Does anyone know if there are any not-for-profit railroad museums that own seperate common carrier railroads to move freight?

Thanks!

midlandblb@cs.com

Yes,I was told Historic Red Clay Valley, operators of the Wilmington and Western tourist railroad, formed a for profit railroad to haul freight after CSX pulled out.
> Does anyone know if there are any
> not-for-profit railroad museums that own
> seperate common carrier railroads to move
> freight?

> Thanks!


mtillger@enter.net

How about the East Troy Electric Railroad in Wisconsin? I'm not sure whether the museum owns a for-profit line or whether the museum simply hauls freight, but I know that they move a small amount of freight with antique electric steeplecabs.

frank@gats.com

TVRM owns the East Chattanooga Belt Railway to move freight over the same.

aw90h@cs.com

Railroad Museum of New England's wholly-owned subsidary Naugatuck Railroad Company is a common-carrier, operating both the excursion passenger service for RMNE, and the small amount of freight service we provide on the 19.5 mile ex-New Haven Railroad Waterbury-Torrington line. NAUG leases the line from Conn DOT.

And, NAUG was apparently the last railroad whose formation was approved by the ICC-- just 5 days before ICC ceased to exist in 1995.

RMNE had to get NAUG chartered by act of the Conn legislature, and that was done in June 1995, coincidently, just 150 after the original Naugatuck was chartered by the same body!

hpincus@mindspring.com

I believe the Indiana Railway Museum has a common carrier affiliate.

TVRM has both its common carrier subsidiary as well as a non-common carrier (contract switching) freight move involving one industry located on the museum railroad.

AMaples@aol.com

Golden Gate RR Museum in San Francisco also has a common carrier adjunct, which switches scrap and other materials from the Hunters Point Navy Yard, where the museum is a tenant.

I believe the Indiana Railway Museum has a
> common carrier affiliate.

> TVRM has both its common carrier subsidiary
> as well as a non-common carrier (contract
> switching) freight move involving one
> industry located on the museum railroad.


bobyar2001@yahoo.com

> Does anyone know if there are any
> not-for-profit railroad museums that own
> seperate common carrier railroads to move
> freight?

> Thanks!

Under IRS section 501(c)(3) tax exempt rules, there is a support schedule which looks at the gross income of a nonprofit organization. If more than 30% of that GROSS income comes from unrelated business income, ie, regularly operated freight operations, the tax exempt status is put in jeopardy.

The Yakima Valley Rail & Steam Museum Association has operated both the Northern Pacific Railway Museum and the Toppenish, Simcoe & Western Railroad. Prior to 2001 the railroad was run with all volunteer members which resulted in the IRS considering the minimal freight operations to be part of the exempt purpose of the nonprofit group. As the railroad expanded freight operations from 20-40 cars a year to 988 revenue cars in 2001, it became necessary to hire full time personnell. As the revenues increased, the freight operation income began to dwarf the museum and tax exempt purpose of the organization. For these reasons the railroad freight operations have now been spun off into a wholly owned subsidary corporation. The subsidiary corporation can pay its profits as dividends to the parent nonprofit organization, but only the dividend is counted toward that 30% number in the support schedule. The for profit subsidiary has to be run separately, but at least the tax exempt status of the museum is no longer threatened.

Kind of a long winded explanation, but this is the reason the nonprofits with a significant freight operation will probably have to spin off the common carrier freight operation.

Toppenish, Simcoe & Western Railroad

Doug@nprymuseum.org

> Under IRS section 501(c)(3) tax exempt
> rules, there is a support schedule which
> looks at the gross income of a nonprofit
> organization. If more than 30% of that GROSS
> income comes from unrelated business income,
> ie, regularly operated freight operations,
> the tax exempt status is put in jeopardy.

> The Yakima Valley Rail & Steam Museum
> Association has operated both the Northern
> Pacific Railway Museum and the Toppenish,
> Simcoe & Western Railroad. Prior to 2001
> the railroad was run with all volunteer
> members which resulted in the IRS
> considering the minimal freight operations
> to be part of the exempt purpose of the
> nonprofit group. As the railroad expanded
> freight operations from 20-40 cars a year to
> 988 revenue cars in 2001, it became
> necessary to hire full time personnell. As
> the revenues increased, the freight
> operation income began to dwarf the museum
> and tax exempt purpose of the organization.
> For these reasons the railroad freight
> operations have now been spun off into a
> wholly owned subsidary corporation. The
> subsidiary corporation can pay its profits
> as dividends to the parent nonprofit
> organization, but only the dividend is
> counted toward that 30% number in the
> support schedule. The for profit subsidiary
> has to be run separately, but at least the
> tax exempt status of the museum is no longer
> threatened.

> Kind of a long winded explanation, but this
> is the reason the nonprofits with a
> significant freight operation will probably
> have to spin off the common carrier freight
> operation.

To Mike, Frank, Mark, Howard, Alan, Bob and Doug - Thanks very much for the info!

Les


midlandblb@cs.com