Board of Directors Meeting   9/28/2021

I apologize, DJ.

We were just informed by somebody watching that the live stream is down, so Joy is just checking real quick.

I want to make sure that we're still recording.

We are?

And if you could make sure you're speaking, I think it's hard for people to hear.

Thanks.

Sorry, my apologies.

As part of that, we are working with Amtrak.

I'll talk a little bit about ridership in a moment, but we're working with Amtrak and we just entered into a 50% off sale that's designed to boost ridership between September and right before the Thanksgiving holidays, traditionally a time that is a little bit of a dip in ridership.

It will allow us to, once again, remind people that, hey, we're winding down from the pandemic, hopefully, and the train is still here, an effort to boost ridership in the next couple months.

Additional updates, if we go to slide four,

I can't see what slide we're on.

Buckingham Branch Railroad is part of our acquisition of the rail lines from CSX.

Buckingham Branch Railroad had a lease agreement with CSX to operate on the railroad.

They had to go to the STB to apply for a permanent operating easement, which they did, and we

supported that filing.

We just yesterday put in our filing, which will allow us to, if approved, take the railroad from CSX closed before November 30th.

So that's another step in us acquiring the right-of-way, which will be critical to all of these initiatives.

Also following closely the legislation on Capitol Hill, I will not make any projections or assumptions on what's going to happen, only assure you that we're watching it closely and looking for any financial opportunities that may be presented.

We're partnering again with VRE with Amtrak, looking for opportunities to get funding for the projects and perhaps accelerate projects.

I want to be very clear, the schedule for Long Bridge cannot be accelerated.

We're not going to get that done any more quickly.

But what hopefully we can do is, if we get the opportunity, move some of those phase three and four projects forward and get them done, leveraging the fact that we'll have crews there doing the work.

Let's do more work.

and then finally we're also reviewing the CRISI program which has applications due at the end of November for potential Virginia projects and we'll update the board as we decide what to go for there.

On slide five, from a ridership point of view, August we saw a slight dip in ridership, about four and a half percent, which could be concerning, but if you look back in past pre-pandemic August, we'd actually see dips quite frequently as folks get away from the summer holidays and start to head back to school and quote unquote normal life.

So we're watching that closely.

We're not concerned, but as COVID, the variants come in, we just want to make sure that we are proactive in encouraging folks to take the train.

As you see the trend on the chart from February, we really have started a pretty significant recovery and we were up to about 60% of where we were in 2019 and that trend continues.

Next slide, we look at the year-over-year comparison.

It's important to note that again in August we were at 64% of August 2019.

This is without the Richmond train.

So the Richmond train that returned yesterday brings us back to 100% of the pre-COVID service.

This will help us get that 63% number even higher.

Bookings in September were just below 60% where they were in 2019.

Again, we're watching that closely.

And then finally on slide seven, we see the comparison of ridership fiscal year to date.

You can see it on the different routes.

It's pretty straightforward.

We continue to make progress and we're happy with that.

Finally, on on-time performance, on the next slide, we're very pleased with the on-time performance.

We are across the board looking at about 82% on-time performance, which is compared to an average of about 78%.

A lot of that is we've had fewer weather-related delays than we have in the past, and also there have been fewer speed restrictions.

Also, the summer knock on wood was not as hot, so we didn't have as many slow orders in place, which was good.

82% isn't great, obviously we strive for 100%, but the trend is in the right direction and you see it there broken out route by route.

No, but I do just want to first of all welcome Wick for being here and I believe Paul Nichols has joined us on the phone as well too.

Thank you.

Part of the challenge of VPRA over the last couple months has been standing up the authority at the same time that we're delivering the projects.

We have made great progress in the area of human resources and I want to introduce Pam Ash, who's the Director of Human Resources.

She's going to talk about our staffing path from one employee up to now double digits.

Pam will correct me and say it's not really double digits because they're people that have accepted offers but they're not on board.

But Pam's going to talk a little bit about the progress we're making in standing up the people side of the authority.

Alright, thank you very much.

Welcome, everyone.

So, as we've been talking about, we have been growing.

We are currently up to nine FTEs with two accepted offers, which will get us to a total of 11.

One of those accepted offers is our Information Technology Manager, Jason Cheeks, who will be starting next month.

And we have an anticipated start date for our Chief Administrative Officer also next month.

Our projected headcount will be 21 by year's end.

Key roles that will be encompassed in that upcoming projection will be our General Counsel, where we're interviewing for that now.

We just concluded interviews, Director of External Affairs, Director of Engineering and Construction, and multiple project manager roles.

as well as our project controls, oversight managers, and our real estate manager roles.

All those foundation roles to get us rolling, to get us going, no pun intended.

Okay, if you'll advance to the next slide.

Some of our accomplishments we've had, we've been focusing a lot on getting our compliance and other items set with it as we're getting set up.

Things that we've set up are e-verify with the federal government, our workers comp program with the state.

We've met the requirements for the Executive Order 18 for COVID and the vaccination status requirements, and currently all of our employees are fully vaccinated.

and we're working on developing policies for performance management in hiring, performance management, I'll touch on it in the next slide, and our ongoing work continues and working on our employee manual and policies to bring those up to date, meeting with consultants to build a compensation philosophy and policy so we'll be able to implement that, and continuing to build our HR practices and tools.

Next slide, please.

All right, so I wanted to touch a little bit on performance management because we have put that into place.

Our performance year will start in October, so just next week or actually at the end of this week, and last through September.

We've developed a program that consists of goals and objectives that are rated as well as competencies, which are organizational competencies that will be rated.

And then we're also including development goals that will not be rated but present that opportunity for people to grow within their roles or grow to the next role.

We have a three-point rating scale that exceeds solid performance.

It does not meet expectations.

And we will have tri-annual check-ins.

So every four months or so, folks will have that opportunity to have that formal sit-down with their leader to talk about how they're doing on their goals and competencies and how they can continue to grow within our organization for themselves professionally.

Our employees will have that opportunity to do a self-evaluation as well as participate in setting those goals with their leaders and rate themselves as a tool for their leaders.

And then the managers will deliver the final ratings on goals and competencies overall.

Thank you, Pam.

As you can see, we've got a lot going on.

These performance management foundations will really set the guidelines for continuing to grow the team and holding ourselves accountable for performance.

Any questions for Pam?

Okay, next up, Mike is gonna talk and give a capital project update.

Hi, thank you, DJ, thank you, directors.

So I'll go through this relatively quickly.

Next slide, if we can.

So we're starting at the top of Long Bridge.

Long Bridge continues to move forward, as you can see from the notes.

And I'm not going to read all the notes here for you.

We continue meetings with DDOT and with our preliminary engineering firm to move the project forward, survey and geotechnical work will also continue.

And Alexandria Fortrack, and I'm looking over at Rich because, sorry, Mr., Director Dalton, because they also have a project in the area at Crystal City, which we've had a lot of discussions on with them and Amtrak.

That continues to move forward.

We've had some good progress lately on some conversations with Amtrak and VRE regarding Crystal City Station.

We have our early works package there at a crash wall that many of you probably have traveled to National Airport.

You've probably gone over the road that goes over the railroad bridge without even noticing the railroads below and we are

Moving that crash wall work forward, as you can see from the notes, we did do some design revisions and the contractor is back on site.

And the construction of that Early Works package will be completed in November.

Frank Cooney, Lorton Third Main Line, that is six miles of third track.

We are working on something called project authorization notices.

You'll see that repeated here throughout the listing of projects.

Project authorization notices are something that we're working on with CSX as they're doing most of the construction other than Long Bridge.

We'll have project authorization notices so we allow them to move forward with the project.

The next one is highlighted, the Franconia Springfield Bypass.

That is one project that needs to catch up with the others with regard to 30% design when we entered into our agreements with CSX, most of the projects.

We're at 15 or 30% design.

Franconia Bypass is a new project south of the Franconia Station, so we have put out an RFP for 30% design, and we are close to finalizing that.

We are in the midst of interviews with some finalists there.

I mean, though, just quickly interrupt.

When Mike says it needs to catch up, it hasn't fallen behind schedule.

It started off behind the rest of them.

So it's still on schedule.

Yes, we did.

Sorry.

Thank you for correcting that.

With DC to RVA, that brought a lot of projects up to 30% design.

And so hence, this was a newer project to be identified during our negotiations with CSX that hadn't yet reached that 30% design level.

The next two projects, Rail Bridge over Newington Road and over Route 1, I'm actually going to talk about a little bit later.

But we are moving forward with some agreements with VDOT and I have a presentation to show you a little bit later on that.

Moving down to the next page.

Thank you.

These projects, we're working on project authorization notices with CSX.

And again, CSX is, a lot of this work is being done, constructed by CSX.

So working on project authorization notices on these projects.

And some of these projects are phase two.

If you recall, phase one is generally

scheduled to finish about 2026, and then the Phase II.

We continue to work on the definitive agreements, the comprehensive rail agreement, and to run operations and maintenance agreement with Norfolk Southern.

But in the meantime, project work still continues.

Noakesville to Calverton is a double check up just south of Manassas, and that project, the Roanoke Westyard project, we have authorized Norfolk Southern to move forward with those projects, assuming that we'll come to definitive agreements with them, and then they'll be eligible for reimbursement.

Salem to Christiansburg project is a project that VPRA will undertake because that is the line we're purchasing from Salem to Christiansburg.

Simply put, on the Norfolk Southern agreement, they will be constructing their projects on their right-of-way and their track, and we'll be constructing our projects on our right-of-way and our track.

And at Salem to Christiansburg, that includes some track work and also

Station Planning Work.

We are in the midst of determining the final station location in the New River Valley for Salem and Christiansburg and we do have a firm on board helping us with that.

The next page

Capital Grants Updates page.

These are other major construction projects.

When we say other major construction projects, these are generally projects that are led by other entities, but that VPRA and or DRPT have a significant stake in.

For instance, the Lawn Font Fortrack project, I'm looking over Director Dalton, and that is a VRE-led project, but there is 22 million in funding.

in the VPRA budget for that.

Arkenale to Powell's Creek, CSX is leading, and that is a project that is ongoing and should be actually finished soon.

As you can see, it's 83% complete.

Quantico Station, also within the same footprint as the Arkenale to Powell's Creek.

That is, again, being led by VRE.

That is a joint VRE, Amtrak station, but VRE is leading that, and we have significant funding.

in that as well.

Newport News Station, you're going to hear from Mike Todd later today who's in the audience.

He's going to give an update on Newport News Station.

That's an exciting project that broke ground.

I think it's hard to believe about a year ago now when Director Mitchell was out there.

And again, Mike Todd will give an update on that later.

Excellent.

I wanted to get a little more information on the Crystal City National Landing situation.

I know in here it says that the language is that

VPRA is working with stakeholders to incorporate an Amtrak Crystal City station.

And I know for a lot of people in Arlington and Northern Virginia, actually getting that Amtrak station is pretty significant to the airport and everybody else.

And I think everybody around the table understands that.

you mentioned that there were some late recent developments regarding Amtrak.

Sure.

I'm also looking at Director Stadler because he's also been working on this, but I think he's let me answer that first.

So we've been working with Amtrak and VRE, and the question isn't if, the question is when, as you allude to, I think all the parties agree that we're supportive of an Amtrak station there at Crystal City, it makes sense, but we need to coordinate that with the four-track work that CSX is undertaking.

Also be a benefit there for when the pedestrian overpass, as part of, as that's been mentioned, is planned to be built from the Crystal City side to the National Airport side, which is so important for pedestrians.

