Good evening folks, .... I can see this thread is producing some interesting discussion. Given some of the recent comments, I feel compelled to weigh in on this matter once again.
cjvrr wrote: And yes, what I said is true.
I have no reason to doubt or quibble with Mr. Vitz's statement. If his official position is that the
Butane dispute played no role in the decision to select a new operator, I will not challenge or dispute the statement. To the extent that my earlier comment suggested otherwise, I respectfully withdraw my previous statement to the contrary.
Having said that, I still firmly believe that the County's decision failed to take into consideration one critical element essential to growing traffic -
i.e. Head to head rail competition between NS and CSX. Having worked with M&E sales and marketing people over the years, I'm acutely aware of what traffic can, and can not, move to the CSX interchange. More importantly, the agreement the M&E entered into as part of the split of Conrail between NS and CSX was written to the
benefit of the M&E and
NOT to the benefit of the underlying owners of the various lines. At the time of the agreement's execution, the Chester Branch was still owned by Holland Manufacturing. The County only owned the D&R branch, and the High Bridge branch at that time.
When the M&E is removed from the County owned rail lines, the shippers on the line
will become captive to the NS. I'm sure the County is being told that access can be "negotiated". That statement is a serious misrepresentation.
The new proposed short line (should it actually come to pass) will almost certainly be via NS Short line feeder "lease". (It will be similar to the NS lease of the lines to Middletown and New Jersey in and around Campbell Hall, NY.) Instead of a traditional "paper barrier", the NS uses a mechanism called a "lease credit" which effectively works as a
paper barrier. This device was developed when the NS was worried that the STB might eventual outlaw traditional
paper barriers. If you interchange traffic with NS, your lease payment is decreased exponentially. If you interchange traffic with another carrier, your lease payment increases. If you
divert existing traffic
away from NS, your lease payment goes up be nearly double.
So, when the new operator tells the County there is no
paper barrier preventing interchange, the statement, while "technically" true, is highly misleading. The operator has no incentive to interchange any traffic with any carrier other than NS. In fact, it costs the operator considerable amounts of money when they do. Those costs subsequently get passed on to the customer in the form of much higher freight rates for non-NS traffic.
In case anyone is interested, the BR&W has begun its official pleadings with the Surface Transportation Board today.
Official Notice of Exemption for the
Dover and Rockaway River Railroad
https://www.stb.gov/filings/all.nsf/ba7 ... enDocument" onclick="window.open(this.href);return false;
Continuance in Control Exemption for Mr. Burenga
https://www.stb.gov/filings/all.nsf/ba7 ... enDocument" onclick="window.open(this.href);return false;
I wish the new carrier(s) the best of luck. However, I'm seriously concerned for the shippers located along the lines. I truly feel the County failed to take into consideration the importance of competition.
