Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, 2016 Minneapolis/Duluth-Superior Passenger Rail Alliance 1 NORTHERN LIGHTS EXPRESS HINCKLEY LOOP RECOMMENDATION

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, NLX -- Project Management Oversight Project Kick-Off Meeting December 19, 2012 February 24, 2016 Minneapolis/Duluth-Superior Passenger Rail Alliance 2 BACKGROUND

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Northern Lights Express Intercity passenger rail service between Minneapolis and Duluth 152-mile corridor on existing BNSF railway track Intermediate Stations Coon Rapids, Cambridge, Hinckley & Superior WI

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Northern Lights Express Base Alternative 90 mph max speed 4 round trips per day 2½ hours from Twin Cities to Twin Ports Hinckley station near business district. Increase in speed and frequency still an option after successful operation of service.

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Hinckley Station

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, NLX -- Project Management Oversight Project Kick-Off Meeting December 19, 2012 February 24, 2016 Minneapolis/Duluth-Superior Passenger Rail Alliance 6 HINCKLEY LOOP STUDY

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Project Purpose To determine the feasibility of constructing a direct rail connection to and a station at Grand Casino Hinckley rather than operating NLX on the BNSF mainline with a station in downtown Hinckley.

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Project Need Ridership analysis in the feasibility study indicated that a direct Casino connection compared to locating a station in downtown Hinckley would result in: 60 percent increase in NLX ridership overall 36 percent increase in NLX revenues

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Alternatives Considered During Round One Screening

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Round One Screening and Evaluation

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Round Two Screening Alternatives 2, 4, 5B retained for round two screening. Preliminary assessment of impact on environmental and cultural resources. Capital Cost estimates Draft Round Two report completed in February Study process halted pending completion of forecasts for the base alternative.

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, NLX -- Project Management Oversight Project Kick-Off Meeting December 19, 2012 February 24, 2016 Minneapolis/Duluth-Superior Passenger Rail Alliance 12 BASE ALTERNATIVE ANALYSIS

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Ridership Forecasts Annual Ridership Current Forecasts , , , ,000,000 Tier 1 Forecasts , ,376,000 Feasibility Study model not suited for comparison between downtown location and casino location. Limited national experience with intercity passenger rail service to casinos High speed passenger rail connection to Chicago Assumed in Tier 1 EA Not assumed in current forecasts 13% of Tier 1 ridership associated with connection to high-speed passenger rail service to Chicago. Tier 1 w/o Chicago connection , ,200,000 18% drop in ridership Change from 8 to 4 round trips.

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Implementation Cost Tier 1 EA $990 M Current estimates $500 M - $600 M

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, NLX -- Project Management Oversight Project Kick-Off Meeting December 19, 2012 February 24, 2016 Minneapolis/Duluth-Superior Passenger Rail Alliance 15 HINCKLEY LOOP ALTERNATIVE ANALYSIS

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Ridership Forecast Methodology SDG model has separate zone for casino. Model is capable of distinguishing between casino and downtown station locations. Three minute access time to casino versus 15-minute shuttle ride. Line haul travel time more attractive than access travel time. The convenience of a one-seat ride may enhance the perceived attraction of the NLX service to the Casino patrons/employees. Adjustment of modal constant. Four minute increase in overall end-to-end travel time. Modest reduction in end-to-end ridership. Fares held constant

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Ridership Estimates Moving the station from Downtown Hinckley to the Grand Casino would: Increase Hinckley-based ridership by 20% 30,000 annual riders Increase from 150,000 to 180,000 Increase overall ridership by 7%. 50,000 annual riders 750,000 – 800,000 Increase overall revenue by 5.5%

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Capital Cost Estimates Alternative 2$87 million Alternative 4$81 million Alternative 5A$81 million

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, NLX -- Project Management Oversight Project Kick-Off Meeting December 19, 2012 February 24, 2016 Minneapolis/Duluth-Superior Passenger Rail Alliance 19 SUMMARY AND NEXT STEPS

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Summary Grand Casino Hinckley is a significant trip generator in the Hinckley Service Area. Relocating the NLX station from downtown Hinckley to the casino would: Increase system ridership by 7% Increase Hinckley station ridership by 20%. Increase the percentage of ridership using the Hinckley station and going to the casino from 38% to 50%. Providing a direct connection to the casino would increase the overall capital cost of the project by around 15%. The overall ratio of user benefit to cost for the entire project would be reduced.

Northern Lights Express Minneapolis/Duluth-Superior Passenger Rail Alliance February 24, Recommendation Defer consideration of the direct connection to the casino. Proceed with implementation of the base project. Review direct connection alternative after experience gained with operation of base project.