That'll be incorporated into the plans as well.

But the issue is getting the Amtrak station in there will be actually connected to the VRE stations as far as current plans are, be on the southern end of the VRE platform.

So there kind of be a joint platform.

I've seen this in other cities as well where you have a commuter rail platform, but it's lengthened to incorporate some benefits for Amtrak passengers.

The recent developments is that we've had some good conversations with Amtrak, Director Stadler, and other staff, and myself, so that we think we're in agreement on moving forward to allow for some track to be laid, sorry, to allow for design to incorporate a future high-level platform, but that needs to be incorporated.

We need to leave a footprint for that to happen with regard to the four tracks.

You have a high-level platform,

changing the track geometry a little bit.

So just if I can add to that, and thank you, Mike, that was spot on.

The agreement with CSX says that all, well with the funding agreement, says that all of the partners need to approve the 30% design in order for it to move forward.

And until recently we had not all approved that because there were concerns from Amtrak and rightfully so, they wanted to make sure that the design did not preclude

the ability to put in a high level platform.

And in working with Amtrak over the last few weeks, we've come to an agreement where we're going to move to 60%, they're going to agree to this, and we're going to show on the design exactly where the footprint for their high level platform station would be.

They're okay with that.

In fact, just this morning they sent a draft letter of acceptance that we need to review and make sure we're okay with, but we're now moving forward to 60%.

In the meantime, Director Dalton, or Rich as we like to call him, he's moving forward with his VRE station and we're moving forward with CSX on the fourth track construction.

From a timing point of view, those two projects will likely be done before the high level platform is in place, but the high level platform will be here.

and Paul

So the, you know, what some would think is that the most economical way is to just do it all at once.

That is not at the current time the plan.

It is to create the current VRE sort of single level platform.

And then at some future date,

And if that's the case, could you give us a sense of timing and what will ensure and likely be a timeline for that higher Amtrak?

Because I got to tell you, I mean, the airport and everybody, they want Amtrak to stop there so that the airport's there.

Everything else, it just makes so much sense.

I don't have the exact timeline because Amtrak doesn't yet have their designer on board.

They're in the process of procuring their designer, so I wouldn't want to speak to their timeline.

I will say, however, from just a pure stop point of view, when the VRE station is ready, everybody has been more than willing to say, Amtrak, you can put that on your timetable and you can stop at that station.

There is nothing that will keep Amtrak from stopping at the VRE station.

There will be wheelchair lifts and other accessibility needs addressed.

There will not be a high level platform there.

I should note as well, Amtrak still needs to fund the station too.

will also be for Amtrak to provide the funding for that station.

Right now, what is funded is the VRE station.

Yeah, and we all hope, as we know with federal money, that hopefully something will come available to assist Amtrak in this.

So did I hear what you just said?

Just to clarify again,

Correct.

And down the road at some point, there's nothing to preclude them from

adding and redesigning the platform.

No one else can stop them from doing that at a certain point in time.

I'll go further than that.

Not only is there nothing to preclude them from doing that, but the plan is for them to do that.

That's very helpful.

Also, if I can just answer the first question that you talked about.

I strongly agree with you that when you're out there doing work, you want to do as much work as possible.

Because earlier I talked about 82% on-time performance, and that's a great thing.

But when you have folks working on the railroad, you've got flaggers out there, inevitably you're going to be slowed down.

If we've got folks shutting down the railroad, we want to get as much work done as possible.

So we're working with all the partners to make sure we can leverage those outages to every extent.

I do want to note that at the L'Enfant platform, which is just one platform, this is a side platform, that has an Amtrak stop for state-supported routes and also a VRE station, I believe, actually, Mr. Director Dalton's busiest VRE station.

And the new Crystal City platform will be an island platform for both Amtrak and VRE.

will be an island platform, therefore two platform edges.

So there'll be even more capacity there, even though it'll be a low-level platform, then the footprint will be there to construct the high-level platform.

So there's a lot more capacity.

When we add that four-track, we'll have that two-track corridor just for passenger trains in the Alexandria-Arlington area and two platform edges at the Crystal City Station.

I have a question about the projects.

This is really an impressive list of projects, and listening to Ms. Ash talk about the staffing and project management recruitment,

I don't know who that's directed to, but I'll take that and just say that is the one aspect of all of this that keeps me up at night.

because there is going to be such a battle for talent if an infrastructure bill is passed to do construction across the country.

Sure.

So VDOT, to their credit, has done a great job of managing these type of complex projects over the course, specifically over the last 10 to 12 years, they've really picked up their game and shown us that they can deliver projects.

So on Long Bridge, for example, and on some of the other bigger projects, the Franconia Bypass,

They have been kind enough to let us tap into their resources, at least at the start.

As we're building up the authority, they have said, look, we will help you build these.

A lot of them are rail highway projects or rail projects that are close to highways, so they have the expertise.

We are going to be leaning on them heavily, at least in the first couple of years, on some of these more complex projects.

Maybe following up on that a little bit, I agree with you.

I think there's going to be a huge push for competition for talent, both for staff, but also for consulting firms.

So kudos for having so much stuff moving and trying to lock in some of those RFPs and consulting agreements.

I'm sure we'll see cost escalation happen as things move forward, too.

So two questions kind of focused on the Southwest a little bit, but one,

I would be curious if you're thinking about Virginia, we have some incredible engineering and planning graduate schools, like when you look nationally, and if there are opportunities in the career development, workforce development to actually build some intentional relationships with Virginia Tech, with UVA, with others,

where there could be opportunities in their own backyard to put some of these engineering skills that could be helpful and really give a state impact.

So we'd love to explore that, hear more about that, think about that.

And I'm curious specifically on the Salem to Christiansburg project, Mike, with the feasibility study that the consultants are doing, I can't recall from when we've talked about this before, is there a,

Any public engagement that's happening as a part of that and what kind of coordination is happening with the New River Valley Regional Planning folks.

Again, I feel like if we are committing to building a new station, we really need to see commitment from those localities to make the multimodal connections.

I saw yesterday Wyatt Gordon, who rode the train, got off at Staples Mill and was going to take the bus back and noticed the bus wasn't coming for like an hour and 20 minutes.

So I think it would be good to take a page from FTA's playbook of what commitments do localities have to really make the transportation and land use piece fit.

I know I've mentioned that before, but I'm just curious where it's at with this one in particular.

and just love lifting these up.

I saw the Governor's tweet about yesterday and in the comments there were people who were like, this is all Northern Virginia benefiting, what about the rest of the state?

So I'll handle them in order of ones you listed.

The public involvement, I attended a meeting last week with our consultants and our staff regarding the timeline.

and they most definitely have public involvement in there.

Later this fall and into the winter, there'll be public involvement.

It'll be about a six-month or so initial study.

As you know, with these environmental though, that'll then grow into a, during that study, we'll have a NEPA determination what that will be for that, especially for the station location.

Yes, there is heavy public involvement involved in the schedule and timeline for that.

You also I think asked about intermodal connectivity and I've been out there with, many of us were out there back in May when we announced the expansion of service

and that is a prime consideration.

Access for road, access for bus, access for pedestrian.

There's actually a popular trail that rides along that is in the corridor that we would like to, and Executive Director Mitchell and I, sorry, sorry, Executive Director Stadler and I were out there recently.

We walked it with one of our CTB board members.

We went up to it, and we would like to incorporate a trail if possible as well.

which is a heavily traveled trail in that area.

So yes, it's very important to us, it's very important and there's some housing developments in the area that keep growing and it frustrates me when I see the only way for some people, there might be a housing development a half mile away, but they have to get in a car and drive a mile or two whereas they can walk and I think it's very important to us in the Commonwealth.

that people can ride or bike or walk and not have to get in the car.

And sometimes when they get in the car and park in the parking lot, then they have another quarter mile to walk.

And I know you see this throughout the Commonwealth.

So that's something that I think we and VRE and Amtrak and others is very important to grow ridership.

Now, not only to grow ridership, but for environmental benefits and health benefits to allow multimodal connections, whether it be bike, walk, bus, car.

Then just briefly to your first comment, I feel like Mike asked you to ask that question because when we go through the work chart, he says now this is a position where we need a recent college grad or a graduate student that can come learn and then be our bench strength because we're going to need a continued flow of talent.

As you and I talked about last night, people aren't going to come to VPRA and stay for 20 years and work on projects.

We're going to have to have continued influence.

So building that bench strength within is critical.

Any other questions on capital projects?

Thank you.

This was good.

Now, Steve, let's talk about our finances, please.

Thank you, Director Stadler.

So I'll briefly take you through the financial report through the month of August.

Feel free to ask questions as we proceed.

So the first slide, please.

This is really a summary of the budget to actual.

If you recall, we had our budget broken down by operations, which included our Amtrak and our administrative operations and then

We had a capital projects section, which are projects we are managing and controlling construction.

And then we also have a capital grants section to our budget.

And at this point in time, I think the biggest thing for me to say here is the pro rata budget does not include the $200 million planned expenditure at the end of November.

because that would really throw the comparison out of kilter.

And then other than that, I think, as Mike said, there's a project or two that we're in the procurement phase, and I think when we did this budget back last December, we had hoped we'd be further along.

So there's that that's going on.

And then the third thing I think there's a factor going on here is

At the end of the year, we did full accrual cutoff and reporting, and so in a way, when we're presenting this on a cash basis, I don't want to say we're missing a month, but in a way, there is a month of activity with those full accrual activity that went in to June 30th that's missing.

Overall, I don't think there's anything to be of concern.

We are trailing the budget at this point, and I'll go through each item a little more as we move forward.

So next slide.

So this is our operations budget, and here you can see, as Pam spoke of earlier, our hiring is ramping up, and we are lagging a little bit on the administrative costs to date.

A lot of that actually is related to our IT budget and we're planning a significant expenditure there later related to an ERP system that hopefully as we get in the spring we'll be in a better position to be moving forward with that procurement.

Also, on the passenger service, our actual core operations, the Amtrak service, we're still receiving credits from the CRSA and CARES funding that we received, so that's why we're showing a positive variance there.

Next slide, please.

On our administrative budget, I spoke briefly about payroll.

The other item, once again, talked about the ERP system.

Really, the office rent, that's showing a variance, but that's because our contract in our building requires prepayment of the rent at the beginning of the year.

Next slide.

And this slide and the next slide are really, it's taken our budget for capital projects and then capital grants and it's showing where we stand on life to date.

You see the 200 million that I spoke of earlier that we're not gonna show that budget until we get to the month of November when we plan to spend it.

And I think Mike spoke of Franconia Springfield bypass that we're

in the process of doing the procurement there, and then Alexandria's fourth track.

I know we've led a procurement there, and I believe we're pushing one of those vendors to bill us a little more timely.

So those are the main points I would point out with that slide.

Capital grants, next slide.

So on the capital grant side, I think the main point I noted here

If you recall from last year on the VRE track lease payments, we had provided them some federal funding and they contracted directly with the federal government to receive those funds and so it created a variance.

We've also worked with VRE in the current year for them to reprogram some funding and to cover the track lease payments out of existing funds that they have.

as part of working through the other initiatives we have working with them, Norfolk Southern.

So that variance is probably the largest one there, and you'll probably continue to see that grow throughout this year.

Next slide.

Focusing on our revenues.

We do show a slight shortfall through the first two months of the year and it was somewhat of a concern because all the economic forecasts and indicators of revenue showed we shouldn't be looking at this and so we continued to push

Well, let me say this.

The funding that we receive at VPRA comes through several different state agencies until it finally arrives at Passenger Rail Authority.

