History of the Advanced Transit Association (ATRA) Year by Year

by J. Edward Anderson, first ATRA President.

2001 – The Twenty-Sixth Year.

The committee working to update the 1989 report on PRT passed out at the January 2001 Annual Meeting a four-page document entitled “Comparison Matrix of Ready and Emerging In-novative Transportation Technologies.” The document lists 41 systems that fulfill the require-ment given by the title, and rates each in the status of design engineering and testing, costing, marketing, and operations in four stages of development: H = Highly developed, fully built, be-ing tested or ready for testing. M = Partially developed, some components and/or reduced scale prototype built and tested. L = Still mostly on paper, some engineering studies completed. N = All on paper. Only six of them were rated H in any category. This document was to be a part of the forthcoming Update Report on the status of PRT.

In September 2001, on behalf of ATRA’s Executive Committee, ATRA President Dennis Manning sent an eight-page document entitled OPPORTUNITY IN THE BALANCE to two or-ganizations: The Central Area Loop Study Committee of Cincinnati and the Elevated Transporta-tion Company Development Committee of Seattle. In the paragraph on “Purpose” he said “we submit information and observations that we sincerely hope you will find helpful.”

In his summary paragraph, he said: “In the end this is about change versus the status quo. No matter how well our mass transit and road systems have served us in the past, the urban areas of American are in a decades-long downward trend in the battle against sprawl and congestion. Many people are deprived of easy access to the goods of our society because they are unable to own and drive a car whether for reasons of permanent or temporary disability, age or poverty. This is the status quo. If you rely on the same approaches you will get the same results. Moving the deck chairs around will not work. Only new technologies will lead to change.

In the Year End 2001 ATRA Newsletter, ATRA Chairman Tom Richert said: “ATRA is in transition. These breakout meetings (at the forthcoming Annual Meeting) are a chance for us to solicit new ideas and get a fresh look at functions such as membership, development and edu-cation.” Items on the meeting agenda included a review of the year’s activities, especially ATRA’s project of reviewing and updating its mission.

The Newsletter featured an article entitled “Megarail Enters the Ballgame.” This was about Megarail CEO Kirsten Henderson’s plans for two AGT systems: Megarail, a system tar-geted at the inter-city market, and Microrail, intended for urban settings. Both systems use a pair of guideways. For Microrail, Henderson planned three types of vehicles: a four-passenger on-demand vehicle that was intended to serve a PRT function, a special PRT vehicle designed for handicapped passengers, and a custom-designed dual-mode electrical vehicle that could be recharged from the guideway.

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Another article in the Newsletter was entitled “Seattle Advances, Cincinnati Disap-points.” The problem in Cincinnati was that the sponsoring organization, a unit of the Metropol-itan Planning Commission called OKI for Ohio, Kentucky, Indiana, had been planning a light rail system, and PRT, via a business organization called Forward Quest, was promoting PRT. After investigating about 60 elevated rail systems FQ selected Taxi 2000 as their preferred sys-tem. $650,000 was found to make the study possible, and it turned out that quietly, behind the scenes, OKI’s goal was to dispose of PRT to get on with their streetcar. In so doing, the consul-tant instead of evaluating our guideway, in a very short time designed their own guideway (an awful design) and presented it to the committee as PRT without giving me an opportunity to ex-plain the difference. The lesson here is to avoid controversy and go where the prime organiza-tion really wants an optimum PRT design, which requires a very large advertising budget.

Due to an initiative of two tour-bus drivers who loved the Seattle Monorail, Seattle formed an organization called “Elevated Transportation Company” and allotted $6,000,000 to prepare a plan that would use a monorail system to serve downtown Seattle and areas to the north and/or west. The City of SeaTac had been enthusiastic about real PRT coming out of the Chicago study, and were terribly disappointed when the Chicago RTA dropped PRT in 1998 be-cause of the high cost of Raytheon’s PRT 2000. Now only two years later, PRT had no chance. So ETC blew through the $6M with conclusions that could have been derived in an afternoon. After this Newsletter, Seattle dropped the idea of an elevated monorail and continued with light rail, knowing that they could get money for it from the feds.

