Abandonment proceedures

I think you also need to look at how the ICC would have considered any abandonment petition and figure that into the equation.

The Surface Transportation Board (ST was formed in 1996 to assume the remaining previous duties of the Interstate Commerce Commission (ICC) after deregulation. Included in that was a streamlining of the abandonment process. For example, in 2000 UP and CORP filed to abandon one mile of track at Coquille, Oregon. In 1996 the two customers on this segment received 30 carloads and 54 cars the next year. In 1998 there was a fire that damaged a small trestle. Original estimates were $54,000 to restore service, but then a sinkhole was discovered requiring another $80,000. Only one customer was on the wrong side of the bridge, but abandoning service for the mile allowed getting rid of a nasty signaled grade crossing. The city jumped in and supported abandonment so they could build an entrance into a former mill site that was being redeveloped. Abandonment was approved despite the fairly low cost of repair for CORP who was making a good profit at the time.

Once abandonment is approved, anyone that is financially responsible has a very limited window to make an Offer of Financial Assistance. This can be an offer of a subsidy or to purchase the subject line. If the seller and potential buter can't agree on a price, the STB will determine who what the net salvage value is and that is the price. There is also an adverse abandonment where a third party (typically a government entity or adjacent landowner) tries to force an abandonment to free the property for other uses - see the City of Creede a few years ago.

Simply, if the track segment is not paying its way, it will probably be approved for abandonment. There is a possibility it might be rail banked or become a rail trail, but I'm not sure this can be forced and is generally done because a non-profit or government agency is behind it and it is good politics.

Under the ICC the rules and attitudes were much different. Remember that before government funded road networks rail often had a monopoly on the transportation for a region. In exchange for this monopoly, crossing public lands and lands obtained through eminent domain; the ICC closely regulated railroad's rates, service, new construction and abandonment. Each state usually entered into the process and generally states and local governments protested any proposed abandonment or reduction in service. Because the ICC also approved the rates, there was a clear attitude that the railroad had a duty to provide service sometimes at a loss for the public good unless the financial impact was unreasonable.

Years ago SP tried to abandon the Fallon, Nevada branch. It was proved to the ICC that the SP had ignored potential customers requesting service. Abandonment denied, and the branch is still in service with substantial transloading though it is surprising it hasn't become a shortline.

Years ago Kyle tried to abandon the Yreka Western. It turned out that due to the economic recession YW was storing a bunch of unneeded IPD boxcars on temporary tracks and actually had made a little profit. YW still exists to this day due in questionable status.

Over the years SP built, bought or inherited several Arizona branch lines. Some of these lines became marginal by the 1950s as mining declined and roads improved. Using newly purchased GE 70 ton diesels, SP replaced steam on the daily passenger train between Globe and Bowie, as well as a mixed train that ran out of Benson on alternating days to Tombstone, Patagonia and Ft. Huachuca. In 1953 the SP abandoned the Globe-Bowie passnger service, most likely the timing was due to a loss of the RPO contract. SP had actually promoted the service and renamed it the Tomahawk as part of a rail-bus sightseeing tour. The local Indian Reservation complained, but suddenly Greyhound provided alternate service - no surprise since SP was a part owner at the time. When SP tried to eliminate the agents position at Tombstone the state filed a protest with the ICC. It turned out that most of the express was delivered directly by SP's truck to the customer instead of the depot, and the agent had only sold a handful of tickets in the last year. There was another manned station on the mainline just a few miles away. SP could show that they had made an effort to continue economical service by dieselizing (the 70 tons were required on the Patagonia branch due to light iron truss bridges). I'm sure SP could have applied to abandon the passenger service and just operate freights as needed, but running a combine instead of a caboose didn't cost that much more and could be used to pad the costs of the operation a little more. About 1960 mining had further declines and SP was able to abandon the branches to Tombstone and Patagonia.

Best example might be the SP narrow gauge. SP had made the decision to retire all but the newest large steam by something like 1957, so theoretically they could have overhauled #8 and/or #18 and run steam to the end. But by buying diesel #1 SP could show an effort to modernize and cut costs, while also gaining the cost benefits dieselization. I remember talking to the late Mr. Wood who was agent in Keeler and was the last agent at Lone Pine. He said that there was just as much rail traffic as when the narrow gauge was running. A couple things here to note. SP bought the #1 diesel with standard gauge truck frames indicating their intent that it would outlive the narrow gauge. Typically diesels were financed on 15 years trusts, so SP knew the narrow gauge was on borrowed time. Next, the SP really didn't end service to the remaining customers. Instead of the narrow gauge picking up at the customer and transloading it at Owenyo, SP's subsidy Pacific Motor Transport picked it up at the customer's door and transloaded it at Lone Pine. As part of the ng abandonment, new transload facilites were constructed at Lone Pine and still used until the standard gauge service was dropped. SP was able to abandon the narrow gauge because they had made an effort to modernize it and cut costs, and even though the customers were dependent upon rail transportation SP was able to provide an alternative service that was economical for the SP and the customer. Likely everything traveled under the same bill of lading and rate.

When Sumpter Valley abandoned mainline service in 1947, there were few with any standing to protest. The only remaining customer owned the railroad, and SVRT still provided transportation since they owned the lumber trucks. There was some quirky deal where UP gave them a rate from Bates to the final destination, and the stop at South Baker for planing was just a stop in transit. It still traveled behind a narrow gauge engine as #101 hauled the standard gauge boxcars over the three rail from the mill to interchange until the mill closed in 1961 eliminating the need for SVRY's trains and trucks.

Basically the ICC considered the public good before a railroad's attempt to make a buck. Smaller railroads had an easier time with abandonments because the ICC couldn't really expect to bankrupt a company if the loss could be avoided or moderated.

Had the D&RGW tried to abandon the Silverton - they would have had to prove:
1. It was an unreasonable economic hardship - if a company was profitable, they were expected to subsidize some reasonable losses for the public good.
2. Was there a demand for service? Had the railroad attempted to meet those demands? What was the potential for future traffic?
3. Had the railroad tried to economize to limit losses? Had they made the necessary investments to modernize (aka buy diesels and upgrade track) if that resulted in lower costs?
4. If abandoned, were there transportation alternatives available?

In the Silverton's case, the freight traffic was so little that as soon as it could be shown that trucks and busses were a reasonable alternative it might have been feasible to try for abandonment. As more passengers showed up to ride due to the movie and spreading reputation, DRGW had a duty to try and accommodate them. Since it also was a potential revenue source, DRGW also had a responsibility to promote the service. Other than building/rebuilding additional passenger cars, there wasn't any reason to modernize. Diesels may have been cheaper to operate but their purchase would have to be paid over a few short months so it didn't make economic sense and many people wanted to ride behind an old fashioned steam engine anyway. Didn't the ICC insist that DRGW upgrade the Silverton's tracks and bridges to allow larger engines as part of the sale?

Abandonment is both an economic and a political situation. There have been railroad officials that prayed for some kind of disaster or customer's collapse (and often assisted in causing them) that would give them an undeniable excuse for abandonment.