And due to this variance, we asked a lot of questions and eventually were able to figure out that the fuel tax revenues had been collected, but they hadn't been transferred on, like VDOT hadn't received them, and then VDOT transfers to us.

And so

Not a reason of concern this shortfall.

It's just a timing issue, and not quite sure where the glitch occurred, but I've been assured that it's been taken care of.

Next slide.

So this is just a tracking, and all of these slides I'm gonna do an 18-month trend analysis, so a few more months until we get to 18 months, and then we'll start dropping a month.

Here you see where we started putting funds in the LGIP account, which is the local government investment pool that the Department of Treasury at the state operates.

We talked about that back in June.

We made that move before the end of the year.

You can see as we continue to bring in funds building up from when we had the large payout of $200 million, we continue to move those excess funds to the LGIP.

And later in this meeting, I will be presenting an investment policy that we spoke about in June at the board meeting.

I'm hopeful that we can get board approval and then maybe we can work in a prudent manner to improve

The returns are available cash.

Next slide, please.

And this final slide, I think just talked about trying to improve our returns.

Obviously, when it comes to priorities, it's the third priority.

The number one priority is capital preservation.

The second priority is liquidity.

and then returned, but I do wanna point out, last year we had a significant, I think it was around $2 million of investment income, and I just do want to lay the groundwork that last year, the LGIP account where the funds are today, at July of last year, it was earning about 0.4%, and today it's earning about 0.05%, and it's just what's gone on in the economy,

and I just think it's important.

Those percentages aren't large, so they don't seem big, but when you compare the relative, it's one eighth of the rate that we were earning last year when we made the $2 million.

So I think it's important to try to set expectations for the coming year, where we're going, we get an investment policy implemented.

I'm looking at this chart and it's going off a clip.

So what happened in March?

That's when we paid out the $200 million to CSX.

So our balance of funds- That was just purely on- Yeah.

And then what's happened since then is we've, well, really it happened all last year.

We've had a declining rate of return.

And I'm just using the LGIP return to demonstrate what's happened.

So it's,

Over the course of a year, it's gone from that old fund from 0.4% to 0.05%.

So there's been no change in the investment policy?

Well, we can't make a change to LGIP.

That's controlled by the Department of Treasury.

But we can decide whether we invest our funds at the LGIP.

And that's part of the investment policy.

I also want to add, because your questions, good questions.

Last year, the $300 million, I'm just going to use that number, it wasn't invested in LGIP until

in the past June.

It was invested in the general account of the Commonwealth, which does get a slightly different rate of return.

And actually, I'm talking with Treasury, last year it actually returned a higher return than the LGIP.

We are not allowed to utilize that general account any longer.

We have been taken off of the state's general ledger.

So it's not an option available to us.

But the hope will be

Yes.

I have a question about the investment earnings.

A source of funding for the operating or administration budget or it's not included in the budget as a source of revenue?

It was not factored in when we did the planning back last December into the budget.

Also, I would say these earnings are unrestricted, so they're not necessarily tied to pay for the operating budget.

So when we did, and maybe just once again I'll state it to you, when we did the budget, we had our revenues, which were Virginia passenger rail revenues, all our other sources of partner revenues, Commonwealth Transportation Fund revenues,

We factored in an administrative cost into that using those revenues and we did not try to project what cash availability we would have.

Yes.

And Hossein, I'll just add to that.

We didn't talk about this in the Finance Committee,

Budget right now has kind of dictated the timing of it because we have to report to the Commonwealth Transportation Board by February 1.

At some point in the future, it might be better to give us a little more time.

I think the CTB would still have adequate time, but we could do a better job with our budget if that date could possibly be moved and give us to have a better budget.

You all get better information and make better decisions.

Any other questions for Steve?

Okay, thank you all.

Great, thank you very much.

I have been informed by our Attorney General Representative that we, because we are conducting this meeting with a few people online as well as in the room, we will need to go back and redo the vote for the electronic participation policy to do a roll call vote because we do need to do roll call votes.

That was my oversight.

So I

I do not believe we need another motion or second for that, okay.

Those in favor say aye.

Those opposed say nay.

Ms. Bulova?

Aye.

Mr. Cardwell?

Aye.

Ms. Doersch?

Mr. Fisette?

Aye.

Mr. Hall?

Aye.

Mr. Moorman?

Aye.

Ms. Moses-Nedd?

Aye.

Mr. Sadid?

Aye.

Mrs. Spore?

Aye.

And Ms. Zimmerman?

Aye.

Okay, great.

Thank you.

And thank you, Julie, for correcting that.

So now I'd like to move on to the bylaws amendments.

And I,

We mailed out a copy of the proposed new bylaws last week.

A red line copy is also included in your package, in your folders.

It should be at the very back of your folders as well.

and there's a few changes here that I'll go through one at a time.

In general though, as we have been preparing our policies and procedures with DJ and the staff, we had identified a few areas where we required either some additional clarification of the bylaws or where there were some changes that we needed to better reflect the

the business needs of the organization, to also clarify some of the responsibilities of the executive director and delegate some responsibilities.

Mentioned before the electronic meeting participation policy, which we passed separately, but is also reflected here in the bylaws, as well as identifying which individuals have the authority to contract with federal agencies.

And again,

These have been some changes that we've identified as we've been going through our policies and procedures.

We did go to the Finance Committee this morning to discuss specifically the delegation of authority.

And I'm actually going to ask DJ to touch on that when we get to that section.

But first, hopefully you all have the track changes version in front of you.

And I'm just gonna walk through these on a section by section basis.

If you have any questions, please stop me as you go along.

So in Section 3.3, and this is reflected again in Section 3.6, we removed the concept of a specific annual meeting that, because, partially for two reasons.

The bylaws had originally stated that that would take place in July of every year because the first meeting of this board actually did not occur until October.

Also given the timing of some of our appointment cycles, which you all are on staggered appointments, which are effective if the appointments are made on time, July 1st of every year.

What I would propose is that we hold the election of officers towards the end of

the beginning of the calendar year.

What we had removed in section 3.6 was a reference to a specific annual meeting.

Rather than having an annual meeting, though, is that we would still elect officers on an annual basis.

Last night, I believe, Vice Chair Bulova had a suggestion regarding some additional language here to propose that we would still designate a meeting for the election of officers each year, but without specifying the month here in the minute, or in the bylaws.

So, Julie, I had asked you if you wouldn't mind proposing some language here.

So we struck the sentence that says in 3.6 the annual meeting shall be held preceding the regular meeting of the board in the month of July of each year.

And my suggestion would be instead that it say at the beginning of each year, the board shall announce the month in which the annual election of officers will be held.

That way you do it on an annual basis, and if you need to do it in October one year and the following year, you need to do it in November or whatever.

Yeah.

Yeah, so at the beginning of the fiscal year, do you generally, or is the expectation then that you will kind of lay out the months in which you'll be having meetings for the upcoming fiscal year?

And so then we would, that sentence would then clarify when that annual anticipated meeting schedule is, one of those would be designated as the month in which elections would occur.

Another question that I asked last night was are we, do officers, can officers only serve for, well, how do I put it?

Could we in the bylaws or somewhere indicate that a term is two years rather than one year?

I believe the statute requires that they be elected annually.

volunteering to run twice or to be in a position.

Be re-elected for another.

Yes.

Okay.

Great.

Okay.

So the next, in section 3.4 as well, we have identified some delegation of authority guidelines related to both budget and also to contract authority here as well.

and we did go over this this morning with the Finance Committee just to present this to them.

Okay, I'll go through obviously more on them in more detail at a very high level, and if there are more questions, we can dig into them.

I feel like the chart's pretty straightforward, but I just wanna walk through the different budget components.

The original bylaw language gave the Executive Director the authority to enter into a contract, agreement, or arrangement on VPRA's behalf

in excess of $2.5 million.

You can't do that without written consent.

And that written consent is a little confusing because if there's an approved budget, does that mean I've got consent?

Does that mean I don't?

And we just thought it would be best if we broke it out and made it very clear because we want to make sure that the board understands what they're getting.

So on the chart for delegated authority under section 3.4, there are four budget components, operations, administration.

That's just the VPRA administrative budget.

That's the payroll and the lease and the IT and those kinds of things.

And what we're proposing there is that we can redistribute line item budgets, but not go over the total.

But the one actually that's in your book has all of them, it's just not Red Line.

Sorry for that.

So the operations administration, that is the VPRA administrative budget, $5.2 million.

We are asking or proposing the authority to redistribute between line items but not go over the total without board approval.

The operations passenger service, that's the money that we pay to Amtrak for operations.

That's broken out by the different routes.

And the proposal there is that we can redistribute line item budgets without board approval.

If we add a new line item, so if we add a new route, for example, we'd come to the board for approval.

And if for some reason the

Costs from Amtrak are higher than expected, up to one and a half percent.

We could pay those bills or add those to the budget without board approval.

Anything more than a percent and a half, we'd have to come to the board.

And we just don't know what's going to happen with Amtrak as far as service disruptions or any unexpected costs.

From a governance point of view, we don't want to not be able to run the service or have to stop service while we wait for board approval.

We think one and a half percent is more than appropriate there.

Capital Grants, this is the $80 million in 2022 of the grants that we give to others for capital projects.

For that, we're proposing that we can modify any one line item or grant by $250,000 or 20% of the grant amount, whichever is less.

and then the overall budget would be capped at a change of 1.5%.

Obviously we could not move from one funding source to another to plus up a project if it's going to leave the funding source at risk of being underfunded.

Anything greater than that we would go to the board for approval.

Any new capital grant, any new line item, we'd come to the board for approval.

And then finally capital projects, which is the projects that we are managing with CSX, VRE, our partners, our true TRV projects.

We are proposing the authority to transfer budget from one project to another up to $5 million or 20% of the gaining project, so the receiving project.

Again, under the assumption that wherever we're taking money, we're not going to short a project or have to come back later.

Anything greater than that, we would come to the board for approval.

And that's pretty much the summary of the budget delegations.

Other piece of this is the next page, which is for contracting.

This, I think, is a little more straightforward.

These would all be things that are approved in the budget, and this just says when we sign a contract, for example, as part of one of those projects, if it's between $250,000 and $5 million, we just in our monthly report would say, hey, this contract was signed, this agreement was entered into.

If it's between $5 million and $50 million, we would let you know at least five business days in advance of us signing that contract or entering into that contract.

And then if it was $50 million or greater, we would just bring it to the board and get approval ahead of time.

It's just not good governance to sign a big contract like that without you all knowing, regardless of whether it was approved in the budget or not.

So those are our proposed limits.

Okay, before we move on to the other changes, any other questions about that Delegation of Authority?

DJ, I guess that you also have

I don't necessarily need to see them.

We discussed it.

We are waiting for this to be approved and we have our levels that we've talked about.

Okay.

And the printout that you all have of the red line is only, I think we've missed two-sided copies here.

So I'm going to point you to, in the folder, you have the un-red line version of the changes.

But we had a Section 3.4.3, which relates to the authorization to contract with federal agencies.

That is now actually a section

4.1, which clarifies that the executive director, chief financial officer, chief operating officer, and the general counsel are individually authorized to apply for, accept, and administer federal awards, and these would be with federal agencies, primarily with the U.S. Department of Transportation, but there may be other federal agencies that we have

agreements with as well.

This is something that we actually require for compliance with federal grant requirements and the ability to accept federal funds for the authority.

Okay.

And then, let's see.

Discuss the changes in 3.6, which actually are on your printed out copy on page five.

Under section 3.7, we have clarified some of the language around the conduct of special meetings.

