In the end, was the Moffat Tunnel worth the investment to it’s backers?
The Moffat Tunnel was built to help pay for the cost of boring the adjacent water tunnel to provide Denver with water, without the tunnel Denver would not be as large today as it is. The Denver water board owns both tunnels.
If I recall correctly, there was also a political swap or deal of some kind with one of the southern Colorado cities - Pueblo or Colorado Springs, etc. - for the state to also fund one of their pet projects.
In that sense, the Moffatt Tunnel did lead to greater development and economic growth of Denver, the surrounding region, and even the state, than otherwise would have been the case. A complicating factor was the Great Depression a few years after the tunnel was completed, which delayed the economic growth for a decade or so. But without the Tunnel, Denver would have been just another Front Range/ Great Plains town with good access routes from the East and to the North and South, but comparatively isolated from the Far West. Rail traffic - the only kind that mattered back then - commerce, and economic growth would have taken the ‘path of least resistance’ and flowed around the Rocky Mountains elsewhere, such as up through Wyoming and down through Arizona, to their benefit and Colorado’s detriment.
I have no great insight on this - just my memory from the Kalmbach book The Giant’s Ladder by Harold Boner. I’ll take another look at it tonight.
- Paul North.
Murphy,
Setting aside the water benefits for the sake of simplicity the Moffat Tunnel did two things.
One - It made the Denver & Salt Lake a reliable line that should have made some money hauling coal to Denver for interchange. Prior to the tunnel winter operations over Rollins Pass was possible only at terrible cost in money and reliability.
Second - It enabled the Dotsero cutoff which for the first time ever put Denver on an east/west main line - CBQ from Chicago and DRGW to Salt Lake, WP to Northern California. As compared to the DRGW route via Pueblo, the Denver route was significantly shorter and avoided the 3% grade of Tennessee Pass ascending eastward.
On balance it strengthened the position of the DRGW and the CBQ at the expense of UP, ATSF RI MP and SP. The national network would have done fine without it. The now UP Craig branch would probably have been long abandoned without it.
My understandfing is that UP is putting no overhead traffic over the line, so I would conclude that today it is not an important route. I also understand BNSF is putting a train or two each way over it between Denver and California. I have no idea what that traffic is worth to them in terms of revenue gained and cost avoided. To the approximate extent BNSF is better off, UP is worse off. BNSF customers are better off.
I suspect that the Tunnel was a good investment, that is it provided a stream of benefits to the national economy greater than the portion of the joint costs allocated to the rail tunnel. Most of those benefits flowed to DRGW, CBQ and their customers.
To really answer your question is at least a PhD thesis.
Mac
By backers, do you mean the taxpayers of Denver and northern Colorado counties who borrowed the money in the bond market to build the tunnel, in the hopes that tolls would pay off the principal plus interest? I hope so because they were the only backers with skin in the game. Railroads put up nothing.
If so then your question should be completed with the words “… compared to alternate investments for the money.” For example, the taxpayers could have put the money in a savings account, or built another infrastructure project, or not taken the risk against their borrowing ability. The answer is an unequivocal yes compared to their alternatives, even if the only outcomes we consider are the ones that can be directly linked, in benefit-cost fashion, to the risk taken by the people who loaned the money to build the proejct.
- The tolls were indeed sufficient to pay for the project. The taxpayers never had to reach into their pockets to pay off the note.
- Northwestern Colorado retained more than 1,000 coal-mining jobs and support jobs every year, and the direct, indirect, and induced economic effects of those wages and purchases, for another 82 years up to the present (and presumably for some time into the future). Most of those jobs would have otherwise vanished by 1950 and never returned without the Moffat Tunnel’s creation of viable low-cost rail transportation into the Yampa Field. Operation via Rollins Pass was not sustainable, The Moffat would not have survived the Depression without the Tunnel.
- Denver and the surrounding counties of Arapahoe, Jefferson, Boulder, Adams, and El Paso received a significant reduction on their electricity cost that otherwise would have paid for imp
In the grand scheme of things, Paul, Denver not gaining access to a direct east-west transcontinental rail line meant absolutely nothing:
- Freight rates from points beyond Western Colorado did not drop with the completion of the tunnel.
