Issue No. 41

December 12, 1996

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EDITORIAL

TRACK WARRENT No. 43 ANNULLED
(FOR THIS RELEASE)
The quad issue is not to be. This release is going to be a three parter. Part Four is hereby annulled.:

• Issue 40 included a news photo of the UP passenger special going through Pinole, CA
• This issue with a Kevin Hecteman photo of the Oct. 6th NWP special at Willits, CA
• Issue 42 with a Jerry Stoors Jr. photo of the CLAIC at Thomasten, TX
• I still plan to use the photo of the SP 127E at Ripon, CA, in issue 43. But, that issue will be part of the next release.

A Kevin Hecteman photo of the Oct. 6th NWP special at Willits, CA

BNSF TODAY

STB RESOLVES UP-SP MERGER ISSUES
Nov21--The Surface Transportation Board (STB) handed down five decisions on Wednesday that clarify what had been open issues relating to the conditions imposed in the recently approved Union Pacific-Southern Pacific merger. Two of the five decisions are in response to filings by BNSF, UP-SP and others, and have major commercial impact. In one major decision, the STB confirmed BNSF's interpretation of a previously-imposed condition that allows BNSF to serve new facilities and transloads on the lines where it has trackage rights. That condition, imposed by the STB in August when it approved the UP-SP merger, granted BNSF the right to serve new facilities, including transload facilities, on both SP-owned and UP-owned track over which BNSF received trackage rights in the merger agreement. UP-SP's petition seeking clarification or reconsideration of the condition was denied by the STB. "The new facilities and transload conditions that we imposed were appropriately crafted and necessary to allow approval of this merger," reads the STB decision in its denial of UP-SP's petition. "BNSF may serve any new facility . . . located post-merger on any UP-SP line over which BNSF has received trackage rights in the BNSF agreement. Likewise, BNSF may serve any new transload facility, including those owned or operated by BNSF itself, located post-merger on any UP-SP line over which BNSF has received trackage rights in the BNSF agreement; and BNSF's right to serve a new transload facility includes the right to handle all traffic transloaded at that facility."

The second major decision handed down by the STB provided mixed results for BNSF, one of several parties that filed a petition asking for clarification of the contract modification condition. In its original decision, the STB had required that UP-SP must modify any contracts with shippers at all 2-to-1 points (locations served by UP and SP only that would see a reduction in competition as a result of their merger) to allow BNSF access to at least 50 percent of the volume.

BNSF argued that the only way to ensure access to at least 50 percent of the volume under contract at the 2-to-1 points is to have access to 100 percent of the volume under contract. While the STB denied this request, it did respond to BNSF concerns by establishing ten guidelines to govern the implementation of the contract modification condition, including one that allows shippers, not UP-SP, to select the portion of its traffic that is open to a BNSF competitive transportation offer.

WINTER STORM STILL HAS ICY GRIP ON NORTHERN LINES
Nov21--Bitter cold temperatures have replaced the freezing rain, ice and snow that fell on the Northern Lines earlier this week. Freezing temperatures, ranging from minus 25 degrees Fahrenheit at Havre, Mont., to two degrees above zero at Whitefish, Mont., have delayed traffic on the Montana division and are expected to continue through the weekend. The weather is also being blamed for power outages on the Kootenai River Subdivision and caused Centralized Traffic Control (CTC) outages between Leonia and Yakt, Mont. Commercial power outages are still affecting over 100,000 customers in Spokane and the surrounding area, causing a severe manpower shortage at Yardley.

The Oregon Trunk Subdivision continues to have limited train movement. Track inspectors are inspecting the lines for rock and mudslides prior to all train movement. Numerous trains have been delayed by slide fences on the Wishram Subdivision between Yellepit and Berrian, Ore.

Main one is back in service on the Seattle East Subdivision between Everett and PA Junction, Wash., and train operations are slowly returning to normal. Maintenance of Way crews continue to clean up debris following high tides, rock and mudslides.

UTILITY CONFERENCE ADDRESSES INDUSTRY DEREGULATION
Nov21--How deregulation or partial deregulation of the $208 billion electric industry will affect large industry consumers and private citizens is one of the hot topics at the annual BNSF Utility Conference being held this week in Las Colinas, Texas.

Gerald Vaninetti Sr., consultant for Resource Data International Inc., will speak to about 40 attendees representing between 15 to 20 utility companies on the competitive position for coal in a deregulated utility environment. The Powder River Basin, where more than 250 BNSF train sets originate and haul coal, is poised to be a low-cost supplier of the commodity. "The Powder River Basin is well positioned for emerging restructured utility markets," says Jerry Bartlett, director of market and economic analysis for BNSF.