And again, that was more of a clarification standpoint.

Likewise, in section 3.8, this again, clarifies that the meeting may be conducted with electronic means in accordance with a Virginia code.

Again, as you know, we just voted on the policy for that.

Under section 3.9, we made a change to the quorum requirements that is really reflected just to reflect what is in the code related to the quorum because the voting quorum is a simple majority vote of the members.

However, under the statute, it does also require that

related to the sale of land or issuance of bonds, that there must be an affirmative vote of nine members present and voting.

Question, Madam Chairman, on this area.

So section 3.7 says special meetings of the board may be called at the request of any three members of the board.

Couldn't camp the chairman also call a special meeting?

Again, that would be your choice, but you're right.

The way that the language is written, it does say that only if the chair wanted it, she'd need two other members of the board to agree.

I would, it seems to me, logical for the chairman to be able to call a special meeting without having to muster votes in order to make it happen.

So then I would suggest the change... Three members of the board or the chairman of the authority.

I think I would put the chair at the beginning.

Yeah, at the request of the chair or

Okay with that any comments or concerns?

Okay great.

Under section 3.10 just a minor change here the language referred to non-voting members we just changed that to ex officio again a clarification and I believe that is

and the majority of the changes there mentioned before the contracting authority and that should be it for the changes.

So any comments, questions, concerns about that?

Okay.

Motion to approve the amendments to the bylaws.

Okay, great.

Joy, would you do a roll call for it?

Those in favor say aye.

Those opposed say nay.

Ms. Bulova?

Aye.

Ms. Butler Painter?

Aye.

Ms. Doersch?

Aye.

Mr. Fisette?

Aye.

Mr. Hall?

Aye.

Mr. Moorman?

Aye.

Ms. Moses-Nedd?

Aye.

Mr. Sadid?

Aye.

Mr. Spore?

Thank you Madam Chair.

So I just wanted to take a few minutes to give you all an update on the status of the year-end audit.

It's a very important item being our first year and we're working to establish our relationships with federal agencies.

One of the things they want to see is an audited financial that shows you have financial capability.

So anyway, first slide, obviously, a lot of the detailed test work is completed.

Really, we're just looking at the one large transaction, CSX, which had a lot of discussion with our attorneys and with the auditors.

Not that it's any debate going on, it's just a very unique transaction that

extends until, I guess the way to say it is it's going to take about two and a half years to get clarity of the exact assets that we're going to own because there's a lot of survey work and a lot of deeds of confirmation that have to be accomplished by June 30th of 2024.

And then we have a couple of more segments that we

have in November of this year and November of next year that we anticipate that we will be assuming ownership of, but there's still work being done at the current time before those assumptions can be made permanent.

So it makes it a very unique transaction, and in fact,

essentially have said, yes, we're committed to the full 525 million as a liability, we've paid 200, and then we're calling it essentially as an intangible asset.

But that one item, still talking with the auditor about to make sure they're comfortable with the approach that my team and I came up with.

Also in October, so right now, the high-level plan by the middle of October will be completed with the audit, and then there'll be required communications that the auditors, you'll be seeing.

And then later in the December meeting, I think with this being the first year of the audit, I'm gonna, time permitting in our December meeting, I'd like for the auditor to come and present and talk with y'all, so.

And same thing with Finance Committee there.

So the next slide, please, is I just wanted to give you all in these next two slides just an idea of what are the two basic financial statements, statement of net position and then the statement of changes.

to that net position.

Just before y'all got a final financial statement, I thought it'd be prudent to at least allow y'all to see what it might look like, because it is a fairly large number, $800 million of assets and then related liabilities and equity.

So just really quickly, I'll just touch a few highlights.

We've talked about the cash balance that we've been

Having for the past year, because obviously the old rail programs that morphed into the Rail Authority had built up balances and the language transferred those funds to Rail Authority.

We have $20 million of receivables.

Just touch on that real quick.

It's the $9 million of our revenue for June that we didn't collect until July.

and also about a $9 million, $10 million credit that we have from several years back working with Amtrak to get some refurbished equipment.

And over time, they're providing us credit on the Roanoke train operations to pay us back for that.

But then if we proceed with our second Roanoke train, that credit will be accelerated.

And the last thing on the assets I wanted to touch on was that intangible that I spoke of.

So you see there it's the $525 million, plus we had some closing costs involved with that transaction.

And then we've had several consultants helping us and lawyers helping us, so there's several transactions.

about $6 million of transactional costs that we've capitalized during the last year.

On the liability side, once again, the $325 million to be paid the next two Novembers.

And then we have an unrestricted, so the net of that is a net position of $466 million.

And the way for accounting purposes, we take the net of our,

Assets, less the debt that's related to those assets, and you classify that amount as a net investment in capital asset, and then the remainder is unrestricted.

So next slide, please.

And this is our statement of changes in net position, and referred to

I think the main thing here would be to point out to y'all is the operating portion of our operations, I guess what we've determined is, you know, the core of it is operating our passenger service.

And so it's our cost to manage everything, but as well as the cost of running our service and then the revenues coming in.

It was very important to us to show the revenues.

I'll call it grossed up because right now our contract with Amtrak is we pay the net amount each month.

But under accounting principles, those revenues that don't actually get sent to us, they're really our revenues because we do control the service.

So from an accounting perspective, and it's very important for us to establish this in the first year that

Those are our revenues, especially because, as we talked about prior, two years out, we're two to three years out, we're looking at bonding against that revenue stream.

The other thing I'll point out here is you see the large transfer in of $320 million, $302 million of that was cash.

We had the credit that I talked about receivable from Amtrak of about $9 million and also another $10 million

Lost my train of thought, but I'll come back to that.

Sorry about that.

Then the next two items, the Commonwealth Rail Fund and Priority Transportation Fund, that is our standard revenues.

VPRA revenue funds is Commonwealth Rail Fund, our 93%.

And then the Priority Transportation Fund are funds that the Commonwealth Transportation Board has allocated to the TRV project, really goes back to Atlantic Gateway Project, that's sort of the precursor of the TRV project.

And what we did is we asked for them to send us those funds through the fiscal year 20.

And we also now are working with VDOT, who controls that fund, to bill them for the FY21 funding, which is about $88 million.

and what we're really doing is trying to repay ourselves for the 200 million that we've paid out on the original purchase of CSX.

The last item I'll point out there is the capital grants of $18 million.

So that is the expenditures we had under the long list of capital grants that when we did the transfer from DRPT,

If you recall, there was about a $45 million balance of existing capital grants that we inherited, and that's what that expense is.

And going back to the balance sheet, you notice the $466 million, which ties back to, because this is our first year, to our equity for VPRA at the end of the year.

And with that, like I said, I just really wanted to show you all this.

I guess I needed to say this when I started.

These are unaudited and they're draft, so they are subject to change, so I don't want anybody to take these as what the final numbers are gonna be.

And when we do a final balance sheet, it'll be a classified balance sheet, so we'll have current assets, current liabilities.

Didn't want to go through all that detail today.

wanted to try to keep it at a high level, but mainly to give you all an idea of the level of activity for our first year of operations.

Any questions for Steve?

All right, thank you, Steve.

Thank you, Madam Chair.

So we talked about the investment policy back at our June meeting, have worked with the Department of Treasury the last month, also briefed the Finance Committee this morning on the investment policy.

So, and I think

Probably the real high level before I jump in and get into the detail in these slides is it's a very conservative policy.

It follows the SPDA, the Small Security for Public Deposits Act.

It also follows the Investment of Public Funds Act.

So basically the two sections of the Code of Virginia that govern the investment and the management of public funds.

So it's in compliance with those.

Also, I think in reviewing the policy, I think we need to view this as it's gonna be an evolving policy that over time we may decide to make some changes and that coming from our ability to better project our capital expenditures, the timing of those, and then also our ability to collect funds from our partners

And so it's a little bit of us gaining that experience and knowledge to better manage that.

And then on top of that, it's a little bit of I'm starting this or proposing to start this policy at a very conservative place.

And so in the future, it may be that over time, the economic situation changes and maybe our risk appetite changes slightly.

The next thing I want to point out this slide is, and it's the next slide really, it's the overall objectives.

And once again, this is in priority order.

So we're not in the business of investing funds to make money.

That's not what we're here to do.

So what we're here to do is build capital projects and then operate passenger service or contract to have it operate.

So that being said, safety of principle, preservation of capital is the number one objective in priority order.

The second objective or priority for us will be liquidity.

When those capital expenditures come up, we need to be able to make those payments.

And then third is

when there are funds available after the first two objectives to maximize the return within a reasonable and prudent risk profile.

So the other thing, last time at June meeting, we got some feedback that we wanted to incorporate environmental, social, and government's principles.

With this policy, it's very conservative.

So when investing in US government securities or T-bills, you really don't have a lot of opportunity for that.

And then also the other factor that I'm gonna put out there is the one area that you could implement these principles is corporate notes, corporate bonds.

And in that area, we've made the credit rating

at a level of AA, and at AA we're really limited to financial services sector.

So there is some, I don't wanna say there's no opportunity there, but there's some, but it is at that credit rating level, it is narrowed down, the opportunity.

But we did incorporate in the overall objectives of the policy that this should be an item to be looked at and incorporated where it can be.

And as I talked about the evolution, I think maybe we can point to this even more.

Next slide, please.

So, on the roles and responsibilities of the Board, you're charged with adopting a policy and then modifying it over time.

The Finance Committee then will be responsible for reviewing myself and my team's actions in carrying out this policy.

and then I'm going to be charged with carrying out the policy working with an investment management firm.

And then there's levels of benchmark reporting and then there's monthly reporting that we will be expanding that what we have in the executive director's report today will expand upon that.

and then on top of that there will be quarterly reporting and for this first year at the finance committee meeting we talked about for this first year having the investment manager, the investment advisor actually come to those quarterly meetings when normally that's an annual on other boards that I've served on it's normally an annual event but with us being

in our first year, and this policy, I think, evolving over the course of the year, I think it's prudent for that reporting level the first year.

Next slide, please.

And this is just real high level, there's a lot more detail in the policy, but getting back to the conservative nature of this policy, eligible investments are all United States short duration fixed income instruments.

The credit ratings are all AA or better using the three rating firms, Fitch, Moody's, and S&P.

Maturities, you can go up to five years, a maximum of two years on a weighted average maturity.

And honestly, with the investment environment it is today, we're looking at probably six to nine months as an initial maturity average for this, for any funds we actually move to.

and Investment Advisor.

And finally, there's concentration limits that once again limit our risk as far as the type of investments, the sector, and then also within that sector, how much, what percentage you can actually invest with one, in one particular instrument or one firm or one company.

And next slide, please.

And I do wanna talk real quick about the benchmarks.

So,

Basically, we're using really broad market indices that match up to the policy.

And what we're looking at is the benchmarks initially would be the Fed's fund rate or the 90-day T-bill rate.

And then we talked a little earlier about the LGIP, and I think we internally are going to be tracking the LGIP

Thank you, Steve.

I appreciate the report.

And I think I was on the VML Executive Committee when we created VML, the finance, the LGIP, years ago, like 2003.

So to frame it, my comments and questions to you are really around my belief that climate change is dramatically important.

and that we're not, as a world, moving fast enough.

And it's a little bit of what every little entity does to make a difference because a lot of those fossil fuel companies, to me, have a lot of stranded assets that very quickly are gonna be realized and are not part of their value because they can't use them.

We're gonna save the planet.

We're a rail organization.

and so I am still very interested in going.

I appreciate the bullet in here.

