Privatization of the LIRR

Here’s a pure hypothetical question. If the Metropolitan Transit authority was able to buy the long Island railroad, could they sell it. I know that it is no longer a private company and has no shares and whatnot. I only put this out to ponder. Could there be any situation where the state would want or have to sell there railroad properties on the island. Or a kind of total liquidation of the whole MTA. Im not trying to bash the MTA here, I only would like other opinions. I know at least some of us would like to see the LIRR under private management.

I guess if the State wanted to sell the LIRR to private interests, they could. Personally, it's probably worth more simply liquidating it and selling off it's assets than running it as a railroad. I know that the MTA cannot by Law, declare bankruptcy until all it's outstanding equipment leases and obligations are satisfied. It would take approval of the State Legislature in order to sell it.

They would have to drastically change it's schedules, fare structure, labor agreements and management for it to ever make a profit. I would venture to say there would be far fewer trains running and the fare would be higher.

Right now, 48% of the operating expense is covered by the fare collection. The remainder is made up by subsidies. What private company could absorb the cost? That 48% doesn't even cover capital expenses.

When the Railroad was purchased by the State, it was basically a purchase of 100% of the LIRR's stock from the Pennsy. It was a typical corporation with all the stock owned by the MTA until 1979 when it was converted to a "Public Benefit Corporation". Hypothetically speaking, I don't see why it couldn't be reincorporated back to a typical corporation that issues stock if purchased by private interests.

I know you mentioned that you would like to see it back in private hands. If that happened you may nolonger have a railroad to "buff", because it's worth more dead than alive. Just my opinion.

There are no passenger railroads (other than maybe tourist lines) that turn a profit. The costs involve can never be recovered through the farebox alone. This is why the railroads got out of the passenger business over 30 years ago, and why talk of privatization of Amtrak will never happen either.

Theoretically, I'm sure the LIRR could be privatized, but as was mentioned above, only to someone like Gershow or Naporano for scrapping.

Jay

You'd probably be looking at a fare of $500 -$600 a month from Babylon to Penn to cover expenses and turn a reasonable profit. Possibly even more if favorable financing could not be obtained for capital improvements.
Many people don't realize how little of the operating expenses their fares pay for.
The NYC subways, maybe surprisingly, actually pull their own weight the most, at a little over half.

Anybody that would buy a commuter railroad these days would have to be some sort of financial Sadomasochist.
Is Abe Hirschfeld still around? He might be the only guy on the planet with money who would be stupid enough to buy the LIRR. (He was the clown who spent millions to develop rubber- covered wheels for the LIRR fleet, then got pissed when they laughed at him.)

Passenger operations almost never made any money. In the pre-automobile days, maybe, but the Freight service always paid for the capital and other expenses. Since LIRR has no freight service anymore, there's no revenue from that source.

The whole idea of Public Authorities like MTA was to make sure that the SERVICE continued. The graft, corruption, political appointments of doofuses in positions of responsibility wasn't even considered. Ooops.

SERVICE seems to be a lost idea today, as everyone is maximizing profit and compromising on the quality of their goods and services (Just look at a Krispy Kreme donut--it's all AIR).

They tried to make the British Rail private. They had to break it up into little pieces to even come close. But they forgot something-- someone had to PAY to fix the bridges, tracks and tunnels. Ooops.

You can't win. All privitizing will do is make it worse. Leave it alone.

Privatization of rail passenger services-- commuter or intercity--- will never happen. I suspect that with increased costs of all kinds, conditions today are much less favorable than they were when the private operators got out of the passenger rail business. If it were possible for a profit to be made carrying passengers over the rails, none of these government rail transportation agencies would have ever been created.

Passenger operations can mae money but only in limited, niche circumstances such as tourist railroads (i.e. Strasburg) or smething like American Orient Express.
Commuter operations are inherently unprofitable since they have to have the equipment and capacity to handle two rush hours while the excess equipment and employees are basically idle during the rest of the day.

