Port considers railroad takeover

By Elise Hamner
City Editor

Saturday, November 10, 2007 | 15 comment(s)

Font Size: Shrink Font Enlarge Font | Submit your news
COOS BAY - Central Oregon & Pacific Railroad officials broke a seven-week silence in talking publicly about the defunct Coos Bay rail line on Friday afternoon.

CORP’s manager of marketing sales was making phone calls Friday. He announced his company intends to host a meeting in Eugene next week to talk about plans for the railroad. It won’t be a public meeting, Thomas Hawksworth said. It will be a discussion about CORP’s idea for a public-private partnership to deal with the line.

While railroad officials appear to be heading down the tracks seeking public money to fix the rail line, the Oregon International Port of Coos Bay is chugging along with legal action.

The announcement came about four hours after the port commission took a first step in trying to wrest control of the railroad away from CORP, with the goal being to reopen the tracks. Three of the port’s five commissioners met with staff in a closed-door meeting at 7 a.m. Fifty minutes later, the board opened the doors and voted to authorize port executive director Jeffrey Bishop to spend up to $200,000 in pursuing the issue.

Technically, the port will work with attorneys to file a “feeder line application” to the U.S. Surface Transportation Board, which oversees railroads.

“We would put together an operation and acquisition plan,” Bishop said Friday.

Through that, the port has to show it can pay the net liquidation value of the rail line and provide rail service for at least three years.

“The port has no intention of operating the railroad,” Bishop said.

Instead, it will try to find someone else to run the railcar end of the business. The port would control the infrastructure. (It already owns the Coos Bay rail bridge and North Spit rail spur.)

This is not the only legal punch the port has swung at CORP. On Oct. 22, the agency filed a complaint against CORP in U.S. District Court in Eugene. The lawsuit seeks at least $15 million in damages. The port contends the railroad breached its lease contracts for the rail bridge and rail spur by closing the line without giving 180 days’ notice. There’s no estimate on how long that case may take to resolve.

As to the takeover process, Bishop said it could take a year or more. And legal fees could cost a lot more than the port commission discussed Friday, Bishop said. The money will come from a rail bridge special revenue fund filled by tariffs paid by shippers, not property taxpayers. Should the port actually gain control of the railroad, Bishop said the agency intends to seek partners with deeper pockets to help finance investment.

No one’s talking about how much the rail line might be worth, but costs for repairs are all over the place.

Initially, a CORP press release said it would cost $7 million over the next five years for tunnel repairs. It would cost $2.8 million to open the line now. However, the railroad made a presentation to the state Senate Interim Committee on Transportation in late October and pegged the cost to reopen the line and maintain status quo service at $27.1 million.

And again at that meeting, the railroad sought public money to help finance repairs and investment.

Next week, Hawksworth said, the railroad intends to divulge its idea.

“We’ve come up with a plan, this public/private partnership proposal, and we want to run it by everybody to see if it’s good, bad or indifferent,” he said.

Hawksworth said his company is inviting the rail line’s former shippers, state officials, Union Pacific, Port of Coos Bay, media and railroad corporate representatives.

As to the plan’s specifics, Hawksworth wasn’t talking. He did say the railroad wants to follow a timeline its officials handed out more than a month ago. By mid-November, CORP wanted to meet with stakeholders to brainstorm about a public/private development.

It’s apparently not a proposal in which the state or local people have had input. Kelly Taylor, administrator of the Oregon Rail Division, said she had not been invited to the meeting but had heard rumor of one. Same with Martin Callery, the port’s director of communications and freight mobility.

On Friday, Taylor was skeptical about whether there is a plan to reopen the line.

“If somebody wants to cough up $27.1 million, then they’ll reopen it again,” she said.
Tags »
Previous
Next

Have you checked out The World Link Forums?

Comments

The comments below are from users of theworldlink.com and do not necessarily represent the views of The World or Lee Enterprises. Participation Guidelines

Note: There is a maximum of 200 words per comment. If you wish to post more, please visit our forum.
Comment Policy

The World welcomes your comments about stories, and we encourage a robust dialogue on this site. All comments must meet reasonable standards of decency and civility.

Please follow these basic rules:

  • No defamatory comments about individuals or businesses.
  • No deliberately false information.
  • No obscenity or racially offensive language.
  • No harassment, verbal abuse, threats or personal attacks.
  • No information that invades another person's privacy.
  • No business solicitations or charitable solicitations.
Comments that violate these standards will not be posted. Users with repeated violations may be banned from future posting.

