Wednesday, November 2, 2011

Understanding the Panhandle Rail Line Issue

The Advocate has a story on the upcoming public meeting of the Ohio Rail Development Commission concerning the proposed long-term lease of the Panhandle Rail Line.

If I could avoid being quoted, I would.  However, few people are tracking this issue.  It's, frankly, hard to track it since it has been like a ten-year drip, drip, drip of policy.

The current 25-year lease proposal, as drafted, is better than anything we've seen out of the ORDC in ten years.  It's not perfect, but it's fairer to the rest of us in the rail business--land owners and developers--who have invested in the current open access rail model. 

Licking County has a stake in this!  The Port Authority has invested seven figures in land purchase and infrastructure development.  The millions invested in the Pataskala Job Ready Site project is another example. Compare that to the state's actual cash investment in the rail line purchase--only $900,000.

A new shipper interested in building along the line can talk to multiple railroads and contract for open access service, negotiating from a position of strength that the lease grants.

That's a big change from past iterations.

A few years back the talk was solely about sale of the line.  During the Taft Administration, sale was the only option on the table.  The line, once appraised at $65 million, was discussed for sale as low as $6 million to the former Ohio Central owner. 

Licking County was particularly vocal, though not alone, in speaking out against sale.  Two versions of a White Paper, in 2002 and 2007, were signed by a cadre of local civic and business leaders.  The Advocate had multiple editorials too.

This wasn't a fight against the railroad at all.  This was a fight for our community.

Had the sale not been stopped, imagine the controversy when the owner sold his lease interest in the line. The owner sold his interest even absent the rail line ownership and still reaped, let's say, much, much more than $6 million. See a story from 2008 about the sale.

The local community officials along the line who rose up and cried foul did the state a huge favor, frankly. 

Today, the long-term lease proposed, if enacted, could actually fund the day-to-day operations of the Rail Commission.

Stay tuned to this issue.  It's looking like a ten-year debate is about to hit closing remarks time.

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