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Once thought doomed, Barron County rail service back on track
Date: 11/10/2004
by Wayne Nelson
Barron County rail service once seemed doomed is on track to continue with the entry of a new short-line carrier that will begin operating by the end of November.
Tim Eklund, vice president of corporate development at Progressive Rail, Inc., based in Lakeville, MN, said the new carrier will operate as a subsidiary to be called Wisconsin Northern Rail Co. It will operate three trains weekly connecting Almena, Barron and Rice Lake with Union Pacific service near Chippewa Falls, WI. Shippers in Chetek, presently served by the Union Pacific in Barron County, also can expect better service.
Among the big beneficiaries are Jennie-O-Turkey Store and Bell Lumber & Pole in Barron, and Birchwood Manufacturing in Rice Lake, all now served by Canadian National. Jennie-O, Northwest Wisconsin’s No. 1 private employer, receives grain via rail for its Barron area hatchery and turkey farms; Bell Lumber produces power poles too long for highway hauling; and Birchwood Manufact-uring relies on rail for delivery of logs.
Eklund said he expects the Canadian National to accept a Progressive Rail purchase offer for two rail spurs terminating in Cameron — one from Rice Lake, the other from Almena (see map). Details of the offer haven’t been disclosed.
Progressive Rail also has presented a lease offer to Union Pacific, for its Cameron-to-Norma spur, terminating near Chippewa Falls. “We believe it will include an option for us to acquire it at some point in time,” Eklund said.
While Union Pacific service to Chetek and Bloomer shippers wasn’t in jeopardy, they will benefit immediately from expanded service. David Ziarnik, production manager at Automated Building Components (ABC), a wood roof and floor truss manufacturer in Chetek, provides a striking case for the benefits of reliable rail service. He said ABC’s shipping costs would increase from $250,000 to $400,000 annually if the company had to rely solely on truck transportation.
Communities to be served by Progressive Rail will have a significant new economic development tool, as well.
Eklund outlined the short-line railroad’s brief history and positive impact on shippers at the fall conference of the Wisconsin Economic Development Association on Sept. 23-24, held at Barkers Island Inn & Conference Center in Superior.
The carrier was launched in 1996 to provide service for manufacturing tenants at an industrial park in Lakeville, 25 miles south of Minneapolis. Eklund said rail traffic there has grown from 600 to 7,000 car loads annually; new and expanding businesses in the park have added more than 240 employees; and the selling price for industrial space has soared from 80 cents to $350 per square foot.
“Transportation is one of few remaining manufacturing cost centers (with potential) for improved efficiency,” he said.
The company also is providing short-line service in a nine-mile rail segment in the Twin Cities.
Class I, or national carriers, in Minnesota and Wisconsin are exiting these operations because short line hauls aren’t profitable for carriers like Union Pacific and Canadian National.
Wisconsin Northern would be the ninth short-line rail operator in the state, Eklund said, adding 540 short-line operators nationwide deliver about 20 percent of all traffic hauled by the large Class I carriers. “They like to have us around,” he said.
Key to making both deals work, the Wisconsin Department of Transportation has approved a $1.4 million loan to Progressive Rail to upgrade Union Pacific’s Cameron-to-Norma spur, subject to a lease agreement.
The prospects for continued rail service are a far cry from the gloomy situation in August 2001 when then-owner Wisconsin Central announced it planned to end service in Barron County due to marginal freight volume. Two months later, Wisconsin Central was acquired by Canadian National. It has maintained the service in Barron County and never filed a petition to abandon its tracks.
Underpinning these deals is a public-private partnership that includes the two Class I rail carriers, Wisconsin Transportation Department and two counties, Barron and Chippewa.
After the Wisconsin Central announced its abandonment plan, the two counties formed the Wisconsin West Rail Transit Authority as a mechanism for maintaining and improving service, including potential public ownership of part of the route system.
Economic development corporations in the two counties coordinated a search of abandoned lines and selection of a short-line rail operator for the authority, ultimately Progressive Rail.
While 80 percent grants from the Wisconsin Department of Transportation are available for purchasing viable rail beds, no public grants have been requested because neither county wants to assume the required 20 percent local match.
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