The Saga of LaPorte, IN...

STB Docket No. AB-55 (Sub-No. 643X)


Decided: April 28, 2004

By decision and notice of interim trail use or abandonment served on February 20, 2004, the Board granted the petition of CSX Transportation, Inc. (CSXT), for an exemption under 49 U.S.C. 10502 from the prior approval requirements of 49 U.S.C. 10903 to abandon its 32.97-mile line of railroad in CSXTs Western Region, Chicago Division, Wabash Subdivision, extending from milepost CF 0.63, at LaCrosse, to milepost CF 15.23, at Wellsboro, and from milepost CI 212.55, at North Judson, to milepost CI 230.92, at Malden, in LaPorte, Porter and Starke Counties, IN. On March 1, 2004, the Incorporated Town of North Judson (the Town) filed an offer of financial assistance under 49 U.S.C. 10904 and 49 CFR 1152.27 to purchase the entire line. Because the parties were unable to agree on the sale price, on March 31, 2004, the Town filed a request for the Board set terms and conditions for the sale. On April 5, 2004, CSXT replied to the request to set terms and conditions and submitted evidence and argument that the net salvage value of the line was greater than the amount stated in its petition for exemption due to a sharp increase in the price of scrap steel. On April 8, 2004, the Town filed a motion to strike a portion of the evidence and argument in CSXTs reply filed on April 5, 2004. On April 13, 2004, CSXT filed a reply urging the Board to deny the motion to strike. In a decision served April 19, 2004, the parties were directed to submit detailed, verifiable and reliable evidence based on valid, reliable, independent sources that would assist the Board in determining the net liquidation value of the lines assets, no later than April 21, 2004.

By motion filed April 21 2004, CSXT seeks a protective order with respect to the confidentiality of two sales orders that it concurrently filed in response to the April 19 decision. CSXT states that the sales orders contains proprietary commercial information that, if made public, could be competitively damaging. Good cause exists to grant the motion for protective order. The unrestricted disclosure of confidential, proprietary, or commercially sensitive material could cause serious competitive injury. Issuance of the requested protective order will ensure that the confidential information in the sales orders will be used only in connection with this proceeding and not for any other business or commercial purpose. The motion conforms with the Board’s rules at 49 CFR 1104.14 governing requests for protective orders to maintain confidentiality of materials submitted to the Board. Accordingly, the motion for protective order will be granted.

It is ordered:

1. CSXTs motion for protective order is granted. The two sales orders, submitted in STB Docket No. AB-55 (Sub-No. 643X), will be kept under seal by the Board and not placed in the public docket or otherwise disclosed to the public, unless the attached Undertaking is executed and the terms of theProtective Order are followed, or unless otherwise ordered by the Board.

2. This decision is effective on its service date.

By the Board, Vernon A. Williams, Secretary.


STB Docket No. AB-55 (Sub-No. 643X)


Decided: May 14, 2004

By decision and notice of interim trail use or abandonment served on February 20, 2004, the Board granted a petition filed by CSX Transportation, Inc. (CSXT), for an exemption under 49 U.S.C. 10502 from the prior approval requirements of 49 U.S.C. 10903 to abandon an approximately 32.97-mile line of railroad in LaPorte, Porter, and Starke Counties, IN. Before the decision and notice authorizing abandonment became effective, the Town of North Judson (Town) timely filed an offer of financial assistance (OFA) under 49 U.S.C. 10904 and 49 CFR 1152.27(c) to purchase the line. By decision served on March 4, 2004, the Town was found financially responsible, and the effective date of the decision and notice authorizing abandonment was postponed to permit the OFA process to proceed. Subsequently, the Town filed a request that the Board establish the conditions and the amount of compensation for the sale of the line. Thereafter, in a decision served on April 30, 2004, the Board set the purchase price for the line at $1,974,041, and established terms for transfer of the line.

By letter filed on May 10, 2004, the Town indicates that it accepts the Board’s terms and conditions and acknowledges that it will be bound by them. When a person offering to purchase a line accepts the terms and conditions set by the Board, the offer is binding. See 49 U.S.C. 10904 and 49 CFR 1152.27(h)(7). Accordingly, the sale will be approved and the petition for exemption will be dismissed. This action will not significantly affect either the quality of the human environment or the conservation of energy resources.

It is ordered:

1. Under 49 U.S.C. 10904, the Town is authorized to acquire the line.

2. Under 49 U.S.C. 10904 and 49 CFR 1152.27(h)(7), the petition for exemption is dismissed, effective on the date the sale is consummated.

3. This decision is effective on its service date.

By the Board, David M. Konschnik, Director, Office of Proceedings.

[Paul Highland] Wednesday May 26, 2004 1:36pm

LaPorte County (IN) Herald-Argus:

Area farmers criticize plan to save CSX rail line


If LaPorte County were to help the LaPorte County Farm Bureau Cooperative purchase the section of CSX rail line set to be abandoned, the county would be giving an unfair advantage to one business, according to farmers opposed to the project. The topic of the rail came up at the LaPorte County Council meeting Monday night and several south county farmers expressed their opposition to the county's proposed contribution of $75,000 toward the $1.7 million sale price of the 33-mile line that runs through Union Mills, Hanna and LaCrosse on its way out of the county. The farm bureau ships approximately 3.5 million bushels per year by rail and also brings in fertilizer by rail.

