Study gauges potential rail redevelopment
NORWICH – The out-of-service railroad track through Chenango County was heavily damaged by flooding in 2006 and continues to deteriorate, but it is not without potential, according to a study conducted by a Pennsylvania-based transportation consulting firm.
“There is a light at the end of the tunnel,” said Development Chenango Executive Director Maureen Carpenter, as she addressed a room full of county leaders Friday morning.
In 2008, the development agency commissioned TranSystems / Stone Consulting to study the portion of New York Susquehanna & Western railroad’s Utica Line, which stretches through 42 miles of Chenango County. The study was funded in part by the Chenango County Board of Supervisors and the Chenango County Industrial Development Agency.
The firm’s operations director, Randy Gustafson, presented the group’s findings to stakeholders at two meetings last week.
According to Gustafson, they were specifically asked to assess the current condition of the track and determine the potential for redeveloping rail service along the line as well as identify possible funding sources and business opportunities. The full results of the study fill more than 150 pages.
The consultant first addressed the history of the rail corridor, from its construction in 1869, through its acquisition by NYS&W in 1985 to the flooding in 2006 which put it out of service.
A line’s value is determined by the competitive nature of the railroad industry, Gustafson explained. The value of the portion of track through Chenango County has historically been its role as “a competitive link for a number of rail carriers,” rather than the volume of local traffic along the line.
“It was never really a center unto itself,” he explained. “It’s all about linkages.”
Local business opportunities
That’s not to say, however, that there are not opportunities for local business. Gustafson was able to identify several of these opportunities during his research.
There is still local traffic in the Sherburne area, but “the (lack of) connectivity south doesn’t hinder business,” he said. After the flooding, this freight was rerouted North to circumnavigate the embargoed portion of rail.
Gustafson identified potential in reopening the track through the City of Norwich. Sheffield (formerly Kerry Bioscience) has already requested a rate quote for freight to and from its facility.
Dominic Shea, who sits on Development Chenango’s board of directors, asked Gustafson what it would take to restore rail service that far south. According to the consultant, the largest impediment is small washout in North Norwich, which he estimated would cost roughly $15,000 to repair. Empty rail cars are currently being stored on the track just north of that washout.
If rail service was restored to the Woods Corners facility, it would also be a selling point for the former P&G facility. This is a “nice, flat, rail accessible site,” Gustafson said. While the track and siding are still in place adjacent to the plant, as the line is not in service, the property cannot be marketed as having direct rail.
Another opportunity identified during the study is the Westcott warehouse on Borden Avenue. At one time, the old Borden facility was one of the largest local customers on the Utica line.
“You can serve a lot of customers there at the warehouse without putting in a lot of track,” Gustafson reported. In order to return rail access to the site, a new rail siding would need to be installed.
Gustafson also believes there would be an opportunity to build a transload site for the transporation of agricultural commodities at the south end of Norwich. These commodities, such as feed and fertilizer, are currently being transported by truck 120 miles round trip.
“It would knock the round-trip feed distance down to about half for local farmers,” the consultant said. He also reported having preliminary discussions with an operator, who confirmed the location’s potential.
There is also an opportunity with the empty plastic plant located on Cherry Street in Greene which, according to Gustafson, would become more marketable if it had access to direct rail.
Overall, the consultant said, he was impressed by the volume of interest he received from his inquiries as well as the unsolicited requests received during the project.
“I’m excited by the potential to keep the phone ringing,” Gustafson said. “There is plenty of reason to believe that there is more business there than we’re aware of.”
But even with that potential business, the transportation expert does not believe stand-alone shortline freight operation would be viable. He does, however, believe it could be of interest to a shortline conglomerate with a number of lines.
“They take a long view,” he explained. The county would be able to gauge interest by issuing a request for proposal, but this can only occur if NYS&W files for abandonment of the line.
Other opportunities
Gustafson was also asked to look at the viability of using the line for a scenic or excursion railway. Although there was significant local interest in this possibility, there would not be enough ridership to support the investment required, he said. “You really don’t have facilities here.”