Don't disagree with the first three at all.

Yet my reference and proposal would be to preclude fossil fuel company investments while doing everything else you have here.

So my first question would be a legal one.

To my knowledge, there are about 1,600 institutions around the world that have begun to do that.

A lot of us live through the South Africa apartheid stuff, so we know that there can be a powerful impact from where you invest money.

Ireland, the whole country did it.

New York City did it.

Illinois just did it in the last few weeks.

Harvard, I mean, tons of universities have done this.

Again, I come back to the fact that we are a rail organization if it's incumbent upon any group that's trying to promote alternatives to fossil fuels and transportation.

And I know we'll get into more how much we haven't yet fully done that, but that rail certainly is far better than many of the alternatives for getting around and increasingly will be divesting itself, hopefully.

of any remnants of fossil fuels.

But my proposal would be, again, if there are no legal prohibitions, I know a lot of local governments are thinking about this increasingly around Virginia as well, simply add to what you have here at the beginning of that bullet,

Investments will be made in fossil fuel companies, comma, wherever practical, because wherever practical actually means nothing.

It means it will never be done, because I've written these before.

I mean, there's nothing mandatory.

There's nothing that would require anyone to give this any more consideration than it's given today, the way it's written now.

So, I would ask for any feedback on that, but if there's a motion, I will be, if there's no preclusion to this board taking that action, I would be making a motion to amend to include the prohibiting essence will be made in fossil fuel companies, comma.

Yeah, I mean, Jay, I'm not going to disagree with you.

So on the wherever practical, I just want to I do want to make sure you understand that part of that is most of these investments are going to be in Treasury, U.S. Treasury securities and really can't impart those factors when you're doing that.

So but I agree the way it's written does leave it open.

And so

But as far as the fossil fuels, I'm not going to argue with you at all.

And to me, I don't think it would have any significant impact on the returns we're going to get to do that.

Yes.

We just want to be concerned, and I agree with you as well.

Do we know what some of these, like the LGIP, what they invest in?

And that's my, but I don't want to answer definitively either.

I guess I would be curious to see what kind of language other organizations or jurisdictions use in that particular area.

So I know with apartheid there was some

of where investments would be appropriate.

So it wasn't just a blanket done at all.

So I guess I agree with what you're doing.

To respond, the best information I have right now in the research that I've done is that there are probably six or seven ways to frame those kinds of investments.

This is probably the most direct and simple because you can get into all the derivatives and where products and packaging comes from and that isn't what is intended here.

The words that I put forward mean in companies dedicated to essentially natural gas, coal, and oil.

You know, so that it is written in a way that is probably narrower and more explicit, and that's what the intention is.

And you could probably find a number of, you know, of these other 1,600 organizations and how they frame it.

Wick, I think you had a comment or question?

I don't want you to view me as an evil person.

I'm on the board of Chevron and say that I think climate change is a very real issue.

I'm sometimes very frustrated about all of the conversation that goes on around it because I think it requires

Very different approaches than we're using today to try to address it, but you and I can talk about some on the point.

So if it's the sense of the Board that the majority of the Board are in favor of that, that's fine.

I think it's a political statement and not a practical statement.

at some point, although I don't think the way the policy is written, it really matters too much, but sub-optimize our possible investment profile.

So I'll just say, I think that this is a rail organization.

I believe in rail, Lord knows.

All of the trains we operate today burn diesel fuel.

and I can tell you from a technology standpoint, it's going to be a while before we have trains that don't.

What kind of strikes me is a little bit critical to take that stance.

I think the whole notion of impact investing is really very important discussion and it's really being permeated.

I oversee a large endowment at the museum and we've had quite a bit of conversation about

I don't disagree at all that we have these environmental and social challenges that are worthy to be considered part of the value proposition of

any organization including this authority.

I think for the sake of this policy and I think Steve pointed out that this is really a starting point and just making a general statement that we are

conscious of the fact that the impact in investing in the environment or social justice.

You know, I was looking at the statistics, the portfolio managers in the country

owned and operated by women investors is a little bit less than 1% of the total portfolio management.

The same thing with the black-owned investment firms.

Now, on the other hand, the investment performance is reported by these firms that are considered to be not as successful as the big players in the market proved to be wrong.

Actually, impact investing has generated better returns than non-impact investing firms.

So I suggest that we table this discussion, leave the statement as a general statement in the policy, but can continue really discussing this as a matter of

a matter of interest for the board.

And the other thing is how does this really match up with the Commonwealth of Virginia's overall investment policy?

Are we getting ahead of ourselves being a component unit of the Commonwealth?

I would urge us to think about that we do this in concert and coordination with the entire state because there are a lot of investments managed by the Treasury.

The question is does this really fall

outside the overall concept of investment for the entire Commonwealth.

One suggestion I would have is we could insert some language that would say that we would discourage or attempt to avoid that.

And could I also suggest, and Steve, I don't know enough about how LGIP

is in terms of how they are structured, what they invest in specifically.

Could I suggest as well that this could be something that our CFO could take up perhaps with the finance committee to look at strategies, whether it's related specifically to fossil fuels or other social investing objectives that could be brought back to the full board as a potential amendment to the investment policy?

If you're asking me what I, I mean, honestly, I think we raised it a few months ago.

Steve did his research.

He answered my questions and said it wouldn't be a problem.

It's not gonna affect the authority's bottom line.

It's not gonna affect his ability to do his work.

I don't see what more talking about those few words matters.

And again, I come back to, if we're a little ahead of the state,

Great.

I mean I'm really fine with that because we have such a small little tiny piece and the political statement on top of the practical one is of value to me.

I mean I remember when I walked in the building I looked up at the engraved words and it's about highways, transportation and highways, so I mean we do a lot more than that.

on what the building was established to do, and I think it's incumbent upon us, and we have every ability.

The biggest question for me was the legal impediment, whether we're precluded from doing it.

Okay, so I guess is that a motion on the floor then?

I think it would be worth sorting out a couple of issues that were raised here before we vote and we start figuring out a phrase.

Do we just couch the phrase a certain way?

Or why don't we get it sorted out so we have language we all agree to?

perhaps at a later time, and I'm very sensitive to the idea of getting out ahead of the state.

There is many of these statewide bodies with the best of intentions.

No, I just had one particular comment.

I think I complimented the gentleman at our last meeting with respect to the values proposition with respect to pre-cooling fossil fuels.

But there was something that my colleague also raised that has also jumped out at me, and that is with respect to women and minority-owned investment servicing.

And so I would say

I have no problem stepping out ahead of where the Commonwealth may be, particularly if we are leading with our values with respect to this.

Obviously, the goal of advancing passenger rail in Virginia is to one, reduce the carbon footprint, bring more people into the transportation system equitably.

And so to the extent that we are going to step out on one particular

value proposition without potentially doing some due diligence in some other areas, particularly with respect to women and minority-owned financial services firms.

I think we might, to my colleague's point about maybe taking a step back just to ensure that we have some comprehensive language that incorporates the value statement that we're trying to make here.

Okay.

So I think where we are now, and somebody can please correct my parliamentary procedure here, but I think we would need to take a motion, have a motion to approve the investment policy in a second.

And then I think if you wanted to make a friendly, or an amendment to that, then I think we'd need to vote on that as well.

So, yeah.

Can I clarify?

So I feel like we have consensus of no matter how Mr. Fisette's

Motion may go, there is an interest and a desire to spend a little bit more time to figure out what the right language is and really get more information from all of us.

And it sounds like that could potentially link up with what Mr. Pritchard was saying around a lot of this financial stuff is even kind of in flux.

And so if we came back in December,

we may have better financial information and investment.

And so I think what I was proposing at least, and Steve can correct me if I'm wrong, I think we do need to get an investment policy in place.

And I think that what I would like to propose at least is that we,

vote on whether we should go ahead and prove this for the time being, have the finance committee.

Jay, you're also welcome to participate in that as well with some work by Steve and perhaps our investment advisors as well to bring back some potential more well-researched amendments that could better reflect a more comprehensive set of policies.

that we could then consider then amending the investment policy within the future.

That was my proposal as opposed to deferring the vote on it at this time.

Any comments or questions?

I'm hearing what people are saying around the table and I respect this.

I wasn't intending to put it forward regardless, but

The reason, by the way, I focused on fossil fuels is because of the connection to transportation and the reference to ESG in its more broad context was here in the way it was presented by staff.

To me, that will become much more complicated, but I support exploring it, right?

which is that this will come back in December with a fuller discussion, our finance committee and other interested board members and our investment representatives and so forth to try to craft language that better addresses this last bullet around ESG investing slash fossil fuels specifically.

So that would be reflected as additional guidance or it's a motion to the thing.

Okay.

I'll do it if I need a second for that amendment.

Okay.

Is there a second for that amendment?

Great.

Thank you.

So with that, Jorovich, go ahead and call the roll.

Those in favor say aye, those opposed say nay.

Yes, I'm sorry, voting on the amendment that specifies that we would bring this back in December with some more research from our finance team and also bring this through the finance committee as well with some proposals for some potential language.

So this is the amendment that we would be voting on.

Potential language that could be presented as an amendment to the policy.

Okay, so we have a second for that amendment.

Those in favor say aye.

Those opposed say nay.

Ms. Bulova?

Mr. Cardwell?

Aye.

Ms. Doersch?

Aye.

Mr. Fisette?

Aye.

Mr. Hall?

Aye.

Mr. Moorman?

Aye.

Ms. Moses-Nedd?

Aye.

Ms. Sadid?

Aye.

Ms. Spore?

Aye.

Okay, great.

Thank you.

So now we have a motion on the table to

approve the investment policy with the amendment as it was presented.

Make a motion.

Okay, and a second?

I already have that, okay.

Do we need to vote on that again?

We already had that, so that vote, okay.

Got the policy and the amendment.

Okay, thank you.

Okay.

We just first and seconded it.

Those in favor say aye.

Those opposed say nay.

Ms. Bulova?

Aye.

Mr. Cardwell?

Aye.

Great, okay.

So we are now at 11 minutes after 12.

What I'd like to propose, we have lunch here in the other room.

Given where we are on the agenda, is 30 minutes okay?

Or would you all like a little bit more time than that?

Okay, why don't we take a quick break for lunch.

For those of you that may be listening on the phone, we'll plan to come back here at 1245, and we have a few items after this which actually should go relatively quickly.

They're all information items, and we can wrap up at that time.

We will have, I take that, we will have actually one action item after this, so.

Thanks.

All right, thank you.

And hopefully we have everybody back from on the line as well.

Victor?

Okay, we've got two out of three.

So we're going to make a change to the order of the agenda again.

What I'd like to do is go into a presentation related to the CSX Comprehensive Rail Agreement Amendment.

Thank you.

So if we go to the next slide, we're here to talk about a proposed amendment to the Comprehensive Rail Agreement.

We're going to walk you through our District of Columbia land acquisition and some things that we found out since we started that.

So, if you go to the next slide, please, just an overview, as I think everybody knows by now and has heard a hundred times, we signed this $3.7 billion agreement with CSX, and part of that was us acquiring the right-of-way from CSX from D.C. all the way down to South of Peters, Dinwiddel County.

Part of that ownership would be north of Roslyn, the RO interlocking, to approximately Control Point, Virginia, which is basically the start of the tunnel that goes into Union Station.

We would be owning all of that area.

That area is critical for us to do the work we have to do in the district, specifically the Long Bridge construction.

And as the slide points out, in December 2020, we had the legislation that told us we can actually construct Long Bridge on Park Service land.

We've worked very closely just over the last few months.