The coal's composition is low sulfur which makes it a clean-burning fuel, and the delivered-price economics for electric utilities are powerful. Already many states are looking at utility deregulation. Since August, California and Rhode Island have enacted groundbreaking competition laws. In May, New Hampshire enacted a pilot program to open the state's retail electric market to competition. Also, 45 other states and the District of Columbia are studying retail competition in their electricity markets. Also on the docket to speak is Steve Miller, president of the Center for Energy and Economic Development (CEED). Miller will speak on activities and initiatives to preserve and enhance coal utilization.

FastFact
About 25 percent of BNSF's 1995 revenue was derived from coal traffic.

SOUTHEASTERN DIVISION'S SANTA EXPRESS READY TO PULL OUT

Nov27--Santa Claus is getting an early start on meeting children in Alabama, Arkansas, Kansas, Mississippi, Missouri, Oklahoma and Tennessee this year. The BNSF Santa Claus Express train, staffed by BNSF employees who volunteer their time, will pull into these states Nov. 29 through Dec. 22 bringing 6,000 pounds of candy to children along the route.

The six-car train will be decorated with more than 25,000 lights, 12-foot-tall candy canes, 11-foot-tall toy soldiers, a 16-foot-tall Christmas tree and Santa's sleigh. The train will make about 60 stops.

BNSF COMPLETES WASHINGTON CENTRAL RAILROAD MERGER; PLANS FIRST TRAIN OVER STAMPEDE PASS
Dec04--BNSF today announced it has completed the merger of Washington Central Railroad Company (WCRC) into a BNSF subsidiary.

As a result of the merger, along with the reopening of the 77.9-mile Stampede Pass line between Auburn and Cle Elum, Wash., BNSF now has a third route linking central Washington with the Pacific Coast, alleviating congestion and expediting rail traffic flow to meet the growth needs of grain, merchandise and intermodal customers.

"The addition of this third route linking central Washington with the Pacific Coast eliminates the greatest impediment to expanding our capacity to meet the growth needs of our customers and the ports, while providing them with a level of service that consistently meets their expectations," said Robert D. Krebs, BNSF president and chief executive officer.

The company also announced it will run one train per day in each direction over this route beginning Dec. 5. Service to former WCRC customers is continuing uninterrupted. Operations could increase to four or five trains daily in each direction during 1997 as customer demand requires.

Increased levels of intermodal and merchandise traffic, combined with a record grain year in 1995, prompted BNSF to announce last April plans to acquire WCRC and reopen Stampede Pass. BNSF now operates WCRC's 234-mile line running between Kennewick, Wash., an interchange point on BNSF, and Cle Elum, Wash. WCRC's 85-mile segment from Connell, Washington, another interchange point on BNSF, to Moses Lake, Wash., is being leased back to Columbia Basin Railroad, a new shortline railroad with Brig Temple as president.

In the early 1980s, diminishing volumes and decreasing demands for rail transportation led Burlington Northern Railroad Company (BN) to take the Stampede Pass line out of service. BN already had two other routes through the state of Washington -- the Stevens Pass route from Spokane to Everett and the Columbia River route from Pasco to Vancouver -- and sold part of the Stampede Pass line to WCRC in 1986.

Although the Stampede Pass line was never closed, it has seen only limited traffic over the past 10 years. A section of the route from Auburn to Ravensdale has been used on a daily basis for commercial purposes and the WCRC has ensured structural integrity of the rail by maintaining and inspecting the line on a regular basis, only to be used as a shortline connection to BNSF's main line at Pasco, Wash.

BNSF plans to spend about $125 million through 1999, including about $60 million this year, to restore and expand the Stampede Pass route, which required extensive trackage improvements to accommodate traffic growth projections.

BNSF PITCHES SERVICES TO INDUSTRIAL DEVELOPERS
Dec05--In hopes of attracting new customers to use BNSF's services, some of Southern California's top industrial real estate professionals and developers were taken on a round-trip rail excursion on Tuesday, December 3 from Los Angeles to Oceanside, Calif. The trip was sponsored by BNSF's Industrial Development Group in conjunction with the California Trade & Commerce Agency.

