(The following story appeared on the Daily Nonpareil website on January 6.)
COUNCIL BLUFFS, Iowa — A Pennsylvania company has purchased the Iowa Interstate Railroad, which has tracks in Council Bluffs and serves several farm cooperatives in southwest Iowa.
Railroad Development Corp., headquartered in Pittsburgh, acquired IAIS and also the assets of Heartland Rail Corp.
From the east, IAIS tracks enter Council Bluffs and parallel Interstate 80 diagonally until curving to the west and then north under Harry Langdon Boulevard near South Avenue. The company’s local office is at 2722 South Ave.
In Council Bluffs, the line has links to the Union Pacific and the Burlington Northern railroads, providing shipping service to other regions of the country.
Based in Iowa City, IAIS operates more than 500 miles of track between Council Bluffs and Chicago.
IAIS primarily transports grain, agricultural products, steel, scrap, appliances, intermodal containers and trailers, chemicals and forest products through southwest Iowa.
Among customers in the area are cooperatives in Hancock, Atlantic, Anita, Adair and Wiota.
RDC and Heartland were partners since 1991 in the ownership of the IAIS, which operates on rail infrastructure and property owned by Heartland between Bureau, Ill., and Council Bluffs.
As a result of the transaction, IAIS now owns Heartland’s assets and has become a wholly-owned subsidiary of RDC.
“We are pleased to have completed this transaction, which is a testament to both the vision of Heartland’s founders and the broad-based support Heartland and IAIS have received since their creation,” said Henry Posner III, chairman of RDC and IAIS.
Heartland was originally formed in 1984 to purchase the main line of the Rock Island Railroad after that company’s liquidation, and IAIS was created at the same time to operate the line as a through route.
Posner noted that IAIS has a history of “tenacity in the face of adversity, but it is important to recognize that its struggle has not been a lonely one.”
He praised the state of Iowa, and particularly the Iowa Rail Finance Authority, for what he termed an “ongoing role dating to the original financing of Heartland.”
Equally important, he said, has been the IAIS’s customers, “without whom the company’s existence would be meaningless.”
Robert A. Pietrandrea, RDC president, said the IAIS management team had done an “outstanding job over the years in bringing the railroad from a startup operation in 1984 to the solid company it is today.”
Under RDC’s ownership, he said, the same team will “continue to guide the railroad in the future. They understand the transportation needs of the shippers and work closely with them to develop the pricing and service packages that help to keep their products competitive.”
Donald C. Byers, president of Heartland Rail Corp. and a retired Maytag executive, expressed satisfaction with the purchase.
“In the mid-80s there was an imminent threat that the track and rail through the center of Iowa would be sold for scrap,” he said. “A group of shippers, along with the state of Iowa, came together to save the railroad and preserve much-needed rail service.”
Now, Byers said, “it is a cause for celebration that the shippers can finally turn the railroad over to a group that is known to us to be committed to ongoing quality rail service.”
Noting that IAIS is now the wholly owned “flagship” of RDC, Dennis H. Miller, IAIS executive vice president, said he could not think of a “more appropriate way to mark this transition than to have completed calendar year 2003 injury free. As we head into 2004, we hope to continue our safety performance and celebrate our 20th anniversary year injury free as well.”
Miller said IAIS officials “look forward to working more closely with RDC and will continue to build on the solid foundation we have created in recent years in providing consistent, reliable and safe service to our customers.”
RDC is a privately held railway management and investment company. Along with business ventures in the United States, it has operations in Argentina, Guatemala, Peru, Estonia and Malawi.