He wrote off the idea of a dinner train option for the same reasons, as they combine all of the liabilities of operating an excursion rail with the additional challenge of running a restaurant.
There could be an opportunity to run a limited number of excursions if the line was taken over by a shortline freight operator. These could be run in conjunction with some of the area’s larger festivals and events.
“The best run would be from Norwich south to Oxford,” Gustafson said. Unfortunately, he added, that stretch of track has some of the worst flood damage.
The study also explored the idea of converting the corridor into a Rails with Trails arrangement, with a walking or bike path running adjacent to the existing track. According to Gustafson, this is also not a viable option.
The elevated embankment on which much of the track sits would not easily lend itself to an adjacent trail. This embankment isn’t as stable as it appears, he explained.
“It moves,” the consultant reported. “That’s why there was so much flood damage.”
He also expressed concerns about the width of the right of way, which he judged to be too narrow.
The only exception, he said, was a portion of the track within the city of Norwich which was flat and wide enough to accommodate a trail.
“I can definitely endorse that,” Gustafson said.
Community volunteer Dick Dansingberg asked Gustafson if he saw any opportunities for the railroad in relation to natural gas exploration in Chenango County. The consultant replied in the affirmative, citing opportunities with the transporation of brine to water treatment facilities.
“I know it’s in the market. I know it’s happening,” Gustafson reported.
Condition of the track
One of the major obstacles to exploring any of these opportunities is the current state of the tracks which, without maintenance, continues to degrade. For this reason, Gustafson explained, his estimates for the cost of rehabilitating the rail corridor greatly exceed NYS&W’s initial repair estimate of $321,500.
It would now cost $1.15 million, he said. $900,240 of that total would be needed to replace severely eroded track along the line. Two major washouts, one behind Walmart and the other south of Oxford, would cost and additional $89,706 and $59,057 respectively to repair. The remaining $102,017 would be required to fix “less effected” sections of the track, a cost of more than $4,000 a mile.
The consultant has recommended the IDA pursue a claim with FEMA to cover all or part of the cost of the repairs. According to Jennifer Tavares, their initial attempts at filing a claim have been rejected because the time elapsed.
“You have a legitimate claim here,” he said, stressing the need to pursue the matter further. “Now is the time to talk to your (elected) representatives.”
How much is it worth?
One of the things the transportation consultants were asked to do was put a price tag on the rail assets along the line, calculating the net liquidation value.
“If anything in this project was a moving target, this was it,” said Gustafson, citing the extreme volatility in the scrap metal market over the last 6 months. “I don’t know when I’ve seen numbers vary so much.”
With that disclaimer, the consultant gave his valuation of the rail assets along the 41.5 miles of track, not including the land, as $8,454,669.
This was based on September numbers, he explained, and will likely need to be run again.
What does the NYS&W think?
While NYS&W was highly criticized for filing to discontinue service along the 41.2 mile stretch of track which stretches from Chenango Forks to Sherburne with the Surface Transportation Board, Gustafson said they were merely doing what was required of them by the regulatory agency.
“You’ve got to announce to the world if a railroad is no longer available for us,” he explained. The good news, however, is that even if the railroad does file to abandon the line, there is less regulatory red tape involved with reopening the line.
Gustafson praised NYS&W for their level of cooperation throughout the project. “They really gave us basically everything we asked for during the study,” he reported.
Nathan Fenno, president of the NYS&W, was present for the Friday morning meeting. It was the rail executive’s first time hearing the results of the study.
“We provided them as much information as we could,” Fenno said. In September, he reached an agreement with the IDA to hold off on filing for full abandonment of the line in part to allow time for the study to be conducted.
The rail executive was non-committal about what affect the study results would have on the railroad, although he said he was interested in hearing them as well as the community’s reaction.
“One difficulty is that there are no current customers,” Fenno said, which makes justifying the large expenditures necessary to rehabilitate the track difficult. “I’m not sure even if we’d be running cars even if the track was in good shape.”
