Railroad’s powers put to test, law gives Vt. Rail the upper hand

MIDDLEBURY — We’ve all seen footage of what happens to a stranded car sitting in the path of an oncoming freight train.
The freight train always wins.
And when it comes to a dispute between a municipality and a freight train, the train seems to have the advantage — a likelihood that Middlebury officials and merchants are learning in their call for modifications to the Vermont Rail Systems (VRS) train schedules during the upcoming replacement of two downtown rail overpasses.
Middlebury has suggested that VRS temporarily detour its freight train traffic through Middlebury beginning next fall when work is slated to begin on a proposed $45 million to $55 million project to replace the Merchants Row and Main Street overpasses. Town officials believe the temporary detour would allow the project to be done more quickly and cheaply, thereby causing less disruption for affected property owners and merchants.
But VRS officials are adamant about keeping the line open for the two daily trains that go through Middlebury, arguing that even a short-term detour would harm the company’s bottom line and potentially other businesses that depend on the train to move their products in a timely fashion.
“It needs to stay open,” VRS President Dave Wulfson said. “There are many, many customers — and a lot of them are indirect customers — who use the railroad and don’t even know it. You have the grain companies that feed the cows every day; where are they going to get their food? What about the oil that goes into people’s furnaces every day? We would basically be out of business if that line were shut down.”
The line wouldn’t be shut down, of course, but detoured around Middlebury to points north and south — a two-day detour that would add about 120 miles and require several rail car switches, which, to date, makes the idea unpalatable to VRS.
OLD LAWS FAVOR RAIL
An Addison Independent review of federal and state statutes governing rail traffic indicates that VRS would likely prevail in its quest to maintain operations through a project that planners have said could span three years.
Vermont Rail Systems operates five railroads in Vermont, New Hampshire and New York. The company is responsible for maintenance of 350 miles of track, around 310 of which are located within Vermont. The two largest rail service providers in the state are VRS and the Genesee and Wyoming, which includes the New England Central Railroad (NECR).
“There’s an ongoing work plan between the railroad and the state and the federal government,” Wulfson said. “We spend quite a lot of money each year not only to take care of the railroads, but improve them.”
Meanwhile, major capital projects (such as the Middlebury rail bridges plan) are the responsibility of state and federal government and are thus the financial responsibility of those two entities.
VRS’s responsibilities are spelled out in a contract that it maintains with the state of Vermont.
Wulfson said that aside from the condition of the Main Street and Merchants Row overpasses and associated drainage issues, VRS is generally pleased with the state of rail infrastructure in Middlebury. He did identify another local trouble spot: The retaining wall adjacent to the base of the National Bank of Middlebury has been migrating inward toward the railroad track for “many, many years,” according to Wulfson. This has precluded trains from carrying substantially wide loads — such as a recent effort by VRS to move some Abrams tanks for the U.S. Army — but the limited width has not inhibited conventional train traffic, he said.
“We’re fine with operating there and can continue to do so for a long time,” Wulfson said, adding that he wants to keep those two daily trains operating through Middlebury while the rail bridges are replaced, including time and effort to replace or restore the current train tracks.
And a survey of state and federal regulations reveals that the railroad is within its rights to maintain uninterrupted service.
The railroads in the national network are governed by the federal Surface Transportation Board (STB), Wulfson noted. Established in 1996, the STB has broad economic regulatory oversight of railroads, including rates, service, the construction, acquisition and abandonment of rail lines, carrier mergers and interchange of traffic among carriers.
As part of the Interstate Commerce Commission Termination Act of 1995, Congress terminated essentially all regulatory authority of state and local governments over railroad operations.
“Subjecting rail carriers to regulatory requirements that vary among the states would greatly undermine the industry’s ability to provide the ‘seamless’ service that is essential to its shippers,” and would upset the industry’s competitive and economic viability, according to language in the ICCTA.
