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2010 Fast Tracks Railway Dreams: BC and US Businesses Looking to Olympics to Provide Catalyst for Rail Investment

The 2010 Winter Olympics is stoking enthusiasm for new rail services on bothsides of the Canada-U.S. border.

Leading the charge is Whistler Railtours Ltd. of Vancouver, which says it is
close to a deal with Via Rail Canada Inc. that could see $20 million poured
into launching tourist-oriented rail service between Vancouver and Whistler
in time for the 2005 cruise season.

The venture is a partnership between CruiseShipCenters International Inc.,
headed by Michael Drever, and Nika Lake Lodge Corp., headed by John Haibeck.

Other partners include CruiseShipCentres chair Eric Trygg and Lorne Embree,
a partner in BelPacific Excavating and Shoring Ltd., which won an $18.2
million contract to rebuild a portion of the Sea-to-Sky highway.

The deal with Via would see Whistler Railtours provide trains, handle
marketing and take bookings. Via would provide the on-train service and
maintain the trains.

“We’re just going to outsource the operation of the train, because we’re not
train operators – they are,” Drever said.

Drever said CruiseShipCenters’ experience promoting BC Rail’s Whistler
NorthWind service revealed interest among cruise passengers in rail
packages, but most weren’t interested in travelling all the way to Prince
George as the NorthWind service offered.

Whistler Railtours would travel to Whistler twice a day and carry about 400
people. Service to Prince George would be less frequent, connecting with Via
trains to Prince Rupert and Jasper.

Drever hopes to draw on cruise passengers who want to circle from Vancouver
to Prince Rupert and back through the Interior to Vancouver.

“What we’re looking at doing is building the infrastructure that doesn’t
exist,” he said. “Nobody has put together a centralized marketing program or
has the train that actually works and makes money.”

Drever said major cruise lines are supportive, thanks in part to the
popularity of similar cruise and rail packages in Alaska.

Haibeck is also overseeing construction of the Nika Lake Lodge, a 78-room
hotel adjacent to the Whistler station. Projected to cost $56-million, the
hotel will open in early 2005 and offer a full-range of amenities. Mike
Duggan, currently general manager of the Pan Pacific Lodge in Whistler, will
manage the new hotel.

Once the service is established he will consider partnerships with other
carriers.

“We are entering into talks already with Amtrak so that we will connect the
U.S. to Vancouver,” he said, noting a U.S. connection would draw visitors
from the Pacific Northwest.

The state of the track between Vancouver and the U.S. border has frustrated
previous efforts to expand rail connections between B.C. and Washington,
however.

The major sticking point has been funding, which neither the provincial nor
federal governments in Canada has provided since Amtrak reinstated a daily
connection to Vancouver in 1995 after a 14-year hiatus. Since 1995, Amtrak
has added four buses.

“It’s frustrating not to get the $20 million to $30 million in Canada that’s
needed,” said Bruce Agnew, director of the Seattle-based Discovery
Institute’s Cascadia Project
, which seeks to secure funding for Amtrak
services in the Pacific Northwest. “We’re a bit perplexed that this isn’t on
the radar screen.”

Meanwhile, Washington State set aside US$170 million this year to cover
railway construction costs over the next 10 years. Another US$30 million was
budgeted to cover operating costs for the Cascades service, which continues
to lose money even though it is one of the most successful in Amtrak’s
network.

Agnew believes the Olympics will attract the interest needed to secure
funding, however.

“It’s an excuse for us who have been at this business for 10 years, but
bring it on! It’s a great excuse and I tell you, there’s a huge enthusiasm.”

Kirk Fredrickson, rail planning and policy coordinator with the Washington
State Department of Transportation, shares Agnew’s optimism.

“We’re going to hopefully use the Olympic Games as something that’s a
catalyst for us to accelerate the capital program,” he said.

Though the long-term goal is to have four round trips daily between Seattle
and Vancouver, Frederickson said current discussions hope to secure at least
one extra run.

West Coast Express president and CEO Doug Kelsey, who prepared
transportation plans that accompanied Vancouver’s bid for the 2010 Winter
Olympics, said funds tagged for Olympic preparations won’t be cash on the
table for new rail services.

The interest the games generate could strengthen the arguments of companies
looking for capital for their own projects, however.

“If it can help drive a legacy that others want to make an investment in,
then that’s great,” he said.

pmitham@biv.com