Another article in the Newsletter is entitled “Frog Leaps Ahead.” The Dutch company Frog Navigation Systems solved the problem of the elevated guideway that PRT advocates have felt was necessary by eliminating the guideway. Theirs is a wire guided system that runs on streets. Later they were selected by Masdar and their system runs there now.

The final article is entitled “APM Conference Attracts Hundreds.” This conference was held in July in San Francisco. “Attendees were brought up to date on the full range of industry activities, from active and planned installations of people mover systems to the development ac-tivities of personal rapid transit systems.”

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My work on PRT during 2001.

On January 10, 2001, our directors and Dick Broms met with managers of Mortensen Construction Company to get them to join us. We had a nice visit but it led nowhere. The fol -lowing weekend, however, was for Cindy and me the most enjoyable in a long time – a birthday party for Dr. Jack Irving at a swanky hotel a bit north of San Diego.

Shef Lang’s next-door neighbor was the President of a lobbying firm called Capitol Hill Associates (CHA). Shef agreed to pay them a fee to lobby for us at the Minnesota State Legisla-

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ture, and they did so for many months beginning with a meeting with the Minneapolis StarTri-bune Editors on February 27, 2001. CHA associate Sherry Munyon spent many hours working for us. At the same time, Liz Sroufe and Tom Goff began stepping up their efforts to find invest-ment fund so that we could build our test system. By May they reported that they had received a conditional commitment letter from a large overseas funding source that would provide funds for our company to get from where we were then through the construction of a first Taxi 2000 sys-tem at the Seattle-Tacoma International Airport and its surroundings.

In March 2001 I gave the following presentations:

March 6th Republican Seniors of Hennepin County

March 6th Senate District 47 Republicans

March 14th Richfield Optimists, Richfield, MN.

On March 9th, I got the surprise of my life: The Mechanical Engineering Department Head Dick Goldstein informed me that he was nominating me for Fellow of the American Asso-ciation for the Advancement of Science, which is one of the most prestigious scientific organiza-tions in the world. Up to that point I was not sure how Dick felt about my work on PRT and I knew that, because of pressure from those who led the push for light rail in the Twin Cities and their opposition to PRT, University officials were divided.

In mid-March I got an email followed by a phone call from a middle-manager at Ford Motor Company – Ernie Tong. He said that he was in a program in which Ford permitted people like him a certain amount of time to explore new opportunities for Ford. I sent him information and we talked occasionally for over six months, with me getting encouraged that we may have the partner we needed. Finally, however, he informed me that he was not able to get sufficient interest from managers above him, which would have been necessary to carry our discussions further.

Ironically, some years later, William (Bill) C. Ford, Chairman of the Board of Ford Mo-tor Company gave a lecture on TED Talks in which he discussed how there were more and more automobile companies making more and more au-tomobiles while automobiles were already produc-ing maddening congestion in major cities. He mentioned a 12-day traffic jam that had occurred in Beijing. He said: “The day will come when the notion of auto ownership becomes antiquated. If you live in a city you won’t need to own a car.”

But Ford was struggling to stay alive, and was not ready for such radical thoughts even though in his lecture he mentioned PRT.

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During spring 2001, we had many discussions with a company called Quadro, a company devoted to transferring American technology to Turkey. After discussions with us, the leaders of Quadro presented Taxi 2000 to the Mayors of Istanbul and Ankara, and likely others. At one point, I heard that the Mayor of Ankara announced on Ankara Television that he planned to ac-quire a Taxi 2000 system. I got a call from one of the Quadro people while he was in a taxi trav-elling somewhere in Istanbul. He called again two hours later from the same taxi, still trying to reach his destination. Quadro was trying to find funds to do a feasibility study of Taxi 2000 in Istanbul, but after many months of activity the possibility of doing business in Turkey faded away.

Also, during this spring, we laid out a PRT system that covered the downtown area of Minneapolis with about 8 miles of guideway and I developed a simulation of it. We hired SRF Consulting Group, Inc. to estimate the ridership. They estimated 89,000 trips per day and we es-timated that the cost per mile would be about 10% of the Hiawatha light rail line, which was then under construction. On this basis, we estimated that Taxi 2000 would provide about 37 times as many rides per dollar as LRT!

