There is a segment of the United States (and Europe too) that loves the railroad and cannot get enough of it.  They love light rail, “regular” rail, high speed rail.  Sometimes the rail lovers like monorail, which is true of the voters of Nevada ten years ago when they approved a $650 million industrial development revenue bond to fund the construction of a monorail in downtown Las Vegas.  I call these people “rail huggers.”  They want to spread rail every where like a plague spreads through communities, states and entire countries.  Cost to build a rail system is not a factor.  It’s irrelevant that these government  created, owned and operated rail systems ever produce more than a fraction of operating costs.  The rail huggers’ motto is “profits, we don’t need no stinking profits.”

The Las Vegas monorail is the only privately owned public transportation system in the United States.  The Las Vegas monorail is 3.9-mile in length and runs on an elevated track.  It links casinos and the Las Vegas Convention Center.    The Nevada Taxpayers Association warned the Nevada voters before the bond vote ten years ago that the credit rating of Nevada would suffer if the monorail could not generate enough money to pay the debt and if the State of Nevada did not have the funds to pay.  Now the Las Vegas Monorail Company has filed for bankruptcy because it owes $500 million to $1 billion and cannot pay the debt.  Surprise, surprise, the revenue from the monorail operations is not enough to pay expenses and debt service.  NTA President Carole Vilardo said:

“We were concerned because bonds for light rail and monorail projects historically had been too aggressive in their ridership estimates,” she says. “The ridership never lived up to the estimates.”

The Las Vegas Sun says “The Las Vegas Monorail will never generate enough revenue to pay off its debts, according to the company’s own financial estimates.  And without financial relief, looming bills to replace trains and other equipment cast doubt on the transit system’s ability to continue operating beyond 2019. . . . Last year, the system generated less than $5 million in net cash flow, woefully short of $34 million needed to service its debt.”

Related posts:

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