to be huge as we develop these station plans.

It's astounding to me that you can walk through a train station that has literally hundreds of thousands of riders every year, yet there's no opportunity to recycle.

I don't think we, as a mode of transportation, and I'm not talking Virginia, really take advantage and leverage the sustainability options that are out there, and that's something that we definitely need to change.

And then the third and final point is from a funding point of view, there are plenty of funding opportunities that we can get access to that we should be tapping into to improve these patients because at Amtrak, we were woefully behind in ADA compliance and to Amtrak's credit over the last

Eight years or so, 10 years or so, they really picked up the pace and gone from having zero compliance stations to well over 100, nowhere near where they need to be, but really making great progress.

I think Virginia has to piggyback on that progress and really ensure we get our stations to a state of good repair.

And to do that, we need to tap the funding sources that are out there.

You can go to the next one.

And thanks for bearing with me with the dog barking in the background.

Apologies for that.

I love the points that you all brought up about connectivity.

It's really exciting to be able to do this.

We partner with communities and it can be a delicate dance, but being able to touch on land use around stations and connectivity will really make them more productive and user friendly in the future.

So thanks for

the time here and this is really a first step.

The presentation that I gave today is the beginning of partnering with you all to figure out what the priorities are going forward.

Great.

Thank you, Emily.

So with that, we have one item left on the agenda.

is our update on administrative items, and Steve Pittard is going to get started with that report.

Thank you, Madam Chair.

I really don't have any slides.

I just wanted to talk you through some items that we have been talking about over the past few months.

Obviously, we

completed the auditor selection and Rob joined us earlier.

He's very busy and I know he had other things to do and couldn't necessarily stay on for the whole meeting.

The next item I wanted to talk about was we had talked about contracting for payroll services.

We completed that process.

We're going to work with ADP.

It's a national firm with numerous Fortune 500 clients.

And the cost, and you know, the full build out, as DJ mentioned earlier, we're working on a staffing and hiring plan for the rail authority, but with a tentative build out of approximately 30 employees, the cost is going to be around $2,500 a year.

So, very efficient because they're good at what they do.

The next item I wanted to touch on is the Banking Services RFP.

We worked with Department of Treasury, worked with Finance Committee.

RFP has been out.

We got responses.

And I was informed this morning that I am allowed to talk through this a little more in detail than I was thinking.

So we got two responses, both the National

banking institutions.

They both have previous or current working arrangements with the Department of Treasury with the Commonwealth of Virginia.

And we, the team that did the selection included experts from the Department of Treasury and we have selected and we have the notice of an attempt to ward out Wells Fargo.

We're in the current process of working through some final contractual details.

With respect to fees, the thought process is there's a soft credit for the amount of funds that are in with Wells Fargo in their accounts.

And they call it a soft credit.

And the thought is that soft credit will offset the fees, which the estimate, and once again, we're having to estimate what we think the activity will be for a year.

was around $14,000 of fees, but once again all that being offset with that soft credit.

The other thing, and hopefully by the end of this week, those final items as far as terms we can work through and have a contract signed with them, which is a three-year contract with two one-year renewals.

The other thing that I wanted to mention to y'all today is, you know,

We do need to adopt an investment policy and this item and the next three items I'm going to talk about, I want to work with the finance committee, get a meeting in May and probably another meeting in June and then bring items to you to the full board.

But that investment policy is important because Jennifer mentioned we did financial closing CSX.

We did send the sizable amount of money out the door to purchase segment one.

That being said, we still have a sizable amount of funds, about $150 million of funding, which currently is in the general account of the Commonwealth.

And we're getting close when we get this banking relationship established.

We're going to be moving those funds out of the general account of the Commonwealth, and we're going to be moving off the state's ledger.

They've been very nice to allow us to utilize their

Ledger and their treasury services all year.

But when we do that, what I would like to do in the interim until we get that investment policy adopted by the board, my plan is to utilize what we call the local government investment pool, which is, it's like a money market fund that the Department of Treasury manages.

It's AAA rated by S&P Standards and Coors.

It's been around since 1981.

The three primary goals of the fund are safety of principle number one, liquidity number two, and rate of return being the third most important attribute of that government investment pool.

I guess I'll add to that.

I won't say all.

local governments in the state of Virginia utilize the local government investment pool, but most, the majority, most authorities similar to the Rail Authority utilize this pool for investment of excess funds.

So the plan will be, of that $150 million balance, about $140 million, instead of sending it through to Wells Fargo, we're going to send it directly to

the Department of Treasury and put it in their local government investment pool after we open an account with them.

And then the other $10 million will go to Wells Fargo, and it won't just sit in an operating account, it will actually be swept each day into a, to begin with, until we have an investment policy, it will be in a 100% Treasury money market fund.

And the earnings aren't

significant on these funds.

I think we all know right now very secure, with security being number one and rates where they are today, earnings aren't substantial.

But with 150 million dollars, you know, the difference between 26 basis points for the LGIP long-term part of that is a lot better than

one or two basis points in a checking account.

So that's the plan for now.

All right.

Well, going on, the next item that I want to bring to the Finance Committee and then to the Board

is as you know we've done a lot of modeling and scenarios testing with respect to the TRV financial plan and gosh we spent good 18 months and with COVID it required a lot of rework and a lot of testing of different scenarios as I think Jeremy's presentation earlier today showed the ridership.

I don't think anyone ever predicted that.

That being said, we have closed the transaction and now we do it appropriate to actually have a financial plan document that will be posted for all entities, all parties to be able to view.

