You need to check the regs first .
There are currently 2 standards out there for Amusement Park Railroads:
The track Std F2960-15 and an operations standard F3054-15
The AP RR operations standard also incorporates the current amusement ride operations standard F770. (Meet all the requirements in F770 plus additional listed items directly related to AP railroads.)
You really should know the law and your responsibilities . It’s not clear what sort of railway this is , but think out the scenarios such as a signal saying “ no train” , someone crosses the track and gets hit.
Arduino stuff is not fail safe and you must ensure you build/use maintain equipment that , if appropriate , complies .
Maintenance of your equipment by others needs to be considered .