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Huron Central Railway survives for another year

Provincial funding buys time to work out longer deal with short-line railroader
Huron Central Railway 1

With a short-line railroader threatening to pull freight service this month, Queen’s Park delivered $980,000 to the Huron Central Railway to keep it running for another year in northeastern Ontario.

The money, announced by Sault Ste. Marie MPP Ross Romano on Nov. 8, is essentially a one-year bridge funding arrangement to keep the line open while provincial negotiations continue with the railway to reach a longer term deal.

“We are committed to this piece of infrastructure and we see it as vital for the region,” said Romano in an interview, echoing a campaign promise made by Premier Doug Ford earlier this year.

The Huron Central’s Montreal-based parent company, Genesee & Wyoming Canada, imposed a Nov. 1 deadline to pull service on the 278-kilometre Sault Ste. Marie-to-Sudbury line.

Freight service still continued past the deadline, Romano said, since the fundamentals of the one-year agreement were already in place, just not finalized until recently.

The funding is only a fraction of the $43.2 million that the railway said it needs from the federal and provincial governments for track maintenance and government-mandated safety upgrades at level crossings.

The company’s application to the National Trade and Corridors Fund was rejected by Transport Canada last spring because matching provincial dollars were not in place, first.

The Huron Central employs 44 in the Sault and Sudbury but supports thousands of industrial manufacturing jobs in hauling steel, forest products and chemicals for Algoma Steel in Sault Ste. Marie, Domtar in Espanola, and EACOM in Nairn Centre.

The line is owned by CP Rail, which contracts Genesee & Wyoming to feed regional freight onto its national main line at Sudbury. CP has shown no inclination to invest in the track.

Romano said since the Ford government has only been in place for a few months, there wasn't time to do the due diligence required to do something long term.

“The deadline was coming very quickly, we did not know what type of federal support there would be and we weren’t prepared to see this rail line close shop. It’s too important for the region to let it go.”

With “a year’s cushion,” Romano said it buys time to continue discussions with the company, shippers, and other stakeholders to reach a solution.

This is the second time in less than 10 years that Genesee & Wyoming threatened to drop service.

During the summer of 2009, the company gave a 30-day discontinuance notice, followed by a series of extensions, until the federal and provincial governments could cobble together a $33-million subsidy for track and bridge repairs. With that funding pool now dried up, the railway is back before the government.

“We want to see this rail line, not only survive, but thrive,” said Romano.

Though committed to keeping the Sault-Sudbury line open, Romano wouldn’t say if the government is prepared to let Genesee & Wyoming walk in a year's time and entertain another rail carrier.

“I don’t think we can foreclose any type of opportunity at this time. From our perspective, we want to ensure that that infrastructure is there and that it is sustainable on a moving forward basis.”