That being said, I want to work through the finance committee and then present in June to you all that

that financial plan document with the goal being after our June meeting that we could put that document out for public review.

The other thing I guess I did want to mention too that we are, and I believe Jennifer has mentioned this, in working with Norfolk Southern, we have some initiatives going on there and those items similar to TRV as those negotiations are

ongoing.

We are holding information related to those close due to those negotiations and the impact that disclosing the full financial plan may have on those negotiations.

The third item that I'd like to bring to the Finance Committee in May and then to the Board in May as a

Director Stadler indicated, we want to begin, and I'd mentioned this, I think back in January, we wanted to begin some reporting, monthly reporting of financial results to the board.

And so I want to work with the Finance Committee, bring something in May, and then I see this as a very iterative approach for a while until we develop a good, one, we develop the processes to deliver good information, and then two,

Y'all give us the feedback of what you would like to see and how best to present that to you.

And the last item I wanted to bring up to y'all today was we are, you know, with the financial close of segment one, there are assets that were purchased.

And right now, those assets to expedite the closing of that process, those assets are in

the Department of Rail and Public Transportation's name.

And obviously, the underlying comprehensive rail agreement with CSX was signed by Department of Rail and Public Transportation.

As we've done, we've talked through in briefings before, these agreements have assignment clauses.

So one, we've got to assign that comprehensive rail agreement, but then two, before June 30th,

We'd like to get these assets, the underlying assets that were purchased.

And there's also some property that DRPT currently owns.

When we expanded parking out of the Staples Mill Station a few years back, we purchased some property there.

And that property also we see moving over to the Passenger Rail Authority.

So by June 30th, to avoid some unusual

to avoid crossing over June 30th and having certain fixed assets that land assets and infrastructure assets in DRPT's names, but passenger rail authority having, so to speak, a right to those assets and working through various do to do froms.

and as I mentioned earlier, all of this activity rolls up to the Commonwealth's report.

We deem it best to get those transfers accomplished before June 30th.

Our attorneys have been working on it.

They see a very easy process to be able to have this happen.

We just want to have the opportunity to brief you in May so you fully understand what we're going to.

One, the agreement we're going to sign, and then two,

exactly what properties we're talking about to have the passenger rail authority take title to.

Okay.

Well, that concludes our open session agenda and we are planning to go into closed session.

Happy to do that.

You can hear me okay?

Let's see.

I move that the board convene in closed session pursuant to section 2.2-3711

A6 for the purpose of discussing potential transactions where bargaining is involved and where the financial interests of the Commonwealth would be adversely affected if the discussion were made public at this time and pursuant to Virginia Code Section 2.2-3711A8 for the purpose of consulting with legal counsel regarding provisions in the agreement requiring legal advice.

Additionally, I move that staff and attorneys attend the closed session because their presence is deemed necessary and will aid the board in its consideration of this matter.

Great.

Thank you.

Second.

Madam Chair, before the vote is called, I have a disclosure I need to make before we go into closed session.

All right.

Pursuant to Virginia Code 2.2-3112-B-1 and 2.2-3114-F with regard to transactions concerning Norfolk Southern, I disclose as a stockholder and retiree I have a personal interest as defined by Virginia Code 2.2-3101.

Notwithstanding this personal interest, I am able to participate in the transaction fairly, objectively, and in the public interest.

Yeah, this is Paul Nichols.

I just wanted to make sure you had me down for today.

I had trouble getting on because I was muted from the beginning, but I'm finally on.

Great, thank you.

And I think we've got Victor Cardwell on as well now too.

Yes, Madam Chair, this is Wick.

I have searched my email.

And for some reason, I am not able to find the language which my distinguished colleague Deb Butler Painter just read.

Thank you.

Okay, with that, I would like to ask, I'm not sure if it's Joy or Bridget to take the role.

If everybody could mute, please.

And Bridget, are you there?

I will go ahead and call the roll.

Ms. Butler Painter?

Aye.

Ms. Dorsch?

Mr. Facet?

Ms. Nolik-Niec.

Aye.

Mr. Spore.

And Ms. Zimmerman.

Aye.

Okay.

Madam Chair, that concludes the rolls.

The ayes have it.

All right.

Thank you.

So, you all should have received a separate

Link for the closed session meeting from Joy Harris.

So why don't we give everybody about a five minute break and we will reconvene over there at 1210 and begin the closed session.

When you do exit the webinar, please make sure you click exit webinar, not end webinar for all because I believe they're going to leave this line open for any members of the public that may join.

So, all right.

Okay.

Okay, I'm going to call the open meeting back into order and read the following motion.

We are now going to take a roll call vote and I ask that each member indicate their agreement with the following.

To the best of my knowledge, during the closed meeting, the only matters heard, discussed or considered were those matters lawfully exempted from the open meeting requirements under the Virginia Freedom of Information Act and only those public business matters as were identified in the motion

by which the closed meeting was convened.

Okay.

For Ms. Bulova?

Aye.

Ms. Butler-Painter?

Aye.

Ms. Dorsch?

Mr. Nichols?

Aye.

And Ms. Zimmerman.

Aye.

Madam Chair, the ayes have it.

Great.

Well, thank you all very much.

Our next board meeting will be, I believe it is May.

I don't have it right in front of me.

It's May 28th, I think.

but the last Monday of not Memorial Day weekend.

And look forward to seeing you all then.

If you have any questions, also keep an eye out for some invitations and we hope to see you all very soon.