After a bumpy start, Amtrak-Iowa Pacific Hoosier State getting clear signals ahead

Last weekend’s (Oct. 16-18) annual fall conference of the National Association of Railroad Passengers’ (NARP) volunteer leadership was held at the Crowne Plaza Hotel (occupying much of the former Union Station, next to the current Amtrak/Greyhound station) in downtown Indianapolis, Indiana. This location gave passenger advocates and frequent train travelers from across the country the opportunity both to tour Amtrak’s Beech Grove Shops, where heavy maintenance and overhauls of nearly all of Amtrak’s rolling stock take place, and to sample the offerings of the newly re-equipped Chicago-Indianapolis Hoosier State train. 

The Beech Grove tour allowed NARP conference attendees, myself included, to witness the staggering volume and diversity of work that takes place inside large brick buildings built in 1915 by the Big Four/New York Central system and later transferred to Penn Central and Conrail before Amtrak acquired the facility in 1975. Tourers were impressed by the precision of the cycle that each type of car or locomotive goes through in the overhaul it must undergo at regular intervals, and by the pride that the tradesmen, members of about a dozen different labor unions, take in the quality of their work. We also got a glimpse of the dozens of wrecked, damaged or retired cars and locomotives that are either out of commission pending an investigation, or awaiting the funding needed for repair and return to service. So much equipment that could be serving passengers and generating revenue if more adequate resources were available.

The Hoosier State has been operated since Oct. 1 under a unique partnership between the Indiana Department of Transportation (INDOT), Amtrak and Iowa Pacific Holdings, which markets it, along with its other tourist and excursion passenger services around the country, under the name Premier Rail Collection. The service still uses Amtrak conductors and engineers, as well as Amtrak’s reservations and ticketing system, but the equipment is owned by Iowa Pacific, which also is responsible for all on-board services, including food and beverage and premium class offerings. This arrangement allows the state and Iowa Pacific to take advantage of Amtrak’s right to access the host railroads’ (primarily CSX) track on an incremental cost basis, and of Amtrak’s liability coverage.

The passenger revenue collected by Amtrak goes to INDOT, which combines it with funds appropriated by the state legislature (accounting for 80% of the gap between passenger revenues and operating costs) and by six municipalities and one county along the route (accounting for the remaining 20% of the operating deficit) to pay both Amtrak and Iowa Pacific for their respective services according to a formula spelled out in the contract between the three parties. 

The three-way partnership has had some teething problems, incurring delays in getting the new equipment approved by Amtrak, FRA and the Food & Drug Administration (for the on-board food service) and experiencing reliability problems with the two ex-New Jersey Transit locomotives, which were exposed to damage during Superstorm Sandy but have since been repaired. Iowa Pacific currently has no spare equipment for the service, but is working on procuring two more locomotives and four more coaches.

The Hoosier State operates on the same schedule as the Chicago-New York Cardinal over the same route segment on the days the tri-weekly Cardinal does not run, so that the two routes combine to provide daily service between the Windy City and Indiana’s capital and largest city. The route also serves the sizable college community of Lafayette/West Lafayette, home of Purdue University. Throughout most of its existence, the Hoosier State has consisted of only two coaches, usually Horizon cars, with no on-board food service and only Reserved Coach seating. 

Now, Iowa Pacific has re-equipped the train so that it carries three 1960s-built long-distance coaches, featuring seating of greater legroom and pitch than Superliner coaches, and one 1950s-built full-length dome car with a full-service kitchen. Coach passengers can have full meals cooked on-board, priced as indicated on the menu, in the lower level of the dome car. But passengers who pay an accommodation charge (on top of the rail fare) of between $23 and $39 to upgrade to Business Class can sit in the upper level of the dome car and be served an entire meal (breakfast northbound, dinner southbound), including unlimited alcoholic beverages, included in the accommodation charge. 

The Hoosier State consist lays over on track that Iowa Pacific leases from CSX only a few miles north of the Beech Grove Shops and, in order to cover the gaps in the Cardinal’s tri-weekly schedule, must be towed by the Cardinal north on Mondays and south on Tuesdays. Without control over the Hoosier State, whose equipment used to lay over at Beech Grove, Amtrak is left only with the use of the Cardinal on Thursdays or Saturdays as a way to shuttle equipment back and forth between Beech Grove and its Chicago hub.

About 25 NARP conference attendees experienced a trip in Business Class and were very impressed with the quality of the service, several saying that it was worth every penny of the $70 total from Chicago to Indianapolis. Iowa Pacific had wanted to call the upgraded service either First Class or Diamond Class, but the Amtrak reservations system could not accommodate this, as the “First Class” designation is reserved only for Acela Express and no other designations were possible in the system. 

Another marketing innovation Iowa Pacific has introduced is the selling of the first two available coach seats on each Hoosier State departure for $1.00, which borrows a concept pioneered by discount intercity bus carrier Megabus. However, the typical base coach fare between the Hoosier State’s endpoints is $31.00, compared to $19.00 on the Cardinal on its departure dates, reflecting Iowa Pacific’s confidence that the quality of its service will command an extra $12.00.

Iowa Pacific President Ed Ellis (who used the Hoosier State to travel to Indianapolis from his home in Chicago) and his Sales and Marketing Manager for the Hoosier State, Heather Hice, both made presentations and answered questions at the NARP conference. Ellis, former Amtrak Vice President for Mail and Express, explained his business philosophy of making train travel an enjoyable enough experience to command higher fares, particularly by offering premium levels of service. He shared his desire to see the Chicago-Indianapolis corridor grow so that it supports at least six daily round-trips, starting with a faster schedule and more convenient departure times for the current daily round-trip. For the time being, Iowa Pacific’s goal is to grow ridership. The Hoosier State’s leisurely schedule makes it practically an excursion train, but “I want to make it the best darn excursion train there is,” Ellis proclaimed.

The Hoosier State’s reliability has continued to improve (thanks in no small part to improved treatment by its host railroads, which has led to remarkable on-time performance) and in a matter of weeks, it has gone from one of the worst trains in the Amtrak system in terms of customer experience to one of the best. The process that led to this point has not been without bumps, but the Hoosier State now stands as an enticing glimpse of the possibilities for breathing the kind of fresh thinking into the marketing and delivery of intercity passenger trains that Amtrak has not been able to provide, at least without a push from Capitol Hill or from a state sponsor.