I mean, it's been a decade that we've partnered with the District on this, but Chairman Mitchell and I, just over the last few months, have met with the District Government, with various high-level officials, to make sure that this process goes smoothly.

The entire Long Bridge construction

Project will require about 30 permits, of which we have six so far, and we continue to partner with them at the highest levels to ensure that that goes through smoothly.

The schedule has some contingency in it, but as I think folks know, through the permitting process, we don't want to lose time over administrative things.

So we feel comfortable about that, and we're in good shape.

We are, if you go to the next slide, please, it talks a little bit about the district coordination.

We're working on a memorandum of agreement with DDOT to talk about project partnership, coordination, funding, design and construction.

In fact, they've talked about putting money in their budget to fund their portion, which will include the Long Bridge, a brand new pedestrian bridge that goes across the GW Parkway, across the Potomac River, and actually puts you right into the waterfront area of the District of Columbia.

And they will

We are planning for them to take over the operations and maintain that after the Long Bridge is approved.

But as I said earlier, we've got six permits down.

We need another 24 or so.

If you go to the next slide, what we're looking for today and what we're discussing today is an amendment to the comprehensive rail agreement that we signed when we first entered the deal.

The amendment is only with

Dealing with the land in the District of Columbia.

And the reason for the amendment is there is a less than clear trail of ownership for the property in the district between the railroad mergers and the different things that happen in the district.

CSX does not appear in the tax records as the owner of the rail corridor in all places.

And we've got to work through those issues with CSX.

It's a mess.

I mean, literally, it's a mess.

It goes back to legislation from 1901, where it was passed to Conrail and to different railroads.

In the meantime, as we wade through this mess, what we have proposed is an amendment to the rail agreement that would change one of the agreements to be an easement deed.

So it would give us an easement so we could continue to get the permits and do the work as we worked out those ownership complexities.

This would allow the project to continue to go forward.

We could get a permit with that easement, which has happened many times.

and not have this slow us up.

Part of that is also a passenger facilities deed that would give us, we're clear that they own the platform, the Lafont platform, so it would give us the deed to that platform and move all of that over to us.

So those are the issues we're talking about today.

If you go to the next slide, what would happen under this amendment is we would get an easement interest instead of the fee title interest for now while the issue's being resolved, which allows us to perform the construction,

puts us in a good position to move this project forward.

It would also maintain all of the ownership rights that we have, so we're not giving anything up, we're just saying as we work through this, give us the easement, and then as it's settled, we'll eventually get the fee ownership as we contemplated.

One item of note, we've been working with the district on the permitting.

Because they're not on the tax record, we have to make sure that the district is clear on how the permits are going to be issued.

We do have precedent where, precedent lowercase P, not in a legal term, where there have been other permits that have been granted for construction that CSX had only in Eastman.

So we're confident that we'll get through this with them, but it's going to require close coordination over the next months and do that.

So we'll talk a little bit more about this in the closed session, but what we're looking to do is finalize these three documents.

One is the easement agreement, which gives us the easement instead of the deed.

The second is the passenger facilities deed that gives us the Lafont platform.

And then the third is just the modification to the CRA that contemplates those other two agreements.

So that's what we're looking to get from you all in closed session today.

What will happen is the first two documents, the easement agreement and the passenger facilities deed are done and ready to be executed with the understanding that we're finalizing the terms with CSX on the amendment.

So that's what we're looking to do in closed session.

Good?

Okay.

Great.

Ms.

I'm glad to do that.

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

To the best of my knowledge, during the closed session, the only matters heard

discussed or considered were those matters lawfully exempted from open meeting or 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.

All right, Mr. Sadid.

Ms. Bulova?

Aye.

Ms. Butler Painter?

Aye.

Mr. Caldwell?

Aye.

Ms. Doersch?

Aye.

Mr. Fisette?

Aye.

Mr. Hall?

Aye.

Mr. Moorman?

Aye.

Ms. Moses-Nedd?

Aye.

Mr. Nichols?

Aye.

Ms. Sadid?

Aye.

Ms. Spore?

Aye.

Ms. Zimmerman?

Aye.

Great, thank you.

So I would now like to present a motion, or ask for a motion,

that would authorize, and Julie, I am just wanna confirm I got the language correct, we're authorizing the Executive Director to execute the amendment to the Comprehensive Rail Agreement, and also with the Deed of Easement document, no, just that.

Could you rejoin us, please?

And Passenger Facilities Deed, great, thank you.

Is there a motion?

Okay.

Second.

Great.

All right.

Joy, would you please call the roll?

Mr. Cardwell?

Mr. Doersch?

Aye.

Mr. Fisette?

Aye.

Mr. Hall?

Aye.

Mr. Moorman?

Aye.

Ms. Moses-Nedd?

Aye.

Mr. Nichols?

Ms. Sadid?

Aye.

Mr. Spore?

Aye.

Okay, great.

Thank you so much.

We have two informational items left.

We have our state rail plan update, which is going to be presented by Randy Selleck, and an update on our Newport News Station.

I am just going to advise you all, I actually unfortunately have to leave in a few minutes for

another commitment, unfortunately.

I will stay here for a little bit, but that's why I've asked our Vice Chairman to step in and close the meeting if I am not able to be here.

This is unfortunately an unavoidable conflict that I was hoping to avoid.

But anyway, I am going to go ahead and ask Randy to get started.

Randy Selleck to discuss our State Rail Plan.

There should be our presentation.

There is a presentation in your book as well as, I think, a PowerPoint.

Nope, that's, oh, I'm sorry.

I missed the, you're right.

I apologize.

We have one more item before this.

Sorry, Randy.

This is a presentation on the agreements that we have with Fairfax County and VDOT for our Route 1 and Newington Avenue bridges.

I'm going to let Mike go ahead.

I will be quick.

This is an item we're bringing to you.

We wanted you to be aware of this, but also this is something that may not need to go to CTB board.

So we wanted you to be aware.

In all fairness, it doesn't have to come back for an agreement.

Next slide, please.

So what we're here to talk about, in the budget, there was a category of TRV, Transfer and Rail Other Infrastructure.

Two big projects in there were under the category Fairfax County Bridges.

One is a Route 1 bridge, and one is a Newington Road bridge.

They're both very similar in that what we're doing here isn't just a rail project.

It's a railroad and intermodal project.

And we'll be able to see it.

Next slide, please, actually.

So to give you an example of what we're doing here, this is Route 1.

It is constrained for buses and trucks.

So what I mentioned is not just a rail project, it's a road project.

There's also a bus rapid transit project because Fairfax County has a plan to add bus rapid transit along Route 1.

I saw Director Bulova nodding.

They have a plan to add bus rapid transit along Route 1.

So not only will we raise the rail

Infrastructure, we will widen the berth underneath it to allow for expanded access for bus lanes and things of that nature.

So again, so this is, so I'm getting to the point here of we're going to have a three-party agreement between Fairfax County, VDOT, and VPRA for the funding of this multimodal project.

We've been working with VDOT and Fairfax County actually for the last four years on feasibility and making sure that we can construct here.

And we're at the point now where we have an agreement ready to go.

to First Signature and again VDOT has informed us that unfortunately, not unfortunately, but it has to go to their Commonwealth Transportation Board for approval.

They're also planning though when we go to them for approval to also have alongside that a blanket agreement so that other agreements like this don't have to consistently go to the Commonwealth Transportation Board because we're going to have a lot of road and rail

Interjurisdictional projects in the next 10-20 years.

So projects like this we'll keep you informed about of course and we'll keep CTB informed.

But this is a project, since this is the first VPRA project,

and then we have first VPRA intergovernmental agreement, we do need to go to CTB.

So I might not have followed my bullets, but I think you get the gist of what we're doing here.

Again, we're increasing the horizontal vertical alignment.

This is not a qualified project in our comprehensive rail agreement with CSX meeting.

We don't have to

construct this to add more service.

A lot of our projects, Long Bridge, Alexandria 4-track, we have to construct those to add more service.

So this is really something we're doing, since we know we need to be out there and adding track, and in this case, we're not gonna add just a third track, we're gonna add a fourth track, because our ultimate goal, as we talked about in the past, is to actually get a four-track quarter all the way from Washington, D.C. to Spotsylvania.

So while we're in there adding a one-track bridge, might as well add a two, so we're gonna have

The current, we had two bridges, each with two tracks.

So we're planning on adding up to a four-track corridor here at Route 1.

Currently, it's a two-track corridor.

So before I move on to Newington, happy to take any questions.

There's some additional maps here in future pages as well.

So next slide.

Newington, as you can see, is even more narrow.

It is, in case you're wondering, it is one lane.

Not one lane each way, but one lane total.

And this is near a busy area.

This is not a rural area.

So again, the plan here is to do very much the similar.

We're going to raise the rail bed.

We're going to widen it to allow traffic to go both ways underneath Newington Road.

And again, this will be a cooperation between VDOT and VPRA.

We did receive a FRA State of Good Repair grant late last year that's going to go toward

funding of this project.

And I've listed the dollar amounts that VPRA is putting in, and there's additional FRA money, and VDOT will be putting in money too.

So likewise, we'll be taking the CTB, or maybe that blanket authority will allow us to execute the agreement with VDOT for this project.

Next slide, please.

I think there were some maps that might have been missing, but anyway.

In case you're wondering, these are north of the Occoquan Bridge.

Route 1 is pretty far south in the Fairfax County area.

Newington Road is within our Franconia-Lorton Third Track area.

So Route 1 is further south of that and Newington again is

is a little further north.

So I've already kind of mentioned some of this.

We've been working with VDOT and Fairfax over the last few years on feasibility studies trying to determine the amount, the general, we think the estimated amount of the project is that needed to be done.

We did a little bit of engineering to determine that so we can come to an agreement.

I will note that if the project increases, then everyone's share increases proportionally.

So that was one issue that we were working through on the agreement.

And again, we're waiting the approval of the funding agreement for Route 1, very similar for Newington Road.

We're still doing a little more engineering on that, but that actually funding agreement should be ready to go soon here too in October.

So we brought these to you so you're aware, if you hear about these, so you're aware of what was transpiring with VDOT.

Happy to take any questions.

I should say, sorry, VDOT and Fairfax County.

Great.

Thank you, Mike.

Madam Chair, I'll just bring your attention.

I don't know if you noticed it in some of the pictures, but it's really, those are substandard vertical clearances, and what we end up with quite often in the service area is basically trucks getting stuck under those bridges, and it shuts the whole railroad down, awaiting bridge inspections and stuff like that.

In the grand scheme of things, very big deal, but on the day-to-day standpoint, those are, I think, two of the three on the Fredericksburg line that are most critical in terms of being substandard.

These projects are important.

Looking at especially Newington Road, you would never guess that that was in Fairfax County.

You're in an area that's populated and lots of traffic.

And no action required on our part?

Correct, no action, but we wanted to advise you these agreements that we would enter into at a later date.

All right, thank you.

Thank you, Madam Chair.

Hopefully everybody can hear me okay.

So I'm Randy Selleck, Rail Planning and Environmental Manager at DRPT.

I'm sitting in for my supervisor, Emily Stock, who's our manager of rail planning.

She's in Milwaukee at a conference, so I'm filling in her very large shoes.

Don't mean that in a bad way.

So next slide, please.

I'm just gonna go through the agenda very quickly.

We'll cover mainly planned structure, the policies, and then the initial freight findings.

We're still crunching the numbers for the passenger rail data and analysis, and so we plan on, this is the first of a number of visits to the board here on the state rail plan, so we'll be back as we develop the information and as the state rail plan progresses.

