Board of Directors Meeting   5/22/2025

and VPRA meeting minutes.

you you

We are pretty diligent ahead of time about what are the bookings look like now.

For the most part, those sales do very well.

I think this most recent one perhaps wasn't as successful.

There was a little revenue, but gaining ridership.

That's great.

To Steve's point, actually, we had a period of a few months earlier this fiscal year where the revenue was doing really, really well, but the ridership was failing.

And that's the tweak we always want to find out.

Here are a couple pictures.

We have installed PIDS, Passenger Information Display Systems.

Amtrak really did the work, but we've worked with them to get it done.

Ashland and Main Street Station.

Ashland is particularly a problem because anybody that's been there, the tracks go right down the middle of town.

And when folks are waiting to board the train, they can't always tell which track it's going to be on.

And unfortunately, they'll stand between the two tracks and watch to see, okay, on this one or this one, huge, huge safety issue.

Once there for years, the PIDs will help passengers know which track the train's coming on ahead of time and just to alleviate huge safety concerns for us.

So it's there.

Here's an update on our AIP goals.

The bottom section is completed.

Fantastic.

And we are on track.

The last couple of times we have shown this, the ridership.

We are not meeting the three-second goal, but with a really strong March, a really strong April, we're back above that goal.

A couple of months left.

May looks good.

We're watching it closely.

And then you see many of these milestones actually we'll hear about today as we do project updates, but we're in pretty good shape with a couple of months left.

Passenger service updates.

Jeremy is going to talk a little bit more about this later, but we once again for 2024 had a number of the busiest stations in the southeast.

Staples Mill was the biggest, then Alexandria is right behind that.

This is just Amtrak ridership.

This doesn't include VR ridership, but it just shows that the people are indeed riding the train.

We have talked also about the work that Amtrak is doing at Union Station.

They take 55-hour windows over weekends, key weekends, to do turnout replacements.

These started in January.

You see the march in the past week in the May impacts.

Coordinate that well.

We let folks go ahead of time.

Trains are canceled, but that work continues.

We've got one more weekend in this phase of the projects in late June and we're prepared for that.

Comment on the partnership we have with Amtrak working together to inform our folks and also let them get the critical work done.

Here's an update of the Norfolk Station.

Norfolk, for those of you that aren't familiar, we have a station in Norfolk that is experiencing incredible ridership.

Last month, I believe, was the highest ridership they've ever seen.

There is construction that's taking place right next to the station that started in the last couple of months.

It's a brand new casino.

The builder is incentivized to get that work done quickly.

I think it started a little later than folks had planned and now they're in rush to get it done quickly.

It didn't cigar off smoothly.

There was a lot of, hey, we understand we're right in the station, but we're going to be taking most of your parking lot and you'll just have to deal with it.

Thankfully, folks stepped in and their minds have prevailed.

We now have a

Good knock on wood relationship.

We're still watching very closely.

You'll see on the next page, we've Norfolk, City of Norfolk really has the agreement with Amtrak, but we're the ones that have been working to get everybody at the table together, have additional parking in place.

We have a, they now have Park Mobile where they use parking app to get parking.

It has been a pretty significant impact on families.

We have worked with the city and we've worked with Amtrak to get communication out.

So again, no surprises.

But this is something we're going to be watching for the next couple of years.

This construction is continuing through 2027, and we've got to make sure that folks, especially those that have special accessibility needs, have clear access to the training.

And thanks to Amtrak for the partnership tonight.

Yeah, and we'll get a team going in there next week.

So we're going to try to work that out.

Yeah, the construction company's main point of access for all of their big, heavy-duty trucks is literally right next to the drop-off.

So we've got to be very careful.

I talked earlier and I sent a message out to the board yesterday.

Table ridership is fantastic.

We've got almost a 10% increase year over year, pretty consistently across the board at all the stations.

Continued good news, continues to really validate the work that we're doing to continue to add more frequencies.

Here's the breakout on the four different lines up all across the board.

And as I said, the Norfolk, we're over 10% over here, over here.

Even if you're out running areas, we are getting close to 90 frames.

I'll go through these quickly.

You just see the performance route by route.

We'll point out that the on-time performance is not what

and again we'll talk about a little later, but we're striving for over 80% and we're not always getting that, whether it's heat orders or other factors.

Jeremy's going to talk about performance crews that work together to solve those problems.

It's a focus of ours because we've got to provide viable assistance.

So here's Newport News, Norfolk, pretty much all good news on type of performance notwithstanding

Here's the chart you see every month.

It continues to show that Virginia, as compared to some of the other state-supported services, has much higher ridership, and as we continue to add service, that's going to continue to grow.

Cross-recovery is far above what we expected, which continues to be good news.

As Steve talked about earlier, we have found and will continue to monitor that sweet spot between ridership.

Here's a snapshot of our operations budget.

Nothing really alarming to note there.

We're aligned pretty much with what we expected.

Pretty much right on track, so that continues to be good news.

We'd like this slide to be absolutely not exciting, and this month we can cheat that.

So any questions on passenger updates, or can I turn it over to Mike for capital projects?

Okay, so Long Bridge North.

Main point here is we're still in active negotiations with Skanska.

We'll be talking about that later today.

I'm gonna move on to the next slide.

So a few of us were out there a couple of weeks ago, DJ and I with some project staff, and we got, it's exciting to get to see the work going on.

What I can say is these rigs on the left, pictures don't do it justice, these are massive.

So these are these are doing some demonstrations right by Ohio Drive.

So Ohio Drive right where it meets 14th Street Bridge up in that area by the railroad tracks.

On the right side, then we walked over to what we call Maryland Avenue Overbuild.

Maryland Avenue goes over our railroad tracks.

And there is a third track that is currently not in use except maybe occasionally for some storage that has been taken up.

We need to take that up as part of the crash wall.

See those crash walls that are beautifully adorned?

That track needs to come up because they're going to strengthen those crash walls both below the surface and going upwards as well.

So they need to get underneath the tracks and hence one of the reasons why the track is coming up.

North of there, VRE does use that third track as a layer of the track closer to Long Fawn.

This area is about a quarter mile to half a mile south of the Long Fawn.

So it's exciting to see the work going on out there.

The Skanska Flatirons teams out there doing the work.

So if you have any questions while we move along, I always love the back and forth, so don't hesitate to speak up.

Next slide.

Long Bridge South.

So Long Bridge South, as you remember, is a little further, they're in the design stage still, so they're right now going from 30 to 60 percent design.

We'll receive that through 60 percent design package of various elements this summer.

So that is moving along well.

That is Trumbull Faye Lagman to remind people of what was agreed to back in January, agreements with them.

I have a question, Michael.

Could you go to the timeline with the South, go back to the Long Bridge South?

So VHP was brought on for when?

VHP?

North package was the year before, in December of 23.

So we ordered the North package in 23, 20... December 23.

Well, 2020 was 30% designed for both North and South.

And then we decided to break it up into two packages.

And then the board awarded North in December of 23, because I remember it was the same week that we got the $729,000 grant.

And then you just said 13 months later in January of 2025, Trumbull Faye Wegman won the award.

Long Bridge North was more complicated because of the Maryland Avenue overbuild and these other bridges so hence the reason why we needed to go out first.

Because Long Bridge South, you're building a bridge next to the current bridge so you don't need to

Stop Service or anything of that nature while you're building a new bridge.

Long Bridge South, well, I'm not going to say building a bridge in Potomac is easy.

