(The following story by Mateusz Perkowski on the Daily Astorian website on December 9.)
TILLAMOOK, Ore. — The future of the Port of Tillamook Bay Raiload is as murky now as it was exactly one year ago, when floodwaters and fallen trees knocked the line out of commission.
What has grown clearer, though, is the enormous investment that would be required to fix and upgrade the railroad.
Before the December 2007 storm, dairies and sawmills in the region relied upon the line, which runs from Tillamook to Gaston, for incoming cattle feed deliveries and outgoing lumber shipments.
In the storm’s immediate aftermath, the port pegged the repair cost at roughly $27 million.
A more complete analysis commissioned by the port brought the price tag to $34 million, but that didn’t include permitting and other bureaucratic requirements.
In late November, the Port of Tillamook Bay received a preliminary estimate from the Federal Emergency Management Agency, which expects the total cost to top $50 million.
The port itself expects repairs will run to about $57 million.
Though FEMA is prepared to pay for three-fourths of the restoration once the agency finalizes its estimate, that will still leave the port scrambling for at least $12.5 million.
“Our struggle now is to find the match to rebuild it,” said Michele Bradley, the port’s new general manager.
Hopefully, the state of Oregon – the railroad’s co-owner – will be able to contribute some of the matching funds if a transportation infrastructure improvement bill is passed during the 2009 legislative session, she said.
The port will also ask companies that depend on the line for shipping to chip in funds, Bradley said. This piecemeal fundraising approach may eventually be successful, but that will still leave the line defunct for the foreseeable future.
“It’s nothing that’s moving fast,” said Bradley.
Aside from exerting a financial strain on sawmills and dairies, who must pay higher costs for trucking, the railroad’s absence also caused considerable tumult in the port’s management during the past year.
In mid-July, the port’s commission fired former general manager Robert Van Borssum because several commissioners thought he was not seeking railroad repair funds aggressively enough.
Van Borssum had also applied for a job as executive director of the Port of Astoria, which was also controversial.
His ouster was opposed by two members of the five-person commission, Steven Kershaw and Loten Hooley, who resigned in protest.
“It was handled very unprofessionally, in my view,” said Kershaw in an earlier article about the incident.
The commission has since replaced those two members and hired Michele Bradley, the port’s former office administrator, as general manager.
Convincing the state to help with repair costs may be a serious challenge for Bradley.
An audit conducted by the Oregon Department of Transportation indicated the railroad was losing money for 18 months prior to the storm.
“We found that they weren’t pulling in enough revenue to cover their costs,” said Kelly Taylor, rail division administrator for ODOT.
After the storm, Oregon Governor Ted Kulongoski indicated he would use a “very sharp pencil” to determine the practicality of repairing the line, and the audit would play an important role in his thinking, said Chris Warner, the governor’s transportation policy adviser, in an earlier Capital Press article.
Not only were the railroad’s expenses outpacing demand, but the line’s value is overestimated and the port lacks money to maintain it in the long term, according to the audit.
“They’ve got a lot of bridges and tunnels on that track, so it’s a challenge to keep that up. It’s a lot of upkeep,” said Taylor.
On average, the port was charging shippers about $740 per rail car to use the line, she said. To make a profit, they’d need to increase that fee to $1,400 per car – that, in turn, might scare away customers, Taylor said.
For its part, the port thinks the fee increase will not need to be quite that drastic, especially since the price of fuel has fallen, said Bradley.
Bradley also said she doesn’t think the audit’s conclusions indicate a lack of support from the governor.
Taylor said it’s too early to predict how the audit will guide the state of Oregon’s decisions regarding railroad repairs.
“I don’t know that anybody knows the answer to that,” she said.
At this point, however, the state does not have any money set aside for repairs, Taylor said. The Oregon legislature did create an account for railroad rehabilitation, but it was never funded, she said.
“There’s a piggy bank, but nobody’s putting any money into the piggy bank,” said Taylor.