On April 2nd, I got an email from Dr. Stan Young, a researcher with the Kansas Depart-ment of Transportation, saying that he had received a commitment of funds to do an impact study of PRT at Kansas State University at Manhattan, Kansas. He asked if he and a couple of his colleagues could visit us to discuss particulars of such a study. We were in contact with him for several years. He later moved to the University of Maryland, where he worked on transporta-tion problems of various kinds and became active in the Advanced Transit Association.

My good friend Lyle Berg, who headed the Bloomington, MN Planning Office, and had supported my work since the late 1970s, invited me to give a presentation on April 12 th to the Bloomington Traffic Committee, and on April 29th to the Bloomington Planning Committee. Bloomington is the suburb of Minneapolis that includes the major Twin Cities Airport. Due to Lyle’s missionary work I have learned that there are many planners and officials south of Minne-apolis that support my work, most recently Steve Elkins, former Bloomington City Council Member and later Chairman of the Transportation Committee of the Metropolitan Council. Per-haps through Lyle’s influence, the Metropolitan Airport Commission began following our work and recently informed us that once our system is fully tested they need it to carry people to and from the airport. The MAC Executive Director told us that his main problem in future years is getting people to and from the airport.

The Universalist Church in South Minneapolis had a forum committee headed by a good friend of mine: Mechanical Engineering Professor Kim Stelson. He arranged for me to give a three-week series of two-hour courses on PRT on April 18 & 25, and May 2. This was a most enjoyable series in which we had good discussions about every aspect of PRT. I learn from ev-ery similar group.

Also in May, I gave a presentation on the 7th to staff members of the St. Paul Chamber of Commerce, on the 23rd at the annual conference of the Center for Transportation Studies, and on

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the 24th to the Y’s Men’s Club of Minneapolis where Taxi 2000 Board Member Ed Rydell was a member. In June, July, and August I gave the following presentations:

June 1 I-494 Corridor Commission

June 18 Planners in Madison, Wisconsin

June 20 Again to the I-494 Corridor Commission

June 27 Merriam Park Transit Committee

July 11 Automated People Mover Conference, San Francisco, California

July 19 Daughters of the American Revolution, Edina, Minnesota

August 14 American Express Retirees

On June 13th I received a call from Andy Ryan at Delphi Auto in Lockport, New York. I had not heard from him for almost a year but now he told me that he was making progress with his Division Director. He showed them a 45-minute video of Taxi 2000 and was told that “Taxi 2000 is a fantastic concept.” He had to answer, however, the usual question about what went wrong at Raytheon and seemed to come out okay on that. The difficult issue was that Delphi was in tough shape and needed to turn around cash quickly. After a great deal of discussion about details and getting me worked up to thinking that this could be our salvation, Andy was laid off in a budget squeeze and that was the last I heard from Delphi.

I gave a presentation at the above-mentioned Automated People Mover Conference, which ran from July 8 through July 11. Shef was there with me for the conference and we had a great time in discussions with colleagues from many places. The highlight for me was that at the end of the conference, the conference chairman, a man from Singapore, said that of the 80 papers he heard, mine was the best. Considering that many of the attendees were from companies that had developed large-vehicle people movers, that comment was particularly satisfying.

During the past month, my telephone notes show long conversations with several people involved in the Turkish project, with Liz Sroufe, who felt that she was close to getting a project at SeaTac, and with Andy Ryan, who still believed that our chances at Delphi Auto were alive and proceeding.

In early July I learned that the Cincinnati Metropolitan Planning Organization, OKI, was urging members of the Central Area Loop Study Committee (CALSC) to attend a meeting to be held on July 17th. Earlier, in mid-June, Chip Tappan forwarded to me a memo from Sam Lott giving his description of PRT and his specifications. I emailed it to Lott with a wide range of corrections. He clearly had only a rudimentary knowledge of PRT and much of what he “knew” was wrong. But until I was sent a draft of the Parsons Brinkerhoff PB) final report following the July 17th CALSC meeting, I knew nothing of the PB work on the guideway, or for that matter any of the other changes they made in our design. In what way, I thought, could springing a draft final report of the study on the full committee with press present and with no attempt to ob-

