Locals seek solutions for Kettle Falls railway

February 14, 2001 Businesses in Grand Forks, B.C., are looking to the city to rescue the Kettle Falls railway - it's a question of survival. A recent presentation from the stakeholder group to the City of Grand Forks proposed that the solution would be for the city to either purchase the line, or invest in the needed infrastructure upgrades, or both, The Boundary Sentinel reports.

Ever
since the railways owners, OmniTrax Inc., gave notice in 2008 of their
intention to close the international rail line supporting shipping for
businesses from Grand Forks through to Kettle Falls a group of business
stakeholders and local government from both the Boundary and Washington State
have been trying to find a solution to the dilemma.

On
Aug. 9, the City of Grand Forks will be asking for the community to give them
feedback on how they should proceed at a public meeting. In particular, council
is looking at funding the development of a business case for the railway’s
operations.

"We
want to share enough information with the public so that they can participate
in choosing or not choosing to make the investment at this point to go forward
with a business case," said Mayor Brian Taylor. "I think all of council wants
to see public input at this level before we start spending $70,000 of public
funds."

Taylor
said that the decision facing the community is a complex one. Businesses rely
on the railway for its services, and yet are not in a position to fund its
operations.

"From
what we’re hearing from the stakeholders and from OmniTrax our ability to put
together an international deal that involved several business partners and a
cross border arrangement is impossible," explained Taylor. "There’s no question
we can’t tie business people into a commitment to operate and yet for us to
just go forward and commit funds to upgrade the rail wouldn’t fly with the
public."

Craig
Dohm from International Forest Products Ltd. (Intefor) has been the
spokesperson for the stakeholders involved with the rail line. Dohm said that
they are waiting to see how the community reacts to the proposal, but that the
shippers are not looking for a handout.

"It’s
going to take a creative solution both on behalf of the shippers, the railroad
itself and the community. Our hope as shippers was to try and get something
done on a commercial arrangement with OmniTrax and that was not successful
because of the capital required to bring the line infrastructure up to
standard," said Dohm. "I think part of the solution will be the shippers
stepping up and making a commitment to the line. Having the city and the
community involved is because it is going to take their involvement as well."

This
leaves the city faced with a decision to take the lead on a purchase offer on
the line and that is defined as including the rail line all the way to Kettle
Falls. Taylor said there might be an American partner on the United States side
that they are in discussion with, although the American local government is not
able to offer that partnership.

"Clearly
we would have to find partners; there’s no way that we could manage to swing
this without support from partners, but those partners, the business people,
feel that they’ve gone a good distance with this by funding the impact study.
They are looking for partners that are going to share the capital cost of
this," said Taylor.

So
far, the federal and provincial governments have declined to get involved,
Taylor commented. The first step for the city will be to look at a business
case for ownership.

"Putting
this together will show whether or not there’s reason to go further. The next
step will probably entail verifications from an engineering standpoint of many
of the cost of the upgrades needed as well as a better understanding of the
business case that OmniTrax has," said Taylor. "If we’re going to look at
buying the rail, basically buying the route, it would have to include all the
way to Kettle Falls, it couldn’t just be the Canadian side, although it would
be nice to have a partner."

Although
there is no specific timeline, the railway could close at any time at this
point and it can all happen very quickly, said Taylor. Pacific Abrasives has
indicated that the plant in Grand Forks will close if the line shuts down and
Interfor may need to choose their most cost-effective mill location for
operations to run and that may not be Grand Forks.