And let me add, we purposely put the Long Bridge South package out after the fact, because we wanted to give anybody who didn't win Long Bridge North the opportunity to bid on Long Bridge South.

So Alexandria at Fort Track.

This is a project that is literally right outside our door.

We're moving along with that and we are right now in the process of right-of-way acquisition.

We've had some good movement.

We have high-level meetings with Arlington and Alexandria because those are two entities we need small, small slivers for easements for.

and we've all said goodbye from people on VRE's port, Takis Carantones and Sarah Bagley from Arlington and Alexandria.

They've been very helpful in getting us meetings and moving these projects along as well.

Speaking of VRE, the reason I brought that up is because VRE is tackling King Commonwealth Bridges that is

also right outside our door.

And they really authorized, the board authorized VRE to release the bid package for that, for Alcanander-Fortrex, which is obviously tied in with, sorry, for King Hamelth, which is tied in with Alcanander-Fortrex.

Next slide.

So there's some work ongoing.

For those who have taken the train, you've probably seen utility work ongoing up and down the corridor.

This is Byward Dock Bank relocation.

There's also various Kinder Morgan pipeline, as you can see.

So this is the fiber dock bank is complete, but the pipeline relocation is still ongoing.

Next slide.

So the Franklin A. Springfield Bypass also in negotiations, and not to be confusing, Flatiron is the lead on this.

Flatiron Herzog is the contract on this one.

Those conversations are ongoing.

We have received some good news recently with regard to

Fairfax County Parks, we need small slivers of easements from them and we've had some really good conversations with them recently also with the help of some Fairfax County folks on Rich's board.

Next slide.

Franconia-Lorton, third track.

We have received a reevaluation okay from FHWA.

I should have mentioned also an Alexandra-Fortrack received a NEPA reevaluation as well.

So in case people are wondering how things are going with the FRA, they're going well.

Projects are moving forward, they're approving projects.

That includes Alexandra-Fortrack, Franconia-Lorton.

We should get formal signature from FRA

on the re-evaluation for Franconia-Lawrence soon.

We've received it from FHWA and this also follows on April 22nd NTP from FRA on Long Bridge North.

What that means is that Steve can now build

for the FRA grant.

We have NTP.

So the NTP for construction, but NTP with FRA means notice to proceed so we can bill.

So if you recall, we talked to you about some right of way

changes that we, the right-of-way we thought was a certain location.

Turns out when we do survey work, we have a different alignment and when that is outside the limits of disturbance or the various EIS or documents we have, we need to go to FRA and get that okay, and or FHWA.

So we receive those.

Oftentimes these are small slivers of land.

Small, small pieces.

So good news on right-of-way, since we're bringing it up, I think there's a slide on it later though, is that we have finished survey work for Arlington, Alexandria, Fairfax, Prince William and Stafford.

Those have been agreed to by CSX.

So we've talked to you in the past about some issues with regard to right-of-way.

Those are all, the survey work is all complete for those five jurisdictions and we will be recording deeds for our part of the property.

If you recall, we'll be receiving half of the rail quarter, eastern half south of Franconia, the western half north of Franconia.

So we've had really good progress on that in the past few months.

DJ's been personally involved with some high-level folks in CSX.

We were down there in December and followed up with some high-level folks there to help move things along and the whole team's done a great job.

And CSX has been responsive so

Good news on the survey front, thus moving forward.

So once survey's done, then you can do final design and you can do right-of-way acquisitions.

So for a lot of these projects, we're in the midst of finishing up final design, kind of tweaking final design, if you will, and moving forward with right-of-way.

So that's kind of a theme through all these.

Except when you get to New River Valley.

New River Valley is a different one, and this is being led by Norfolk Southern.

This is moving along very quickly.

And there was a ceremony a couple weeks ago,

with our chair and DJ and some of the board members there.

As you can see, the governor was there.

And I think he put it really well when he said this gives people the opportunity to go north without getting on 81.

It gives people the opportunity to get on a train without even having to get on 81.

Anyone who's gotten on 81 understands.

It's very unpredictable.

So this was a big event through the shovel ceremony, and the very next day, they began construction, and we have some pictures on that.

Mike, I just want to interrupt quickly, if you can go back to the previous slide.

I love this picture, but

Thelma Drake was in the front row and very integral piece of this announcement with the governor as well because she worked on the Roanoke opening and she had left.

Thelma, you left right before we grabbed the board members together to take this picture.

Well, thank you for that, Tiffany.

So no, I had to leave.

I had another commitment.

I had to be back in Norfolk.

I mean, Ms. Drake, you left faster than I leave most social events.

And I got here on time.

Just to remind everyone, while this is the shovel ceremony kicking off construction, we're really excited about in 20, 2027.

doing the ribbon cutting.

That'll be great.

I see Bruno nodding his head.

Amtrak's going to be able to get another train down there.

Two trains down there.

The two ranches from Roanoke will be extended to New River Valley in 2027.

As you can see, construction work is definitely ongoing.

So remember, we have two construction sites.

One is at Christiansburg at Cambria at the Old Depot, and the one's for the layer facility in Radford, exactly 10 miles west of there.

So I'll move quickly to the next few.

I do want to mention Tejoma Creek Third Track Siding A that also includes a road component at Leland that is important.

We have gotten good approvals from Stafford County with regard to both those aspects of the project.

Hillsville Siding we've talked to you about before.

That is a new siding that is going to be in Hanover, just moving that old Hanover Siding two miles north so we avoid rebuilding Route 1, frankly.

Next slide.

So King and Commonwealth already mentioned that we are contributing money to the VRE's overall.

Alexandria Station rebuild, it's much better to have less contractors in there.

So the hence why we have agreement with VRE there moving forward with King and Commonwealth.

Newington Rail Bridge, for those who aren't familiar, that is a one lane bridge, not one lane each way, but one lane in the Franconia-Lorton area.

That is important.

That does have a $14 million grant.

We're working on getting obligated.

Next slide.

Here, I want to point out that we are still waiting on obligated grant for Richmond to Raleigh, 30% design.

We are working with FRA in North Carolina.

Technically speaking, North Carolina is the recipient of that grant, but they're working through some things with FRA.

And just like I mentioned that we have

gotten some re-approvals, some NEPA re-eval approvals, and notice to proceed from FRA.

They're receiving good indications from FRA that they should be able to move forward with that grant that will do 30% design, which is very important for places like Appomattox River Bridge, which is a single track bridge in that area.

And we're still waiting on a federal grant for Stanton.

That was a federal grant we applied for and it's still outstanding.

Don't make sure.

I'll take this.

We talked about Tom Shores and there was the possibility of doing a land swap or a land gift where CSX was going to, the developer, excuse me, was going to give us a piece of land that would allow them to put soil from railroad land onto more railroad land.

We talked about it at the board and there were concerns, rightfully so, about the risk, especially since the land they were going to give us 20 years ago was dumped, literally a dump of landfill from the sea.

We've decided not to follow that path forward.

So what happens now is when we take ownership from CSX of the land from CSX that we were purchasing in the original transaction, we can finish the survey work.

We're going to take ownership of that most likely later this month.

The developer will come out and they will do soil testing to make sure that it's viable for construction.

And then once that testing is done, they can start construction just as normal like they did with part

We already have, we have a draft agreement on our side.

They were going through a construction agreement that takes care of all the risk on the soil.

So if anything's found, you know, they can't move anything.

We have to make sure that we have all protections in place on our land, but we're hopeful that we'll get that agreement done quickly with them.