County Attorney Shaw Friedman reminded the council that the Indiana Department of Transportation is offering a $1 million grant and the farm bureau plans to spend $335,000 itself. However, since the appropriation was not on the agenda, the council took no vote on the matter and it tabled a motion to sign a letter of support, fearing the letter would express intent to contribute. Though none of the farmers said they wanted to see the line leave — it provides local farmers with rail access at the farm bureau's grain elevator in Union Mills — they said using tax money to help one business was unfair to competition and shouldn't be used for one small group.

If you give the Co-Op money and not everyone else, we will suffer, said Elwood Grieger, a farmer in the Wanatah area.Grieger questioned the farm bureau's claim that the rail would provide an extra 10 cents per bushel profit. He presented the council a hand-written sheet with nearly a year and a half of bean and corn shipping rates, which showed cheaper rates for truck shipping 57 percent of the time for corn and 93 percent for beans. The two methods were priced the same 30 percent of the time.Friedman said if other businesses wanted the same benefit of tax dollar donations, they could approach the LaPorte County Commission and would likely receive the same support. The issue at hand, he said, was maintaining the line for the future of business growth. We want to encourage economic development and continued growth, he said.

Dean Kaesebier, farm bureau general manager, said keeping the rail line open would help the farm bureau compete with the Starke County Farm Bureau, which some south county farmers use in lieu of LaPorte County's bureau. He acknowledged the farm bureau could compete if forced to ship by truck, but farmers are better off with rail. Jerry Smoker, a Wanatah farmer, asked how much more money the county would have to pour into the line to repair and upgrade the line. I don't understand how (the selling price) is going to help anything, he said. Kaesebier said repairs and maintenance would be about $500,000 for the first three years. State Rep. Steve Heim, R-Culver, who represents three southeastern LaPorte County townships, said the rail service would be contracted to a private operator who would be responsible for maintenance. And with another INDOT grant available for maintenance, Heim guaranteed the county would have no further expense beyond the initial donation.

[Paul Highland] June 26, 2004 11:26pm

Gary (IN) Post-Tribune:

Porter County (IN) council votes down purchase of CSX line

By Jim Stinson / Post-Tribune staff writer

VALPARAISO The frugal Porter County Council may have pinched pennies so hard that jobs may dry up,trucks may clog local roads and grain costs may rise. That's the take from people who supported a $50,000 grant to help purchase a 33-mile rail line CSX Transportation is abandoning. The Porter County Council rejected the economic development grant by a vote of 4 to 3. And now it seems as if the deciding vote was cast against the project because County Councilman John Ruge, R-at large, thought it was for a study to purchase the rail line, rather than a grant to help a cooperative association keep the line open. Ruge, 86, said he thought the $50,000 would go to a study, and suggested he believed that Porter County would eventually take full ownership. It's just like buying a dead horse, said Ruge in his apartment on Wednesday. Does the county even know how to repair an old railroad? The vote jolted the coalition of farmers and lawmakers who believe saving the line will keep agricultural transportation costs down.

The town of North Judson is serving as interim buyer as $1.9 million is sought for the line by CSX. At this point, there's nothing more we can do with that issue, said a surprised County Commissioners President David Burrus, R-Morgan Twp., who recommended the county help with the grant funded by county economic development income taxes. It doesn't make sense to me. Burrus said the vote was a blow to the agricultural community of Porter County, which he said deserved support to remain a thriving part of the local economy. Burrus also defended the argument that a complete abandonment of the line would lead to as many as 2,400 more trucks on local roads per year. It's a contribution to the problem, Burrus said. It's certainly not going in the right direction. He countered criticisms that the grant was a partial subsidy to farmers, citing highways as amassive subsidy to the trucking industry. Burrus said he believes the coalition will continue to try to receive grants and will eventually purchase the rail line. The group appears before the LaPorte County Council Monday night. And the vote has caught the attention of LaPorte County officials. I would say it's probably split right at the moment, said LaPorte County Councilman Terry Garner, R-District 1.

Since Porter County didn't pass it, it may swing. Garner said he is one of the three opposed to the $75,000 grant LaPorte County may make, but four councilmen may vote to pass the grant. Garner said the project is getting opposition from farmers who operate competing grain elevators not on the line. Garner said he still has yet to make up his mind for sure. I hate to see any line taken away, said Garner, a Hanna resident who lives near the line. The line begins in Union Mills in LaPorte County and ends at the Malden grain elevator. That connection led Porter County Commissioners to team up with LaPorte County agricultural officials. The effort to purchase the line is being headed by Dean Kaesebier of the LaPorte County Farm Bureau Association, as well as state Rep. Steve Heim, R-Culver. The group could receive $1 million from state grants, as well as $330,000 from the Farm Bureau, to help complete the $1.9 million purchase from CSX.

The motion looked as if it would pass when fiscal conservative Councilman Robert Poparad, D-District 1, voted yes. But to the surprise of many, moderate Republican Ruge voted no, joining with Councilwoman Carole Knoblock, D-District 4, Councilwoman Rita Stevenson, D-District 2, and Councilman Al Steele, R-District 3.