Opposition to the plan to revive long-dormant rail traffic on Tennessee Pass is growing by the day.
Residents of Chaffee, Lake and Eagle counties buried the Surface Transportation Board this month with opposition to the plan proposed by a Texas-based, short-line operator to begin running freight and possibly passengers on tracks that last saw trains in 1997. Environmental groups, county commissioners and a competitor on Colorado’s Eastern Plains have joined the chorus of opposition, asking the federal transportation board to either reject or further scrutinize the deal.
Chaffee and Eagle county commissioners are weighing in on Rio Grande Pacific Corp.’s push to run crude oil trains on a proposed new railroad in Utah that might lead to tankers of Uinta Basin crude rolling through Avon, Minturn, Buena Vista, Browns Canyon and Salida.
“If we want to stop this train from coming down our valley, then let’s stop the railroad up there in Utah. If it’s not in Utah, there’s no way crude is coming through our valley,” said Chaffee County Commissioner Keith Baker, whose board joined Eagle County commissioners and Town of Avon leaders in enlisting a nationally renowned railroad attorney from Kaplan Kirsch Rockwell to voice their concerns in the environmental review of the proposed Uinta Basin Railway.
Rio Grande Pacific Corp. is set to operate the $1.5 billion, 85-mile Uinta Basin Railway in Utah. The new rail line will connect the mountain oil fields with the national rail network. The so-called “waxy” crude coming from the Uinta Basin is too thick for a pipeline and the new rail line would enable shipment of the crude beyond local refineries around Salt Lake City. Rio Grande Pacific Corp. said the new rail will allow delivery of about 400,000 barrels of crude oil a day to Gulf Coast refineries from the Uinta Basin southeast of Salt Lake City. While one potential route for the company to reach those southern refineries is across Tennessee Pass, a company spokeswoman says that is not part of the plan for Rio Grande Pacific’s newly formed Colorado Midland & Pacific Railway.
“Colorado Midland & Pacific has no plan to run oil trains. In fact, we don’t see any means to connect the Tennessee Pass Line segment we have with other (lines.) There is no business case for that. Our focus is to explore passenger and commuter opportunities in that corridor as well as freight and other opportunities,” said Colorado Midland & Pacific spokeswoman Sara Cassidy, speaking this week to dozens of Upper Arkansas River Valley residents during an online meeting organized by the Lake County Open Space Initiative.
Cassidy said her company’s confidential lease agreement with Union Pacific stops just east of connecting with the rail tracks at Dostero that run west to Utah and northeast along the Colorado River to Denver via the Moffat Tunnel. Without a lease for that final, short leg of railroad between Gypsum and Dotsero, the company can’t connect the Tennessee Pass Line with the national rail network, she said.
Rio Grande Pacific Corp. is an innovative rail company and dealmaker. It owns four short-line railroads that cover about 700 miles in six states. Several years ago the company forged a deal with Drexel Hamilton Infrastructure Partners, the private equity firm funding the Uinta Basin Railroad, to connect its New Orleans & Gulf Coast Railway with a $2.5 billion, 200-acre oil exporting terminal in Plaquemines, Louisiana, that will rank as one of the largest terminals in the world when it opens in the next couple years.
Rio Grande Pacific Corp., formed in 1986, has a host of subsidiaries that provide services to other short-line and commuter railroads and offers signal technology as well as selling railroad surfacing equipment. The company last year took over operation of a commuter rail in north Texas.
Cassidy said her company has been negotiating with Union Pacific about opening the Tennessee Pass Line since 2011, a year before Utah officials concluded that using trucks on the highway was inadequate for moving Uinta Basin oil. Cassidy said the initial plan includes potential passenger service between the Eagle County airport in Gypsum and Leadville, possibly involving a public-private partnership. The trains also could move “building materials like rock and sand” along the Arkansas River section of rail, she said. She also suggested that rail could serve the American Gypsum Co. wallboard maker in Gypsum.
The company only plans to move local freight and passengers on the Tennessee Pass line without connecting to rail networks to the east and west, Cassidy said.
