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Railroad has new freight contract, eye on more Tahawus business

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Saratoga North Creek Railway

A Saratoga & North Creek Railway engine is seen. The railway company has been officially booted from the Warren County rail line.

Saratoga & North Creek Railway has secured its first long-term contract to move freight on its line and has eyes on more business from the former mines in Tahawus, now that the property has changed hands.

The railroad has worked out an agreement with Barton Mines to move products south from North River to Saratoga Springs, where they will be picked up by Canadian Pacific Rail and moved to Virginia Beach. The company mines garnet for multiple uses.

Railroad General Manager Justin Gonyo said this is the first long-term freight contract the company has negotiated, with runs beginning in the coming weeks and the contract ending in August 2019.

It was unclear how many freight trains will run for Barton Mines, but he said they will be “regular.”

Gonyo said railway executives are also optimistic a recent sale of the former NL Industries mines in Tahawus to Paul Mitchell Logging of Tupper Lake could result in stone shipments going south from the mines again. The logging company also runs a subsidiary, Mitchell Stone Products LLC. A call to its office was not immediately returned Tuesday.

The mines, once a major source of titanium, closed in the late 1980s, but tons of stone tailings remain on the property. Gonyo said the tailings have use in construction projects.

He said Paul Mitchell Logging has been taking stone out of the property by truck through a prior agreement with the property owners, but hopes to market it more and increase shipments now that it has taken ownership.

“He is looking at inbound and outbound loads,” Gonyo said. “It is a very encouraging development.”

The remote rail line to Tahawus, north of North Creek, is owned by Saratoga & North Creek Railway, which has used it recently for a controversial program to store out-of-service rail tanker cars. The railway leases the line between Saratoga Springs and North Creek from Warren County and the town of Corinth.

Gonyo said flooding and ice issues that occurred in the Thurman area earlier this winter had alleviated and the line has been re-opened.

Gonyo’s good news was tempered when he was questioned about late revenue payments from the railway to the county, which led to a discussion about where the payments stood and the status of the contract between the county and railroad.

Some supervisors have been concerned about a history of late payments and the controversial tanker storage program, with acting county Administrator Kevin Geraghty saying the payment issue was “a big concern of mine.”

Gonyo said he could not respond, as those issues are handled by the parent company.

Warren County Attorney Mary Kissane said she sent a letter to the railway’s parent company, Iowa Pacific Holdings LLC, informing the railroad last month about “breaches” in the contract with the county, and the railroad has until this week to respond.

She outlined the county’s legal options if it did not.

“At that point, the contract is breached and you can determine what you want to do. You can terminate,” Kissane said.

A half-hour closed door executive session ensued, with the board taking no action afterward.

Bolton Supervisor Ronald Conover, chairman of the county Board of Supervisors, said the company’s communication with the county has to improve.

“I think a successful partnership operates that way,” Conover said.


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