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tain comments on it in advance from either the Skyloop Committee (SLC) or Taxi 2000 be con-sidered fair? What became of Fred Craig’s strong assertion the previous November that the study would be fair and objective? One fact that was very demoralizing was Craig’s statement that we had been uncooperative and couldn’t be reached to provide information. This was a lie – not even a close approximation to the truth – but the comment went unchallenged. The draft fi-nal report “redesigned” our guideway, if their work could be dignified by that term. It was what I call “slap-dash.” It was laughably full of unwarranted assumptions clearly done quickly at min-imum expense. The whole process was done in a way that showed that its purpose was to dis-credit the PRT concept. The work was unethical and a disgrace to the engineering profession. Why would men behave in such a way, I wondered? Well, they were paid!

Following the July 17th meeting, the SLC decided that the only way they could respond to the travesty was to prepare a rebuttal. Dr. Roth set aside his paid work and worked full time vir -tually night and day on the rebuttal. Bob Brodbeck likewise neglected a great deal of his paid work to answer the draft report, as did Chip Tappan and other members of SLC. Several Taxi 2000 people including me did likewise. For two months, we had to set aside the more important work of doing all we could to support our efforts to raise money to get underway, which of course was our primary task. The SLC/Taxi 2000 Rebuttal Report was posted on the SLC web-site, www.skyloop.org. It can still be found by going to www.archive.org, punch in the Sky Loop web page, and select a version from 2002 or 2003.

A group in Istanbul got interested in Taxi 2000 and we thought we would get a letter from the Mayor of Istanbul to go over there in a week or ten days. The project would involve Boeing Turkey and probably a large Turkish construction company. Because Turkish currency had dropped 98% in the last year or two, financing was an interesting proposition and may even involve Turkish military. Apparently, Ford is to provide 7000 pickup trucks a year to the mili-tary, upon which will be mounted a gun of some type and they would be remotely controlled in battle so there would be no soldiers in them. You can imagine the electronic control problem with video cameras aboard each truck and some guy in a remote location steering the truck and firing the gun. How this would be involved with bringing Taxi 2000 to Turkey is long and com-plex and I won’t go into it here.

In San Francisco Shef and I met Board members of a new Seattle Elevated Rail Company that has a mandate to come up with a new solution to their traffic problems by August 2002. Some of them want to include Taxi 2000 in the mix because they have come to recognize that the available transit systems simply provide too poor service for too much money.

In early January, Cindy and I attended the 80th birthday party of Dr. Jack Irving, Vice President of The Aerospace Corporation and head of their work in the early 1970s on PRT. I worked with him a great deal then since my group at the University of Minnesota found that he had by far the best PRT system in the world. Taxi 2000 would not have been possible without his work. He invited about 130 people, all expenses paid, to spend a weekend with him at a fab-ulous resort north of San Diego. The whole event must have cost him close to $200,000, and of course that was near the peak of the stock market. A feature was a Friday evening dinner fol-

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lowed by what was supposed to be a two-hour talk on all the people he had worked with through-out the years. It ended up over three hours, but was very entertaining and certainly no braggado-cio. The next evening Jack had arranged for a group of musicians to perform, and surprised us by having them perform a few of his own compositions. As a theoretical physicist, he took up composing at the age of about 65 and continued it to the end. He is a good example of why the age of 80 is no longer old. He was in vigorous health.

A Taxi 2000 Board Meeting was held on August 7th at Richard Broms conference room in Eden Prairie. Chip Tappan, chair of the Cincinnati Sky Loop Committee, had been elected to our board at the previous meeting and he attended. I reported that we had received an invitation to go to Turkey to visit Turkish officials and a Boeing representative in Istanbul and Ankara be-tween the 7th and 14th of September. We had had many conversations about this in previous months and we knew that we were up against competition from the “heavies” in the transporta-tion field, mostly from Germany and Japan. However, our contacts insisted that we had a good chance because of the much superior performance of our system. After considerable discussion, the Board decided not to authorize the trip because 1) the way this trip would lead to funding was too vague, 2) the need to develop a first-class presentation to the Cincinnati Central Area Loop Committee was too important to short change, and 3) the company would have to pay the ex-penses of at least four people at a time when it had no money to do so. Another problem was that we would have to translate our presentation into Turkish and give it through an interpreter.

