Tuesday, October 21, 2008

Humboldt Port Development. Lets talk.

Humboldt Port Development.

The rail story you don’t hear:

On February 11th of 1998 one of my best friends was the engineer of a train hauling product from Northern Humboldt to the southern portion of our rail system. Word was out that a slide was occurring between Dos Rios and Bell Springs. Nick’s step father “Fergy” Ferguson told Nick to abandon the rail cars at Island Mountain, and those cars are there to this day! Nick took the Locomotive north to wait for the time to return to repair the line. Mind you, this had been pretty much Standard Operating Procedure for over 85 years. The repairs needed to restore service were nothing more than they had been up against in past years or not anything they hadn’t seen before. Nick said it would have taken about 2 days at the least, and no more than a week or two to resume service at way under 1 million dollars. Unfortunately, the North Coast Rail Authority had contracted out rail services to Railways Inc. and CEO Ron Darling had announced they were going bankrupt. Nick and other rail workers were actually working for free, in hope that the rail would find money to pay the employees sometime in the future. When it became obvious there would be no payroll checks forthcoming, people left to find new jobs. Many workers filed claims for past payment due from Railways Inc…….including the CEO Ron Darling. Wild stuff.

So this interruption in train service for just ten years ended up being a huge contributor to the train downfall. We went from a rail system needing less than 1 million to continue a service that had only short interruptions in the winters for decades, to a totally stagnant rail system that is dilapidating yearly. New figures thrown out there for functional/actual train service is now over 1 Billion dollars! How and why did this happen? It seems the North Coast Rail Authority has become its own beau racy that has money coming in, but where is it going out? Staff? Repairs? Studies? Directors? Attorneys? Got me. I am looking from the outside in. This is a loosely wrapped observation and I am sure others out there who know more particulars. Please refute my facts publicly and not anonymously. I will monitor those out.

7 comments:

Mike Buettner said...

Take a look and make a guess at how much it will cost

Jeff Muskrat said...

There's more money for the oil companies if their are more truck-trailers and less boxcars. I'd love to see the rail open again. Leave the bay alone!

Anonymous said...

Whoa! Check out those pics!

wooxen said...

What railroad?

Not A Native said...

Richard,

I don't know what facts you believe you've posted here. Anecdotal stories from your acquaintances don't explain the financial situation of the NCR at the time. But to me, "going bankrupt" is a process whereby the company's capital is declining and with no reasonable expectation to replenish it. When theres no more capital to pay bills and creditors refuse to extend loans, operations cease.


Below is a news article at the time of closing, mentions questions about the accounting and $7M in unpaid bills.

Also, the DOT order for the shutdown documented a long history of noncompliance and operational violations: http://www.fra.dot.gov/downloads/safety/eo21.pdf

Looking over the document, it reminds me of the recent closure of Eureka cold storage that occured under similar circumstances with dilapidated facilities that presented an immediate hazard of death or injury.

Safety Risks Shut Down Freight Line
November 28, 1998 in print edition A-28

The historic Northwestern Pacific Railroad, once vital to the lumber industry, has been shut down because of safety risks and the line’s threat to the environment.

The emergency order, which took effect at 6 p.m. Friday, halts the freight line from Humboldt to Napa counties.

Northwestern Pacific officials said they were stunned by the order.

“This is bad news,” said Bob Jehn, a member of the North Coast Railroad Authority, the public body that oversees the railroad. “These trains need to continue running.”

Storm damage has made the track hazardous with the threat of death or injury to the public or railway employees, the federal agency said Wednesday. Thirty-two of the railroad’s 127 highway crossing signals were broken, it said.

The deterioration of the tracks also threatened the Eel and Russian rivers, the administration said. The 286-mile line passes through the pristine upper Eel River canyon in Humboldt County and runs along the Russian River above Healdsburg in Sonoma County.

Millions in emergency federal funds to fix the tracks have been held up for more than a year because of questions over the railroad’s accounting practices.

For years, the railroad ran an extensive ferry service on San Francisco Bay and a commuter train service in Marin County. But as a subsidiary of Southern Pacific, it later cut back to freight-only operations.

Southern Pacific sold the railroad to a short-line operator, which in 1991 was taken over by a consortium of government agencies, including Humboldt and Mendocino counties and the Golden Gate Bridge District.

The line in Sonoma and Marin had been proposed for passenger transit, but voters rejected transit sales tax measures in November.

Meanwhile, a private firm with a history of financial problems, Rail-Ways Inc. of Elgin, Ill., ran the freight operations, neglecting maintenance. The railroad still has $7 million in unpaid bills.

Rail-Ways Inc. has been hauling about 300 cars a month on the railroad from Willits to Napa, mostly carrying gravel and timber.

Federal regulators said the order would remain in effect until the crossing signals are repaired, vegetation is cleared from the tracks and maintenance crews are properly trained.

samoasoftball said...

Not a native: That, in fact, the rail could have been running freight with very little capital at the time. Yes, the 7 million at the time was a big factor. But Railways Inc. going bankrupt was a biggie. They could not pay for the workers who could of kept the line in business. And the NCRA just sat back and watched it all happen. They had accounting issues.

Not A Native said...

Richard
READ THE DOT ORDER SHUTTING DOWN THE RAILROAD. I put a link to it in my last post.

Then you'll understand why the railroad was not permitted to keep running. The deficiency items had existed for years and the cost to fix them was many millions that apparently wasn't available. So, they just kept running without doing maintenance, at huge risk of a catastrophe, until they were ordered to stop.

You seem to want to "blame" the NCRA when in fact the role the NCRA had was a conduit to send FEMA money to Rail-ways.

I don't know what the NCRA tried. I'll bet Dan Hauser wanted FEMA to give them money but FEMA was asking difficult questions that NCRA didn't have good answers to. Hause's clout in Sacramento wasn't enough to get him very far with FEMA.

The fact is, the railroad was a money losing proposition and needed massive subsidies to keep operating safely. And the NCRA wasn't able to convince the officials that the railroad was a good use of public subsidy money.

Could a better politically connected NCRA have gotten money to fix the problems cited in the DOT order? I don't know. But my belief is that the amount of money was so large it would have taken a national emergency that could be helped by an operating railroad to politically justify the expenditure.