And then sometime over the next couple of months, they can actually start construction on the Virginia Station there.

So long time coming, survey work,

is complete.

CSX is finalizing their, they're reviewing the drafts of our deeds of confirmation and we're hopeful those deeds will be processed later this month and make construction with the development.

So good news, we're finally seeing the end of the tunnel as we've been staring at the light for a long, long time.

Good, good risk protection on our side and a good path forward for that community, which has grown incredibly over the last day and sorely, sorely needs other transportation

What happens if contaminants aren't found in the soil?

Well, then the developer is going to have to pay more money to move those contaminants to a super hazardous site.

Nope.

So they are constructing a station on land that is currently owned by CSX, but that we purchased from CSX back in 2020.

So originally they had additional land

that they were going to use as a soil storage spot that they wanted to give to us.

We decided that wasn't a good plan.

Okay.

But it's been railroad land the whole time?

Yes.

CSX?

The railroad station has been railroad land the whole time.

It's CSX.

We bought it in 2020.

They, the developers, need to wait for that ownership to transfer

Okay, thank you.

Is that risk agreement already finalized?

It is not.

We have a draft on our side that we have to send over to them, but we have not sent that.

Is there a timeline associated and the risk agreement?

That's all on the developer.

We mean that there's not a timeline.

It would work for them to continue to

For those who aren't familiar, what you actually see in the bottom of the picture is the beginning of the pedestrian walkway over the track.

So the parking garage has been built.

I don't think it's open yet.

I was out there last month.

I don't think it's open yet.

There's a nice promenade up top.

Big VRE sign.

Yes, big VRE sign.

And that is the beginning of the VRE station that you can already see that at the top of the roof there.

That's going to head out over.

What you really can't tell is that it's going to go straight out over.

It doesn't have to go up and over because of the landscape.

It's very much like the rip-on station where it just kind of, it doesn't have to go up and over.

It just goes straight over.

And that is, as DJ mentioned, where the VRE platform will be on the other side.

But people from the neighborhood will be able to come through that area, walk across over, and get down to the platform.

Next slide.

I already touched on the boundary surveys because it's so important to the projects that for the main, for all these projects right here, boundary surveys are complete.

So I think we talked to you about that back in the fall.

And this is a big deal to move this forward.

and so we can move forward final design right of way and then the really great step which is construction.

So again this is a reminder of who's doing what.

When I say who's doing what that means their CSX might be leading on procurement or design and construction but as you can tell the VPRA is often the lead on environmental issues in the public face of these projects even for a newer value whereas NS is leading the

The construction, we have a team down there that I think has been well received in the community and is talking to local neighbors as construction is ongoing.

So on all these projects, we are the public face and we handle the environmental matters and also the right of way as well.

So again, design and construction lead, as you can see here,

VRE is a little different for a few of their projects.

As we mentioned, so we have some projects we undertake.

There's also capital and operating grants.

Nolksville to Cowards is a project that Norfolk is leading in the south of Manassas and also Roanoke West Yard as well.

There's money that is to get to River Valley, you have to go through Roanoke Yard.

We're trying to clean that up.

Next slide.

So the grant funding status,

I already mentioned.

So the ones at the top are probably going to come off soon except for Stanton.

As I mentioned earlier, that is a grant we put in that remains to be determined when we'll find out about that.

We also did put in some congressionally directed spending requests.

The out changer of Ford Track is one as a same one as we did last year.

Representative Byer was put forward.

And Atrick Station,

We could always use a little more money there in our station, so the opportunity has arisen to put it in a congressional inductive spending request for ETRIC, and we're doing that as well.

We did that as well.

Any other questions for Mike?

Sorry, to be fair, Mike, I ended his question.

Yes, thank you, DJ.

Everything, I guess at a high level, everything is still on track.

As Mike mentioned,

The getting that notice to proceed from the FRA for that $729 million grant was critical for me to be able to say that.

So that's a big item.

It's not in these slides.

This is the standard slides that we look at every month in the Executive Director report.

So here it's our dedicated Commonwealth Rail funding.

The main point here is we're on track.

If anything, maybe slightly above the $163 million estimate for the year, but

As you see also, the revenue coming to us doesn't always come to us in a real predictable manner.

And that's a lot to do with transfers between taxation and VDOT and then to us.

Next slide.

So here, I think the main points I want to talk about here are you see in September, we had the $315 million outflow for the Manassas Line purchase.

And that's why the total balance decreased quite a bit.

And I think what's happened since then between now, September and now, we've come like 75, I think it's actually $477 million balance.

So through these past eight months, I think that is, we've actually been able to have more inflows of revenues than outflows, but I will say the last three to four months,

Our expenditures with our projects as we're getting closer and closer to construction and in some cases moving into construction.

Our daily, weekly, monthly outflows of expenditures are increasing, but we have recovered nicely from that large outflow earlier in the year.

The other thing to point out here is that $18.9 million year-to-date income.

We do expect that to be greater than $20 million for the year, which was sort of our internal goal that we had set, which also helps in the long term.

When we have other projects we want to seek or are having potential cost increases on projects.

Next slide.

So here, the point here is, I guess, at a high level, there's been a lot of rate volatility the last two, three months, literally 50 basis point changes, which is unusual, but there's been a lot of economic uncertainty, I'll put it that way.

The consensus, though, of the different groups we consult with is that rates are still going to drop in the long term, well, short term meaning, longer term meaning the next six months to two years.

That being said, if you all recall, last February, we got a new investment manager and implemented a process where we took a lot of our funds, about $200 million of our funds,

and we moved those maturities instead of staying in that one to two year window only, we put some of those dollars and put them out to two, three, four, five years up to five.

And we did that because at that time rates were expected to decline.

They have declined since that time.

And what you see is the end result that we have a 5.6 million dollar gain.

It's an unrealized gain.

But if we sold those securities today, we realize

For April 30th, we'd realize a $5.6 million gain.

And what's happening, we're not intending to sell them, but what's happening is we're actually earning more interest than the market's paying today.

So another nice windfall for us.

Next slide.

Here, we look at liquidity of our investment portfolio, and you see the upper left-hand chart

You see the different types of investments and you see the act for our investment policy, border proof investment policy in maximum maturity and you see the policy in the dark blue and then in the light blue is where we are with the longest maturity for any individual security of that type.

So if in compliance there,

just talked about the maturities by year, so I'll move over on from there.

And then in the portfolio limits table on the right-hand side of the slide, essentially we have limitations within our investment policy of percentages of what we are allowed to invest in individual investment types.

So for instance, government securities, that's 100%.

Corporate Notes, 25%.

And what this slide is showing you where we are in the pie.

And then in the bottom right down in the corner there, it shows you that limit.

And we're within all those limits.

Next slide.

And this final slide, we do have in our policy a benchmark that we are trying from a return perspective.

And return is the third

You know, we go in order of preservation of principal liquidity to be able to fund our projects and then return being the third principal in that order.

So return, we do have a benchmark in our policy of the federal funds rate.

And as you can see, both our short-term LGIP investment and our investments with our investment manager are both actually slightly above that at the end of April.

And with that, I'd be glad to entertain any questions.

Thank you, Steve.

As biodiversity, just a reminder, this is the paradigm under which we track

Small Business and Supply Diversity.

Same slide you see all the time.

It's just the definitions of my real business, micro business, small business, et cetera.

Here are the E-guidelines that are established at the federal level that we follow as well.

Here's our performance for the third quarter and see that we did not meet our goal in the third quarter.

We set a goal of 11.5%.

