I just received this from one of the local lists to which I subscribe. I know this is kind of a zombie thread, but this is news. <http://www.gazettetimes.com/articles/2007/10/26/news/community/3aaa05_bailey.txt> Shippers may buy Bailey branch By BENNETT HALL Gazette-Times reporter The fight to reopen an embargoed rail line in south Benton County has moved from the courtroom to the bargaining table. In June, the Willamette & Pacific Railroad halted service on the Bailey Branch, a dilapidated 23-mile stretch of track that runs south from Corvallis to the Hull-Oakes Lumber Mill in Dawson. The shortline operator called the line unsafe and said low freight volumes did not justify the cost of repairs. Hull-Oakes Lumber, Venell Farms and seven other freight shippers that use the line filed suit in August against the Willamette & Pacific and its parent company, Genesee & Wyoming Inc., in Benton County Circuit Court. The suit also named the Union Pacific Railroad, which owns the tracks and leases them to Willamette & Pacific. The case was moved to federal court in September, but early this month the plaintiffs dropped the suit and opened discussions with Union Pacific officials about buying the branch line. "It was a good-will effort to attempt to get this thing settled out of court if it was possible to do so," said Wayne Giesy, a former partner in Hull-Oakes Lumber. In turn, Giesy said, Union Pacific dropped its asking price for the Bailey Branch from $2.1 million to around $1.8 million. James Barnes, director of media information for the Union Pacific, confirmed that negotiations are taking place but declined to provide specifics of the discussions. "Since the lawsuit was dropped, we are talking to parties interested in purchasing the railroad," Barnes said. Willamette & Pacific officials have been threatening to abandon the line for years, citing low freight volumes and high repair costs. But until this summer, they always stopped short of halting the weekly run to Dawson in the face of opposition from shippers, elected officials and rail transport advocates determined to maintain service to south Benton County. Abandonment — the permanent closing of a rail line — is a formal procedure that requires approval by the federal Surface Transportation Board. No abandonment request has been filed with the STB so far, but that could still happen, W&P President Bruce Carswell said. "We are still moving down a path to discontinue service on the line formally," Carswell said, unless a solution to the stalemate is found. That probably means finding a buyer for the line — but not necessarily the whole 23 miles. No one directly involved in the current negotiations would discuss details of the talks, but both Giesy and Carswell said one possible outcome would be to sell a portion of the line to Venell Farms. Larry Venell, who has been handling the negotiations for the shippers, could not be reached for comment. But Venell Farms seems a likely potential buyer for several reasons: * It's one of the northernmost stops on the Bailey Branch, just six miles south of Corvallis. * It's the second-largest shipper on the line, after Hull-Oakes. * It has its own railroad siding and covered loading facility. And because the stretch from Corvallis to Venell Farms is only about one-fourth of the branch line's total length, it presumably would cost much less to buy and repair than the whole line. If talks break down, however, the matter could still wind up back in court. "We dismissed (the lawsuit) without prejudice," noted Alex Boal of Leonard Churchill Lawyers, the Salem firm representing the shippers' group, "which means it can be refiled." Side bar: The Bailey Branch The issue: Farmers and other freight shippers in south Benton County want to reopen the Bailey Branch, a 23-mile rail line that runs from south Corvallis to the Hull-Oakes Lumber Mill at Dawson. What's happened so far: The Willamette & Pacific Railroad embargoed the Bailey Branch in June, saying the line was unsafe and would cost too much to fix. Nine shippers sued in August, hoping to get the tracks fixed and the line reopened. What's next: The shippers have dropped their suit and are now negotiating to buy all or part of the line.
Buying the line is one thing, getting it in decent eough shape to use is another. They may as well plan on spending as much for rehab as they are for the purchase price. Then comes the issue of who operates it- themselves, a newly-formed Class III common carrier, or PNWR under contract. I certainly hope the potential buyers have deep pockets.......or can make back the line's salvage value (which may be at or less than the aforementioned purchase price).
Well, they have had some time to think about it so maybe they do have some sort of plan. PNWR, despite it being one of my favorite RR's, didn't give them great service. Part of the reason the tracks were so lousy is because PNWR doesn't spend much time, effort, or money on maintenance. We'll see what happens. I, of course, want all rail lines to be preserved and used.
