The Resurgence of Shortline Railroading in Northern New England

 In the last 20 years vehicle-miles-of-travel by trucks and passenger trucks grew by 72% while road-lane-miles grew by one percent. (FWHA Data)

 The 13 States in the Mid-Atlantic region account for about a quarter of the nation’s population and jobs. Half the trucks on the interstates and almost all of the rail freight originates or terminates outside the region. Trucks represent 10-20% of all vehicles on I-95, averaging more than 10,000 units a day. (Mid-Atlantic Rail Operations Study)

 Since 1980 New Hampshire rail mileage has decreased by 15% while total rail freight tonnage is up 25% just in the last eight years. (New Hampshire Rail Plan)

Northern New England has four north-south Interstate highways: I-95 along the coast of Maine and New Hampshire, I-93 through the middle of New Hampshire, I-91 along the Connecticut River, and I-89 running diagonally between Boston and Burlington, VT. So any westbound trucks must go south to the Mass Turnpike (I-90) at either Boston or Springfield.  Believe me, the congestion can be fierce.

 There are no Class I railroads in northern New England. However, there are five regional railroads and ten shortlines, all but one created over the last 20 years as the Class I railroad scene as evolved. The one New England railroad constant over that period is the Guilford System (GRS), still operating the former Boston & Maine and Maine Central Railroads, and the only single line haul railroad reaching from northern New England to west of the Hudson River.

 And business is booming, says David Fink, Executive Vice President. “Just look at the volumes on the Chicago-Waterville [Maine] service we run with NS and our carload business in general.” This is good news because almost every New England shortline or regional has at least one GRS interchange.  Moreover, as highway congestion increases (the Mid-Atlantic study projects total freight tonnage could grow by 80% by 2020), the only alternative is a healthy and dependable rail network. The tools are at hand. 

The other four regionals are the St. Lawrence & Atlantic (SLR, Genesee & Wyoming), the New England Central (NEC, Rail America), the Montreal Maine & Atlantic (MMA, Rail World) and the Vermont Railway System (VRS, independent).

The 260-mile long St Lawrence & Atlantic (www.gwrr.com) is the former CN line between Portland and Montreal. It is unique in that it is the only northern New England double-stack container service, complemented by domestic trailer service to both local and international customers. Moreover, the Auburn (ME) terminal, sitting astride I-95, is augmented by the extensive (1,500 cars per year) transload facility operated by Safe Handling, Inc.

SLR General Manager Charles Hunter says SLR handles about 28,000 carloads a year plus 40, 000 containers and trailers annually. The big international container customers ZIM, and APL from Vancouver and Halifax. Trailer users include Hub Cities and the local paper companies, all looking for the now-standard 53-foot unit.

To handle all this Hunter currently runs seven crew-starts a day in the US plus three in Canada. They’ve standardized on vanilla GP-40s, getting more miles out of fewer units, driving mean time between failures (something all shortlines ought to measure though few do) down to about 1,000 hours.

Track maintenance runs more than $10,000 per mile per year between capitalized and expensed items, twice the shortline average. However, says Hunter, there’s a lot of worn rail (mostly 100-lb. RE), especially on curves and bridges, pushing track costs up. It’s all stick rail, too, with no CWR. They’re getting some roadway help from Quebec, though support in Maine is limited to industrial development (more on that anon).

The Montreal Maine & Atlantic is the newest rail operator in New England, having purchased the former Iron Road lines in January, 2003. Predecessor lines include the former CP lines into Maine and Vermont and the Bangor & Aroostook. MMA operates east to Brownsville Jct ME from St Jean PQ while the Irving Group’s Eastern Maine and New Brunswick Southern railroads provide haulage to and from St. John, NB. 

The MMA start-up was marred by the sudden closure of its biggest paper plant, Great Northern in Millinocket. Happily, through the cooperative of the new mill owners and the Governor of Maine, output is now on track to be fully restored by mid-2004. Meanwhile, says Marketing VP Bill Schauer, they’re building back the business by calling on former customers and working with them to regain their former customers.

The service design plan calls for second-morning delivery to the CP in Montreal from a 2 PM pull in Presque Isle. That’s 500 miles and three trains with the longest dwell just 15 hours. Track speed is 40 MPH, tops, so they have to hustle. There’s also a marketing agreement with VRS so that MMA customers can reach beyond New England via NS and CSX. As a result MMA will be shortly be back at the 60,000 annual carloads originally budgeted.

MMA has opted for an all-GE fleet, running sixteen B-39-8s and fourteen C30-7s, based on prove, availability, and track record on other RailWorld properties. Track expenditures call for a run-rate of $6.5 mm a year, both capital end expense. Like SLR, it’s a heavy hit, due mainly to deferred maintenance and worn rail. The good news is it’s mostly 286-compatible 100- and 110-lb rail. And being frozen six months a year ties last 40 years.

