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Members of the Surface Transportation Board contend RailAmerica should never have purchased the spur line between Coquille and Eugene if it wasn’t in a position to maintain the 136-mile line.
Board member Charles “Chip” Nottingham on Friday told Paul Lundberg, a RailAmerica vice president, that the company wants the state of Oregon, shippers and other stakeholders to bail out the company when it knew the condition of a series of tunnels and tracks when it bought Roseburg-based Central Oregon & Pacific Railroad a few years ago.
“You bought the line of your own volition, voluntarily — caveat emptor (let the buyer beware) — and then when there’s a problem, you want others to pay and when they say ‘no,’ we see no progress (on reopening the line),” Nottingham said during the second day of hearings on the matter in Washington, D.C.
A day earlier, U.S. Sens. Ron Wyden and Gordon Smith and Rep. Peter DeFazio blasted the company for its failure to reopen the line that was closed last September because of safety problems in a series of tunnels.
Nottingham and other members of the three-person board were critical of RailAmerica for its failure to have plans in place to repair the tunnels and get the line reopened this year.
“This board has been very patient, but I would just suggest that the lack of progress on reopening the line is testing the board’s patience,” Nottingham said.
Lundberg said RailAmerica had worked hard to come up with a solution that would allow repairs to be made and reopen the line. He said the company, which during the past four years had spent 40 percent of its gross revenues from the Coos Bay line on capital expenditures, could not afford to pay by itself the $7 million needed to repair the tunnels.
Lundberg said he was surprised the state of Oregon and other stakeholders were unwilling to help fund the repairs, insisting instead that the railroad reopen the line before any negotiations took place.
“Quite frankly, I’m quite disappointed and surprised that they’ve had the reaction that they’ve had. Because it seems that it is in the public interest — that the state of Oregon and the governor and two senators and Congressman DeFazio have stated that this is very important to them — but they don’t seem willing to give us consideration to ways to do it,” Lundberg said.
During the past five years, RailAmerica has spent $300 million on infrastructure improvements on its 43 lines across the country. Of that, $44 million was spent on the CORP lines. This year, $60 million has been budgeted companywide, he said.
“I wanted to correct what might have been a misconception about RailAmerica not investing on the Coos Bay line, on the CORP or any of its railroads,” Lundberg said. “We are committed to that.”
He said the railroad was hurt when a major shipper, a Coos County sawmill, closed in 2004. Traffic on the line decreased from 7,500 carloads a year to 5,000.
“For a short line, that is a huge body blow,” Lundberg said.
Lundberg told the board that without a public-private partnership or some other solution, the preservation of the Coos Bay line was in “serious doubt.”
Nottingham, who said he was troubled by earlier comments by RailAmerica officials that there was not enough business on the line to justify keeping it open, said the company needs to make a decision.
“We need to see some progress on your part or, make up your mind and let the process play out if you truly don’t want to be a part of the future of that landscape,” Nottingham said.
Both the state of Oregon and the Port of Coos Bay have expressed interest in taking over the line and contracting with another rail company to operate it.
• You can reach reporter John Sowell at 957-4209 or by e-mail at jsowell@nrtoday.com.
Board member Charles “Chip” Nottingham on Friday told Paul Lundberg, a RailAmerica vice president, that the company wants the state of Oregon, shippers and other stakeholders to bail out the company when it knew the condition of a series of tunnels and tracks when it bought Roseburg-based Central Oregon & Pacific Railroad a few years ago.
“You bought the line of your own volition, voluntarily — caveat emptor (let the buyer beware) — and then when there’s a problem, you want others to pay and when they say ‘no,’ we see no progress (on reopening the line),” Nottingham said during the second day of hearings on the matter in Washington, D.C.
A day earlier, U.S. Sens. Ron Wyden and Gordon Smith and Rep. Peter DeFazio blasted the company for its failure to reopen the line that was closed last September because of safety problems in a series of tunnels.
Nottingham and other members of the three-person board were critical of RailAmerica for its failure to have plans in place to repair the tunnels and get the line reopened this year.
“This board has been very patient, but I would just suggest that the lack of progress on reopening the line is testing the board’s patience,” Nottingham said.
Lundberg said RailAmerica had worked hard to come up with a solution that would allow repairs to be made and reopen the line. He said the company, which during the past four years had spent 40 percent of its gross revenues from the Coos Bay line on capital expenditures, could not afford to pay by itself the $7 million needed to repair the tunnels.
Lundberg said he was surprised the state of Oregon and other stakeholders were unwilling to help fund the repairs, insisting instead that the railroad reopen the line before any negotiations took place.
“Quite frankly, I’m quite disappointed and surprised that they’ve had the reaction that they’ve had. Because it seems that it is in the public interest — that the state of Oregon and the governor and two senators and Congressman DeFazio have stated that this is very important to them — but they don’t seem willing to give us consideration to ways to do it,” Lundberg said.
During the past five years, RailAmerica has spent $300 million on infrastructure improvements on its 43 lines across the country. Of that, $44 million was spent on the CORP lines. This year, $60 million has been budgeted companywide, he said.
“I wanted to correct what might have been a misconception about RailAmerica not investing on the Coos Bay line, on the CORP or any of its railroads,” Lundberg said. “We are committed to that.”
He said the railroad was hurt when a major shipper, a Coos County sawmill, closed in 2004. Traffic on the line decreased from 7,500 carloads a year to 5,000.
“For a short line, that is a huge body blow,” Lundberg said.
Lundberg told the board that without a public-private partnership or some other solution, the preservation of the Coos Bay line was in “serious doubt.”
Nottingham, who said he was troubled by earlier comments by RailAmerica officials that there was not enough business on the line to justify keeping it open, said the company needs to make a decision.
“We need to see some progress on your part or, make up your mind and let the process play out if you truly don’t want to be a part of the future of that landscape,” Nottingham said.
Both the state of Oregon and the Port of Coos Bay have expressed interest in taking over the line and contracting with another rail company to operate it.
• You can reach reporter John Sowell at 957-4209 or by e-mail at jsowell@nrtoday.com.