We are below that 11.5%, as you can see there.

That said, we're still thrilled with our work on supplier diversity, and here's why.

Third quarter, we had the highest outgo of supplier diversity that we ever have had.

Over $4 million went to companies that are in the SWAM category.

Why we didn't meet the goal is because we had more project spending than we expected to have.

We had Long Bridge South, for example.

We spent a lot of money on mobilization that we didn't expect to spend until later.

So that just shows that we're moving money out faster for project related things.

Unfortunately, in the mobilization side, there weren't any swim opportunities.

So that increased the denominator without really touching the generator.

So we're watching the fourth quarter closely.

The fact that we're under the 11.5% that we had hoped for doesn't really discount or doesn't really take away from the fact that we are very focused and committed to swim usage because we think it makes the entire program better and we're working to work more closely.

Questions on that?

All right, administrative updates.

We had said to you all last week, and I'm happy to answer questions on it, but there were conversations over the past couple of years on what protections are in place for members and VPRA officers and employees.

We sent out a policy for VPRA for the group that provides yet another level of coverage to make sure that there are no concerns.

Sent it out, got a couple of questions that we have either answered or we're working on answering, but I just wanted to make sure everybody saw that.

We think that there are good protections in place already.

This just adds yet another level of protection.

What we don't want to do is have anybody feel that they are not covered for the work we do here.

Organizational updates.

We're currently at 67 FTE.

We're going to even out sometime somewhere in the mid 70s.

So we feel good where we are now.

We've got some interns that are coming on board, which is a great, great

to start in May, pretty much on track with what we've expected.

Four postings are currently out, as we speak.

Here's the chart showing just our diversity by gender and age, by race.

We feel good about this.

We feel, again, committed to making sure we've got a good, diverse dashboard.

Administrative budget, you see we're on track about category for the most part.

Nothing unexpected here.

As I alluded to earlier, this is a chart where we don't want it to be exciting.

And thankfully, this is nice and boring.

So that continues to be good news.

We'll talk more about the budget later as we look for approval for the 2026 budget.

No contracting updates.

We didn't have anything this month that was over $250,000.

So you have another bullet slide.

Happy to present that.

OK, but coming soon, we have, as we've talked about in the past, we start with with agreements with CSX and then we get to complete design or close to complete design.

We do addendums with CSX on the projects they're working on.

And they are not ready yet, but they're very, very close.

We are going to be sometime in the next few weeks entering addendums with

CSX on Long Bridge and also on bypass.

They're between $5 and $50 million, the exact amounts.

One is $16 million and one is about $9 million.

You will see an email from me, as you often do, that says, hey, we're going to enter into a contract after leave and we'll give you five days notice.

You get five business days notice.

But these two will be coming

I just wanted to mention it, I didn't want you to get the email next Monday and say, well, he didn't talk about this on Thursday and here's this $16 million contract he wants to enter.

But this is just continuing to move forward and signifies the fact that on both of these projects, very soon, CSX will be starting hard construction work on what they're doing there.

More details coming in the email, but again, no surprise.

Mr. Westman, you happy?

He's very concerned that I say, don't say things that I'm not supposed to say until we've come to final agreement.

All right, budget estimates.

So this is one we talked at the last meeting about a change in our siding program.

We had a siding that was going to require us to replace a highway bridge that turned out to be much more expensive than we thought.

So we went to CSX and we said, look,

We would rather take a look at whether this siding is exactly where it needs to be.

And if not, let's move it to a place where we don't need to do that bridge.

Thankfully, CSX and SURE, we can move it north.

It actually makes a little more sense to move it north.

So we now have what's called the title tailors for siding.

And we'll talk a little bit more later about that siding shift.

But when we got to that decision, we wanted to make sure that we could start design work on the siding in the new location as quickly as possible.

And it brought up a little bit of an ambiguity.

where the executive director has the authority to move money between projects up to a certain level, up to $5 million.

I also have the authority to start a new project up to $1 million, as long as it doesn't exceed the overall capital budget.

But there was confusion because this is a siting that we need to get service, but it's in a different location.

So we're going to change the line item and say, hey, this is a new siting.

So is it a new project?

Is it not a new project?

It wasn't clear.

So we took the very conservative approach and said, look, let's call this a new project, even though it's a signing that's part of the signing portfolio, we'll call it a new project.

DJ, you only have the authority to put $1 million there.

So it's a $1.2 million contract.

However, because conservatively, I only have the authority to move $1 million, we signed a contract for the design, but we said you cannot spend

And we have the right to get out of this contract whenever we want to.

So under no circumstances without the board being aware would we spend more than that million dollars.

But this is a budget adjustment that would be made to shift to deciding.

And that leads me to and I'm happy to answer questions, but that leads me to it really pointed out a pretty ambiguous section of the bylaws where the whole five million versus

So what we're proposing, and we talked about this finance committee meeting, and there was comfort there, I believe.

What we're proposing is to modify the language, not back the language, but I'll show you in a minute, to make that more clear.

And as long as the overall capital budget is not exceeded, to give the executive director the authority to move $5 million, either to a new project or to an existing project.

Again, making sure the overall capital budget

So, first, any questions on the Taylor's Mill Siding Project, and then I can go to the language that exists now, what we're looking to change.

Here's the existing language, and you see it says, if you transfer $5 million to 20% from the existing budget, then the second, the bottom line shows that I can add budget to a new line item up to $1 million to 20%.

It's not really clear how that works.

It's the siding in the Manassas Line are two very good examples of where there's not a clarity.

So what we've done is we've drafted some changes and they're the red line changes that it's, some people prefer a red line, but they're the red line changes.

We're making it much more clear than closing to make much more clear in the bylaws.

So it can be 5 million.

There's a red line change and you have it in fact, you got it out.

And then here's what it looks like.

Just what the new is in here.

So that's our proposal to change the bylaws.

We feel that it's a reasonable level.

The executive director had five million already.

You can't exceed the capital budget.

There's got to be full awareness to the board.

We just wanted to make it, we wanted to add more clarity to the bylaws.

Mr. McLaughlin, Mr. Westerman, anything that I missed there?

I just want to point out that nothing you missed, that the previous project in the secondary side was $142 million.

So there was a question is, do we have $1 million, $5 million, $142 million to spend?

Is it a new project or is it just relocating the current project?

So again, we're taking the conservative approach and not assuming, not presuming anything.

So we want to take the conservative approach, but it is important to get projects moving.

I'll just say we've struggled with this ambiguity twice in the past year.

The top row tells you what happens when we're transferring funds among or between line items but not increasing the capital budget.

The bottom row tells you the constraints when you are increasing the capital budget.

And the confusion came up when we were adding a not yet existing line item, not increasing the capital budget for transferring from one to a not yet existing line item.

So that's where the ambiguity came up.

And it came up twice.

And we realized, OK, we're going to have this over and over.

We're going to need to move and spend some money initially to advance some concepts without calling special board meetings constantly.

So that's why we've gone to the new language that clarifies it's $5 million you can transfer among or between as long as you're not increasing.

Yeah, I think this is reasonable clarification.

I think it adds consistency, again, as you point out.

And by the way, I love the red line of this.

Just, you know, one's a transfer and one's an addition, and it seems like to have all transfers should be consistent.

I don't think we've been that inundated, though, with needing to approve something over five million, have we?

So it's a different concept.

So of the between 5 million and 50, anything over 50 right here, but that's anything over five.

This would be different.

This would be a budget change.