- The UP via Wyoming remained the lowest cost route into Denver for freight anywhere west of Denver except for Western Colorado itself.
- The UP via Wyoming remained the fastest route into Denver for freight originating anywhere west of Denver except for Western Colorado itself.
- No significant economic development occurred in Denver as a
Thanks RWM for your perceptive analysis!
Kurt Hayek
note that I added a section to my first point that is a substantial addition
RWM
I stand corrected, that is a VERY nice branch line!
Mac
It is assumed the pipeline in the below view is one of the subjects of this thread.
The photo was taken Thursday, September 30, 2010 near the west railroad portal of Moffat Tunnel.
I’m overmatched here in a couple of ways, and my previous post had more B-S- than I usually tolerate, but it’s been so long since we had rational analysis and a good debate that I’ll risk a rhetorical pummeling* with the following responses:
For long-haul transcontinental freight, you’re right - why should it detour to Denver ? Plus, doing that likely loses a single-line haul over the UP (or ATSF).
And most freight back then was fairly short-haul - only a couple hundred miles - wasn’t it ? So the beneficial effect probably would have been limited to within that range - and yes, mostly to ‘open up’ the ‘Parks’ region of western Colorado to settlement, development, and 'exploitation" (in the positive economic sense).
The only other benefit I can see is to provide another rail route alternative to UP’s near-monopoly to/ from further west, although the D&RGW did already have the high-cost alternative of its Tennessee Pass Route for that purpose (but see below). While UP’s rates may not have decreased, the presence of the Moffat Tunnel Route could have been another ‘lid’ that helped to prevent UP’s rates from increasing ?
What - if anything - does Vance say about this in his book, The Geography of the North American Railroad ?
But what I was really trying to say is ess
Paul: In rates and service analysis, there’s a sharp divide between regulated and deregulated railroading. Let’s consider the regulated era, as that was the era in which the tunnel was conceived and constructed, and for the first 52 years, operated.
From a freight shipper perspective in the regulated era, there is no UP monopoly to/from the long-haul west (Salt Lake City and beyond). You received exactly the same rate shipping via UP as via Santa Fe as via D&RGW via Pueblo. So long as you didn’t try to make a car run backward through a rate territory boundary you could specify route, or not bother at all, and you paid the same. Service quality and transit time, however, was quite different. Perishables moved in very low volume on D&RGW, via either route, due to poor transit time and service quality. The effect of the tunnel on UP service and rates was zero. For example, if you had a 10-day Sacramento to Denver transit time via SP-UP or WP-UP, and a 13-day transit time via SP-Tennessee Pass or WP-Tennessee Pass, getting that down to 11 days via Moffat Tunnel would not create a service parity to UP.
The passenger perspective is somewhat different. There wasn’t a large demand for Denver-Salt Lake City business. D&RGW and UP each fielded a day train and a night train. D&RGW’s night train, the Prospector, was slower but the service was said to be better, so I will agree that UP may have seen an impact from D&RGW service after D&RGW improved the train in the 1950s. In the 1930s, though, D&RGW service was not nearly as good as UP’s, and I have never heard that UP service was poor, so there was no effect at that time. I think UP looked at the bigger picture with its passenger service, preferring to offer a uniformly competent and standardized service, rather than seeing how much it could squeeze out costs in individual corridors and trains where there was little competition, or conversely sharply ramping
The story of the Vista Dome’s inspiration on the DRG&W may not have been directly related to Moffat Tunnel. The aesthetics of both the car design and the view it rendered are not forgotten.
I’m not sure which I found to be more of an eye opener: 1) The fact that I know so little about the Moffat tunnel, or 2) The fact that UP can move a ton of coal a mile for 2 cents.
Freight rates were regulated for years and years. Were passenger rates regulated as well?
Murphy – I’m using 2 cents/ton-mile as a nominal value for coal – it tends to move at a very low cost relative to all commodities because it’s large volume, consistent, requires a lower level of service, often uses shipper-provided equipment, etc. Individual lanes, commodities, and contracts vary. Current U.S. average rate for all commodites is around 3.4 cents/ton-mile.