Comments will be approved throughout the day during business hours. After hours and weekend comments may not appear until the following business day. It may take a couple of hours before comments are approved.

The World generally does not edit comments, but we reserve the right to edit any comment that does not meet our standards.

Close Guidelines

Stephen Willis wrote on Dec 12, 2007 11:44 PM:

Our economic future can not depend upon containerized imports. Nationally we need exports to balance imports. Locally any increase in traffic will help. Loads both ways will make the port of CB viable, not 50 trains/day of Chinese imports. The drop in the value of the dollar will cause our exports to increase. The rail line is definitely needed to put it all together. We need to pay attention to what CORP is doing. This is not the only section of their railroad at risk in Oregon.

J.Lampke wrote on Dec 2, 2007 6:57 AM:

In the long run, shipping by trucks via an interstate spur would be much more expensive than a rail line. The only people who would benefit would be the truckers. Period. The shipping companies know that. Coos Bay won't thrive as a shipping port without that rail line. That's all there is to it.

Joe six pack wrote on Nov 18, 2007 2:05 PM:

I think if thay want to abandon the railroad for any reason thay should give back the land that thay where given,If the port gets it. Thay will add more no tespassing signs. Once state or federal money gets involved it will cost much more! Tunnels are first on the list don,t forget the tressels, In trying to stop the rot all the good methods are complained about and even more if it touches water like at Ten mile lake. So there are no quick fixes.

Gene wrote on Nov 16, 2007 1:41 PM:

I wasn't going to comment any further but, I did some research and found the cost of a new feeder line to Eugene for the transport of container cars to be in the neighborhood of $500,000,000 and that does not include the 9 tunnels or so that must also be enlarged or rebuilt. The total cost would exceed any amount reasonable for services that only benefit a few. An interstate spur would make more sense and provide for all the people in the area.

Gene wrote on Nov 16, 2007 1:39 PM:

I wasn't going to comment any further but, I did some reaseach and found the cost of a new feeder line to Eugene for the transport of container cars to be in the neighborhood of $500,000,000 and that does not include the 9 tunnels or so that must also be enlarged or rebuilt. The total cost would exceed any amount reasonable for services that only benifit a few. An interstate spur would make more sense and provide for all the people in the area.

RailFan wrote on Nov 16, 2007 4:55 AM:

The cost of a doublestack train from the Port would be outrageous. Port needs to focus effort at state level and bring pressure on the person in charge of investments who works for the state but is also a trustee of a Fortress fund. Fortress is dictating to the state (public private partnership nonsense) while holding $450 million of taxpayers funds. Something is wrong here.

J.Lampke wrote on Nov 14, 2007 8:50 AM:

Well, it's sad, if you ask me, this situation. I have hoped that congestion in the other shipping ports would make CB an attractive alternative for shippers and the railroad alike. Maybe in time.

Thomas wrote on Nov 13, 2007 10:36 AM:

Given the current economy and politics, this railroad will not be repaired, much less rebuilt anytime soon. Coos Bay was once a great port for cheaply shipping out our resources, but now it is just geographically in the wrong place for importing anything other than nuclear waste destined to Nevada or LNG for California ........ and for those only because no other port will take them. If it had ever penciled for business to use Coos Bay as a port for imports, you can bet they would have long ago upgraded the railroad and done so. Maybe it is time for us to finally get real about what we are, and what we never will be?

J.Lampke wrote on Nov 13, 2007 3:43 AM:

Gene: You need to research the issues and facts. I don't want less jobs, but running thousands of trucks from Coos Bay to Eugene would be an economic and environmental disaster in the long run. In terms of freight-ton-miles, trucks are several times more expensive to ship by. Same for exhaust emissions. Trucks tear up the roads, which we as taxpayers have to pay for. Besides, no shipping company is going to look seriously at CB if all we can offer is a fleet of trucks for shipping. We have to be economically competitive to succeed. It just isn't going to happen without that rail line. I've been an Engineer in the shipping industry for 30 years, and have seen this business from the inside out. Please believe that in the long run, that rail line will make all the difference between success and failure as a shipping port for CB. Highly unlikely that it will cost "billions" to upgrade the line from Eugene to Coos Bay. Taking everything into consideration, and looking at the figures being put out by various interested parties in this issue so far, I think closer to $500,000,000 to upgrade the line to mainline freight capability. Chicken feed compared to the resources wasted in this war we're in. Regards.