And so you're right, we've not had a, usually when we do budget changes, we have enough

Now, with that said, we're going to talk later today about our negotiation status on Long Bridge North and Bypass and we're going to be recommending that we have a special meeting in June because we think negotiations will be done by then and we'll be coming together for a budget, but that's much more than $4 million.

Yes, of course.

We just thought to call the entire board together.

The deciding is a great example because we made the decision, we got the agreement with CSX and do we wait two months and not start design work or do we call a special meeting by the board for a half hour to give $200,000?

It seemed like clearing this up was the much better path forward than calling everybody together for $200,000 or waiting two months and not doing work outside.

Great.

Any other questions?

So moved.

Thank you.

Thank you.

Thank you.

Any opposed?

I oppose.

Thanks.

Any abstentions?

Thank you very much.

That completes my report.

All right, so we'll start off with some slides that it seemed for, and hopefully I know there's a lot on them.

So hopefully they're becoming more familiar.

Looking at the VRE performance first, just want to point out, so April, over April, we are doing slightly better than we were this time last year.

So that's positive, but of course, 90% is our goal.

So this is not ideal.

So we will continue to work on that.

We did have some better months recently, but we've dipped down just a little bit

I'll point out here on the right-hand side, so when we look at the blue ones being the Manassas Line trains, Brad being the Redstone Line trains, so 321 at 100%, that's a morning southbound out of Washington, so that train has done perfect in February through April, but when we look at 309, which is the poorest performer, so that is an afternoon train that is coming out during some of that congestion,

But one of the things I'll note is we looked into 309, how bad is this train performing?

That was pretty bad here, but also it's not, a lot of it is not chronically bad.

So I would, just to clarify that, I would say out of the 22 runs, seven of them were within 10 minutes, six minutes being late, it was 10 minutes late or less, and two of those times by six minutes.

So of course we want to continue to work better.

Mr. Dalton, do you have anything you'd like to add?

Keep going.

So top delay causes Amtrak interference, so Amtrak BRE occupying a lot of the same track in the Northern Virginia area, slow orders as CSX is performing work out on the tracks and that will ramp up into the summertime.

And then of course there's CSX train interference, CSX out there, but that actually impacts Amtrak more as you go from south towards Richmond and then

which is something we're continuing to watch.

Amtrak Performance, the Northeast Regionals are the trains that Virginia sponsors.

As a reminder, through kind of plateaued in the low 60s here, this is all station on time performance, meaning it reached that scheduled stop within 15 minutes.

I'd just like to occasionally remind that the official one is how many customers arrive on time, but for just knowing what goes on in the network, we look at this metric.

So this time, or April of 25 versus April of 24, we are doing slightly better.

We still want to get to that 80% mark.

That is the goal.

We color coded a little bit to help you see the trains in purple headed down to Roanoke and then the ones in Teal, the Newport News and the Richmond trains and Norfolk in the blue.

So a good number of them, more of them below 80% than above.

Our morning trains typically do better.

195 is a southbound on the weekend.

So that train had eight runs in April.

Seven of the eight times it came into Washington Union Station on time, and then four of the times, four more times, four of those seven came out of Washington Station late.

So again, it's just kind of showing that Washington Union Station is where some of our trains are coming into Virginia late, starting off on the wrong foot.

Long distance trains, longer to travel, so more opportunities to fall behind, but we are doing, I would say, almost significantly better than this time last year, but we did see a dip.

So one thing I'll talk about today is we look through the long distance train numbers.

These are our named trains.

The Carolinian is actually North Carolina's train, Palmetto, Floridian, and Silver Meteor long distance trains.

40 and 41 here on this chart are the Floridian.

And the Floridian used to be the Silver Star.

And there's a lot going on in the Northeast Corridor.

So Amtrak redid the Silver Star and got the Northeast Corridor.

So it's a diesel train the entire time from Chicago to Florida.

I just checked to see how 4D is doing coming up from Florida.

So it's just south of Raleigh in three and a half hours within schedule.

This train is one that Amtrak is looking at the schedule for fixes, but there's a lot of problems further south that we need to work on.

With 41 coming south, you know, it comes from Chicago.

It also has a long time where it can get tripped up over other railroads, but it has an hour of dwell in Washington and it doesn't have an engine change.

And so that was intended to help push them into the schedule and get it out from the right foot, but that doesn't seem to be part of the story here.

So again, some things we need to look at at long distance, but Floridian is one that we're going to focus on, one of the others, I think, on schedule fixes.

Any questions on those three?

We'll delve into some other information.

The things that we look at on how can we improve, I'll go over some opportunities today.

So the CSX heat orders, CSX again has very considerable heat order policy, one o'clock to 7 p.m.

If there's a heat order day, then the trains have to slow down during that time.

and we are entering the season where that is going to be seen a lot more.

We've already seen it in April.

We're seeing it a lot in May already.

And I'll go over that.

So we're gonna try and adjust schedules to account for some of that.

Delays at Washington, I'll talk about as we're continuing to watch performance at Washington, Amtrak has continuous improvement watching very closely.

Then we also know there's a lot of track work coming, just maintenance of way work is coming in addition to the construction projects that we will have coming online

And then the new thing I'm going to talk about this time is the Norfolk Southern.

So we really only talked about Richmond or Washington, but we did have our first meeting with Norfolk Southern to start doing the same exercise on the Norfolk trains that run over Norfolk as they go south toward Norfolk and also our run of line.

So we're tracking heat orders.

We're tracking temperatures and heat orders.

And so already in April, you can see this red bar here in April is 25.

So we're a little higher than we were last year, but not quite as high as we were in 23.

I would say May is on track to probably beat last year.

And as a reminder, heat orders can be triggered with a swing in temperature as well as a hot day.

So the springtime is seeing a fair number of heat orders, not just because of temperatures, but because of the swings in temperatures.

We will expect to see heat orders based on the data.

It will be the worst in June and July.

And we will do, again, another pilot of adding time into the schedule to try and mitigate some of this.

We can't completely mitigate for it.

There are going to be days where we don't have heat orders.

And so this schedule that we're doing is kind of a function of how much cushion is already in the schedule.

You know, what happens when we have days where we don't have heat orders?

So it's

Something, when we call it a pilot, it's because we're still trying to get this right.

We are adding more trains.

We're adding two north of trains to it this year.

And we were also able to get North Carolina to agree to add their trains to it this year.

So more trains will be part of this pilot.

Washington Union Station.

So we kind of peaked when we really started to see these problems.

In 2024, in the summer of 2024, the southbound delays to our trains peaked at about 4,500 minutes.

We had been in discussions with Amtrak July of last year, we really started to see Amtrak, their hiring was coming online.

We started to see their efforts to improve, started to come to fruition.

So in August, September, October, November, we saw some really good trends in bringing down the delayed and Washington Union Station to Amtrak's credit.

We have seen that tick back up just a little bit and primarily remains to be because of servicing or just getting the train out and mechanical issues.

So to talk about that a little bit more, engine swaps, so getting that done on time.

Amtrak is one of the Amtrak folks we talked to calls it hand-to-mouth with engines.

So they're kind of waiting on light trains coming up from the north.

They're coming in from Northeast Corridor to have those engines serviced and turned for other trains.

And when they come in late and we don't have other engines ready, it makes other trains late and there's a cascading event.

And that's one of the reasons Union Station continues to see this afternoon cascade congestion issue.

Mechanical issues.

So it's interesting, we want to know more about this.

We've talked to continuous improvement at Amtrak.

The engine failures, it seems there might be also some supply chain issues for parts to repair engines.

