Officials to contest possible rail closure
Published 12:00 am Saturday, May 31, 2003
NATCHEZ &045; Shippers, government and economic development officials are banding together to fight Canadian National’s possible abandonment of a rail line between Natchez and Brookhaven &045; but they don’t have much time to do it.
Canadian National, parent company of Illinois Central, announced in March that it is evaluating closing two of its lines a result of the closing of International Paper’s Natchez mill, which is expected to take place this summer.
Those include the 66-mile Natchez-to-Brookhaven line as well as a 188-mile line between Canton and Southaven. Given that, 40-plus stakeholders met early Monday morning at the Natchez Convention Center to discuss strategy.
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Their conclusion? If CN applies to the National Surface Transportation Board for permission to abandon the line, local, regional and state interests will need to file a unified, thorough appeal to have a real chance at keeping the Natchez line.
If rail service leaves the area, it will affect every man, woman and child in Adams County by making it more difficult to attract industry, said Bob Rhorlack, director of the Mississippi Development Authority.
&uot;We’re interested in rail service for one reason &045; jobs,&uot; Rhorlack said. &uot;These are companies with big labor pools and an economic impact on the whole community. For example, a retail shop downtown needs a vibrant community to be able to do business.&uot;
The rail’s closing &uot;would have a devastating effect on our business,&uot; said George Matthews, president of Mississippi River Corp. &uot;More than 50 percent of our incoming and outgoing (shipping) is by rail.&uot;
The rail line’s possible closing is also having an effect on companies already seeking to do business in the area.
Chemical company Tessenderlo Davison, which inspected the former Ethyl Petroleum building earlier this year as a possible location, has extended its option on the building until the end of June.
The reason, according to company officials, is to see whether Natchez keeps its rail service &045; and how the rates will be if a company does decide to continue to operate the line.
In addition, Pat Murphy, executive director of the Natchez-Adams County Port, said he is constantly working with clients who want the combination of river, road &045; and rail &045; service his facility provides.
&uot;Rail service is critical,&uot; Murphy said. &uot;We can’t lose that regardless of what it takes.&uot;
The stakeholders’ best bet would be to convince CN to keep the line operating, if that were possible, said Charlie Banks, a railroad consultant working with the MDA and the state Department of Transportation to keep the CN rails running.
If that cannot be done, one of CN’s options would be sell to another operator, such as another railroad company or to two or more rail companies that would sections as regional &uot;short lines.&uot;
CN could even sell to other interests, such as government agencies.
Asked whether MDOT would be interested in buying and operating the line &045; which lawmakers have given it the power to do &045; Director Larry L. &uot;Butch&uot; Brown would only say that &uot;I’ll do anything I can to keep (the rail lines) operating.&uot;
If a party besides CN wanted to buy the line, it would have to do so quickly, before easements on the land on which the track sits revert to the previous landowners.
Another of CN’s options would be abandonment &045; more specifically, to the NTSB to abandon its obligation to provide service on the line. If the board approved that petition, CN could then remove the track itself.
Since the abandonment process could cost CN more than $200,000, and since the process is a highly complicated one governed by more than 50 pages of federal laws, &uot;this is not something (the company) would do frivolously,&uot; Banks said.
Both Banks and Brown said there is still a chance of negotiating with CN directly.
One possibility is for stakeholders to convince CN to operate for up to one more year in exchange for the group paying CN what it expects to lose over that time by operating the line.
Another option would be for CN to sell to the stakeholders’ group at net liquidated value &045; the value of the rail and land, less the amount it would cost for the company to pull the track up, Banks said.
&uot;We can also attempt to encourage another operator to come in, but they want to know what’s in it for them,&uot; Banks said.
And, if an abandonment application is filed, the stakeholders can contest it. &uot;Te railroad wins 80 percent of the time, but it can be done,&uot; Banks said.
If CN chooses that road, locals’ timeline to respond would be short, said Banks who, in the past, did consulting work for railroads in such cases.
&uot;It’s obvious that the timeline works against us and for the company,&uot; said Marion Smith, attorney for the Adams County Board of Supervisors, who attended Monday’s meeting.
For one thing, the company is not required to notify anyone more than 15 days in advance of when they intend to apply for an abandonment.
Stakeholders then would have 45 days to put their case together and submit it to the NTSB. The company would have 20 days to rebut the locals’ argument, and the board itself would then have 45 days to make a decision on the matter.
&uot;The railroad will make an economic case &045; what they think they’ll lose in a year if they continue to operate the line,&uot; Banks said.
&uot;The NTSB will balance that with the economic impact on the community and the users Š and will also consider any environmental issues.&uot;
However, he noted that the burden of proof is on those opposing the abandonment, not on the company itself.
&uot;The board assumes that CN won’t abandon a line unless they know something about the business, Š so we have to be better (in our arguments) than the railroad,&uot; Banks said.
Banks told those gathered at Monday’s meeting &045; officials from Natchez-Adams and Franklin and Lincoln counties, as well as the state level &045; that even if rail service is maintained, CN has much control of its rates and level of service.
&uot;A lot depends on negotiation,&uot; Banks said.
What’s the next step? Even before shippers had left Monday’s meeting, they huddled with Banks to set a timeline for getting him more information to compile their case against the possible abandonment.
The MDA and MDOT will also meet today with locals in Grenada on the possibility of losing that line.
Other than that, stakeholders can write their congressmen and senators to ask for help and must be ready to meet again.
&uot;This will take more than one meeting,&uot; Rhorlack said.
&uot;We’re going to be working hard for the best scenario possible. Š Working together, we can make it happen.&uot;