NEC (www.railamerica.com) handles 38,000 cars a year on its 343 total route miles, of which 215 miles are in Vermont and 20 in New Hampshire. And just as GRS is the east-west link for northern New England shortlines, so NEC provides the southern gateway with CSX (former Boston & Albany) at Palmer, MA.

Moreover, NEC is heavily involved in the rail-truck transfer business with two on-line facilities in Vermont alone. Jack Dail, VP Marketing, tells me, “Our 200,000 sq. ft White River Junction facility is less than 150 Interstate miles from three major metro areas and four major grocery chain DCs. Service frequency allows daily switching and hi-cube cars work fine.”

Track is FRA class 3 or better, with Amtrak’s St Albans-NY service running daily. NEC  interchanges daily with CN at East Alburg VT and five or six times per week with CSX. A reciprocal agreement with VRS gets NEC to CP and NS through the “Green Mountain Gateway” between Bellows Falls, VT  and Whitehall, NY.

The Vermont Rail System (www.vermontrailway.com)  is an affiliation of four Vermont-based shortlines -- the Vermont Railway, the Green Mountain Railroad, the Clarendon & Pittsford Railroad, and the Washington County Railroad. As noted above, most of the track is owned and maintained by the state of Vermont. VRA also hosts Amtrak’s Ethan Allen Express between Whitehall and Rutland.

VRS handles about 34,000 carloads a year, however its main claim to fame is its intermodal business. In business for more than 35 years, Vermont Intermodal has carved a lucrative niche in the trailer trade, of all places. This makes sense because truckers in domestic lanes want 53-foot trailers, not the 45s most railroads were marketing. And the 53-footer is a major part of the Vermont Intermodal fleet in lanes reaching literally from Maine to Miami.

Further, intermodal growth nation-wide since 1996 has been largely international, up 5.7% per year, while domestic trailer traffic barely budged at 1.7% per year, partly because truckload shippers want 53-foot trailers, not a mish-mash of containers. On the other hand VTR's New England Service, now including a link with MMA's Presque Isle terminal, is all about simplicity. All you need is a few acres, a Packer, and a bobtail. States have been known to pitch in with CMAQ funding to assist in the acquisition of same.

 To my mind northern New England’s railroads are unique in their cooperative spirit. Says Eric Moffett, VP Intermodal for VRS, there’s a strong sense of “we’re all in this together” and there is no room for turf wars. That’s why one sees marketing agreements that extend single-line hauls from Bangor to the deep south and the midwest over as many as four different carriers.

 A second unique aspect of shortline railroading in Northern New England takes the form of state support. Maine, New Hampshire and Vermont have, in the last ten years committed tens of millions of dollars in direct support of shortline operations. The lessons learned here are lessons to be learned in every region of the country.  

 In Maine, the Office of Freight Transportation’s Allan Bartlett says, “DOT plays a role primarily in the funding and development of transportation infrastructure.  We interviewed many businesses, large and small, while writing the Integrated Freight Plan (www.state.me.us/mdot/freight)  and we found that business generally wants rail transportation to be customer focused.”

 The state has more than 1,100 miles of track, of which it owns 300 miles. The core rail service is provided by GRS, the SLR, and the MMA. Working through what Maine calls its "Three Rail Carrier Strategy," MDOT and these carriers develop state rail projects, with the state evenly splitting the cost of capital improvement projects with them.

 There are in addition two smaller shortline operators – Safe Handling, and the Belfast & Moosehead Lake – that operate the lines owned by MDOT.  Safe Handling operates the former MEC Brunswick-Augusta “Lower Road” and the former MEC Rockland Branch. Safe Handling opted not to renew its lease in September 2003 and both segments are out for bid. As of early July the B&ML had just been sold and the new owner’s focus appears to be more toward tourism than freight.

 Maine also has its Industrial Rail Access Program that provides a maximum of 50% of estimated project costs. Recent projects include half a million dollars each for two paper-related industry track improvements, more than $250,000 for a team track and a food-related industry, and $343,000 to expand a multi-use rail-truck transfer facility.

 Over in New Hampshire, the State Rail Plan (www.state.nh.us/dot/public.htm) correctly reminds the reader of the FRA’s mandate that each state have a current Rail Plan to be eligible for federal funding. Of the more than 400 miles of active railroad in NH the state owns about half spread among four freight railroad operators. The state also owns another 300 miles now rail-banked for interim trail use. Federal funding has been a key element of the program.

 It is instructive to note that since 1980 New Hampshire rail mileage is down by 15% yet total rail freight tonnage is up 25% just in the last eight years. Of the 8.2 million tons of rail freight handled in 1999, for example, well over half was forest products and aggregates, high-density commodities not well-suited to a what is essentially a two-lane highway network in much of the state.  Still, about a quarter of the tonnage on NH rails either originates or terminates in-state. 

