Dennis Storzek: bravo! You hit it right on the head.
It also helps to bear in mind that 611 was built to haul 18 or so passenger cars at high speeds for long distances...it's not a saddle tanker.

Non-profits won't be around for long if they don't turn a profit. They have to operate as "for profit" businesses and for all intents and purposes are. The key difference is that there are not owners or shareholders financially benefitting from the non-profits business.

It is not legal to operate as a non-profit if that’s the only difference. It’s not a loophole - there are specific legal requirements. But that’s not the topic of this post so I’m not sure why you brought it up. I was just correcting a post to make it clear that we are talking about both a for-profit and non-profit here.

Crescent Zephyr, you are conflating how a business is run with the use of the profit or surplus. Boilermaker is referring to sound business practices. Any successful nonprofit is going to conduct their activities so that they end up with more than they started with. We call it profit. I think what you are confusing is where that profit goes to. In a nonprofit it stays with the organization. In a for profit it goes to the owners or increases the value of the company.

Any good nonprofit manager is going to look at any proposed project or venture in a way that maximizes return. The return may be in people reached or a project completed, or revenue generated, but they are not going to do it if it results in a net loss to the organization, unless that loss is spelled out as part of the goal.

There are more similarities than differences between for and non profits.

Very good point and hopefully this is part of the equation that each operator uses. However, it is not always possible to generate the full amount of required revenue for each operating day. A sound business plan can also include a certain amount of fundraising for each 1472 inspection. Perhaps it is found that for that 1.5 million rebuild that 2/3 comes from retained revenue and 1/3 is obtained from a capital campaign. They can then plan accordingly. But whatever that plan is, there should at least BE a plan.

I beg to differ. Fundraising has no place in a BUSINESS plan. Fundraising is for foamers... If they don't meet their goal, the engine simply 'goes dark' until they do, but Strasburg would dry up and blow away if they allowed that to happen.

Yes. A good point. Of course it’s not necessarily foamers, it’s individuals who are passionate and want to support a cause. There are many examples of religious, education, and arts organizations who are in the same boat.

But yes this is a perfect example of the major differences between for-profit and non-profit.

Lots of head scratching among any nonprofit professionals that happen to read that comment!

In the nonprofit world fundraising is indeed a major source of income and is part of most business plans.

And I must ask, what does Strasburg have to do with this since they are a for profit company?

Aren't they the ones running the trips?

But 611 is owned by a nonprofit. Strasburg is just the host railroad that provides track time, crews and other services for a fee.

As often said here in the past:

"Non-profit" is an IRS tax accounting status, NOT a business plan.

My assumption was that, like most nomadic British diesel and steam locomotives, the host RR plaid a fee to the loco's owner(s) for the "guest star's" use, while the owner(s) arranged for transport. (See the Gramlings for the closest U.S, equivalent.) With Strasburg and 611, there are probably more details such as over-the-winter storage, any repairs or overhaul, etc.

Indeed. A non-profit could decide to run steam trains, or other programs, for free for the benefit of the mission of the organization. The mission of a non-profit should never be “let’s make all the money we can.”

Crescent Zephyr: Surely, you are joking? The goal is to absolutely make money. The only difference is that instead of benefiting shareholders or owners, the money goes back into the organization. Sure, museums have free programming and often a charitable educational aim, but the bottom line should be no different than any other business.

Yes, it's expensive for many, but I've seen people drop a lot more than that during a night at the casino, which won't be nearly as memorable. Heck, many folks donate that amount or more to these locomotive restorations and receive nothing but a meager tax write off. I think the point that you're missing is the laws of supply and demand. These tickets WILL sell out.