Algoma Central Railway stakeholders back to the table

From the Sault Star:

Photograph:  August 21, 2009   Ren Farley
Photograph: August 21, 2009 Ren Farley

ACR passenger rail service officially ceases Wednesday, July 15, 2015.

It’s the second time this year that passenger train service between Sault Ste. Marie and Hearst, Ontario has been threatened to come to a screeching halt.

Last week’s announcement that Railmark had not been able to meet the precondition of securing a line of credit for the operation and would not be running the passenger rail service after July 15 means it’s back to the drawing board for the stakeholder working committee in search of a new third-party operator.

Economic Development Corp. CEO Tom Dodds said late Tuesday that the train will stop on Wednesday.

In the meantime, Mayor Christian Provenzano, and Dodds, in his position as chair of the stakeholder working group, are both penning letters to CN Railway, requesting that they consider operating the service on an interim basis until a new operator is found.

“We know CN doesn’t want to run a passenger service but we’re trying to thread something together that will see the operation of the train for a period of time while we can work together and find an operator,” Dodds said.

CN Rail could be the recipient of the federal government subsidy provided to operate the train.

“We appreciate that they don’t want to run the train full time. That’s why we began this process but unfortunately, it didn’t net us the result we were looking for,” Dodds said.

CN Rail was ultimately responsible for choosing the third-party rail operator.

It was the city who chose not to sign a contractual agreement with Railmark because it failed to meet a precondition of securing a line of credit of about $550,000 – or three months of operational costs.

Dodds said that work is being done to rework the expression of interest and request for proposals into one document in an attempt to get interested parties to submit a proposal and business plan.

“We’re hopeful that we can drive to a quicker solution because we’ve been done this already,” he said.

Of the original 20 or so expression of interests that were initially received, four serious applications were received.

Of those, one proponent revealed he didn’t have the experience required and withdrew.

Eventually, Railmark had been selected.

Dodds said media reports about the situation have created a renewed interest in the route again.

The reinstatement of the federal government funding also offers more hope that another viable proposal will come forward, he said.

“The reality is we need someone who can pick up and run that train Thursday, but I have no sense right now if that is possible or not,” he said. “CN has been given the information and they need to make their decisions internally.”

The ideal candidate would be a current Canadian operator who already has the licencing and insurance requirements needed to run the service.

Also needed is enough trained rail crews to ensure that standards are met and relief engineers are available to meet the ‘go slow’ orders on the track.

Familiarization of the line also becomes an asset with those orders.

But Dodds said all options will be explored.

Sault MP Bryan Hayes said he hasn’t been officially asked to do anything at this time but has been involved in the process since the beginning and will continue to serve as an intermediary between the working group and Transport Minister Lisa Raitt.

“The stakeholder group is going to continue to work with Transport Canada officials to develop a solution,”Hayes said.

“I have been assured by Minister Raitt that the money is still there but we want to find a qualified operator. It’s unfortunate that things didn’t pull through with Railmark.”

Hayes said if a new operator is found, the same due diligence process will have to be undertaken by the federal government, ensuring that a viable business plan is in place.

“Whoever comes forward still has to have a business plan that makes sense to the federal government. We want long term sustainability without ongoing requirements of federal funding down the road,” he said.

Hayes said he will support the city and the stakeholder group and do what he can to assist from the federal government perspective.

He too expressed hope that CN considers running the train service in the interim.

“They have expressed that they are not interested in the passenger service. . . They continue to be supportive of a third party operator but I hope in the interim, they step up because if they don’t, it will shut down until we find a third party operator,” he said.

Railmark provided the passenger train service since May 1 without any government subsidy because the agreement had never been signed.

Dodds said that to his knowledge, there has been no request or action from Railmark to receive funding.

“I don’t know of his intent but there was no agreement in place and there never was,” Dodds said.