 One of the best friends shortlines have in New Hampshire is Ray Burton, Executive Councilor for District No. 1. We met back in June in his Haverhill office, literally on the old Boston, Concord & Montreal right-of-way. Burton acknowledges that tourism has displaced much of the industry in the local Woodsville area, however there are rumblings of some rebirth. And his efforts in keeping rail lines intact is about to pay off.

 Just north of Woodsville is the former Gilman Paper mill that shut down back in 1999. The plant has been purchased by Dirigo paper of Boston with plans to reopen early in the fourth quarter of 2003. Initial traffic estimates range between 800 and 1,500 cars a year, traffic that could not move rail were it not for New Hampshire’s purchase of the serving rail infrastructure. Whether the mill ever would have been reopened without rail is doubtful.

 New Hampshire has five locally-based shortline operators (tourist rails excluded). The New Hampshire Central (NHCR) is the northernmost, handling chiefly aggregates and – shortly – Dirigo’s paper, connecting with the SLR in Groveton. New Hampshire Northcoast (NHN) is a wholly-owned subsidiary of Boston Sand & Gravel, operates in the southwest quadrant of NH, and links up with GRS north of Portland. New England Southern (NEGS) handles a mixed bag of commodities from anhydrous ammonia fertilizer to lumber, connecting with Guilford in Manchester.

 Finally, the Claremont-Concord  (CCRR) operates a cement transload on state rail property in West Lebanon, connecting with the NEC at Concord Jct. And the Milford- Bennington (MBRX) runs several stone trains a day to the B&M connection at Milford. . Kit Morgan, head of the NH DOT Rail Division, notes that that the quarry MBRX serves would not be allowed to operate without rail access, due to local restrictions on heavy trucking.

 The New Hampshire shortlines are fortunate in that the state’s financial support has run the gamut from line purchases to locomotive leases. Since 1991 the program has generated some $10.6 million in operating and infrastructure financial aid with slightly more than a third coming from the feds.  However, the 2001 Rail Plan cautions that “there are no longer any public grant programs dedicated to freight rail” at the state or fed level. Note the caveat does not include loans or the RRIF program of the FRA.   

 Vermont’s Agency of Transportation (www.aot.state.vt.us/rail) owns nearly 400 miles of railroad out of the nearly 800 total rail miles in the state. About 250 of the state-owned miles are operated by shortlines with balance rail-banked as trails. The website says it all, recognizing “the social, economic, and environmental importance of rail service as a component of the state's transportation system.”

 Among Vermont Railroad operators, The VRS is the largest, running over the former Rutland connecting Burlington with Bellows Falls, Bennington and Whitehall NY. VRS also, through its Washington County Railroad (WACR) subsidiary, operates the former CP and B&M lines north of White River Jct  to the MMA connection at Newport. The New England Central is next, covering some 215 miles between the Mass and Quebec borders.

 The SLR cuts the extreme northeast corner of the state and the MMA dips into Newport from Brookport, PQ, making Vermont the only state touched by all four of the core regionals. Oddly enough, the only GRS property left in Vermont is the Twin States Railroad (TSRR), serving the Dirigo Paper facility, and that’s under an operating lease with a Florida-based shortline operator. 

 State financial support is critical. For example, VAOT is helping VRS run the River Line (WACR) to the tune of $300,000 a year for the next five years. The Amtrak contract with NECR is several times that counting both state and federal funds. And VAOT strives to maintain all its owned lines to FRA class 3 standards at least. The benefit comes in the shortline and regional railroad marketing alliances forged with regional and national connections. As a result, rail shippers in Vermont have single-line hauls to points on GRS, CN, CP, CSX, and NS.

 So the pieces are all there: a growing traffic base, state governments that believe in railroads, and rail operators who are more serious about growing the business than protecting their respective turfs. And if can be done in the hardscrabble climes of northern New England, it can be done anywhere. What are we waiting for? 

Note: This text is what was actually submitted for publication. The article that actually ran was somewhat shortened due to space limitations. My apologies to the many who generously allowed me to quote them but whose names did not appear in the article as printed. -- RHB

 

Week in Review | Resources | Search | Roy Blanchard | Laura Blanchard | Home

THE BLANCHARD COMPANY
2041 Christian Street - Philadelphia PA 19146-1338 (215) 985-1110 voice - (215) 985-1446 fax
Roy Blanchard, rblanchard@rblanchard.com
Laura Blanchard, lblanchard@rblanchard.com

Site contents copyright 1995-2001 The Blanchard Company except as indicated herein. All rights reserved.

home home Home Laura Blanchard - personal page Roy Blanchard - personal page Search the site Resources for the Railroad Industry The Railroad Week in Review