Next slide, please.

The plan process has really three phases, the visioning, alternatives, development, and refinement.

At this point, we've gone past the visioning phase.

We're into the alternatives development really and actually putting together a list of projects.

And so we're working with the railroads, with the other stakeholders to go ahead and put together a project list for the State Rail Plan.

For public involvement, we've had two surveys so far, both for visioning, just a general visioning survey and for the Commonwealth Corridor Study specifically.

We've also had stakeholder meetings, as I mentioned previously, and we did have a public meeting, a general public meeting back in May on the state rail plan and the visioning process.

We are currently working with stakeholders, as I said, on the project list, and then our next outreach would be, from a public standpoint, would be late this year or early 2022, and we're looking at wrapping up the state rail plan in mid-2022.

Next slide, please.

Just an overview of the plan and how it's related to VTRANS.

The State Rail Plan aligns with VTRANS goals, which kind of creates the larger framework statewide.

The State Rail Plan was adopted in 2018, the last one, although it is the 2017 plan, hence the timing.

It's a four-year cycle that FRA has determined to update the plan.

and FRA, and this is fairly recently within the last four or five years, has come up with a framework for these plans so that you can actually compare from state to state and look at data as far as the rail planning goals and objectives.

And of course, new to this iteration of the plan is we will have to do this in close coordination with VPRA.

Next slide, please.

and also just a little bit more explanation.

Again, V-Trans forms that overarching sort of framework statewide for planning and the State Rail Plan dovetails in underneath that and serves also as more of an implementation plan for those projects that are identified during the rail planning process.

Next slide, please.

So the plan structure,

We have your rail system overview or existing conditions, essentially.

Sort of a how Virginia plans for rail, both at the V-Trans level and with the RPT.

And then focusing on the change and what's changed and what hasn't between the last rail plan and current rail plan.

Of course, some major changes at the state level in Virginia.

of course lots of data collection and interpretation that's going on and then analysis of that data, division goals and objectives which will help to shape our project list and also our policies that we'll be developing and I'll speak more to that later.

and then also the plan will include a service development plan which will look at a 20-year, less than and greater than 20-year time frame.

So this is sort of a post-transforming rail look at what the service might look like and then needs that we might identify in the Commonwealth.

Next slide, please.

Just going over the structure of the plan itself, it's going to be, we're kind of embarking on a new thing this time around as far as the structure.

We're going to have an executive summary that's going to kind of form the hard copy of what would be distributed, but that's going to be accompanied by what's called a story map.

This is something that's GIS based that people can go online and as you step through it, it's a lot of interactive information, maps associated with different portions of it, and so it sort of provides an interactive experience on top of the written documentation.

Going through the sections, the vision goals and objectives, we'll look at freight and passenger rail.

Where are they going?

What are they doing?

What are the trends?

Again, going back to how Virginia plans for rail, looking at the larger V-Trans and the DRPT state rail plan.

And then the Virginia rail system overview and looking at those, what's changed since our last plan?

What's the infrastructure that exists in the state?

How is that changing?

with the projects and the programs that we plan to implement, and then ridership and freight usage and trends as well.

We'll also be speaking to the three general assembly studies, Bristol, Commonwealth Corridor, and the Bedford study and the results of those studies.

Next slide, please.

We're also going to do more to define policies in the State Rail Plan.

The goal is to come up with, and what's here on the screen are just probably a few of the many that we'll need to address.

You know, previously, Virginia was in a position where we were really doing these plans without an implementation part or active part in that implementation.

Now that we have BPRA, we have Transforming Rail, we're actually

taking that infrastructure that had been planned and also have a way to actually implement it.

And with that, we have a whole host of responsibilities.

Climate change policy is one that's kind of bubbling up a number of different fronts at the state level.

Things to address like resiliency of infrastructure, the emissions, greenhouse gas emissions,

Of course, passenger rail station policy is something that we will also need to address.

And these policies, the idea is in the State Rail Plan to have a general policy structure and then organizations, agencies like VPRA can come in and add to those policies as needed to further specify and clarify.

Next slide, please.

and speaking to those changes with the State Rail Plan, as I said before, with Transforming Rail, VPRA, our previous plans had more of an aspirational project list, but the fact that we can now implement a lot of these visions that we've had in the past is a unique thing and a definite change with this State Rail Plan.

Next slide, please.

Also, the structural change is taking place with DRPT and VPRA.

As you all are aware, a lot of the passenger rail planning functions are now moving to DRPT with the exception of the statewide planning.

And so that changes the mix of things and also kind of underscores the importance of the work between DRPT and VPRA as we move the plan forward.

Next slide, please.

So next steps for the policy, as I said, once again, we plan to have general policies that then can also be supplemented as needed.

We're going to absolutely involve VPRA in this as we need to.

Policies ultimately go to the CTB, and then many of them will be carried out by VPRA as they move forward.

Next slide, please.

Taking a closer look on the freight side, we are looking at some of the freight data and indicators.

One specific one is potential demand by sector.

And what we wanted to do was look at industry related factors and see what future demand for rail services might be.

And we're doing that by looking at generators of rail traffic and freight traffic.

and just, you know, because businesses are more likely to use rail if it's something that's in proximity and the goods that they produce, of course, are something that are transportable by rail and we used a data product called Data Axle, which sort of aggregates data and then brings it to a level that we can use it and publicly display it.

and then this map on the next slide, please.

It does not look like coal.

Oh, okay.

And so this map is an example of that data aggregated and

created or simplified to the point where we can display it publicly.

This is an example of the kind of things that we'll be able to show in that story map where individuals will actually be able to go in and look at, and this is a hotspot map showing the areas that have higher potential trip generators.

So lots of great data and lots of great analysis that can be done with that data.

Next slide, please.

Then looking at freight rail, trends and forecast by commodity type.

So this is kind of an interesting metric and analysis.

Looking at this data, we see a decline in the volume of rail or the tonnage of rail moving, but not necessarily the volume.

And part of that, and I just skipped to the next slide.

which is awfully difficult to read and I apologize for that.

At any rate, what we're seeing is that there's a shift from things like coal to intermodal rail.

So while tonnage is dropping, the actual amount of train cars is staying the same or even going up.

And this shift sort of underscores the importance of looking at the rail infrastructure that we choose to implement depending on the different types of

Commodities that are being moved now versus the previous focus on heavy things like coal, high tonnage.

So that's just an example of some of the things that we'll be pulling out with this analysis and taking a closer look at.

We're gonna continue to work on the project lists and project identification, and then assess the impacts and the benefits of those projects.

The service plan development, so we'll be working on that, looking at the service gap analysis, which will look at areas that maybe could have, could support service in the future that don't currently have them.

And then as I said, we'll be coming back to the board with updates regularly on the plan, and then going out to the public later this year again,

some more information and more requests for comments.

And at that, I will, time for questions.

Questions on the state rail plan?

It's really interesting, and correct me if I'm wrong,

This is a part of, the planning part of rail is staying in DRPT versus VPRA.

Yes, statewide.

Statewide planning, so the planning part of all this passenger rail is not within the authority.

That's correct.

Yeah, there's still some overlap there.

Really, I'm a huge proponent of planning.

It's so important to actually developing and implementing policy, what we do implement.

The planning side of it is really critical, sometimes years and decades ahead.

So for me, it's really interesting to know what our role is versus DRPT, and this is sort of an informational briefing.

Yes, and I think VPRA, because so many of the policies, I would argue some of the most high level and visible ones, like station stop policies, like the climate change policy, are going to be tied to VPRA because

VPRA is running the service, is owning the infrastructure, is building the infrastructure.

I think that we're going to have to work very, very closely on those.

But once again, the goal for the State Rail Plan is to have policies that are broad enough that the VPRA can then come back in and add specifics where those are necessary.

And it's going to take time, I think, to develop some of these.

Some of them will need to come online more quickly than others.

For example, the station stop policies, Americans with Disabilities Act compliance.

That's something that I've worked with DJ on trying to get that going because that's critically important.

Well, the framework will be.

So identifying the policies, identifying maybe some ways to attack those policies, starting to put some meat on them, but really what you're going to have is more of a framework.

So they'll set the overarching

broader picture, and then our authority can add some meat to those bones, but ostensibly to be consistent with the state rail policy or this range.

So again, then I get back to the question, even at that higher level, as an authority, it might be helpful to know, DJ or others, sort of what a little more explicit timetable and where

Our board would have direct opportunity to comment and provide input before CTB adopts something.

If I can, Randy, and correct me if you disagree here, that I think that's a great point and we do not have that timeline in place.

I'll add more complexity to this conversation and say that in the nine policies that you see here, we actually have sub-bullets under many of these big items that say, hey, we need more specific policies.

Some will be DRPT, some will be VPRA, some will be all of us together.

So there's a lot more work that has to go into this

Economic Development, for example, there are two or three bullets underneath that that we envision separate policies.

I know I would appreciate it and that's why the structure of the process going forward might be valuable.

And while our board as a whole should have ultimate ability to take a last look, there may be ways of setting up

That's fair.

Sure.

No, I think that's a great idea.

And that's something I'll certainly take back to Emily and, you know, assuming that we'll come back before the board in December to figure out some way in the interim to make sure that the board is engaged in it.

I would love that.

I'd welcome that.

That would be great to get that further detail.

And I think it's not just

what we might want to input into that, but hopefully if you're having an inclusive process, there are things coming up that would be good for us to hear as we're thinking about our own pieces.

It drives me a little bit crazy that government, we have all these silos and we're zooming along in our silos,

If we talk to our neighbors and say we're on the VPRA, they'll probably ask us, well, this, I mean, they probably won't ask us about the State Rail Plan, because really, how many people are following the State Rail Plan?

Sorry, my nerdy friends and my nerdy neighbors will.

But the point is like, the public sees rail and they don't know which entity is responsible for what little thing.

So the more we can kind of coordinate and sync up, it's, I know I'd have an interest, it'd be really helpful to

to kind of think through some of those things.

Because yeah, there are some of these sub bullets that to Jay's point, it's like, well, is that us?

Is that CTB?

Is that V dot?

Like, where does that rest?

And sometimes that means it isn't resting anywhere.

And that's a problem too.

If there are no further questions, so this will continue to come back to us.

Thank you very much.

We only have one more item on our agenda and that is a briefing on the Newport News project and who do we have to... Michael Todd will be briefing us on that.

Good afternoon, everyone.

Hope everyone's doing well.

Just a really brief introduction to myself.

My name is Michael Todd.

I've been with DRPT for getting close to about 10 years now.

I was previously actually in the planning division, and now I'm currently a grant manager, which essentially means I distribute some of our funding sources and then also kind of monitor and manage those projects as they move forward.

So we were hoping to give you an update on one of our ongoing major construction projects, which is the Newport News Multimodal Transportation Center.

Next slide, please.

So I wanted to start with a bit of the background and kind of the planning that led to the construction.

We've been working with this project for quite some time, but want to make sure that everybody's kind of up to speed on, you know, essentially why and how it came to be in its current state.

Also go over the benefits of the project, you know, budget and the schedule, walk through the design packages.

The construction's been split into some separate design packages.

and then actually have some pictures of the progress that has taken place so far.

Next slide, please.

Starting with that planning and background, on the left hand side is a map essentially of the original alternatives analysis that took place.

So just as a little bit of history, I actually, this is one of the first projects that I started with at DRPT in 2011.

They started the alternatives analysis.

So this has been around for a decade now.