Gary Rouse wrote on Nov 12, 2007 11:49 PM:

You guys sound like a broken record. My wife and I worked very hard with several others to get Coos Bay on the map. Here you are 25 years later blowing the same smoke. Having worked in the railroad industry fo the last 20 tears, rail transportation is more efficient. Mr Lampke is right. It equates to cost per ton mile. One railcar load equals between 2 and 3 truckloads. That is where the reduction in emissions come from. As I said 25 years ago: would the last person out of Coos Bay turn out the lights. You have a great asset with the port and a mostly sea level rail route.

Gene wrote on Nov 12, 2007 11:15 AM:

Mr. Lampke, I don't agree with you that the state should pay for the new rail system. It would cost billions, not millions, and where would it come from? More property tax, state sales tax? Your chances of getting either is about 0 to nothing. As for the exhaust emissions, Horsepower is horsepower and it emits so much per gallon. A diesel electric engine burns a lot of fuel, it isn't free, the savings is mostly in the man-hours. Is that what you want, less jobs?

Thomas wrote on Nov 12, 2007 7:28 AM:

Having seen a few sections of this railroad, $27,000,000 seems like a lowball estimate of what it would cost to even repair, much less upgrade to container shipment standards. Just the 3/4 mile long tunnel near Reedsport probably would cost that to redo. Maybe there's an upside in CORP's action, though ........ it just might finally reign in our unaccountable Port of Coos Bay poobah's attempts to turn us into the West Coast's dumping ground for schemes no other place wants?

M.Lucas wrote on Nov 11, 2007 12:09 PM:

As a one-time resident of the Coos Bay area (1953-1960) and an occasional visitor,I strongly agree with the comments of J.Lampke (11Nov07). Unless the CB area developes some areas of growth and jobs, it will never increase it's tax base enough to support it's schools or improve it's infrastructure enough to attract other businesses. Developing a serviceable railline and improving the port facilities would go far to insure the future of the CB area and doing so will require money now that will return it's present value many times over.

J.Lampke wrote on Nov 11, 2007 2:48 AM:

We're at a cross-roads in regards to the future of Coos Bay as a shipping port. The wood products industry will never be what it once was. Those days are gone for good. We must look to other sources for jobs and growth. International intermodal shipping is the answer. The railroad is key to that. Even if there was a four-lane freeway from Coos Bay to Eugene, trucks could never compete with the railroad for a multitude of reasons. The best thing that could happen to Coos Bay would be if the Union Pacific Railroad took control of the line from Eugene to Coos Bay and upgraded it to accommodate modern double-stacked containerized freight. Consider these statistic; As of early 2006, 50 trains daily were leaving the port of Los Angeles. Each train carried an average of 220 containers. That figure is expected to double in the next 20 years. Coos Bay could get a piece of that action. The future financial security of Coos Bay and our children could be secure. History will judge us by the decisions we make now. I don't agree with the course of action taken by CORP, but if the State has to pay to upgrade the line, so be it. The money will come back many times over for generations to come in the form of jobs for Coos Bay residents and taxable income for the State, as well as import and shipping revenue from the shipping companies. Another thought; Income derived from intermodal shipping won't have the damaging effects on the environment that logging did, and trains are a lot cleaner than trucks, in term of exhaust emissions.

That's nice wrote on Nov 10, 2007 8:40 PM:

Oh great, first they bought a broken down railroad bridge now they want to spend more tax money for the rest of the broken down system that will require many millions of dollars to upgrade. More school money going down the drain. I guess their railroad has a better return than educating our kids.


*Member ID:
*Password:
 

Not already registered?

Do not use usernames or passwords from your financial accounts!

Note: Fields marked with an asterisk (*) are required!



*Create a Member ID:
*Choose a password:
*Re-enter password:
*E-mail Address:
*Year of Birth:
 

(children under 13 cannot register)

*First Name:
*Last Name:
Would you like to be added to our mailing lists?
Daily Headlines
Breaking News
Special Offers
 
Advanced Search
Web Search powered by YAHOO! SEARCH

Blogroll

Most Popular

Polls

» View Past Poll Results
» Suggest a Poll

Marketplace

Special Sections

More Special Sections