Letter from New York Rail Authority on Future of Erie-Laccawanna MainlineW.& Possible Pass. Service

[Anonymous]

Thank you for your email and your interest in railroads in western New York.

Let me respond to some of the points you raise in your email. Perhaps I can correct some of your misunderstandings so as to remove some of the confusion you refer to in the first sentence of your email, and so as to help you understand what we are trying to do with the Southern Tier Extension Line.

First of all, the "Chautauqua, Cattaraugus, Allegany and Steuben Southern Tier Extension Railroad Authority," which we call the "Southern Tier Extension Railroad Authority," or STERA, for short, owns the Southern Tier Extension line, which runs from Corry PA through Jamestown, Salamanca, Olean, Cuba, Friendship, Wellsville, Alfred Station, Almond out to Hornell NY. That is, STERA owns the real estate, including the rails, for a period of 10 years from the spring of 2001, whereupon ownership reverts back to Norfolk Southern. STERA has executed a leaseback agreement with Norfolk Southern, allowing Norfolk Southern to operate trains on the line during that 10 year period. During the 10 year period when STERA owns the line. no real estate property taxes are paid by Norfolk Southern, and STERA itself also is exempt from these taxes as a public authority. In the last several years of the 10 year agreement, Norfolk Southern will pay an escalating payment in lieu of taxes to STERA. In 2001, Norfolk Southern executed a sub-lease arrangement with the Western New York and Pennsylvania Railroad Company (employer of Dan Eagan), under which WNYP can operate freight trains on the line for 30 years, with Norfolk Southern retaining the right to operate trains on the line.

STERA itself is not an operating railroad company. Nor are the Counties (see: your suggestion that the counties lease and run Metro-North passenger trains). Nor is Southern Tier West.

Southern Tier West, which is a short form of our formal name, which is Southern Tier West Regional Planning and Development Board, is not in title to any railroad line anywhere, contrary to your suggestion in your email. Southern Tier West is a unit of local government, a "regional planning board." STERA is a "public authority." These two types of entities have differing legal status under the laws of New York State. Southern Tier West is not STERA.

For passenger service to happen on the line, either Norfolk Southern or WNYP would have to offer it. WNYP is constrained by the terms of its sub-lease from offering passenger service. To get approval from Norfolk Southern to offer passenger service, amongst other things, WNYP would have to obtain appropriate, expensive insurance. This is what Dan Eagan told you.

The line might also have to be rehabbed to passenger service levels, and there also would have to be FRA approval of passenger service on the line.

Neither Southern Tier West nor STERA have the ability to offer passenger service. That ability is vested in Norfolk Southern, or its sub-lessee WNYP if WNYP gets Norfolk Southern's permission.

You also mention the New York and Lake Erie. That line is owned by the Cattaraugus County Industrial Development Agency, and operated by Bob Dingman out of Gowanda. That line does connect to the Southern Tier Extension in Waterboro (Chautauqua County), but the NY&LE's track and connection has not been maintained and is not in service. The cost of putting this into service would be somewhat high, I would expect.

You mention "train service to Buffalo and the casinos." There is freight service to Buffalo currently, so I'm assuming you mean passenger service to Buffalo and the Buffalo casino (plus probably also the Salamanca casino as well). The passenger volume of course would have to justify the capital investment needed to bring the relevant lines up to passenger service levels (more expensive than the capital investment required to bring the line up to than freight service levels). Plus the operating costs for trains, passenger cars, train crews, insurance, and return on investment. The Southern Tier Extension wouldn't provide passenger service connection to Buffalo anyway, without the NY&LE or the Olean to Buffalo Norfolk Southern Line being used. So access to Buffalo for either casinos or "transportation for low income people for jobs," as you suggest, would not be a possibility, either. Frankly, the lines are slow, anyway, at least at the level of service we've been able to afford to rehab them to, and rehabbed to freight standards. It'd be faster and more comfortable to take a bus, unless we put a lot more money into rehab. Also, in Salamanca, the rail line is on the other side of the river from the casino, so you'd need some sort of local bus connection as well, plus a passenger terminal. The existing depot has asbestos in it, and so is probably unusable until this could be remediated (also very costly). It's also not clear what the level of interest of the Seneca Nation of Indians (proprietors of the casino) is in rail service at this time. In fact, the Seneca Nation of Indians actually has passed a resolution authorizing the tearing up of rail line in the unused railyards in Salamanca.

