California Western (Skunk) RR

Buyer inspects CWR, loan repaid to city

On the weekend of Oct11 and 12, management team members of Fort Benton Funding reported that they had completed an inspection of the California Western Railroad.

The venture capital group from Grants Pass, Ore. made an offer to purchase the railway in August on behalf of its subsidiary, Pacific Cascade Railway. Fort Benton Funding made the offer and a management and operational overview summary was submitted by Fort Benton's attorney, Michael Bird.

Bankruptcy trustee Mike Meyer granted the team access to the property to review track conditions, rolling stock, real estate and other assets. According to Fort Benton spokesperson Bill Korpa, the information from the inspections will become part of the proposed purchase package, which was likely to exceed the original offer.

Bill Collins, operations manager for Pacific Cascade Railway, said that the tracks would need immediate attention if the train is to open for the spring season. Two prior inspections by the Federal Railway Administration identified what it called inadequate tie quality along the line. Collins predicted that winter rains would also slow the repair of the line as runoff sometimes completely covers areas of the track. Collins went on to say that the rain could also cause track washouts in areas where poor drainage exists.

Korpa said that information gained by the inspections was valuable to the group in making their assessments. "Their knowledge can make for a good transition," he said, "and I believe it helps strengthen our plan." Korpa said that the group should be able to submit plans to the trustee this week.

At the last regular meeting of the Fort Bragg City Council, Interim City Manager Robert Christofferson reported that California Western Railroad had fully paid back its loan.

"Everybody will be grateful to know that another check for $75,000 was received from the railroad, and that essentially pays off the loan," said Christofferson.

Although the principle loan amount was paid off, Christofferson said that around $2,000 in penalties and interest were still owed, which the city will try to collect.

In March, the council granted the loan to California Western Railroad, in the amount of $125,000 to keep its operations going until the summer tourist months. The loan was a public-private partnership between the city and Savings Bank of Mendocino County, which agreed to match the city's loan, totaling $250,000.

In August, council members learned that CWR was able to maintain its operations through the summer, without having to tap into the bank's line of credit. - Tony Reed, The Fort Bragg Advocate-News, courtesy Larry W. Grant

 

The California Western actually declared Chapter 11 back in the spring and operated through the summer under bankruptcy protection.

The rider that talked to you about the Colorado narrow gauge had the wrong operation...the Cumbres & Toltect is owned by the state governments of Colorado and New Mexico, and I doubt that they are looking at purchasing anything in California...however, the Durango & Silverton is under common ownership/management with the Great Smokey Mountains Railroad, and that outfit was involved somehow in keeping the California Western going through this past summer (appointed to operate the road by the trustee? I don't remember exactly how they were involved, but I know that they were). I do know that they are on record as saying they are not all that interested in purchasing the CW.

The railroad only operated the Fort Bragg-Northspur portion of the line this year...the Northspur-Willits segment has not seen a train in over a year due to track conditions. On a positive note, the railroad did get their steam locomotive #45 (a Baldwin 2-8-2 logging mikado, ex-Medford Corp. #3) back into service very late this past summer.

The line was shut down for approximately one week in late August due to insurance coverage problems; however, they were able to get insurance coverage again, and they were back into operation for Labor Day weekend. They closed up shop for the year after Labor Day, and if they re-open in the spring it will be under the new ownership.

As far as freight operations go, the line has not hauled any freight since November of 1998, when the FRA shut the Northwestern Pacific down. The line was actually building their freight business at that time, and they were on track for handling something like 800-1000 loads a year (all lumber). However, since the NWP shutdown happened both of the sawmills that provided 100% of the line's freight revenue have shut down and are not coming back, meaning that if and when the NWP re-opens any freight to be handled on the road will have to come from new sources.

Hope this helps,

JD Moore
Elko, NV