Before this meeting, we had been discussing our fundraising strategy. It was suggested that we raise perhaps a hundred thousand dollars from friends to build one prototype vehicle that would run on a short section of guideway, and indeed at that time several of our insiders thought a respectable demonstration could be built for under $100,000. Richard Broms had opposed that idea because his experience showed him that getting a group of major investors to fund an actual application would be very difficult if not impossible if there had been a prior group of so-called unsophisticated investors as stockholders. He wanted to raise funds needed to go beyond a full-scale test track into a real application and he thought he could do it. He may have been right, but that was not the majority feeling at the time. After considerable discussion Rydell moved and Tappan seconded the following resolution: “The Board authorized development of a prototype and authorizes purchase of the software needed to develop a Rule 504 offering document and au-thorizes a visit to Gray Plant Mooty Mooty and Bennett for advice on the funding mechanism.” The motion was approved.

In mid-August, Roger Broering, a member of the Sky Loop Committee and an engineer, visited PB engineer Tom Martin, who had worked on our guideway. At the July 17th CALSC meeting Martin had said that a curved trussed guideway couldn’t be built1, and that he had de-signed a much heavier steel-girder guideway for the Sky Loop to use for costing purposes. I was urged to call Martin, which I did, although a bit reluctantly because I felt it was his duty to con-tact me. He had said in the July CALSC meeting that he found the deflection of our guideway to be about 30 inches. I had a long conversation with him during which I explained the history of our guideway design. I asked him what spacing between posts he had assumed and what end 1 An inspection of a modern amusement-park rollercoaster, which uses curved-truss guideways, will quickly disprove this state-ment.

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conditions he used. He said that he thought the span length was 90 ft instead of our 60 ft, and that the ends were simply supported, whereas our guideway is clamped at both ends. Any good structural engineer knows that the deflection of a span under uniform load is proportional to the fourth power of the span, and that a simply supported beam has five times the deflection of a beam clamped at the ends. The ratio of deflections of these two beams is therefore (1.5) 4 x 5 = 5.06 x 5 = 25.3. Moreover, he doubled the weight of the vehicles, which doubles the deflection, giving a total deflection of (25.3)(2) = 50.6 times the deflection of our beam. Thus, his calcu-lated deflection of 30 in should have been 30/50.6 or 0.59 inches, which is well inside the range of tolerable deflection, and which was about what we calculated. Martin acknowledged that he understood what I was saying, but he had already given his statement in a public meeting. He said that a girder design, which he had “developed,” would be cheaper to weld than a truss. His drawing showed $1.75 per lb, whereas we got a bid for welding our truss of $2 per lb, both counting material cost. But our truss weighed only 140 lb/ft, whereas his design weighed 400 lb/ft. So the cost ratio would be $1.75(400)/$2(140) or 2.5 to one. I had started out with a plate design in Fall 1981, but in Spring 1982 it occurred to me to examine a truss and I discovered a dramatic reduction in weight under the same loads.

I was invited to meet Bob Taft and Al Eke, on Saturday, September 22, 2001, at Taft’s home north of Minneapolis and close to the west side of the Mississippi River. I understood that they wanted to show me some work on the cabin design for the demonstration system. When I got there, I was ushered into Taft’s design studio. He had several computers and apparently had done some design work, the nature of which was not immediately apparent. I learned that Taft and Eke were not engineers, but had taken two-year courses in engineering technology, and Eke had taught engineering technology. When they showed me their design, which I learned had been built up out of portions lifted from various web pages. I commented that the design was not very aerodynamic, meaning that the air drag would be higher than would be desirable. Eke com-mented that air drag was not important; however, I had made calculations that showed that even at 25 mph air drag would be the #1 energy user. I left unimpressed that these two men, working out of their homes and without serious engineering experience, could produce the high-quality design we needed for a reasonable cost and time budget. If our demonstration was going to be useful, the passenger cabin, which is the most visible part, had to be first class. I began thinking about options. I mention this here because of a push to get us to give our cabin-design contract to these two men gained significant importance in the history of Taxi 2000.