“On the flip side, we’re a great proponent of the corridor being preserved for the future in one way or another.”
“There is a light at the end of the tunnel,” said Development Chenango Executive Director Maureen Carpenter, as she addressed a room full of county leaders Friday morning.
In 2008, the development agency commissioned TranSystems / Stone Consulting to study the portion of New York Susquehanna & Western railroad’s Utica Line, which stretches through 42 miles of Chenango County. The study was funded in part by the Chenango County Board of Supervisors and the Chenango County Industrial Development Agency.
The firm’s operations director, Randy Gustafson, presented the group’s findings to stakeholders at two meetings last week.
According to Gustafson, they were specifically asked to assess the current condition of the track and determine the potential for redeveloping rail service along the line as well as identify possible funding sources and business opportunities. The full results of the study fill more than 150 pages.
The consultant first addressed the history of the rail corridor, from its construction in 1869, through its acquisition by NYS&W in 1985 to the flooding in 2006 which put it out of service.
A line’s value is determined by the competitive nature of the railroad industry, Gustafson explained. The value of the portion of track through Chenango County has historically been its role as “a competitive link for a number of rail carriers,” rather than the volume of local traffic along the line.
“It was never really a center unto itself,” he explained. “It’s all about linkages.”
Local business opportunities
That’s not to say, however, that there are not opportunities for local business. Gustafson was able to identify several of these opportunities during his research.
There is still local traffic in the Sherburne area, but “the (lack of) connectivity south doesn’t hinder business,” he said. After the flooding, this freight was rerouted North to circumnavigate the embargoed portion of rail.
Gustafson identified potential in reopening the track through the City of Norwich. Sheffield (formerly Kerry Bioscience) has already requested a rate quote for freight to and from its facility.
Dominic Shea, who sits on Development Chenango’s board of directors, asked Gustafson what it would take to restore rail service that far south. According to the consultant, the largest impediment is small washout in North Norwich, which he estimated would cost roughly $15,000 to repair. Empty rail cars are currently being stored on the track just north of that washout.
If rail service was restored to the Woods Corners facility, it would also be a selling point for the former P&G facility. This is a “nice, flat, rail accessible site,” Gustafson said. While the track and siding are still in place adjacent to the plant, as the line is not in service, the property cannot be marketed as having direct rail.
Another opportunity identified during the study is the Westcott warehouse on Borden Avenue. At one time, the old Borden facility was one of the largest local customers on the Utica line.
“You can serve a lot of customers there at the warehouse without putting in a lot of track,” Gustafson reported. In order to return rail access to the site, a new rail siding would need to be installed.
Gustafson also believes there would be an opportunity to build a transload site for the transporation of agricultural commodities at the south end of Norwich. These commodities, such as feed and fertilizer, are currently being transported by truck 120 miles round trip.
“It would knock the round-trip feed distance down to about half for local farmers,” the consultant said. He also reported having preliminary discussions with an operator, who confirmed the location’s potential.
There is also an opportunity with the empty plastic plant located on Cherry Street in Greene which, according to Gustafson, would become more marketable if it had access to direct rail.
Overall, the consultant said, he was impressed by the volume of interest he received from his inquiries as well as the unsolicited requests received during the project.
“I’m excited by the potential to keep the phone ringing,” Gustafson said. “There is plenty of reason to believe that there is more business there than we’re aware of.”
But even with that potential business, the transportation expert does not believe stand-alone shortline freight operation would be viable. He does, however, believe it could be of interest to a shortline conglomerate with a number of lines.
“They take a long view,” he explained. The county would be able to gauge interest by issuing a request for proposal, but this can only occur if NYS&W files for abandonment of the line.
Other opportunities
Gustafson was also asked to look at the viability of using the line for a scenic or excursion railway. Although there was significant local interest in this possibility, there would not be enough ridership to support the investment required, he said. “You really don’t have facilities here.”
