(The Canadian Press circulated the following story on July 1.)
NORTH BAY — The federal government will spend $2.5 million to keep the Ontario Northland Transportation Commission’s passenger trains running between Toronto and North Bay for the next year.
“The federal funding will ensure continuation of the service between Toronto and North Bay, while the provincial government and (the commission) continue seeking a long-term solution for the Ontario Northland rail service,” Transport Minister David Collenette said yesterday.
Ontario Northland is a provincial crown corporation that operates rail, bus, ferry, telecommunications and hotel services.
For the past seven years, Transport Canada has financed the corporation to ensure passenger service continues to North Bay and remote parts of the province’s northern regions.
Yesterday’s contribution extends the funding for an additional year beginning today.
The financing move comes a few weeks after Canadian National Railway Co. scrapped plans to buy Ontario Northland over what CN said were unacceptable demands by the provincial government for job guarantees for Ontario Northland workers. CN planned to invest millions of dollars to improve the rail service, but also wanted to streamline the operation to cut costs and make it more competitive as a freight shipper.
Montreal-based CN was selected by the Ontario government out of three bidders to negotiate the takeover and talks began last October.
After the deal fell through, Jim Wilson, minister of northern mines and development, said privatization of the regional crown railway was off the table.
Until 1996, passenger service between Toronto and North Bay was subsidized by the former National Transportation Agency, now the Canadian Transportation Agency. Transport Canada assumed funding responsibility from the National Transportation Agency when a new federal law ended that agency’s ability to continue subsidizing the service.