So there's something they're working on there to be able to get more engines back in service.

I'll point out also two things down here at the bottom on the right.

Switching signals, we had two days in April on the 22nd and on the 27th where we had two significant switch failures.

There is a rehabilitation program going on at Union Station.

So as DJ pointed out earlier, we have 55-hour outages.

We have these plans.

The customers only see which trains are available, so we're not advertising those problems.

But right now, we still have some issues with switches.

So that rehabilitation program continues and hopefully

over time, and Blue Flag procedures.

This is one that we're learning more about, but these are procedures for protecting folks as they service the train.

Darren, before we move on, just want to remind people that Amtrak has some new aero trains coming.

They're going to take care of that engine swap.

You won't have to swap out the engine.

Don't want to speak for Amtrak, but a couple, two to three years or so in that time frame.

We're seeing in about a year and a half.

No, on our quarter, about two and a half.

Okay.

First, let's go out to the board.

I just want to make sure I understand the slide.

So this is from January to April, 2025, and it's by cause.

That's the number of times.

So it's 2,684 times.

There was a delay due to engine swap.

Minutes.

Oh, minutes, minutes.

Okay.

And just to look how BRE is also performing, so the terminal congestion of course BRE2, and I know there's a lot to look at, but the red is where we start to see some things

We know 336 is coming up from Virginia.

336 does fairly well getting into Alexandria, but what we've seen in the data is that 336 is often held outside Washington.

So that's one of those things.

And then it has 13 minutes to switch and become 331.

And then if 331 is behind, that affects 311.

That's 10 minutes behind it.

So

Just for clarity, 301, 303, 305, 321, 335, those are the train numbers.

Those are the VRE train numbers.

Sorry, yes.

No, that's okay.

Slide the right a little bit, Jeremy, because that's actually the worst one, 337, not 334.

Yeah.

Oh, absolutely.

Yeah.

This is very concerning for us.

I'll give you an example.

337, it held out 68 minutes last night.

We've got people on those trains.

Right.

And you've got a lot more people on those trains now, right?

That's good.

And it's a huge opportunity because as we continue to tell Long Bridge, allowing us to add all of this service, Washington Union Terminal, Washington Station is incredibly congested at the current level of service.

So if we're adding 6, 7, 8, 10, 12 more trains a day,

And thankfully, the folks at Union Station Redevelopment Corporation, folks at Amtrak, are aware of that and support it, but it's a problem that we can't stop.

We've got to stop admiring and start.

It's a challenge, excuse me, to have an opportunity.

Thank you, my fault.

Can I just have one more thing?

And you don't have to go back to your slides or anything, just a couple of things too.

In the terminal itself, we've changed from a mode of operation, we activated PTC in the terminal as well.

So you make a positive train control.

That will, I will say, eventually actually enhance, on top of enhancing safety in the terminal, it will enhance throughput in that terminal as well.

So that's something that's going to take a little bit of time for some consistency.

I noticed on your previous slides that you are tracking PTC slash initialization.

up there.

I know we both, BRE and Amtrak, I think have had a couple of incidents.

So that'll materialize.

I think that'll help us out.

And then number two, my favorite topic, Track 22 should come online here in a couple of months, right?

We're told in the summer, that'll give us an entire track and platform

from which, you know, it's not accessible to either VRE or Amtrak.

So don't want, again, don't want everybody walking out of here cutting at risk, particularly themselves.

Yes, so we've heard that as well, the end of summer, Track 22 should help.

There are a lot of construction projects in the Northeast Corridor as well.

So it's not just on the Virginia side, it's also coordinating service on the Northeast Corridor with constraints.

You can do station right now.

So there's just a lot going on.

And PTC, one thing I'll note, because we, you know, we went up to Union Station, spent a few days educating about the customer service program that we have, and just talking to crews.

And, you know, we also asked them things like, you know, we mentioned PTC initialization, you know, and it was interesting that they have identified and are working on something where we thought it was always just initialization, is it a computer problem?

So excuse my ignorance but I thought PTC was supposed to be completely implemented and deadline by two or three years ago past all the terminals

It's not in all the terminals.

It's not in all the terminals.

So that wasn't part of the deadline.

Okay.

Oh, it's not.

Yeah.

Okay.

That makes sense.

Okay.

But you are implementing it.

Is that all I'm hearing?

Okay.

And why, then?

Okay.

So that's an option.

Okay, and that's an option.

That's an option to do the implementation.

Okay.

You need to receive funding to do that.

And I will say that some of the things will advance quicker in terms of fixing some of the problems after, you know, we were successful in taking control of each station.

We talked a lot about the construction that's coming online and one of the projects that Deutsche Bahn, we have on staff at VPRA for service performance, they're building out a network chart

that we will be monitoring with all the projects, all the sponsors of projects to have one source of truth.

So as an example of what we're going to build is a web-based, something that we can share with all of our project stakeholders.

So looking at Alexandria, where you have the station on this side, if you're familiar with Alexandria Station, you either board on the station side or you go across the tracks to the station there.

We want to make sure we have all these phases for every project down the corridor in one

One web-based platform that we can share with all stakeholders and have those discussions.

And so it's really that one source of truth.

So we're working on that for service performance and make that accessible once that's built out and to have greater alignment.

So that's just one initiative I think that's going to help us get through the tough times ahead.

So I guess the final thing I'll talk about is the Norfolk Southern side of the state, which is actually two sides, but we initiated our first performance monitoring meeting the other day.

And I'll talk a little bit about corridor before I talk about what we talked about with them.

So they are kind of bifurcated.

So we usually talk about in these meetings that the Washington to Richmond are compete down to Petersburg.

And we sometimes look down the peninsula too, because we just want to know how it's affecting it,

and up to Washington border that we're focusing on the CSX.

And so the orange is our grown-up route holiday going to New River Valley.

And so that has service and long-distance service.

And then when you look south of Petersburg, when you go down to the Norfolk Southern, down to Norfolk, those are just state-supported service only.

There is no long-distance service on that route.

And so just to give you a clearer picture of what that looks like.

So this is Alexandria.

So everything comes together at Alexandria before it goes over the Long Bridge.

The Crescent is a daily train that goes down to New Orleans and then we have our two daily round trips coronate that will extend to Newark Valley and then we have three times a week the Cardinal service which is partially on the Buckingham branch but for the most part on the Norfolk Southern once it gets to Charlottesville.

So any questions about the service application?

We have the three round trips that are state supported.

So one of the things that's interesting about the Norfolk Southern side of the state is our service, our second frequency and our future third frequency have a different arrangement.

So we have been tracking this in kind of a pilot phase because once we finish the projects, we will be able to have a performance regime with Norfolk Southern.

So we pay a premium rate for that second train.

It's equivalent to the BRE rate.

actually, but if they don't perform, we can reduce that amount in 10% increments based on the performance.

So we've built that spreadsheet and we're currently tracking it.

We have to have Norfolk Southern's buy-in, which they have looked at the sheet and it is complex, but we're getting there before it goes live because they have to finish their construction projects before that is utilized.

And then we've looked at service in two different ways.

So focusing on the Roanoke corridor first, we broke the orange dotted lines of the Crescent and the Cardinal service.

So you can see longer distances, they don't perform quite as well.

The Crescent is a long distance train that's heading between New Orleans and the Northeast.

Come up through Roanoke, Danville, Williamsburg, and then up through Charlottesville to DC.

and also the Cardinal comes in through Clifton Forge staying out through Charlottesville.