Back to Cincinnati, the big CALSC meeting we were preparing for was held on Septem-ber 25, 2001. A ruling had been made that CALSC members could vote at the final meeting only if they had attended three fourths of the meetings. There were 22 members present at this final meeting who were qualified to vote. Wally Pagan, the CALSC chairperson, opened the meeting with a speech in which he said that the study had been objective and impartial. He encouraged all to speak their minds. The study was not about personal business. It was not a forum for LRT, streetcar, PRT or shuttle, but was for the common good. It was about economic feasibility – fair and impartial. He recognized “certain biases” but had not stifled anyone. Jim Duane, OKI Executive Director, then added that they wanted to achieve fairness and would allow SLC and

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Taxi 2000 time to present their rebuttal. The rules were to stick to facts and to be fair. A roll call vote would be held to vote for action. Chip Tappan went into his prepared speech, which was well done. Questions followed.

John Schneider, strong LRT supporter and very “objective” person who had led whistle blowing to drown out speakers at an anti-LRT press conference, was primed to ask very negative questions. After the questions by committee members, Fred Craig launched into their so-called “analysis” of our guideway. He commented that a PB engineer had asked Bob Brodbeck, a member of the Sky Loop Committee, if he had a drawing of a curved section of our guideway. Bob had responded that he didn’t. Someone asked Fred if he had asked me about the curved guideway and he insisted that they had tried to contact me but that I was difficult to reach. I had an answering machine, which showed no calls from PB engineers or from any of their sub-con-tractors. I of course wanted to respond but the way the meeting was structured I was not permit-ted to respond unless asked a direct question by a committee member. Why Chip Tappan did not ask for my reaction I will never know. Fred gave the floor to the structural engineer, Tom Mar-tin, who launched into his “finding” that our guideway would deflect 30 inches under load, not-withstanding that I had discussed that issue with him and he had to have known that under the correct conditions the deflection of our guideway would be less than one inch and was well within code. He then went on to say that he had talked to someone at Stone & Webster and that that person basically agreed with him. He referred to data on deflections on a page 10 of the S&W documents we submitted, but after the meeting I looked at every page 10 and found noth-ing related to deflections. He must have known that because of the meeting rules I would have no chance to challenge him. At one point, he referred to a deflection of nine inches and con-cluded that that was too much. None of the deflections shown in the S&W report are more than 0.8 inch. The conclusion of the guideway section of the S&W report states that our guideway meets the standard bridge standards in both straight and curved sections and that all deflections were well under one inch. I had no idea where the nine-inch deflection came from and no com-mittee member including Chip Tappan gave me an opportunity to respond. I was practically jumping out of my skin to respond, but no one on the committee asked me to respond and I was too “proper” to shout out to them. So, I left the meeting fuming that the committee assumed that I had been unresponsive (discounting any reason why I would be), that our analysis was wrong, and with my professional reputation tarnished in the most unfair and dictatorial manner.

It was pointed out several times that the PB ridership analysis showed the ridership on the streetcar system to be 6,994 per day and on PRT to be between 26,506 and 32, 152 depending on the fare, but that didn’t matter at all. CALSC voted 14 to 8 to not recommend PRT and to pro -ceed with studies of the streetcar. In the end, it was obvious that reducing congestion did not matter in their decision.

Here are some final thoughts on our work with Cincinnati:

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We enjoyed the experience of working with the SLC. They are great people and there has been no group anywhere close to them anywhere in the United States in terms of dedication and competence in challenging the transit status quo.

Selecting Taxi 2000 over any other plausible elevated rail system in the world added greatly to our prestige and was an important factor in enabling us to obtain the funding we needed.

The work forced me to advance the capability of my network simulation and to prepare sev-eral other papers that were useful as we advanced the Taxi 2000 design.

PB’s behavior confirmed our prior knowledge that they had worked hard and often to try to eliminate PRT as competition for their conventional rail systems, but to do so they had con-sistently assign characteristics to PRT that it need not or does not have and then to bash in based on those bogus characteristics. This was an important indication of the strength of the PRT concept – the opposition was afraid to consider it as it really is.

For many years our position had been to go in only where we had been invited. In Cincinnati we certainly were invited by SLC but we faced a hostile MPO and we knew that from the be-ginning. We vowed not to repeat that experience.