Here’s a table for your use:
http://www.bts.gov/publications/national_transportation_statistics/html/table_03_17.html
Passenger rates were also regulated.
RWM
Much of this discussion omits the WWII role of railroads. During WWII, much thought frieght and troop trains did go via the Moffet between the east and California. The D&RGW was an early installer of CTC on its main line, and very early bought EMD FT’s as well as new steam locomotives to handle additional traffic. The Moffet line had all the traffic it could handle efficiently during WWII. Wisely, it did not accept traffic that would result in gridlock. This may be the main railroad contribution to the Nation of the Moffet, exclusive of the local contributions to coal mining, Denver water supplies, etc. Difficult to put a price tag on this. The railroad did come out of receivrship and began paying dividends again. I include the Len-Lease period summer 1939 - 1941 Peal Harbor as “wartime.”
Dave,
That the DRGW was busy during the war years does not prove that the Moffat Tunnel was important or crucial to the war. Only if the traffic that went that way would have produced gridlock on the UP, ATSF, SP, NP, and GN would there be evidence of great importance. I suspect the first three listed could have done the work but proving either hypothesis today would be difficult.
Mac
Last night I re-read the pertinent portions of Harold A. Boner’s book The Giant’s Ladder (which I understand RWM views as too uncritical of Dave Moffat, but that won’t matter for this point because he was dead then), and have to concede that it pretty much corroborates RWM’s analysis once I knew what to look for.
In brief, the purpose of the Moffat Tunnel seems to have run on 2 levels - the popular perception of the ‘vision’ of Dave Moffat and maybe a few others to establish an independent, Denver-based and -controlled rail connection for the long distance to Salt Lake City and other points west; and the more local and pragmatic need to access the other side of the Continental Divide with its coal, cattle, and other supplies for the growing city. That need became very clear to Denverites and the cattlemen in the western Colorado region during the scarcities of World War I and other disruptions immediately thereafter, including when the Moffat Road’s ‘temporary’ line over ‘The Hill’ was blockaded by snow for months at a time in a couple of instances. To put this into perspective, during those years, the coal traffic was on the order of 1 million tons, and 1,000 to 2,000 carloads of cattle, and some other miscellaneous traffic, which resulted in typical daily trains of about 50 cars of coal and 25 cars of everything else - too much for The Hill in winter, but seemingly nowhere near enough to justify the Tunnel by itself. Yet without the Tunnel the Denver populace must have thought that they were pretty remote from any other source of those essentials, and the Tunnel became necessary in their collective mind-set as the best way to secure access to those supplies on a long-term basis.
Said another way, for Moffat and the other ‘dreamers’, the Tunnel was perhaps an example of “Build it, and they will come”, writ large and about 90 years earlier; to t
Mac is wrong. The situation was not grid lock or not grid lock. Anymore than saying that the PRR electrification was of value to the USA during WWII only if it could be proved that otherwise grid lock would have occured on eastern railroads. What the Moffat did was speed up all freight between the west and the midwest by opening another of the useful transcontinental routes, and the additional fluidity helped the war effort. The D&RGW route was not as direct as some of the others, but probably just about as good as the RI-SP Golden State route and the MP-TP-SP route, especially since both fed a a single-track Sunset route. All these routes handled record traffic and all made substantial contributions to the war effort. Cutting down delivary of airpline parts by one day can make a difference in saving USA servicemen’s lives. Again, one would not say that the war would have been lost if it were not for the PRR electrification (or for the Moffat) but simply that winnning the war cost fewer lives.
What ever gave anyone the idea that service via the WP-D&RGW-CB&Q was poor? They coordinatred their operations to a very high degree, and all three railroads were generally know for sharp operation. I can vouch for a high degree of moral and management-operating crew cooperation and friendship on the D&RGW.
Dave,
Of course the Moffat Tunnel was “of value”. It was of value to the DRGW as a corporation. That is a long way from important or crucial to the national network and the ability to wage war. That is the point I was trying to make. There were lots of alternate routes during WWII and I know of no reason to assume they could not have shouldered the traffic that went via the Moffat.
Mac