In an open letter to Dunedin city councillors, Mosgiel-Taieri Community Board chairman Andrew Simms highlighted losses by council-owned Dunedin Railways, deferred maintenance on the Taieri Gorge track and that the vast majority of passengers on the gorge train trip came from cruise ships.
Ratepayers subsidised gorge train passengers by $68 a ticket in the 2023 financial year, he said.
"Dunedin ratepayers, many of whom cannot afford to take their own family on the Taieri Gorge Railway, are heavily subsidising a loss-making commercial tourist operation that almost entirely caters for cruise ship passengers."
The pointed commentary from Mr Simms comes amid debate about what should be done with the rail corridor between Dunedin and Middlemarch — a track upgrade, conversion to a cycle trail or a compromise.
Mr Simms is part of a working group for the Otago Central Rail Trail Trust, which is looking into the potential for extending the cycling and walking trail past Middlemarch and through the gorge.
Meanwhile, train enthusiasts want services, which have operated on a limited basis and under temporary structures since the Covid-19 pandemic, to be rebuilt.
The clash of visions has arisen ahead of the Dunedin City Council working through its 2024-34 long-term plan process, including public consultation.
A compromise — developing an old walking track for part of the proposed cycling trail and allowing trains from Dunedin to use the railway tracks as far as Hindon — is understood to be a far more expensive trail development option.
At a community board meeting this week, Mr Simms tabled both his open letter and a report about what the economic impact might be from extending the Otago Central Rail Trail.
The report by economist Benje Patterson pointed to millions of dollars of benefits if the trail for cycling and walking was extended past Middlemarch into the gorge and towards Dunedin.
The rail trail between Clyde and Middlemarch attracted about 12,750 people in the year to June, resulting in a visitor spend of about $25.9million, he said.
Potential lift in annual spend by rail trail visitors due to a Taieri Gorge extension was between $6.9m and $11.4m, Mr Patterson said.
Mr Simms noted gorge train trips attracted 14,442 passengers last season and 80% of them were from cruise ships.
"The subsidy for cruise ship passengers totalled $786,000," he said.
Dunedin train services — when considered together with track upkeep needed in the gorge — have for years effectively operated at a loss.
A city council spokesman said recent financial results for Dunedin Railways reflected disruption caused by Covid-19.
"Dunedin Railways’ pre-Covid passenger numbers were split between domestic, international and cruise ship passengers.
"It’s also important to remember Dunedin Railways and the Taieri Gorge excursion are key parts of our city’s tourism offering, and help deliver significant economic benefits for the wider city."
The cruise industry has itself been estimated to have an annual economic benefit for Dunedin exceeding $60m.