Thank you.

Yes, thank you.

So why do you think that is?

We filed a, you know, the Department of Justice filed a complaint against Long Beach Southern on our behalf about their failure to honor on-time performance and providing us reference.

On Amtrak's behalf.

Right, right, right.

It's the first time the Justice Department has taken that action.

They've always had the power to.

It's the first time since 1979.

Wow.

They've actually done it.

And was that a ruling that was done?

They filed an action.

I gotcha, okay.

Was that after Biden?

Yeah.

DOJ?

Yeah, that's what I thought.

Okay.

They are.

And then we look at the Northeast Regionals that goes with

starts in the morning early and one that starts early in the morning from DC.

And then they kind of flip and go the other way.

So those are performing generally much better, but of course, shorter distances.

And what we did is break up the south bounds and north bounds.

The reason is our north bounds generally start in the morning,

And they perform very well.

They have shorter distances.

You know, everything's fresh, plain slate.

We start near the south bounds are coming to Norfolk Southern off of the RFMP.

And I guess

As I wrap it up, let's talk to Norfolk Southern.

One of the things we've had to do, and this happened in CSX too, now that we've been doing these performance committee meetings for three years, this is earning the trust, right?

There's a lot going on.

There's legal actions or potential for legal actions in the background.

And so we're earning the trust to show them we're utilizing the data to have conversations.

We did talk about 20.

We talked about 151, which is our southbound in the morning out of Washington DC to Norfolk.

We have to have

So that they meet and don't trip each other up.

But there's a lot coming as far as when we look at scheduled adjustments in the Northeast because of Amtrak's construction, because of our construction where we may be able to have a scheduled resolution as well.

So that's something that we talked about with Norfolk Southern at length.

That was really where they wanted to start.

So more to come from those meetings.

Thank you, Jeremy.

And it's perfect timing.

It's about 10 of 12 and lunch is here.

So we are going to take a break and we'll go into recess and come back and speak in a closed session.

Let's, if it's okay with everybody, we'll meet back here at 12, 20, 30 minutes.

Good.

Maybe we'll be able to get everybody out of here.

Okay.

We're in recess.

Thank you, Jonathan.

So now that we're back in open session, we will need to take a roll call vote, and I ask each member to indicate their agreement with the following.

To the best of my knowledge, during the closed meeting, only matters heard, discussed, or considered were those matters lawfully exempted from the open meeting's requirement under the Virginia Freight of Information Act, and only those public business matters as were identified in the motion which the closed meeting was convened.

Ms. Doersch?

Aye.

Ms. Drake?

Aye.

Mr.

He stepped out.

Mr. Jordan?

Yes.

Thank you.

Mr. Crawford, Mr. Crawford, and perfect.

Thank you, Marystelle.

You're welcome.

And then we'll also drop the comments right as we get through that content.

Thank you, Ms. Perry.

Starting with our high level financial plan look like we normally do.

As you recall, we present this every time we take the budget to orient the board on what's changing from a high level.

So across the top, we have what we brought to you in January, we brought the capital budget that ultimately went to CTV.

And then down below, what we are showing is the changes we're ordering to talk about in detail in the next slides.

So from a sources perspective, so these are all the revenues coming into our plan to pay for VPRA's program and projects.

We have an increase of $97 million.

On the USDA side, so this is our capital projects, our grants, and then our operations.

We also had positive news of a decrease of $188 million.

What that results in is a net spread that goes to the management reserve, our risk mitigation tool, of $285 million.

We're going to jump in into detail starting with the sources.

As a quick reminder, now that we have a management reserve policy, we come in and approve the actual sources changes on an orderly basis.

So what you're seeing over here, we've talked about in January, so we're not going to touch on the sources that have been updated at this point.

We're going to focus in on the Q3 changes in sources.

And really the overarching message here is that we have regained revenue, starting with the I-66 toll financing.

So as you can see, we're showing an increase of $22 million.

We've done a lot of work with VDOT to figure out what this financing can deliver for VPRA.

Feel confident, it's at least $600 million.

So $22 million increase here.

More to come on this, we're undergoing a level two TNR study wrapping up in August.

So hopefully we've got good news on the back end of that.

Our Commonwealth Rail Fund estimates come from taxation.

The last few years, we've shown a decrease and a slump in the taxes.

However, this year we have regained that and then some, adding $37 million into VPRA's financial plan.

Next, we have our investment income forecast.

VPRA has some really strong cash management investment policies that we're able to deploy to bring this income into VPRA's financial plan.

And we feel confident that through those processes, we can bring another $26 million to fund VPRA's projects.

The last thing I'm going to talk about here is the Stafford County Utilities Realtation.

This is a contribution coming from the locality, and it's a VPRA to deliver a project, which we'll talk about on YouTube, so I want to highlight it here, because we'll go ahead and book in this in a couple slides.

That's that increase of sources, $97 million.

Across the bottom, you can see what's ultimately happening is that's driving the management reserve balance over the quarters as we improve it.

What it's resulting in is what we're going to approve later is this $461 million management reserve balance.

That's a cute thing.

Let's look over the other side of the equation with the uses.

I know that it's kind of a big question to try to kind of cordon off what we talked to you about in January and then the new changes.

And that's exactly what we have here.

So we're going to be focusing on what's changed in April.

By quarter, you can see that the big changes are coming in the I-95 corridor.

And the last thing we want to note on this slide is that in April, there are no new budget items.

Everything we're going to talk about are net changes to the budget items you guys already have.

Let's jump into

I-95 corridor for those fake trees that are occurring.

In January, we signed a contract for Long Bridge South where we have an idea of what the construction costs are going to take to deliver that project.

As part of our project methodology here at VPRA, when we get a construction over, we come in and re-baseline that budget so that that's what we're tracking towards for the duration of that construction.

So as you can see here, we're showing a decrease of $186 million.

We are confident that we can deliver this project for this balance now that we have that contractor on board with the signed contract.

The next item is Richmond Layover Facility.

We are currently funded for this project for 60% design.

We are recommending that we bring in 100 funding for 100% design and also the right-of-way acquisition.

This is a required project in order to turn on our phase two service trains to Richmond.

We are actively working to identify the funding.

So through grants, so we've made a couple of different grant applications that we're looking towards.

When we identify the funding to bring this whole project in for construction, we want to make sure it's shovel ready.

So that's why we're recommending this next step on this project

100% design of right-of-way after this.

The last item is that Stafford Utilities relocation.

We are doing this work on behalf of the locality, but they are going to reimburse us for it.

So in order to expend the dollars, we have to put it in our budget.

So we're getting this up to the full estimate at this time.

So adding $10 million to this project.

We're going to go ahead and flip over to the Western Rail corridor.

When we came to you all in January, we had added $6 million for this project.

This really relates to the parking lot component of Cambria.

That can bring up site.

That portion is entirely buried by VPRA.

Now that we have the construction estimate, we know what it's going to take to actually do all the grading and the lighting and the drainage.

It is more than we had initially anticipated.

So there's another increase now that we are actually have shovels in the ground.

We have the contractor on board.

It's up to $7 million.

So $1 million change from what we came to before.

The next slide of our capital budget changes, I want to, hopefully you can see this, there are color differences here.

So everything that's in gray and white, we talked to you before, we're not going to touch on them again.

We're going to focus in on the orange items here.

So for other capital projects, we're recommending a $9 million increase related to our monastic fine capital maintenance.

Now that we're on this line, we have been doing a lot of work with NS to understand what it takes to maintain it to a state of good repair.