Let's hope they can come to an agreement. I'd hope the price could be made fairly reasonable. I wonder what the value is, of that scrap steel? Boxcab E50
Probably not 1.8 million. I think the county would be wise to get into it, too, if, say, the shippers need an extra bit of change. The amount of wear on county roads due to increased truck traffic would more than outweigh a little help in the form of deferred taxes or what have you.
If the condition is as PNWR represents, I doubt there's much more that could be salvaged, beyond steel. Real estate? I don't see any worth there. Especially if the sans- rails end would be as a trail. If lost altogether, it's a multiple hit. No longer a private sector tax paying, job generating entity. (Particularly as a trail, where it eats revenues.) Any added operating expense forced upon those businesses. (What if they close down, or relocate? There's a notable negative!) And, to the area road infrastructure. Boxcab E50
The primary value of this line, I believe, is as a right-of-way. It would be an important part of a Corvallis-Eugene line if one were ever rebuilt, and I think the county would be unwise to not do what they can to at least keep the R-O-W intact. P.S. Boxcab, it's hard to make any serious points when in the corner of my eye I keep seeing that dancing banana.:ru-biggrin: ... or shall I say:w20z6q::w20z6q::w20z6q:
Bailey Branch The condition of the Bailey Branch is terrible. There have been derailments of standing railcars. Even the 5MPH speed was too fast for the track. The branch got in this condition from years of no maintenance by the late Espee. With the number of shippers using the line it would seem that at least enough work could be done to keep the line available for the shippers using it.
It didn't help that certain former W&P employees ignored speed regulations, including two choice specimens who were running a couple 100T woodchip cars back while standing on the platform of a remote control caboose when they let the speed creep up to way over the speed limit and flipped the cars, and therefore the caboose, right over. They were hurt but recovered, though they got to go find other employment. What I am saying is no that these tracks are great, but that there's nothing about the ground beneath them that is cursed. I hope the right-of-way is maintained intact.
I agree in that regard. My thought is insofar as the sale, with the RR wishing to abandon it, it loses monetary value as part of the proposed purchase transaction. That's a part of my secret plot to take over the world. If I can just keep a enough people distracted... Ha ha. Boxcab E50
Any updates on the "Bailey Branch" ? I head that UP would sell, but they want the P&W to still operate it ?
I haven't heard anything. The PNWR group at yahoo hasn't had any recent discussions on this as far as I know, and there are several employees in that group.
A friend and I drove down to Greenberry (7 miles south of Corvallis) on 3.22.08 to photograph a "cute" little seed storage and loading facility. Looking south, the track is indeed in need of some heavy maintenance. Here are 4 south-facing pictures:
The other issue to keep in mind is the lack of attractive rail rates. The commodities this line generate are not high volume, nor high value, therefore they general a lower return for the UP on the linehaul. The UP handles ALL business on it's own internal revenue requirements, and that is there right, and the commodities on this branch they simply do not want. Even if a large shipper were to come back, is this business the class 1 wants? Probably not. Intermodal, and unit trains are the traffic the big carriers prefer, carload business and branch lines such as this one are just not a priority for them and it would seem that they are not long for the industry. A sad state to be sure, but it's the way the industry is going. JPF
JPF: It looks awfully familiar. You hit the nail on the head. Not easy to state the honest truth, but better than living under the illusion that all lines can be saved. Those that will be retained, and which require rehabilitation will also require outside funding when the revenues (if the Class 1 carriers do cooperate) don't even cover annual operating/M/W costs much less earn a profit. You just cannot expect a private, enterprise, company to invest in a business when there is little or no chance of making a profit. It is much more fun to model a line like this than it is to operate or own one. I am glad I don't have to lay awake at night worrying about whether a bridge will give way or wash out; a tunnel will cave in; or my most important/largest, revenue, producing customer will go to truck or close the plant and move overseas; or at the very least some "clown" will drive into the side of my train and then sue me for "damages" and cause the line to shut down. I enjoy working for them...not owning them. BOK
I think the Bailey branch is straighter then yours was at start up. All good points. The other thing to consider is this. You rebuild now, and have a few good years and let things slide again, then you're right back to where you are today. The biggest obstacle is still going to be your class 1 connection, if they don't want the business at rates that your customers can/will pay you're wasting your efforts here. JPF
I am a fan of the SP, but this is, unfortunately, all too familiar with a lot of ex-SP branches in Oregon. I don't know when the SP quit doing any maintenance, but it was well before 1996.
