Needs
more than farmer support Source: The Valley Leader - By Glen Hallick
Published: August 14th 2009
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About 90 people, mostly farmers from between
Rathwell and Nesbitt, were presented with an
opportunity at a August 6 meeting in Holland.
With the Canadian Pacific Railway (CPR) listing the
101 kilometers of track between the two points for
closure, a meeting was organized to guage any
interest in setting up a shortline railway company.
“We can’t afford to lose it,” Carman MLA Blaine
Pedersen said of the rail line.
The meeting was facilitated by Pedersen and Bob
Wheeler from the Manitoba Agriculture, Food and
Rural Initiatives (MAFRI) office in Treherne.
ADDED TO LIST OF CLOSURES
Shortly after being elected in 2007, Pedersen spoke
with Wheeler about the particular stretch of railway
and its future. Especially since the previous year
the CPR added the line to its list of closures. More
recently Pedersen and Wheeler met again and the two
decided to be pro-active.
For the Holland meeting they invited Boundary Trails
Railway Company (BRTC) president Kevin Friesen, Paul
Stow from Mission Terminals and lawyer Art Stacey of
Rail West Management. The three spoke of their
experiences in setting up short line railways.
“It’s been a long process and we’re pretty proud of
what we did,” Friesen said.
The BTRC began moving grain in June and its
president said there are significant savings thanks
to the railway.
“Every time a rail car travel down the line, $1,000
stays in the local community,” Friesen told the
audience.
FIVE STEPS
He also outlined the five steps a fledgling
shortline company needs to follow. The first was
dealing with a willing seller.
“Don’t let the next two years, three years go by. Do
it before the abandonment process is over,” the BRTC
president said. He then urged farmers to garner
community support for the idea.
“Beware of the coffee shop talk, don’t let it be
negative.”
As the third step, Friesen said farmers must also
work together.
“Competition between farmers is over.”
He suggested farmers with their own shortline
railway could see $30,000 to $50,000 added to their
bottom line by co-operating together.
The fourth was to get government support. He stated
the BTRC was very pleased with the assistance from
the province.
“Show them you are leaders,” Friesen advised.
The final step was to hire a lawyer and giving him
people to work with.
“The young farmers in this room, you need to sign
on,” Friesen urged.
The gathering next heard from Paul Stow.
“One of the things [Mission Terminals] saw was the
consolidation of the grain industry,” he said. “We
decided to form working patnerships with producers
and producer groups.”
RELATIVELY NEW TO WEST
Stow said that although Mission Terminals is
relatively new to doing business in western Canada,
the company has been in operation for about 75 years
on the Great Lakes and Quebec.
“We will guarantee [your grain] at the port provided
that those car that unload are representative of
your samples,” Stow said.
He added that Mission Terminals invested in BTRC and
two Saskatchewan based shortlines.
With producers cars, Stow pointed out the main
saving is the elevation a farmer pays - about $13.50
per tonne.
“There is no elevation charge when you ship a
producer car, that is your main savings,” Stow said.
He added producers could not only save $1,000 per
car, but perhaps as much as $1,800.
“We have been involved in numerous short line
intiatives and the ones that succeed are farmer
driven and have farmer support.”
Art Stacey, who has been involved in setting up four
short line railways, spoke next.
“What a successful short line needs is not so much a
lawyer, but a committed group of farmer-owners who
are going to ship cars along the track. It’s just
that simple,” the lawyer from Thompson Dorfman and
Sweatman said.
DECIDED A GENERATION AGO
“The mainline railways decided a generation ago that
they just couldn’t afford to be coming and picking
up every car in every little town on every branch
line in western Canada,” Stacey explained.
“I think the primary reason for that is there are
very significant overhead costs and very significant
labour costs.”
“The business model of the mainlines these days is
they want to run big, long trains east and west.
They don’t want to run a single train north and
south if they didn’t have to,” he continued.
Stacey said the mainlines are often supportive of
shortlines and the CPR is easier to deal with than
the Canadian National Railway (CNR). He stressed a
shortline company can’t be left to one or two people
doing most of the organizing.
“There needs to be a leadership group. Raising money
is then eaiser,” he stated.
“I think you have a willing seller,” Stacey said of
the CPR.
He believes the CPR estimates the cost of the
Rathwell to Nesbitt line of 45.4 kilogram type of
track to be about $6 million. Because of the weight
of the track Stacey cautioned the CPR could rip up
the line and relay it elsewhere.
“CP doesn’t see a viable shortline between Nesbitt
and Rathwell.”
Then Stacey offerred up a more aggressive
possibility.
“An approach that would see a group come together
and try to acquire the line, as I understand it,
from [Souris] to Winnipeg. That’s an exceptionally
aggressive plan in my opinion.”
“Ironically the line from Rathwell east could be got
for less than the line between Rathwell and
Nesbitt,” Stacey added.
He explained the CPR could be thinking that way
because of scarce amount of traffic between Rathwell
and Nesbitt.
“CP only thinks of what’s the value of steel to it.
It doesn’t attribute a single dime to the traffic
because it doesn’t think it’s going to get the
traffic. On the other hand, if it believes a viable
shortline could operate into Winnipeg and bring in
all the traffic that it brings in itself off that
line, you might well be able to make a deal,” Stacey
said.
A CPR spokesperson previously told the Valley Leader
only 84 cars were sent west of Rathwell last year,
49 fewer than when the railway announced its
intention to close the stretch in 2006.
STEERING COMMITTEE
Stacey advised a steering committee be set up to
formulate with a plan - be it the intended 101 kms
or something longer.
In an August 10 interview Blaine Pedersen said there
were a few farmers who expressed an interest in
forming a shortline company.
“It was one of those meetings where [people] wanted
to go home and think about this,” the Carman MLA
said.
Also, he pointed out the CPR is parking train cars
east of Nesbitt and that might account for the small
number using the stretch of track.
“Trains go up to Holland, maybe Cypress River,”
Pedersen said.
While taking only a facilitator role, he strong
suggested action be pursued quickly.
“We need to do this in the next couple of weeks, to
decide if anything is going to come of it.”
In the meantime Pedersen will investigate the actual
amount of cars being sent down the line.