First Quarter 2021 All Aboard is a news bulletin for employees/retirees of the Alaska Railroad. The emailed version includes short briefs with links to longer stories or more information, most of which are posted on our employee website, Inside Track, https://insidetrack.akrr.com/. OUR BUSINESS Summer passenger schedule shows gains over 2020 The 2021 summer passenger schedule will feature train departures well above summer 2020, as the railroad anticipates a partial rebound for travel to Alaska. While hopes for cruise ship returns have dimmed, the state’s visitor industry believes (and we agree!) there is pent-up demand to visit a magestic destination like Alaska, whether or not via cruising. Indeed, the railroad is seeing a bump in reservations, compared to last year, indicating greater demand for rail travel this summer. Booking online, in particular, has gone very well, with online sales totaling over $1 million in March alone. Comparing March 2021 with March 2019, seats sold are definitely up. The reservations agents are very busy, as are online bookings. We are hopeful this trend continues. While this is very good news, our visitor projections acknowledge a continuing pandemic that we expect to dampen domestic and international leisure travel. Many would-be tourists will hold off until a far greater percentage of the population is vaccinated. Daily summer trains like this one will soon be operating by the end of May. The image photographer, Brian Reed, is one of the finalists from the 2020 Catch the Train photo contests that concluded in December 2020. (continued on next page) “Since last spring, we’ve been hoping – and planning – for a return to our regular operating schedule in 2021. In light of the continued uncertainty of the COVID-19 environment, we’ve had to pivot from that plan,” said VP Marketing & Customer Service Dale Wade in a March 10 email to all employees, which included a revised schedule for summer 2021. “We’ve worked hard to develop a daily transportation schedule that will both meet our fiduciary duty as a self- sustaining entity, and support our obligation as a state corporation to provide for the economic recovery.” The result is a schedule that expands last year’s truncated schedule, but still reduced from 2019. Daily summer trains begin May 29, a full month sooner than 2020 (July 1), and about two weeks later than 2019. Like 2020, the season will end about a week sooner than in 2019. While the Coastal Classic and Glacier Discovery will operate round-trip every day, the Denali Star will have an alternating northbound-southbound schedule, reducing trains from 14 to 8 per week. As was the case in 2020, the Hurricane Turn flagstop service is merged onto the Denali Star. See Wade’s email memo with March 11 news release on the Inside Track > NEWS > Leadership News > 2021 Leadership News page for schedule details. Public health guidelines remain in force, including social distancing and wearing masks in depots and onboard trains, and frequent and in-depth sanitization. OUR FINANCES 2020 Annual Report shares tale of perseverance The Alaska Railroad released its 2020 annual report at the end of the first quarter. Audited financial statements show a net loss of $7.8 million, with total revenues of $150.7 million and total expenses of $158.5 million. The numbers tell only a fraction of the story. Facing tremendous challenges posed by a global pandemic, the railroad sought to balance multiple expectations in terms of safety, service, mission and finances. “In a year of unimaginable challenge and change, the Alaska Railroad met demands on multiple fronts thanks to the perseverance and ingenuity of railroad employees,” said ARRC President & CEO Bill O’Leary. “The 2020 annual report recounts many of their remarkable feats of productivity, efficiency and reliability. “That’s the story behind the numbers,” added O’Leary. “Our employees are reason enough to again start the new year with optimism. Together, we can tell a tale of recovery and rebuilding in 2021.” The 2020 annual report is available at AlaskaRailroad.com > CORPORATE > Leadership > Reports. OUR ASSETS Federal funding bolsters railroad’s 2021 capital plan Posting a pandemic-induced $7.8 million net loss for 2020, the Alaska Railroad had little internal funding available for capital upkeep and improvements in 2021. Thankfully, federal grants have helped to fill the gaps, allowing the railroad to budget $66 million to maintain and improve our infrastructure in the year ahead. Funding sources include about $27 million in Federal Transit Administration (FTA) grants (which typically require a 20% match); nearly $20.5 million from the Coronavirus Aid, Relief and Economic Security (CARES) Act, about $11.3 million in Consolidated Rail Infrastructure and Safety Improvements (CRISI) grants (requiring a 50% match); and $7.7 million from ARRC-generated funds. (continued on next page) All Aboard – Alaska Railroad employee news bulletin — First Quarter 2021 Page 2 A big chunk of this year’s capital work is focused on our bridges. With a $40 million budget, the 2021 bridge