Michele Boomhower is director of policy planning and intermodal development for VTrans. She acknowledged the powers that railroads have been given through federal statutes.
“We really have very little latitude in terms of directing (the railroads),” Boomhower said. “We work collaboratively as much as possible with the railroads to try to arrive at common objectives, but we don’t have the authority to overrule them in most instances.”
It should be noted that the extensive powers of the railroad were first mapped out by Vermont in 1843, when the state Legislature helped establish the Champlain and Connecticut River Rail Co. Lawmakers at the time conferred upon the new railroad “all the rights incident to corporations, for the purpose of constructing a railroad from some point at Burlington, thence southwardly through the counties of Addison, Rutland, and Windsor or Windham, to some point on the west bank of the Connecticut River… for the transportation of persons and property by steam or horse power.”
The corporation would be governed by a seven-member board endowed with the power, among other things, “to enter upon and take possession of all such lands and real estate as necessary for the construction and maintenance of their railroad and the requisite appertaining thereto.”
If the board encountered landowners resistant to selling property, it was the duty of the county court to appoint a three-member commission to assess the grievances and determine compensation, whereupon the railroad could seize the lands in question. Landowners were given an appeal option to the county court.
AN UNLIKELY DETOUR
Lawmakers gave the state the right to purchase the railroad 50 years after it was up and running. The state elected not to take that tack, and the state’s two major railroads continue to enjoy great autonomy over their operations and routes. The two companies are in competition with one another, which is a major reason that a detour around Middlebury is not likely to happen during the rail bridges project, officials said.
While there are some instances of short distance agreements to allow another rail operator to travel on another rail company’s line, the companies tend to be very protective of their routes.
Detouring around Middlebury would require a changeover in Rutland onto the Green Mountain Railroad and then onto the NECR (a G&W line), and then back onto the VTR in Burlington. This would generate additional switching of cars in the Rutland yard, the Bellows Falls yard, and the Burlington yard as well as add an additional 120 track miles to get to Burlington, according to Vermont Rail Systems officials.
In addition, VRS would need to lease additional cars for the term of the project due to the increased turnaround time for the cars to make the extra distance in the trip, officials noted. Depending on the volume of freight, additional track might need to be installed to allow for the movement of the existing freight along with the additional cars.
This, according to Wulfson, would essentially place VRS in the position of trusting their largest rail line’s business to their competitor (NECR).
“It would be like putting Foster Motors in charge of G. Stone Motors for two years,” Wulfson said.
He said temporarily closing (or detouring) the rail line in Middlebury would have the same impact on commerce as closing Route 7. He said VRS’s freight clients would not be pleased with having their products make a 120-mile detour.
 “It’s all about the products; you can’t just stop them,” Wulfson said. “It’s not like a highway where you can close one street and route traffic around and it’s a five-minute detour.”
VTrans officials, in a July memo to the town of Middlebury, defined the competition quandary that VRS would face with a detour.
“To detour the freight to Burlington (via the NECR) would mean putting the value of VRS and its future in the hands of (NECR),” reads the memo. “Given the risks associated with the detour, it is a scenario the board of directors and management of VRS are not interested in for understandable reasons.”
That said, VTrans officials said they will try to get Middlebury the best deal possible.
“We are actively working with (VRS) to arrive at a schedule that will be mutually beneficial for the project as well as continued commerce for the railroad,” Boomhower said. “In terms of what we can direct them to do, we are very limited in that regard.”
Wulfson has no preference on how the two Middlebury rail bridges are ultimately replaced. But he recommended that the town get on board with a project soon or risk having a solution foisted upon it that the community might find unpalatable.
“In my opinion, if Middlebury can’t figure out what they want, then they might get something that they don’t want,” he said. “It’s a federal project using federal money and the feds have clearance requirements on new construction. We can’t just build it the way it was, and that’s not up to me or the state.”
Reporter John Flowers is at johnf@addisonindependent.com.

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