I have two questions about buying stock and a Friends group for the Strasburg Railroad.

For right now, they are NOT offering stock in the company. Apparently, it's still a privately owned entity. But you would think that people would fall all over themselves if the company did an IPO (initial public offering).

Also, apparently, a "Friends of the Strasburg Railroad" idea has been brought up before.

My idea was to have volunteers to help with various duties on site, do booster work and community outreach and off site events.

This too, is not on the agenda for the current time period. They may re visit these at some point down the road.

There has got to be something between owning an annual pass (which I already have) and forming a Friends group that I can direct my affection of the SRR towards. Any ideas?

hugh.clayton@nara.gov

I too am impressed with the Strasburg Railroad; but remembe it is different than most of the organizations discussed here at RYPN.

It is not a 501.c.3 non-profit group. You can not deduct any funds given to them, car tolls, mileage or in-kind donations like you can to the non-profit sector.

But is is a great ride and it will be better when they get the turntable in at the LemonPlace end of the line!

Ted Miles

ted_miles@nps.gov

In the area of stock, a private company is just that and it affords some degree of flexibility.

As far as the Friends idea, in my own opinion there are two main factors.

First I think that they have too much going on to depend upon anyone but paid staff.

Next I think that many people would not take part in a Friends group due to the fact that they are a for profit business. Would you work for free at Friends of Burger King?

There are pleanty of places to do this kind of stuff as a hobby. Cross the street to RR Museum of PA, drive down the road to Wilmington and Western, or up to WK&S for just a few.

Tom Gears

> In the area of stock, a private company is
> just that and it affords some degree of
> flexibility.

Nice to see you here, Hugh.

Amplifying the good points Tom and Ted make, I was told last fall by an SRR corporate officer that the railroad recently has preferred to buy out existing shareholders as opportunity has arisen (e.g., from estates of deceased shareholders) to further consolidate ownership.

Absent the need to raise additional capital for operating purposes, it's hard to see what SRR as a corporation would gain from offering additional shares, which would by definition dilute the ownership of the current investors. I can't see how they would put the capital to work in a way that would earn a high enough rate of return to overcome the dilution. Anyhow, all evidence suggests that the current owners and the BOD have no interest taking the company in that direction.

SRR really IS a for-profit business, albeit one that offers so many challenges and such a constrained rate of return that you almost have to be in it for love, not money. They best way to support them is to patronize their trains and stores, as Hugh noted that he was already doing.

eledbetter@rypn.org

> Absent the need to raise additional capital
> for operating purposes, it's hard to see
> what SRR as a corporation would gain from
> offering additional shares, which would by
> definition dilute the ownership of the
> current investors. I can't see how they
> would put the capital to work in a way that
> would earn a high enough rate of return to
> overcome the dilution. Anyhow, all evidence
> suggests that the current owners and the BOD
> have no interest taking the company in that
> direction.

> SRR really IS a for-profit business, albeit
> one that offers so many challenges and such
> a constrained rate of return that you almost
> have to be in it for love, not money.

Selling stock is a extremely expensive and difficult proposition. SRR is not going to take over the Northeast corridor, and there's a limited market for their technical services unless we start running Chines SY's or something.

In order for an public offering to make sense, you need to have high growth propects in order to cover the extraordinary legal, accounting, underwriting, marketing and regulatory fees and hoops.

A second issue is that Strasburg needs to have control vested in people with specific technical skills. Having outsiders dilute the current control would interfere with a fine operation.

Of course I'd love to own 1 share just to say I was part owner.



Superheater@rrmail.com

A friends group at Strasburg railroad? You gotta be kidding, right?

No way, it will never ever happen. Ever!

The Strasburg guys are reading this and I can assure you I can hear the guffaws resonating from the backshop.

As long as they are a for profit company with paid employees, it will remain the same as it ever was. No volunteers, period.

> I have two questions about buying stock and
> a Friends group for the Strasburg Railroad.

> For right now, they are NOT offering stock
> in the company. Apparently, it's still a
> privately owned entity. But you would think
> that people would fall all over themselves
> if the company did an IPO (initial public
> offering).

> Also, apparently, a "Friends of the
> Strasburg Railroad" idea has been
> brought up before.

> My idea was to have volunteers to help with
> various duties on site, do booster work and
> community outreach and off site events.

> This too, is not on the agenda for the
> current time period. They may re visit these
> at some point down the road.

> There has got to be something between owning
> an annual pass (which I already have) and
> forming a Friends group that I can direct my
> affection of the SRR towards. Any ideas?

> As long as they are a for profit company
> with paid employees, it will remain the same
> as it ever was. No volunteers, period.

Well... just in the interests of complete soup-to-nuts history of Strasburg nit-picking--I do believe that back in the heroic age any number of volunteers or at least "unpaid staff" worked on the property. But as for here, now, and today, yes, it sure seems unlikely, and understandably so.

eledbetter@rypn.org

The Strasburg is going to be using volunteers this year if they deem that camelback #4 is an affordable candidate for resoraation. It has been posted here by Strasburg shop people that this will be the case. I don't know where the volunteers are coming from but they are going to do it.

Now, this does differ from a friends group, but I think they are planning this to keep costs down, and because their staff is swamped with other repair jobs and contract work.

Paul


plc95@yahoo.com

The volunteers that will be working on #4 will be volunteers from the ranks of the Strasburg's own shop staff coming in on their days off to work the engine without pay. They are not inviting volunteers from outside the Strasburg RR's payroll to work on the engine.

> The Strasburg is going to be using
> volunteers this year if they deem that
> camelback #4 is an affordable candidate for
> resoraation. It has been posted here by
> Strasburg shop people that this will be the
> case. I don't know where the volunteers are
> coming from but they are going to do it.

> Now, this does differ from a friends group,
> but I think they are planning this to keep
> costs down, and because their staff is
> swamped with other repair jobs and contract
> work.

> Paul