The removal of dozens of tanker cars from tracks north of North Creek apparently does not signal the end of Saratoga & North Creek Railway’s plan to store out-of-service rail cars on the line.
The railway’s parent company, Iowa Pacific Holdings LLC, informed state officials Wednesday that it plans to continue to store cars on the rail line, despite a pledge by the owner of cars stored there now that they will be removed, unless the state purchases its rights to the line.
The 80 or so tankers brought to the so-called Tahawus line in Essex County are owned by Union Tank car Co., which announced Tuesday that it plans to pull them out after state and local officials and environmental organizations protested for months.
But Iowa Pacific has other clients in need of train car storage and plans to bring “hundreds” of additional cars for storage in the region, Iowa Pacific’s counsel, David Michaud, wrote in a letter to the state Department of Environmental Conservation.
Iowa Pacific will stop storing cars on the line, which runs between North Creek and former stone mines in the hamlet of Tahawus in Newcomb, only if the state buys the company’s freight easement on the line, Michaud wrote. That purchase price would include investments the company has made, including the hiring of workers, he added.
“Short of such an agreement, however, SNCR will continue to store rail cars on its line and, in fact, has plans to bring in hundreds of more cars over the next few months,” Michaud wrote.
Company officials have estimated that as much as $5 million has been put into the local operation.
Michaud also wrote that the state’s proposed action to end the plan through a claim that the line was “abandoned” will not succeed.
“In response to the proposed adverse abandonment action that your agency allegedly intends to file, there is no merit to such a filing, and even if there was, a favorable ruling would not prevent the storage of railcars,” he wrote. “Once again, the salient point here is that my client owns the Tahawus branch freight easement in perpetuity. An abandonment action would do nothing to impact my client’s state property rights.”
Ed Ellis, president of Iowa Pacific, has not responded to requests for comment since Union Tank Car Co. made its announcement late Tuesday.
The Tahawus line runs through state Forest Preserve lines, which has prompted complaints about aesthetic concerns and possible environmental problems. Iowa Pacific has said the tanker cars were cleaned, and a state inspection found no actionable issues.
Warren County officials said Wednesday that they have heard nothing from SNCR in recent weeks.
Neither Horicon Supervisor Matt Simpson, chairman of the county Board of Supervisors Public Works Committee, nor Public Works Superintendent Jeff Tennyson has been in communication with the company after the latest developments in the storage saga.
“We don’t know what the next step is for them,” Simpson said.
Warren County and the town of Corinth own the rail line from North Creek to Hadley and Corinth to Saratoga Springs, respectively. The municipalities have contracted with Saratoga & North Creek Railway for use of the line for tourist and freight trains.
After SNCR won a contract to use the line in 2011, Iowa Pacific purchased the long-shuttered rail line to the north, which had been used to get materials out of the Tahawus mines.
Ellis said the revenue from train car storage was needed to make capital improvements on the line, as the company has been losing money because freight traffic has not developed as hoped.