17 October 2010

Feds, Province to Decide Fate of Ottawa Valley's Canadian Pacific Line

Inside the cab of a RailAmerica locomotive running along the Ottawa Valley rail line.

Pembroke Ontario - It is now up to the federal and provincial governments to determine the fate of Ottawa Valley's Canadian Pacific rail line, which is in the process of being abandoned.
 
Last week, the deadline passed for private companies to reach a deal with CP for the 175 kms of line running between Camspur, just north of Petawawa, to Smiths Falls, which means it will be offered first to the federal government and then the province to see if there is any interest.
 
Kevin Hrysak, Canadian Pacific's media relations manager, said the company did not reach an agreement with any of the parties who made an expression of interest in purchasing the line following six months of good faith negotiations. That period ended 4 Oct 2010.
 
"We are now moving to the next step of the discontinuance plan, which is offering the line for sale for whatever purpose to the different levels of government," he said.
 
This process, as outlined under the Transport Canada Act (TCA), is to first offer the line to the federal government, then the provincial, and so on. At each level there is a 30-day window to make an expression of interest, with the rail offer passed down the line as each deadline expires.
 
Mr. Hrysak said negotiations are continuing with an interested party for the CP line between Camspur and Mattawa. This six-month good faith period ends 20 Dec 2010, if a deal is not met.
 
One party to the Camspur-Smiths Falls rail line which is unlikely to step forward to take over is Ottawa Valley municipalities, which are hamstrung by both the huge financial commitment involved, and the ongoing election, which renders some councils unable to act swiftly until mid-December, when the newly elected councillors are sworn in.
 
If the federal government decides to pass on the lines by the 4 Nov 2010 deadline, the province will have 30 days to make an offer before the ball would be passed on to the municipalities in December, giving them just a couple of weeks to decide if they want to get into the railroad business.
 
Petawawa Mayor Bob Sweet, who has been working on the issue with municipalities in Lanark County and as far north as Mattawa, hosted a meeting in March to discuss what could be done if no one else steps forward to take over the lines.
 
The conclusion then is the same as it is now, that there is little if anything the municipal level of government can do, even if they could afford to make such an investment.
 
"We're in a very weak position to deal with things the federal and provincial governments walked away," he said, adding they have asked CP for more time, only to be told the company is sticking to the deadlines as outlined in federal legislation.
 
Mayor Sweet said making this complicated is CP's desire to sell the rails and the railway corridor they are sited on in one piece, a sliver of land about 1,000 acres in size. If no one steps forward to take over the line by year's end, he said he doesn't know what will happen.
 
There is also the queston should municipalities be getting involved in railways in the first place?
 
"This is a very sensitive issue," Mayor Sweet said. "We're really between a rock and a hard place."
 
The future of the Ottawa Valley rail lines has been a major topic of discussion among area municipalities since CP announced at the end of 2009 it was discontinuing its leasing agreement with RailAmerica, the owner of Ottawa Valley Railway (OVR), and searching for a new carrier to take over the lines between Mattawa and Smiths Falls.
 
The CP line is one of two running through the Ottawa Valley. The other, the old Canadian National line known as the Beachburg Subdivision, which runs to Ottawa, is also in the process of being abandoned.
 
Pembroke Mayor Ed Jacyno said it would be a real travesty if the Ottawa Valley lost both rail lines, considering its importance to the regional economy. He has made it part of his election platform to encourage the development of a Pembroke to Ottawa rail service along the CN tracks, something the Transport Pontiac Renfrew consortium is still working on. That is a co-operative effort between Pontiac and Renfrew Counties and the city to see if they can obtain the tracks for a regular passenger and freight service.
 
If the CP line is abandoned, the mayor feels trains from CFB Petawawa can use spur lines to connect up to the main CN lines around Pembroke, and this will in turn allow the municipality to look at getting rid of the tracks running through the city's core.
 
"There have been derailments in the past, which is always a concern," Mayor Jacyno said.
 
He isn't sure who would step forward to take over the rail lines, speculating Ontario has been pushing to convert to a green economy, so perhaps they can be persuaded to take them on, as train traffic is more environmentally sound.
 
It is unclear at this time whether the federal government would consider taking over either line.
 
In a recent press release, Renfrew-Nipissing-Pembroke MP Cheryl Gallant urged all interested stakeholders to forward their comments on the interim report issued by the independent review panel established by the federal Conservative government on rail freight service by 8 Nov 2010, the deadline for input. This is four days after the expiry of the 30-day deadline from 4 Oct 2010 for the government to make a decision on whether it wants to take over the CP line.
 
"With the future of two shortline railways up for discussion in the Ottawa Valley, the OVR (Ottawa Valley Railway) and the OCR (Ottawa Central Railway), I encourage all interested parties, particularly shippers in the forest industry as well as municipalities concerned about economic development, to provide their comments for submission as soon as possible," she said in the release.
 
Some of the key solutions to the matter of shortline railways discussed by the panel include placing a moratorium on line abandonments, amending line transfer provisions to allow more time for entities to consider the railways' discontinuance plans, encouraging public/private ownership of low-volume rail lines with running rights given to all railway companies. Such actions would result in long-term planning of railway infrastructure acquisition of rights-of-way, upgrading, and investment, all in the public interest.
 
Other solutions include empowering the Canadian Transportation Agency to investigate demarketing and other strategic de-facto abandonment activities of rail carriers, transferring low-volume lines to shortline operators, and providing federal funding to assist in the establishment of shortline railways.
 
The panel will provide its final report to the Minister of State for Transport Rob Merrifield by 22 Dec 2010.
 
Mayor Sweet said he hasn't heard from the province on what it would consider doing, and noted he and other Eastern Ontario municipalities have asked for an audience with the federal railway review panel, but have not received a response.
 
Stephen Uhler.