The work we've done to date on returning freight service to the line is justified by potential freight shipment volumes, and we feel that the ultimate employment impact there is much more direct and solid than any speculative employment increases that might be envisioned as a consequence of passenger service, be it east-west on the Southern Tier Extension, or north-south on some combination of the Southern Tier Extension and some other line. Having said this, when we've accomplished our more immediate and much less costly goals of providing adequate freight train service to the southern tier, if there seems to be an appropriate and commercially viable role for passenger service in the western New York rail system, we will look at it.

You also suggest that the counties lease and operate passenger trains. Neither Chautauqua, Cattaraugus or Erie Counties are at this time financially in a position to undertake such a venture. All of these counties are laying people off and cutting services, not expanding services through investing in speculative ventures such as passenger train service. If passenger service were commercially viable, it would be offered currently. Comparing our situation to that of Cleveland or any other large city is inappropriate, as projected passenger ridership levels would be much higher in a big city.

You also suggest that we are "giving the rail line away." Hopefully you understand that this is not true. It is not ours to give away. Further, if we hadn't entered into this agreement in 1998 with Norfolk Southern (see: third paragraph, above), Norfolk Southern would have torn the track up and it would be gone, almost certainly forever, along with any real estate taxes and any of the companies that were then or that are now using rail freight service. The deal we have struck with Norfolk Southern is part of a long term plan to realize commercially viable mainline and local freight service from Corry to Hornell, so as to promote business development and job retention/creation. The plan is that the rail line goes back on the tax roles once again, and that in the future there will again be real estate taxes flowing to the municipalities and school districts, whereas if we had done nothing, those revenues would already be gone, never to come back. If we were to "keep the railroad in the public domain," this would be inconsistent with that strategy.

We anticipate that there will be more public and private investment in the line, justified by freight service. No one currently is coming to the plate offering capital and operating investment for passenger service. Were this to come to pass, it probably would make passenger service more attractive as an option.

Again, when we've accomplished our more immediate and much less costly goals of providing adequate freight train service to the southern tier, if there seems to be an appropriate and commercially viable role for passenger service in the western New York rail system, we will look at it. Passenger service is in the back of all of our minds right now, but the time doesn't seem right for it now. It may come to pass that it is appropriate at some time in the future. I will pass along your email to the rail authority and the rail operator.

Thank you again for your email and your interest in railroads in western New York.

Thomas M. Barnes
Senior Regional Economic Development Coordinator
Southern Tier West Regional Planning and Development Board
Center for Regional Excellence
4039 Route 219, Suite 200
Salamanca, New York 14779
Telephone: [phone]
Fax: [phone]
Email: [e-mail]
Web: http://www.southerntierwest.org
Web: http://discoversouthwestny.com

[daveklepper]

Thank you for sharing this response with us.

[spbed]

Sounds like typical pol response. Actually I think the real reason is NYS is out of $$$$ due to the fact of subsiding that new football on the West Side of NYC for that zillionaire Johnson.

[Anonymous]

Your welcome. There seems to be issue here of using Goverment power (Exp Eminate Domain from which the railroads would not have existed) to benift a few private buisnesses using authorirys that meet behind closed doors instead of the greater good of the Public At large.

[Overmod]

Perhaps you would be so kind as to explain exactly how you'd propose for the "Public At large" to finance the 'greater good'. In actual dollars, backed by letters of intent from the open-door, presumably public, agencies that would provide the actual dollars...

I thought not.