Visual impact was a major factor in the eyes of vocal CALSC members and there was no question that the streets in downtown Cincinnati are narrow. The visual impact of an over-head structure is usually not acceptable unless local congestion is serious and not unless de-creased congestion with the guideway and other improvements are seen overall to improve the urban environment. A decade previously in Chicago, a well-known sculptor, John David Mooney, referred to Taxi 2000 as moving sculpture both for what it is and what it does. Two decades previously in Indianapolis 15 government, business, and civic organizations en-dorsed a PRT system with a guideway larger than Taxi 2000. The problem then was one of procurement. When I was in Cincinnati I never found congestion to be much of a problem. It certainly didn’t need a streetcar.

One of the CALSC members commented that a three-passenger vehicle was too small be-cause he often took his three children various places. Actually, our 57-inch-wide bench seat could easily hold that father and his three children. Subsequently I avoided calling it a three-seat vehicle, and could add two fold-down seats in front for children.

We appreciated very much a statement of endorsement prepared by the Advanced Transit Association, sent to CALSC members in advance of the final meeting, and presented there by ATRA president, Dennis Manning.

The Taxi 2000 Board of Directors met on October 26, 2001. The major issue was this: do we follow the resolution at the previous board meeting to obtain a few hundred thousand dol-lars from friends under SEC Rule 504 to build a small prototype, or do we seek sufficient funds to build a first application. Richard Broms argued passionately that for sophisticated investors, the former would be a “can of worms” and would make getting the funds needed for a full-scale demonstration at least difficult and more likely impossible. In obtaining funds from individuals in several states, under Rule 504 we would have to deal with state laws in each state. Dealing with 35 unqualified investors would scare major investors. The Board would have to be insured.

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The directors would be personally liable. While no motion was made, the dominant opinion was that the possibility of “sophisticated” investment should be explored more before deciding to proceed with a 504 offering.

This issue was extremely important for the future of the company. Proceeding with a 504 offering could result in a small demonstration, but it would not be the kind of test system need to secure orders for operating systems. The hope was that if we built one automatically controlled, LIM-propelled vehicle and showed that it would operate on a short stretch of guideway (we dis-cussed 60 ft because that length would fit into our shop) we would somehow be able to find the funds needed to go commercial. If Broms was correct, proceeding with 504 could forego the possibility of ever going commercial. At the time the company had a debt of over $1,000,000 to engineers who had worked on the project in the Boston Area and adding to that many small in-vestors would likely make it extremely difficult if not impossible to proceed further. With the benefit of hindsight, this is exactly what happened, but at the time we did not have the benefit of hindsight. We had many friends who wanted to invest and the 504-offering showed the way. There was a great deal of pull to go in the 504 direction, and the hope of going from paper to an actual application seemed remote. Broms urged the Board to explore a Taxi 2000 project in the Chicago Loop through a major investment house. It was agreed that downtown Chicago was an excellent location for a large PRT network and that Broms should be encouraged to explore this possibility with his contacts in the Chicago investment community. Broms did not think he could find sophisticated investors who would fund just a full-scale test track, even one big enough to operate vehicles continuously at desired speeds. But, such a track was the next logical step toward commercial operation. He believed that sophisticated investors would only fund a system that would directly produce the revenue needed to return their investment. Here one is reminded of the story of the three bears. Going with the baby bear was too small. Going with the papa bear was too big. Going with the mama bear was just right, but seemed impossible.

A second important issue was related to conversations Richard Broms had had with Dar-rell Robertson about a Turkey project. Robertson reported that interest in Taxi 2000 in Ankara was very promising and that he needed to know what we would do. He said that the City of Ankara was willing to invest in Taxi 2000 and that the mayor wanted to adopt it as the public transit system for Turkey. Boeing-Turkey would be involved as vehicle supplier and a major German investment firm would partner. A reasonable return was expected. A key was that we had to show that an operating cost of 37 cents per passenger-kilometer is reasonable. A large American auto firm would also partner. A problem was that if the money was to come from Tur-key, the test track would have to be in Turkey. Because of the possibility of the deal going sour, it was decided that our position would be that we would have to assemble an engineering team in the Minneapolis Area and also build a test track in the Minneapolis Area, and that at the end of testing we could also market the system in North America. We felt that Turkish engineers would have to come to Minneapolis to learn the technology from us as we developed the test track while a parallel program would proceed in Turkey. We voted to authorize Broms to take the

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next steps in negotiating with Darrel Robertson with the understanding that it would require funds for at least one trip of three people to Turkey.