They had multiple sites in the city of Newport News and

You know, went over many of those typical types of metrics, you know, what would the general cost of operations and capital be, you know, right away impacts, impacts to Amtrak operations and operational efficiency, and then, of course, the environmental impacts as well.

and ultimately the location that was preferred by the locality was the Bland Boulevard Station.

That is the station that's actually the farthest north on that map on the left and it's kind of zoomed in on the map on the right at that specific spot at Bland Boulevard.

Next slide.

And so going into the design and location benefits, on the top there is actually just a little clip from our engineering plan sheets.

On the left-hand side, it kind of shows the turning line that parallels Bland Boulevard

So essentially the Amtrak train can come in from the west back into that Y to turn around and then get right facing to go back to Richmond the following day as this is the end of the line for that route.

And then also on the far right hand side, you'll see actually the servicing facility for Amtrak as well.

So at being an end of the line stop, Amtrak needs space for storing and maintaining their trains here as well.

So it's kind of a site that's a little bit split into two pieces here.

This location was the preferred alternative because it actually fits with the way that, and this is my understanding anyway, this was a local decision, it kind of fits with the growth of Newport News.

Many years ago, Newport News developed kind of outside of the core downtown area.

They developed a new business park and new government center that was outside of the norm, core CBD of Newport News.

And this site is adjacent to that new business park, and it's actually adjacent to the airport as well.

So it lines up with a lot of the regional plans for multimodal connections for transportation and also for land use development.

So that's why this location was chosen.

Apart from location,

Updates to the station at Newport News have been needed for some time.

Level boarding and ADA compliance is a huge benefit of this new construction.

It also increases storage as the end of the line.

It was kind of a

a barrier to growing additional frequencies on this route because we didn't have any storage for the train.

So we'll have additional storage for additional Amtrak service.

Another huge one is that it actually removes conflict from the CSX coal yard nearby.

So the Amtrak train used to literally, I'm not exaggerating this, go into the coal yard loop entirely around the coal yard and then come back through the coal yard again so that it could turn around and dock at the Amtrak station.

So, you know, multiple conflicts with the freight carrier was not an ideal operational environment for anyone.

So this addresses that issue as well.

And then there was also, you know, a bunch of station deficiencies.

The existing Newport News Station is the original, you know, kind of 1970s era Amtrak stations, a little bit smaller than the service requires as the service has grown.

And so there'll be things like waiting room capacity and additional seating, parking lot capacity, and so forth.

And then also handicap, you know, ADA access to and from the building as well will be improved.

And then the final aspect, which kind of goes back to that preferred alternative, it will serve actually as one of HRT's bus transfer facilities in the end as well.

So a multimodal connection, but also it actually kind of increases the local transit kind of footprint and brings, as I was mentioning, the growth of Newport News kind of out west.

It kind of brings the transit with that growth.

So multiple benefits here.

Next slide, please.

Budget and schedule.

So we are well underway.

This is a multi-funded project.

For the most part, it is the local and regional funding that flows through VDOT, but we also have a significant portion, the CRF there, it stands for the Commonwealth Rail Fund, at about 44% of the total budget.

We awarded the construction packages in the summer of 2020.

We have now entered phase two, which is the track and service facility work.

and are expected to be completed in the summer of 2022.

Next slide.

So I mentioned previously that this work was actually split into three separate design packages.

This was actually, for the most part, I mean, there are a few nuances in the decision, but for the most part, this was for the sake of time, essentially putting as many resources as we could on each phase of the construction so that the construction moved as quickly as possible.

And as you know,

Time is money, so that actually served somewhat as a monetary savings as well.

So package one is the grading and utility work.

We have about two and a half million dollars of the Commonwealth Rail Fund included in that first package.

That package is what I would call substantially complete.

They essentially just have a remaining punch list, but the work is complete.

Package two is what we just kind of kicked off a couple of months ago.

It is the track work and service facility.

So it's that turning Y, you know, it's the separation from the CSX mainline to service the platform.

And then it's also that lead track that goes out to the new Amtrak service facility.

And that is the largest chunk of our funding, which is about $16.3 million of the Commonwealth Rail Fund.

And then the final component is the station and the site work.

So this is the drive in, drive out of the parking lot, development of the parking lot as well, and then also the building itself.

The city has some retention ponds and some wetland restoration work as well on the site, so that's included.

But our portion of package three is about $1.7 million of the Commonwealth Rail Fund, and that's for the platform and canopy work that's right there connected to the site and to the building.

Next slide, please.

So then the remainder, actually, I guess, yeah, that would be a good place to pause.

The remainder, I just wanted to show you a few pictures of the progress.

So perhaps this is a good time to pause and just ask if there's any questions about

If not.

One thing I just, I was mentioning this to DJ when we broke for lunch.

I think it would be great to know some of the DBE targets that have been hit on some of these different contracts and like who's getting the contracts and things and so

Yeah, we can absolutely do that, of course.

Yep, absolutely.

So, I have, essentially the next few slides are kind of a series of pictures of, you know, we went out and took pictures in July of 2020, then December, and then just recently in August of 2020.

And I know these are not the most awe-inspiring construction pictures, but for anybody who's been in it, essentially what you see in July is we haven't touched anything yet.

So this is just kind of what it looked like previously.

In December, we were essentially doing all of the staging for the utility work.

And so all the things that you see there, you know, all the piping, all the fittings, everything is now, when you move to the third picture, that's now underground.

So it's not like we've moved it.

It's we've actually installed all of that utility.

And that's an amazing amount of earthwork, an amazing amount of infrastructure that's been put in place.

And so again, I know the pictures themselves aren't maybe the most awe-inspiring, but it is a considerable amount of work that's taken place.

So this is just when you're literally standing on the bridge of Grand Boulevard looking south took some pictures.

The next slide is I just turned around and went to the other side of the bridge and so now you're kind of looking you can just barely see the track off to the right-hand side and so again it's just before we touched it you know the pipe piping infrastructure that we put then put in the ground for August.

Next slide.

Again, same just under the bridge.

So we have before we touched it, the infrastructure that was needed and then now it's in the ground in August.

Next slide.

And then finally, I just wanted to leave with we're still in early stages, but we have moved to actually building the track and service facility infrastructure.

So we kind of did that clear cut to make the connector path.

As I mentioned before, this site is really in two kind of different locations, one where the building is going to be in the platform and then one where the service facility is going to be.

So we have to have a connector point between those two.

made that connection point, cleared out the area to put in the service facility, and now we're starting to stockpile and stage the pilings and the infrastructure that's needed for the service facility.

Next slide.

and that is it.

And so that is just for your reference, a rendering that was used in the public hearings.

It kind of looks like a little bit of a Y shape and that was on purpose as they wanted to make the connection with the airport.

So it kind of looks like a plane's tail wing.

That is awe-inspiring.

That's beautiful.

Any questions?

Excellent presentation.

Okay, that brings us to the end of our agenda.

Anything else to be brought before the authority?

If not, the September 28th?

Again, most of you have seen the press on that.

You know, horrible accident.

You know, we had 146 of our customers in transit and 16 of our employees.

And when the derailment happened, it was late Saturday afternoon, early evening, and we had four cars on their side and several others leaning.

Three of our customers

The NTSB

taking over the scene and they're investigating the cause and you know we're not going to speculate at this point what the cause of the accident was that we will find out from them what it was and then we'll take whatever corrective actions they recommend.

You know we had our family assistance team out there, we had our claims people out there, we had a whole team of

of Amtrak Personnel, and just tremendous response from the local first responders.

You know, Liberty County, Montana is in the middle of very few population centers.

We had six different jurisdictions from that county respond and do heroic work.

We had about 60 people injured, including two of our employees.

All have been released from the hospital.

There's still four people hospitalized.

And we're working with their families.

And Bill Flynn has met with all the families involved and with the families of the deceased.

So that's where we are.

The track was BNSF track.

And it has been reopened as of 4.30 this morning.

Thank you, Bruno.

Must have been just horrible.

It was.

The other thing that, and we don't have to do this, but what Jennifer and I were talking about is we were talking about this infrastructure bill, and I can give a two-minute sort of overview of what that bill has, because it does have a lot of potential funding for this group.

The infrastructure deal that's been talked about is really two pieces.

One is an infrastructure, bipartisan infrastructure deal that was passed.

This bill was passed as one bill in the Senate August 10th.

The first part was just infrastructure dollars, $550 billion for infrastructure.

And the second part was reauthorizing the FAST Act.

The total comes up to $1.2 trillion.

The infrastructure money is appropriated money.

It's five years of dollars, and the dollars would come in equal increments.

For rail, there's $66 billion for rail projects.

And again, that's guaranteed appropriated.

Congress has no other action to take.

$22 billion is for Amtrak directly.

$6 billion would be in the Northeast Corridor.

$16 billion would be in non NEC.

And those dollars are largely for, I would say, dealing with old things.

It's anything from replacing fleet, taking care of state of good repair issues, stations, and other obsolete technical items.

There's 36 billion that would go to the FRA for grant programs.

24 billion would be

Not more than $24 billion would be for the NEC, and that would be dealing largely with the major infrastructure projects that the Northeast Corridor Commission has identified, things like the B&P tunnel, the Hudson tunnels, things of that sort.

And then at least $12 billion would be on non-NEC, and that could include corridor growth and corridor development.

Then there's $5 billion for Crissy Grants, which we're all aware of, and $3 billion for dealing with grade crossing issues.

So that's what's happening.

It's scheduled to be voted on Friday, our Thursday, I mean, which is when the FAST Act expires.

So we'll see what happens.

Obviously, the competing political issues involved with reconciliation may yet thwart that actually happening.

Meanwhile, the government's got to figure out a way to stay open, too, by the end of the week.

So that's where we are.

And if I can, one interesting note, I think we've talked before about core capacity as an FTA program.

One thing that core capacity

New Starts and Small Starts has is multi-year funding opportunities, multi-year grants that stand the test of time.

Doesn't matter if it's signed in next administration.

When it's signed, it's honored through the next administration.

The Federal State Partnership for Inner City Passenger Rail Grants, which I believe you mentioned, has a provision that will allow for multi-year grants.

So right now, it's kind of feast or famine.

Sometimes you go into a certain grant cycle and you may not get anything for years, even though you have a great project.

If you have a great project under this federal state partnership issue grants and it's a huge dollar amount with advanced appropriations, it's a total of 43.5 billion.

It's hard to believe that number's that high.

We could try to enter into multi-year grant opportunities, much like when I was in Chicago, Chicago Transit Authority got a billion dollars over six years from the FTA.

So for some of our programs and projects, especially for phases three and four and other projects coming down the pike with the CSX agreements or even with

We could even work with some of the agreements we have now.

We could try to apply for multi-year grant opportunities.

I hope that makes sense when I say multi-year.

It's you're not just given money in one year and then you might not get anything for years.

If you have a great $2 billion program in projects, you can apply for it and you can enter into a grant agreement that will be long term.

So that's kind of a game changer.

It's something we've been asking for.

Secretary Valentine testified in front of the House Transportation Infrastructure Committee in March and asked for something like that, a long-term guaranteed grant program that no matter what administration is assigned, that might be more favorable to your project.

It's going to stand the test of time, and assuming the administrations do abide by that, as they have with the FTAS 5309CIG program, this is, I'm sorry if I'm excited about it, but this is the kind of thing we've been asking for, and we've had a good relationship with our congressional staff, and they helped push forward.

Thank you.

Thank you.

And, you know, on behalf of the Passenger Rail Authority can express our deep sympathy to people who were injured and who lost their life, including your staff and members of Amtrak who have been victims of this terrible accident.

So thank you for the briefing, Bruno.