In our recent meetings and our forecasting, we have become aware that there is some signaling and communication that needs to be upgraded so that it does not become obsolete.

So we're going to go ahead and add that budget into this line so that we can cover those costs as they come down the pipeline in about 10 years.

This section we talk about here is in the grants.

Just this big item here, Amtrak train equipment.

Historically, when we bring on new service, VPRA has to refurbish train sets or pay Amtrak some portion of money in order to get the train service for Virginia.

However, Amtrak got IJA funding to fund the new aero fleet, which we will get to benefit from.

So we have confidence when working with Amtrak that we no longer need this budget item, so we can free that up to spend elsewhere in our program.

To the operations side,

We will approve a one-year budget today.

However, we'd like to look at it from that 30,000 feet of what's happening within our financial plan.

Minor changes going on in this budget.

You have a problem with ATU in January.

We get a pretty significant decrease related to FY24 as they revised the PREA 2009 methodology.

So we had some big savings.

And then we also refined our admin costs that flowed through operations.

And that story is really continuing here.

Now that we have a cost allocation plan that's approved by the FRA, we're able to proportion of our costs based on a level of effort between operations and then where they should be on the capital projects.

For a while we were double counting.

We're actually kind of including an operations budget and also the capital projects, so we're continuing to refine that to make sure that that admin costs are in the right buckets.

That's just further refined understanding that this is almost like undoing more double counting that we have in our chip.

Let's go ahead and zoom into the one-year operations budget.

The story here really is that it's flat.

As you can see down here, cost recovery from budget perspective, 67% in FY25, continuing that in FY26.

The reason for that is that we are about to put the corridor under construction.

So from a revenue perspective, we are not expecting revenue to grow at the rate that we currently have.

So we are only forecasting a $1.2 million increase.

Why it's critical that we don't overestimate revenue is that's in our financial plan.

So we have a gap.

Revenue comes in lower.

We create an unfunded position in financial plans.

So we're trying to see what happens to our revenue as we put the poll.

The next item here, so the Amtrak train operations expenses would pay Amtrak to run our service.

A slight increase of $1.5 million.

You might have noticed on the EDR report when we talked about our F.25 actuals, we're running about $5 million under budget this year.

We do expect costs to go up, but there's significant budget already.

So we just kept it rather flat because we have excess.

Last item here we're going to talk about is kind of goes hand in hand with what we talked about in the last slide.

So the operations administrative budget, that decrease is also being reflected here in this one year look too.

With that, we're going to continue on the administrative budget theme.

While we do take the administrative budget and push it between two components, your operations and capital budget, we will always bring it to the board holistically so you can see what are having for us by budget category.

There's a lot going on on the slide.

We wanted to make sure to answer to all of your questions on it.

on starting on the left hand side.

So we've got our 25 annualized act.

So where we think we'll land and then the budget just for comparative purposes.

And now we'll move into what we have from the FY26 budget, what we are recommending.

And this is what we're going to talk through here.

So 13% increase.

What's really driving that, as you can see, is payroll.

And so we'll jump into that really quick.

So we're expecting to add about 10 average full-time employees for the fiscal year.

The other thing that's happening that's driving this number up, almost half of it, is that we have re-baselined some assumptions on direct staff time.

We had some assumptions in the budget that were not accurate.

So what it does essentially is rather than the projects getting the dollars right up front through direct staff time, it puts the money into the admin budget, and then it appropriately uses the cost allocation plan as the methodology to put the level of effort on the projects.

One regular baseline that increased this budget $1.2 million.

So about half is just really an accounting exercise.

So let's move on to professional services.

There's this thought that as we increase our head count, that professional services outside needs to decrease.

So while it is maybe not as much as you expect with the full-time employee count going up, what we want to call attention to is that every year we take on a new initiative.

This year it's the Asset Management Plan.

We are going to be spending a great deal on looking at that great deal.

Good amount of money, right amount of money to develop the next phase of what we're headed into.

When this is all built, we have to maintain all these assets.

So it's a big investment that we need to make early on so we can do this right.

So not only we're going to put a policy in place, we have to do requirements gathering because we need a system.

And then we also need to do asset inspections.

So we have a baseline of everything that we own.

So that's why this item is really flat on top of things that we will just continue to need to outsource, such as our investment management, service planning, some legal assistance.

That's the story of why professional service is not seeing a big decrease.

The other item we'll talk about is information on psychology.

It really does go hand in hand with the asset management system.

As that comes online, there will be amortization that goes along with that.

So we're seeing that as an increase for FY26.

In addition to that, we have a PMIS system that will be in place all year increasing amortization as well.

I'm looking at where the admin budget sits as a total perspective of our expenditures.

Let's try to describe it so you can see this.

As VPRA, so what it is is we've got the total expenditures and this is going to be the admin cost of the percentage of the total expenditures, right?

So you can see that admin budget has kind of shifted rather high in the beginning.

We were just getting up and going, right?

So the admin budget as a percentage of expenditures was around that 5 to 6% range.

But as we start to level off and we get the capital projects going, we're moving into this 4.5 to 3.5% range.

This is right in line for sister agencies within the Commonwealth, specifically in transportation.

So that's what we wanted to call attention to.

We do feel like we're leveling in about right level of administrative costs for our program.

That's great, though.

The last bit about this, you just said about the comparison with other comparable agencies.

Thank you, Ms. Perry.

Second.

Thank you.

Any further discussion?

All in favor, say aye.

Aye.

Aye.

All opposed?

Mr. Crawford, Ms. Drake, did you record your vote?

Aye.

Yes.

Aye.

Thank you.

Any abstentions?

Perfect.

Just another slide on this.

We talked about how we arrived at this $461 million management reserve for Q3, so you know how we got here.

I mean, we had to call attention to the fact that this is the highest management reserve we have had, and it's above our goal.

So then we're going to come over to the other side of this slide, and what we wanted to really highlight is that

What level of confidence do we have in our program cost estimates?

And this pie chart is depicting that.

So of our entire program, we have 33% where we have construction bids.

We're pretty confident that we know what it's going to take to deliver those projects.

But there is a much larger portion of our program that we're still doing engineering or we're negotiating those construction prices.

So while we have a large management reserve, it does not mean that we're looking for new projects to bring into the program.

It is our safety net to ensure that the funding that we have allocated to us

and deliver the program or projects that we have on our to-do list.

So with that, we would like to ask the board, we can answer any questions, but we'd like to ask the board to approve the Q3 Management Reserve balance at $461 million.

Second.

Thank you.

Ms. Drake and Mr. Crawford.

Aye.

Aye.

Thank you.

Can we vote and take everybody's vote?

Oh, sure.

I'm sorry.

I asked for discussion and was then going to ask for vote, but you're right.

I'm not sure why I asked for theirs first.

But yes, all in favor, please say aye.

Aye.

Any opposed?

We already have this Crawford and Ms. Drake's vote.

Any abstentions?

All good.

Thank you.

Any further discussion before we are able to adjourn this meeting early?

Do you have a little bit of time?

Yeah.

Sure.

After you meet for the next slide, please.

Sorry.

Just a reminder.

The virtual meeting will be on the 26th to read you all on the negotiations, which should be filed by the Passerwood and then also approve an amended budget to reflect those new numbers.

Thursday the 26th from 11 a.m. to 12 30, that'll be virtual.

And then you can see the upcoming four pages.

And I know Maria still will get all that information out to everyone in the near future.

So any further discussion, any questions or comments before we adjourn?