program includes several replacements and major repairs. Posted on the railroad’s external website’s project page AlaskaRailroad.com > CORPORATE > Projects the 2021 Bridge Program Fact Sheet provides an overview of planned work, with separate fact sheets available for the bigger bridge projects. Track rehabilitation (fact sheet also available the external projects page) is the next biggest chunk with more than $20 million earmarked for tie and rail replacement and resurfacing; as well as embankment, yard and branch improvements and culvert replacement. The 2021 Capital Budget document offers more details on dozens of other projects, including funding sources for each. Discussed during the Fall 2020 employee town hall meetings, this document is available on Inside Track > DIALOG > Town Halls page. Aside from projects in the ARRC budget, the railroad periodically works with the Alaska Dept. of Transportation & Public Facilities (ADOT&PF) on projects involving shared infrastructure. One such project got underway in early March, as construction crews began rehabilitating the road-rail surface along the entire 2.5-mile Anton Anderson tunnel. Much of the work is performed at night, to minimize disruptions to train and vehicle traffic using the tunnel. Funded by the Federal Highway Administration through ADOT&PF, the Whittier Branch tunnel project is schedule to be complete by the end of April. Project Manager Gabriel Thomas snapped this image of the Anton Anderson tunnel opening, while on-site coordinating resurfacing work inside the 2.5 mile structure. OUR CUSTOMERS ARRConnect offers freight-handling transparency ARRC’s new freight customer portal might be compared to online banking, where your bank lets you to do some things for yourself (like accessing your account profile and statements). But there are still some actions that require you to actually go to the bank, or to interact with a bank representative. “That’s kind of what we offer with ARRConnect,” explains Freight Customer Service Manager Sasha Kincaid, a key contributor to the portal’s development. (continued on next page) All Aboard – Alaska Railroad employee news bulletin — First Quarter 2021 Page 3 What does ARRConnect offer? ARRConnect is an outward facing self- service portal, giving customers the option to help themselves instead of calling or emailing the railroad. Customers can login to track their railcars and trailers, access and print waybills, and, if needed, more easily connect with the Freight Customer Service department. When did it come online? ARRConnect launched in September 2020, following a year of development. Freight Marketing and Information Technology (IT) worked closely on how best to structure the portal and the information and functions it should present. How does it work? ARRConnect is a fully electronic advancement. There are no physical components. The portal takes advantage of the existing Transportation Management System (TMS), which is the backbone of ARRC’s railcar / intermodal movement and tracking software. TMS has always had the ability to generate railcar location reports, direct car moves from one station to another, create and manage freight train lists, and other tasks. ARRConnect lets customers view a snapshot of TMS information associated with their cars. Customers can use the portal with a computer, phone, tablet or other device with a browser, explains IT Systems & Analysis Supervisor Drew Dekreon, who played a key role in implementing ARRConnect. “Because portal information is drawn directly from our system, as soon as ARRC has an update the customer can see it as well,” he added. How does it help the railroad? Prior to ARRConnect, customers had to email or call Freight Customer Service to obtain railcar location information and to submit or receive copies of waybills. Given the portal’s automated capabilities, railroad representatives can now focus even more attention on delivering the best customer service. This leads to happy customers and repeat business. What do customers think? Feedback so far is positive, says Freight Marketing Director Tim Williams. He notes that this kind of automation is becoming a norm in the transportation sector, and therefore something customers will expect. While the ARRC Freight Marketing Department has a general idea of how customers feel about ARRConnect, the team will be looking for specific feedback in the near future. “We are modifying our freight customer service survey to include questions regarding our automation efforts, to include ARRConnect,” said Williams. Survey results will help prioritize the features are added to the portal’s functionality. What about moving forward? There are more portal improvements in progress. These aim to improve the customer experience by adding more self-service options and further automating as opportunities arise. Examples of future upgrades include allowing customers to: A) gain access to outstanding invoices; B) electronically order and release their railcars; and C) electronically spot and pull requests that then automatically empty or load cars in our TMS.