REGINA – Short-line rail operations in Saskatchewan would make money, says the head of an American rail company.
Bruce Flohr, chair and chief executive officer of Railtex, which operates two short lines in Eastern Canada and 22 in the U.S., said he believes Saskatchewan branch lines that might be abandoned have a viable future as short feeders to the main CN and CP rail lines.
“What a lot of people aren’t aware of is the fact that we can make money with short haul rail of things like grain,” Flohr told reporters after a meeting organized by the Saskatchewan Association of Rural Municipalities.
Read Also
Man charged after assault at grain elevator
RCMP have charged a 51-year-old Weyburn man after an altercation at the Pioneer elevator at Corinne, Sask. July 22.
Railtex hauls grain on lines abandoned by major railways an average of 80 kilometres from small elevators to large storage facilities at half-a-cent per bushel less than what truckers charge.
“We see a similar role for that right here in Saskatchewan,” Flohr said, adding the track is in good condition and would require little work.
But Flohr said there is one impediment.
“The first thing that has to happen in Saskatchewan is the elimination of successorship rights,” he said.
These rights guarantee that labor contracts signed with the major railways continue when rail lines are sold.
Too much to take on
Flohr said Railtex’s Goderich and Exeter line in Ontario employs eight people. But if successor rights had been in effect “we would have had to have eight different labor unions and probably 16 employees to do the work, so as a result we would not have bought the line at the time.”
Geoffrey Chambers of Rail-One in Montreal also said successor rights are an issue.
“It’s clear that Saskatchewan is going to have some really good candidates for short lines in terms of their basic economic qualities and if some of the political questions can get solved, principally the successor rights questions, then we’d be very interested in acquiring lines here,” Chambers said.
SARM vice-president Neal Hardy said he was encouraged to hear the enthusiasm for Saskatchewan branch lines.
“We believe there’s room for four or five short-line railway companies in this province and maybe more,” he said. “American, Canadian, local, we’re just hoping that somebody will come forward and operate those lines to serve the producers out there.”
Hardy said rural roads are in jeopardy if branch lines are abandoned.
