June 24, 2018
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Talks on freight railway buy roll on

By Nick Sambides Jr., BDN Staff

Neither side calls it an impasse, but Montreal, Maine & Atlantic Railway and the state remain locked in talks over a state plan to buy 233 miles of northern Maine freight rail tracks slated for abandonment, they said Tuesday.

Neither Robert C. Grindrod, the railroad’s president and chief executive officer, nor Maine Department of Transportation spokesman Mark Latti wanted to say that the negotiations are stalled.

But if they are continuing, it seems that not much is being discussed.

“I think if you were to ask the state folks where the talks were, they would probably say that at the moment we’re at an impasse, but I would rather have them say that,” Grindrod said Tuesday.

“Its kind of a strange situation. While that [the word ‘impasse’] is being said, there has also been nothing said on either side outside the arena of negotiations that would suggest that there isn’t the opportunity for further discussions,” he added, “so I am hopeful.”

“We are still exchanging ideas,” Latti said Tuesday, “but at this point we don’t know whether we will reach an agreement first or whether the Surface Transportation Board will render a decision on the abandonment.”

In July, both sides said they were working to find common ground between DOT’s argument that the tracks and other equipment are worth $18.1 million and MMA’s contention that they should fetch $26.2 million as a whole or $23.7 million if broken into smaller pieces or parcels.

The federal Surface Transportation Board will decide which offer is more suitable if the negotiators can’t and if it approves MMA’s request to abandon the lines. No decision date has been set.

MMA sought federal approval in February to abandon the tracks, most of which run from Madawaska to Millinocket, by summer, citing losses of $4 million to $5 million annually. That deadline has been extended several times.

Stakeholders in the railroad service, such as 22 major Maine manufacturers, have said it would be disastrous to the state’s economy if the tracks were lost. Grindrod said the rail service did not want to abandon the lines but had no choice, given its losses.

The state wants to buy the tracks with $7 million in bonds and other funds and lease the tracks to a rail operator that would keep northern Maine’s freight moving. Voters approved during a June referendum the $7 million allocation as part of a $47.8 million bond package.

The tracks’ preservation would help maintain as many as 1,722 jobs that could be lost if the freight lines were abandoned, Aroostook County economic development officials have said.

MMA provides the only rail freight service in Aroostook County, serving primarily the pulp and paper, agriculture and potato processing industries. The tracks targeted for abandonment run from Madawaska to Millinocket, with spurs to Caribou, Easton, Houlton, Limestone and Presque Isle.

Several freight railroad services besides MMA have expressed interest in a lease deal, state officials have said.

If the deal were made, the state would put the bond money toward the purchase while rail stakeholders would commit to $3 million in hauling fees.

“There is the possibility,” Latti said, “that we could come to an agreement or the STB will make their decision and then we move from there. We don’t know.”

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