Railway in crisis: public opinion sought

Mona Mattei
By Mona Mattei
August 5th, 2010

Businesses in Grand Forks are looking to the city to rescue the Kettle Falls railway – it’s a question of survival. A recent presentation from the stakeholder group to the City of Grand Forks proposed that the solution would be for the city to either purchase the line, or invest in the needed infrastructure upgrades, or both. Ever since the railways owners, OmniTrax Inc., gave notice in 2008 of their intention to close the international rail line supporting shipping for businesses from Grand Forks through to Kettle Falls a group of business stakeholders and local government from both the Boundary and Washington State have been trying to find a solution to the dilemma.   On Monday, Aug. 9 the City of Grand Forks will be asking for the community to give them feedback on how they should proceed at a public meeting. In particular, council is looking at funding the development of a business case for the railway’s operations.   “We want to share enough information with the public so that they can participate in choosing or not choosing to make the investment at this point to go forward with a business case,” said Mayor Brian Taylor. “I think all of council wants to see public input at this level before we start spending $70,000 of public funds.”   Taylor said that the decision facing the community is a complex one. Businesses rely on the railway for its services, and yet are not in a position to fund its operations.   “From what we’re hearing from the stakeholders and from OmniTrax our ability to put together an international deal that involved several business partners and a cross border arrangement is impossible,” explained Taylor. “There’s no question we can’t tie business people into a commitment to operate and yet for us to just go forward and commit funds to upgrade the rail wouldn’t fly with the public.”   Craig Dohm from International Forest Products Ltd. (Intefor) has been the spokesperson for the stakeholders involved with the rail line. Dohm said that they are waiting to see how the community reacts to the proposal, but that the shippers are not looking for a handout.   “It’s going to take a creative solution both on behalf of the shippers, the railroad itself and the community. Our hope as shippers was to try and get something done on a commercial arrangement with OmniTrax and that was not successful because of the capital required to bring the line infrastructure up to standard,” said Dohm. “I think part of the solution will be the shippers stepping up and making a commitment to the line. Having the city and the community involved is because it is going to take their involvement as well.”   This leaves the city faced with a decision to take the lead on a purchase offer on the line and that is defined as including the rail line all the way to Kettle Falls. Taylor said there may be an American partner on the United States side that they are in discussion with, although the American local government is not able to offer that partnership.   “Clearly we would have to find partners, there’s no way that we could manage to swing this without support from partners, but those partners, the business people, feel that they’ve gone a good distance with this by funding the impact study. They are looking for partners that are going to share the capital cost of this,” said Taylor.   So far the federal and provincial governments have declined to get involved Taylor commented. The first step for the city will be to look at a business case for ownership.   “Putting this together will show whether or not there’s reason to go further. The next step will probably entail verifications from an engineering standpoint of many of the cost of the upgrades needed as well as a better understanding of the business case that OmniTrax has,” said Taylor. “If we’re going to look at buying the rail, basically buying the route, it would have to include all the way to Kettle Falls, it couldn’t just be the Canadian side, although it would be nice to have a partner.”   Although there is no specific timeline, the railway could close at any time at this point and it can all happen very quickly, said Taylor. Pacific Abrasives has indicated that the plant in Grand Forks will close if the line shuts down and Interfor may need to choose their most cost effective mill location for operations to run and that may not be Grand Forks.   “Hopefully the turnout is positive and the response is positive to allow the city to (develop the business case.) I think it will help to identify possible scenarios that might work. I’m sure the shippers will want to be engaged in that. I know we will as a company. It’s an important thing for our business there and I think the city and the regional district recognize that,” said Dohm. 

The community is invited to attend the meeting set for Monday, Aug. 9 at the Dr. Perley Elementary School at 7:00 p.m. 

Categories: Politics