I reported at the October Board meeting that I had had a conversation the previous day with Liz Sroufe in which she said that she and a colleague work working on various details of a proposition with us and would be visiting us soon. The deal she was working on would provide the $24M we had concluded that we would need to build our test system.

It was reported at the Board meeting that Minnesota Senator Satveer Chaudray had of-fered to author a bonding bill for the funds we needed for our test track. There were at the time a substantial number of Taxi 2000 supporters in the Minnesota Legislature and we had found inter-est in our project in five Minnesota companies, so we felt that this possibility had to be explored. As I have mentioned, Shef Lang had engaged the support of the lobbying firm Capitol Hill Asso-ciates and said that he would discuss this possibility with Bill Strusinski, CHA president and neighbor of Shef’s, and that together they would meet with Senator Chaudray and other Legisla-tors.

On November 14th I gave a presentation to a large group of Minnesota professionals at a meeting of the Minnesota Public Works Association. There was clearly a great deal of interest in our system there. Then, on December 13 I gave a second presentation to the Michigan Institute of Transportation Engineers, followed a day later by a presentation at the Novi City Planning De-partment. Novi had an important transportation problem. They had four shopping centers on the four corners of the intersection of a major freeway and a major arterial street, making it difficult for shoppers to move between them. But a new director of planning came in a month later and exhibited no interest in following up. On the 17th of December I gave a presentation to the Re-publican Caucus at the State Office Building. Even though Senator Chaudray was a Democrat, we found much more interest in us from Republican Legislators.

Our Board of Directors met on December 19th at Richard Broms conference room in Eden Prairie. He stated that it would be necessary to meet our funding goal by July 4, 2002 if he was to continue to be involved. Based on experience, I was not happy with such a firm deadline but had to take his word and had to understand that he had limited patience. I reported that I had been working as rapidly as I could on the engineering specifications and costs. This involved obtaining and evaluating bids on all the components for the prototype system and for the proving ground or test track that would be the next step. Eke and Taft had submitted a proposal for the cabin design and construction, but by now our engineering group, which included Ray MacDon-ald, Larry Jack, John Braff, and me, felt that the Eke-Taft proposal was marginal and we re-solved to search for an alternative. Because of a tight travel budget, we decided that we would search only in the Twin Cities Area. We visited Jerry Hammer, the General Manager of the State Fair Grounds, and found him receptive to having our full-scale test track there if we would find the funds and manage the project. That was the way he worked with all concessions at the Fair. We discussed a bonding bill that was proceeding in the State Legislature, now being writ-ten by Republican Representative Mark Olson. It was moved and seconded that we proceed with

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the SEC 504 offering. It was carried. This was over Richard Broms objections. I am not cer-tain, years later, what all of the motivations were, but the facts were that we later had 81 share -holders and over $1,000,000 in debt, which were, per Broms previous arguments, strong deter-rents to finding the sophisticated investors needed to go from where we were to a large system in the Chicago Loop. Broms was still working on large investors. He stated that there was still in-terest in Turkey. He would find out in a few weeks if Boeing Turkey would attempt to convince Boeing top management to back the project. To do this, Darrel Robertson wanted market-study information also in a few weeks. Since we had been compiling such information for years, this was not a difficult task. I commented that I had been corresponding for about three years with Arno Mong Daastol of Oslo, Norway, who was pushing a Taxi 2000 project at the old Oslo air-port, which was being developed for commercial and residential use. He asked to be our Norway representative and we agreed. At this Board meeting both Chip Tappan and Bert Press resigned from the Board, which now left only Shef Lang, Ed Rydell and me.

At the invitation of Representative Bruce Anderson, I gave a presentation to a group in-cluding Legislators at a restaurant in Elk River, Minnesota, on December 27.

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