Wednesday, August 14, 2002
Rail authority takes leap of faith
EUREKA -- An act of God shut it down, and it may take an act of God to open it up again. Oh, and a pile of money. The North Coast Railroad Authority approved a strategy Tuesday to reopen Northern California's long-dead railroad after getting a sobering glimpse at the huge capital investment that will take, and receiving little assurance it would be a profitable endeavor.
Under the plan, it's going to cost $46 million over five years to reopen the railroad, then $250 million over the next 20 years to improve it and keep it running. The 300-mile rail would be opened in stages, with the northern and southern parts of the line opening next year, and the sketchy Eel River canyon section opened in 2006. In a best-case scenario based on little projected economic growth for the area, the subsidized rail won't profit more than a couple of million dollars a year, beginning around year five. After that, it is predicted it may slowly take a dive.
That report was given to the board Tuesday by a team of consultants hired to determine the feasibility of reopening the line. At times, a debate over whether to accept the strategy took on a religious tone. "It's not going to be blind faith on my part," said director Bruce Burton from Mendocino. "This isn't a church group." "We have to have a little vision to lay on top of this," said director Allan Hemphill during the consultants' presentation. Hemphill added that the state may balk at approving funding under the strategy.
Authority staff member Doug Christy said he believes that restoring the railroad is a good thing for the region, and that it is the authority's mission, but it has to be accepted that the business needs time to recover. That's because the railroad is a disaster in the Eel River canyon, where El Niņo storms in 1997 and 1998 spawned landslides that wiped out tracks there. About $70 million has already gone into the railroad's purchase, operation and upkeep.
"You have to believe in something more to justify what we're doing here," said authority director Allan Hemphill, concerned about the picture painted by the consultants. The presentation will be made to the California Transportation Commission this month. The commission will approve or deny the use of $61 million in October. "It's the only chance we've got," said director Leo Sears. "We don't have another game."
The consultants are Willdan/HNTB and PB Ports and Marine out of San Francisco, which were paid $126,000 to do the work for the authority and the Humboldt Bay Harbor, Conservation and Recreation District. The firms looked at the capital needed to get the railroad off the ground, what was needed to ensure environmental compliance during the process, and the long-term feasibility of the railroad. They considered the outlook for the railroad based on three scenarios: low, moderate and high use by existing North Coast industries. Only under the high-use scenario does the rail begin making money, between 2006 and 2009, and then only if the entire line is open. It then begins profiting by between $2 million to $4 million per year, a figure that slowly shrinks over the two decades after the whole line is open.
Those figures could change for the better if a tariff is raised to match inflation, said Dominic Spaethling of PB Ports and Marine. "This is a snapshot in time," Spaethling said, and things can change. The railroad could fare better if economic development occurs because of the rail, adding to business. That could happen in the port of Humboldt Bay, which many believe needs a rail to thrive. But, Spaethling said, "One thing we have to assume is that the rail can support itself without relying on the port."