He wrote off the idea of a dinner train option for the same reasons, as they combine all of the liabilities of operating an excursion rail with the additional challenge of running a restaurant.
There could be an opportunity to run a limited number of excursions if the line was taken over by a shortline freight operator. These could be run in conjunction with some of the area’s larger festivals and events.
“The best run would be from Norwich south to Oxford,” Gustafson said. Unfortunately, he added, that stretch of track has some of the worst flood damage.
The study also explored the idea of converting the corridor into a Rails with Trails arrangement, with a walking or bike path running adjacent to the existing track. According to Gustafson, this is also not a viable option.
The elevated embankment on which much of the track sits would not easily lend itself to an adjacent trail. This embankment isn’t as stable as it appears, he explained.
“It moves,” the consultant reported. “That’s why there was so much flood damage.”
He also expressed concerns about the width of the right of way, which he judged to be too narrow.
The only exception, he said, was a portion of the track within the city of Norwich which was flat and wide enough to accommodate a trail.
“I can definitely endorse that,” Gustafson said.
Community volunteer Dick Dansingberg asked Gustafson if he saw any opportunities for the railroad in relation to natural gas exploration in Chenango County. The consultant replied in the affirmative, citing opportunities with the transporation of brine to water treatment facilities.
“I know it’s in the market. I know it’s happening,” Gustafson reported.
Condition of the track
One of the major obstacles to exploring any of these opportunities is the current state of the tracks which, without maintenance, continues to degrade. For this reason, Gustafson explained, his estimates for the cost of rehabilitating the rail corridor greatly exceed NYS&W’s initial repair estimate of $321,500.
It would now cost $1.15 million, he said. $900,240 of that total would be needed to replace severely eroded track along the line. Two major washouts, one behind Walmart and the other south of Oxford, would cost and additional $89,706 and $59,057 respectively to repair. The remaining $102,017 would be required to fix “less effected” sections of the track, a cost of more than $4,000 a mile.
The consultant has recommended the IDA pursue a claim with FEMA to cover all or part of the cost of the repairs. According to Jennifer Tavares, their initial attempts at filing a claim have been rejected because the time elapsed.
“You have a legitimate claim here,” he said, stressing the need to pursue the matter further. “Now is the time to talk to your (elected) representatives.”
How much is it worth?
One of the things the transportation consultants were asked to do was put a price tag on the rail assets along the line, calculating the net liquidation value.
“If anything in this project was a moving target, this was it,” said Gustafson, citing the extreme volatility in the scrap metal market over the last 6 months. “I don’t know when I’ve seen numbers vary so much.”
With that disclaimer, the consultant gave his valuation of the rail assets along the 41.5 miles of track, not including the land, as $8,454,669.
This was based on September numbers, he explained, and will likely need to be run again.
What does the NYS&W think?
While NYS&W was highly criticized for filing to discontinue service along the 41.2 mile stretch of track which stretches from Chenango Forks to Sherburne with the Surface Transportation Board, Gustafson said they were merely doing what was required of them by the regulatory agency.
“You’ve got to announce to the world if a railroad is no longer available for us,” he explained. The good news, however, is that even if the railroad does file to abandon the line, there is less regulatory red tape involved with reopening the line.
Gustafson praised NYS&W for their level of cooperation throughout the project. “They really gave us basically everything we asked for during the study,” he reported.
Nathan Fenno, president of the NYS&W, was present for the Friday morning meeting. It was the rail executive’s first time hearing the results of the study.
“We provided them as much information as we could,” Fenno said. In September, he reached an agreement with the IDA to hold off on filing for full abandonment of the line in part to allow time for the study to be conducted.
The rail executive was non-committal about what affect the study results would have on the railroad, although he said he was interested in hearing them as well as the community’s reaction.
“One difficulty is that there are no current customers,” Fenno said, which makes justifying the large expenditures necessary to rehabilitate the track difficult. “I’m not sure even if we’d be running cars even if the track was in good shape.”
“On the flip side, we’re a great proponent of the corridor being preserved for the future in one way or another.”
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