At $3500 for the cheapest seat for an 8 day tour, The American Orient Express better be making money!!

You must blow up your paradigm! Look from outside the box. What is the LIRR most valuable asset, getting more valuable all the time? Access! You pave over the rails, leave one set for frieght. You get rid of the killer overhead, M-7's, M-3's..... How much would a company pay to have one of it's trucks be able to get to any where on the Island in a third of the time, with the risk of an accident lowered to near nil, the truck accesses the system at Long Island City and 20 minutes later it's in Deer Park. You fill up a bus with commuters in Port Jeff and 30 Minutes later thier in the city. Move frieght at non-rush hour times, frieght trains late at night.....

I don't believe this topic!!!!
Why do you all think the Pennsylvania Railroad sold the L.I.R.R. to the
State of New York in the first place way back when?
You people who are too wet behind the ears to remember what it was like
on the Long Island and practically all of the other commuter carrying
railroads of the northeast should ask someone who does remember it.
You who are old enough to remember private railroads doing this job, ask
yourselves if you would like to go back 30 to 40 years, I doubt if you
would want to.
I think you should be happy that you got what you got. Basically the
whole state is paying for your commuter trains, I am not complaining
about that but I think you are getting a very good deal out of it.
Noel Weaver

Noel,

The guy was just creating a discussion with a hypothetical situation. I don't think anybody ever really believes the LIRR will return to private ownership...it's just conversation, you know, like.."Gee, if I was President..."

May I ask you..were you a commuter, not a small boy riding now and then, but a grown-up everyday commuter on the LIRR before 1966?

The hypothetical nature of this discussion is a point well taken. I think that the tone of the discussion, however, stems from the experience that those of us who are old enough to remember the last days of private operation of both the commuter railroads, and the intercity railroads are simply too aware of the detrioration of these services which was the result of the fact that the systems could not charge enough in fares to cover their operating expenses without massive subsidies from some government agency. This becomes a vicious cycle--- service and maintenance is cut because of cost/revenue problems, which drives more passengers away from the service, which causes even more financial problems, etc. etc. etc. And nothing has happened in the last 30 or so years to indicate that, without government involvement, it is any more possible for a private operator to cover his operating expenses out of the "fare box" now than it was 30 years ago.

Tourist railroads may be an exception, but these roads can run trains when they choose to, rather than when people need for them to run.

I was not trying to anger the masses, I was only looking for peoples possible answers to this hypothetical question. I also stated that I was not trying to bash the MTA. they basically saved the railroad, so no mater what other people on this forum fell about them. it is the honest truth. And yes, I may not be old enough to know what it was like. I was only posing a question.

I, for one, am definately not angry. In the perfect world, the market place would be the incentive for a private operator to provide better service than the government agencies do. The problem here is that the incentive is making a profit, and when that becomes impossible, as it did for rail passenger services decades ago, there is no longer any incentive to even provide the service, let alone do it well. Government takes over, when the service is deemed to be so necessary that it must be provided, regardless of the fact that you can't make money doing it. This is the state of most public transportation services today.

Mr. Weaver does indeed know about this, as he was an operator and then a engineer on the old New Haven as it was dying in the '60s. I believe he worked on several area roads into the PC era. I grew up in the era and watched as several short minded folks ran that road into the ground, and then watched them spend $$$ to get caught up, and still rail in CT is clinging on as more nitwits at the state level mismanage it, running old equipment into the ground and talk about giving away crucial r.o.w.'s into "busways", etc.

Another example is what's going on in Beantown, with the state trying to revive the Old Colony passenger service south of Boston. The NH told them to pony up some $$ around 1957 to keep the trains running, the state said no, and now they're trying to restore basic service long overdue, while wasting mega$$$ fending off lawsuits from nimbys. Privatization maybe an interesting what-if, but as long as the culture that exists today in the USA, (tax them on all real estate, row's, etc. and pay only a fraction of what the aviation and road industry gets) then it is only a dream...