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Spurned operator to bid again on P&N Railroad

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A short-line railroad operator that lost a bid last year to operate the restored Piedmont & Northern Railroad in Gaston County, N.C., is back with another proposal, the Gaston Gazette reports. Bill Gray, president of Carolina Central Railway, could not come to terms with transportation officials on a lease agreement last year. But Gray said he plans to bid again on the state's latest request to find a long-term operator for the P&N Railroad.

The state terminated
negotiations with Gray in November and selected an interim operator in early
January. The deadline for proposals from operators interested in a long-term
lease is April 21, said Jim Westmoreland, the state’s deputy secretary of

"He has the ability and
the right to submit a proposal," Westmoreland said.

Westmoreland said the
department has received inquiries from interested operators, but no finalized
proposals yet. Interim operator Carolina Coastal Railway Inc., a
Pennsylvania-based short line, has a 180-day lease on the line and could bid
for the long-term lease. The shortline operator already provides shortline
service on a 142-mile line between Raleigh and Plymouth and a 17-mile line
between Belhaven and Pinetown.

Gray, who has led the
push to restore and reactivate the P&N Railroad since July 2007, said his
second proposal could be denied just like the first, but he hopes the state
will not "overlook the work we’ve done and the amount of business we’ve tried
to stimulate in the region."

"If we don’t respond, we
certainly aren’t in the running," Gray said. "We’ve invested a great deal of
work in this process and we can hit the ground running faster than anybody out

But Gray still maintains
that the terms proposed by the state in last year’s negotiations would make it
impossible for him or any other operator to run a profitable business on the
P&N Railroad. But transportation officials have said they offered favorable
terms to Gray.

"I don’t see any way –
unless they (North Carolina Department of Transportation officials) change
their view of the world – that anybody will be able to operate that railroad,"
Gray said.

The first four miles of
track between Gastonia and Ranlo are ready for service. The second phase of the
project, restoring the line to Mount Holly, is scheduled to be completed a year
from now. The restored P&N Railroad, originally built in 1911 by James B.
Duke, will offer connections to two Class 1 operators – Norfolk Southern in
Gastonia and CSX Transportation in Mount Holly. CSXT still owns and operates
freight service on a portion of the P&N Railroad between Mount Holly and
uptown Charlotte.

The state hopes to sign
an agreement with a long-term operator within 60 days of the April deadline for
proposals, Westmoreland said. Two local representatives have been appointed to
the selection team, including Donny Hicks, executive director of the Gaston
County Economic Development Commission, and Mike Holder, the NCDOT’s division
engineer over Alexander, Catawba, Cleveland, Gaston, Iredell and Lincoln

The rail division
purchased the idle portion of the P&N Railroad in 1991 to preserve it for
future transportation use. Although it would not be covered in the initial lease
agreement, local leaders have expressed an interest in seeing passenger service
eventually restored on the railroad.

Hicks told the EDC’s
board of directors that the state is meeting next month to discuss the
possibility of restoring a spur that runs from the Mount Holly junction to
downtown Belmont for freight traffic or a trolley serving Belmont Abbey. Three
or four national operators with previous success reviving abandoned railroads
could submit proposals, Hicks said.

Frank Matthews, a retired
Belk executive, told fellow EDC board members that dropping Gray’s bid seemed
unfair because Gray initiated and led efforts to restore the railroad.

"It seems to me that it’s
unfair that he’s been put in the caboose of the train," Matthews said. "The man
comes in, found an uncut diamond, polished it up and now everybody wants a
piece of it."

Winters said Gray was
instrumental to the project, but the restoration is being funded by the state
and county taxpayers. And Gray did have an exclusive opportunity to negotiate a
lease agreement. If Gray doesn’t have the best proposal, perhaps the state
should consider other offers, Winters said.

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