“Any speculation or scenarios about oil trains are not true,” she told the online group this week. “They are not within our plan or within our capabilities.”
Chaffee County Commissioner Baker said he thinks Cassidy is being “absolutely sincere.”
“But she is saying what she’s been told and she gets paid to do that. Colorado Midland & Pacific may well be telling her that, but Rio Grande Pacific Corp may have different motives,” he said.
Chaffee County commissioners this week were among more than 50 Upper Arkansas River Valley residents, businesses and conservation groups sending letters to the Surface Transportation Board.
“Crude or refined oil, coal, fracking fluid, or any other potentially hazardous material transiting alongside our pristine Upper Arkansas River is unconscionable,” reads the letter from Chaffee County commissioners, “and expediting the (Tennessee Pass Line’s) reactivation without careful scrutiny even more so.”
The type of cargo rolling along the Arkansas River and through Browns Canyon National Monument is very important, Baker said.
“Conditions have changed here since we last saw trains,” he said. “That word in the letter — ‘unconscionable’ — we meant it. We need to be very clear that this is our position.”
Many of the comments focus on the business viability of commercial traffic on the railroad between Gypsum and Cañon City. Mike Conlin with the Lake County Open Space Initiative said the seven railroad crossings in Lake County would require roughly $1.75 million to prepare for train traffic.
Eastern Colorado billionaire businessman Stefan Soloviev, — whose Colorado Pacific Railroad has filed objections to the Colorado Midland & Pacific lease proposal in his campaign to secure access to the Tennessee Pass Line — estimated that the cost of rehabilitating the railroad for just freight is $278 million. Renovating the line for passenger traffic, with stations for loading and unloading, would add to that cost. In its filings with the Surface Transportation Board, Colorado Midland & Pacific said it expects annual revenues around $5 million.
Residents along the tracks are worried Colorado Midland & Pacific would pursue volume and high-dollar freight to offset the cost of rehabilitating the line. Many remember when long freight trains stopped in towns like Buena Vista in the 1980s and ’90s, blocking all three of the town’s railroad crossings at once. Environmental groups worry that a high volume would increase the chances for derailments or spills. A history of derailments on the steep Tennessee Pass and a chemical spill that killed two in 1996 played into Union Pacific’s decision to mothball the line in 1997.
When a railroad operator proposes to take over an existing rail line, it can ask the Surface Transportation Board to exempt it from intensive review of the proposal. All of the more than 50 letters submitted to the Surface Transportation Board in the last two weeks urge the governing body to not exempt Colorado Midland & Pacific from more rigorous scrutiny. That exemption is meant for proposals that don’t have significant impacts on communities and the environment.
Michael Booth, a spokesman for the Surface Transportation Board, said the board operates like a court, with strict parameters for approving or rejecting rail plans. The board’s goal is to insure rail traffic rolls smoothly and that competitive issues are resolved, Booth said. It doesn’t have a lot of leeway for rejecting plans by an operator who promises to fix up a critical corridor that has been neglected for decades.
“We have limited jurisdiction to decide economic regulatory affairs,” Booth said. “The board’s concern is mainly, ‘Does the line serve a public purpose?’”
Before trains roll over Tennessee Pass, there will be much more review and studies by a host of local, state and regional authorities, including the Forest Service and Colorado Department of Transportation. The transportation board is a first step in what will be a long process.
Jeremy Nichols with the WildEarth Guardians environmental group sent a letter to the board arguing that reviving the rail line after 24 years was no different than building a new railroad and would have “potentially significant impacts to the region’s communities, economies, environment, health, and quality of life.”
“We are trying to get the board to recognize that an exemption is not appropriate and this should go through a much more rigorous process, with scrutiny and input from communities that will be impacted,” Nichols said in an interview.
Cassidy said her company is spending the next few months talking with commissioners and communities along the line, trying to gauge interest and weigh options for rail traffic.
“If communities tell us this isn’t going to work or there isn’t any interest in doing this, we are back to the drawing board with other options,” she said.