Railroad will repair tunnels with further state commitment

The company that operates the Central Oregon & Pacific Railroad said it is willing to pay for the cost of repairing a series of tunnels beset by dangerous conditions that caused the railroad to close its 120-mile spur line between Coquille and Eugene in September.

In a letter to Gov. Ted Kulongoski, Paul Lundberg, vice president of the RailAmerica Operations Support Group, said his company would fund the $23 million in repairs if the state agrees to provide money for other infrastructure improvements and ongoing support necessary to make the rail line viable on a long-term basis.

The line, he said, could be reopened by this fall.

"We believe this sort of public commitment to be clearly in the state's long-term interests of preserving freight transportation in southwest Oregon," Lundberg wrote in a two-page letter, dated Feb. 4. "Our plan is practical, realistic and far less costly to the public than any plan that presumes the state acquiring ownership of the line from Vaughan to Coquille."

Kulongoski has not publicly commented on the proposal. Patty Wentz, the governor's spokeswoman, said Friday that a response is being prepared and should be issued within the next week or so.

The letter came in response to a meeting late last month in Salem between the governor, Lundberg, U.S. Rep. Peter DeFazio, state transportation officials and shippers. During that meeting, Kulongoski said the state would not consider pumping any money into the line until it was reopened.

At that time, Lundberg said he needed to go back and talk to other corporate officials before responding to the state's ultimatum. Previously, RailAmerica had offered to put up $4.66 million while seeking a group of public and private concerns to foot the rest of the repair bill. It had also asked for $10 million over five years to cover $1.5 million in annual losses to operate the spur line.

"The CORP will begin the process of repairing the tunnels to the extent that service on the Coos Bay from Vaughan to Coquille can be safely resumed, as promptly as safe engineering and construction standards will permit. The CORP will fund those repairs," Lundberg wrote in his letter, which The News-Review obtained Friday from the governor's office.

Lundberg said Central Oregon & Pacific Railroad had invested more than $48 million in the past five years in maintaining and improving its track structure in Oregon. Included in that amount was $5.5 million spent so far to construct a new rail yard off Interstate 5 north of Winchester.

That project has stalled after the Rail Division of the Oregon Department of Transportation halted further state payments to the railroad. The state had provided CORP with about $1 million out of $7.7 million in ConnectOregon grants before the spur line was shut down without notice in September.

The state Transportation Board is considering whether to cancel its participation in the project, which also required the railroad to put up $1.9 million of its own money.

State and federal officials blasted the railroad after the spur line was closed. It is an important shipping link for Roseburg Forest Products, American Bridge and other mills and companies in coastal Douglas and Coos counties.

DeFazio has said the state should save the $7.7 million it pledged for the Winchester rail yard and use it for the state or the Port of Coos Bay to buy the Central Oregon & Pacific.

When the spur line is reopened, the railroad plans to institute a surcharge of $200 per rail car as a commitment by shippers to help fund the restoration of the line, Lundberg wrote.



* You can reach reporter John Sowell at 957-4209 or by e-mail at jsowell@newsreview.info.