The Oregon International Port of Coos Bay has taken another step toward acquiring the Coos Bay rail line from Central Oregon & Pacific Railroad.

At its regular meeting Thursday, the port’s Board of Commissioners authorized Executive Director Jeffrey Bishop to sign a letter of credit for $12.5 million.

The action was required by the U.S. Surface Transportation Board, Bishop said, to demonstrate the port’s ability to own and operate the rail line.

He said the $12.5 million figure should not be confused with what the port would pay for the rail line if CORP abandons it, as expected. That price will be determined by the STB, he said.

The actual cost to the port for signing the letter of credit is about $62,500.

The board also authorized Bishop to file a feeder line application with the STB. The cost of doing so is expected to be about $500,000, though Bishop noted funding will be requested from other agencies, including the state and the Coos County Urban Renewal Agency. The application is required in the process to force the sale of the railroad and propose port ownership.

In other business, the board adopted the port’s $40.2 million 2008-09 budget. Included were the expenses requested by Bishop regarding the rail line acquisition, as well as 4-percent wage increases for employees due to a jump in the Consumer Price Index. The executive director was not included in this increase, though the board previously gave him a cost-of-living raise, bringing his salary from $131,000 to $137,250. In addition to the wage increase, port employees will split about $30,000 after meeting five of the 10 goals set out for them last September.