COLDWATER, MI (WTVB) – The Indiana Northeastern Railroad Company celebrated the completion of the Branch County Rail Users Association Project with their partners on Thursday.
They showed off the upgrading over the last year of nearly 10 miles of railroad right of way from Coldwater to east of Quincy to a group which included members of Coldwater city government and partners in the project.
The project addressed the deteriorating conditions of the rail line and the need to increase the weight capacity of rail cars serving local companies.
The R.U.A. was awarded a grant from the Rail Division of the Michigan Department of Transportation for 50 percent of the project cost which came out to $625,000.
The Coldwater City Council and the Indiana Northeastern Railroad both approved $312,500.
The Railroad’s investment included a provision to become a full voting board member of the R.U.A..
The I.N.R. later made an additional investment of over $233,000 to cover cost over-runs which brought the total amount of money spent on the project up to over $1-point-4 million.
As for the repairs that were made, The R.U.A. was created for the purpose of purchasing the old Conrail Railroad line that served two counties and local industries.
Besides the railroad, the R.U.A. board is comprised of representatives from Sekisui Voltek, Panel Processing, Star of the West Milling, the City of Coldwater and Branch County Economic Growth Alliance.
The railroad also brought in 5,000 tons of new stone for ballast under the rails.
The city of Coldwater is one of the owners of the Rail Users Association, which purchased the Quincy-Coldwater section of the rail services from the federal government in 2002.
When those ties and ballast are installed over the next few month “It’ll look like a railroad again,” according to Andrew Hershman who does marketing and sales for the railroad.
He is also a part-time locomotive engineer.
“I was an engineer three weeks ago on a train and I don’t operate that much through Branch County. When I do, I’m reminded of just how much this project is needed,” he said.
Work to repair the bridge east of Coldwater over the Sauk River has begun.
“With the addition to the ties and the surfacing work, that will improve the condition on the track,” Hershman said. “It will bump us to the next class that will allow us to do 20 mph on that stretch of road.” The limit is now 10 mph.
The big advantage comes with heavier freight. The national lines use rail cars with a 286,000 pounds per car load limit. Because of the poor condition of the local line, businesses here face a car load limit of 268,000 pounds.
The lower limit resulted in Panel Processing moving work to its other plants.
“Panel processing was hoping that they could get some heavier boxcars in here,” Hershman said. “With the heavier loadings, you get better economies of scale with your freight rates.”
The heavy loads will help “especially over at Ceres Solutions. With their inbound fertilizers, some of the potash and the dry fertilizers, it will be a little bit cheaper if we can handle the heavier cars,” Hershman said of the farm co-op..
Darling International rendering plant could not fully load outbound rail cars. Other users include Voltek, Star West Milling and Sungrow of Quincy.
Rail traffic was down in 2020 and 2021 during the pandemic. Hershman said the numbers might have been “slightly depressed” yet “we saw about 800 cars out of Coldwater last year.”
He believes sales will rise.
“A person now looks at the railroad and they’re kind of discouraged, and rightfully so. With the improvement in the track structure and in its appearance, it would be an easier sell,” he said. “We’re open for business, the red carpets out. We can handle your freight.”
It’s all about price. Andersons were trucking corn oil from its Albion biofuel processing plat to Coldwater to load into rail cars for shipment to Louisiana. Canadian National Railroad gave a better price so now the corn oil is trucked to Lansing to connect to that rail line.
Hershman said in the current market with shortages of trucks and higher fuel prices rail shippers can save 25% to 40% on rail freight.
“The further the distance, the more competitive rail is,” he said. “Generally speaking, a rail car is about the equivalent of four trucks.” Cost goes up if trucking is needed at either end of the haul.
Indiana Northeast Railroad is a 105 mile short line railroad. It owns from Quincy to its national connection at Montpellier, Ohio.
The railroad will pick up a quarter of the $1.2 million “corridor improvement” costs. Coldwater will use $312,500 of its Capital Improvement fund to pay a quarter of the cost. A grant from the Michigan Department of Transportation pays the $625,000 remainder.