The real estate professionals and developers were educated on BNSF's industrial development capabilities as well as the benefits of rail transportation to this important region. Additionally, the trip served as a springboard to promote next year's Fall World Congress of the International Development Research Council (I.D.R.C.) in San Diego. The I.D.R.C. is the world's foremost corporate real estate and facility planning association with members, mostly site selection executives, who represent a large portion of BNSF's customer base.
Excerpts from BNSF Today via James Czarnecki, thanks also to Bill Farmer for his input.

CN

GATEWAY INTERMODAL TERMINAL
Dec02--CN's new $20 million Gateway Intermodal Terminal began operation on this date when the first intermodal train from Halifax arrived at the new facility in Harvey, IL, south of Chicago.

Both rail and highway accessibility to the terminal is complemented by 16-hour, six-day-a-week operations, with three front-lift mobile cranes, and a high-speed overhead crane with a self-steering guidance system.

The Gateway Terminal can handle nearly a quarter of a million lifts per year. It can store 2,065 containers and 1,100 trailers. The terminal also has two 7,200-foot loading tracks that can handle doublestack trains 1.3 miles long.
via Brian P. Kreimendahl

CN SELLS MATAPEDIA-CHANDLER LINE TO QUEBEC RAILWAY CORP.
Nov29--Under the terms of an agreement signed today by CN and the Quebec Railway Corporation, operation of CN's 146-mile- long Matapedia-Chandler rail line will be transferred on December 1 to the Chemin de fer Baie des Chaleurs, a Quebec Railway Corporation subsidiary.

The Quebec Railway Corporation also owns the Limoilou-Clermont line, operated by its subsidiary the Chemin de fer Charlevoix Inc.

The sale of the line is part of CN's three-year system rationalization program aimed at transferring secondary lines to shortline railways.

CN Press release via G D Marson via misc.transport.rail.americas,soc.culture.quebec

KCS

GATEWAY WESTERN BOUGHT
Dec02--KCS announced plans today to acquire the outstanding stock of the Gateway Western Railway Co. Gateway Western is a Class II carrier that operates between Kansas City and East St. Louis and Springfield, Ill., and haulage rights between Springfield and Chicago.

With the purchase, KCS will extend from East St. Louis and Springfield, Ill. to Laredo, Texas, via the Texas Mexican Railway.
via Brian P. Kreimendahl

NEW KCS FREIGHT YARD IN JACKSON, MS
Nov29--The new KCS freight yard in Jackson, Ms., is up and running full steam for the past several months. This is actually in Pearl, Ms. just across the Pearl river from Jackson. Their old yard in central Jackson (ex-IC) was too crowded and small for the volume of traffic coming through. They are adding a new intermodal yard to the Pearl yard (Pearson Yard) which is rapidly nearing completion. There are strings of cars with empty KCS trailers in the yard now which are to be unloaded next week. They are to receive their first customer traffic next week, which will probably be some UPS trailers. The KCS will not run the intermodal yard but will sub-contract its operation to another firm. They will only pick up and deliver strings of piggybacks.

They are reworking all the street crossings in Jackson and plan to continue both ways. The track looks in great shape from Meridian to Vicksburg. If anyone makes a successful takeover they will get a much improved railroad over the old MidSouth. It seems like Norfolk Southern and KCS together could make a great team to bid for the Mexican Railroad.
Tom Joiner

NWP

NWP TRIP REPORT 11/29/96
Well, this turned out to be something of a bust...

Nov30--I heard NWP 3844 South talking on the radio while in Cloverdale Canyon and assumed I was going to be chasing a freight train. I didn't see anything on the tracks in Cloverdale, so I headed south on Old Redwood Highway. On the northern edge of Geyserville, I finally heard an air horn behind me, and pulled over expecting to see a freight. What I saw was the 3844 all by itself. No other engines, no train, no nothing. Seems he was headed for Healdsburg to pick up a maintenance crane. I found SD9 4327 parked at Schellville and GP9 3850 parked at Petaluma, but no other movements. Guess the NWP took Friday off for the most part...

BTW, the NWP's road channels: 161.550 from Eureka to Willits, 161.385 (also the California Northern channel) from Willits to Schellville.

I got a few good shots of the 3844's solitary cruise through Geyserville and Healdsburg, but I guess I'll have to wait for winter break to get some train photos up that way...
Kevin Hecteman

REGIO SPRINTER

REGIO SPRINTER IN CALIF.
Nov27--The Regio Sprinter is prohibited from operating self-propelled or carrying passengers on main line trackage. It can only do so on branches where no other traffic is moving simultaneously.

TONGUE RIVER RR

PROPOSED RAILROAD IN SOUTHEAST MONTANA
Nov22--A proposed railroad in southeast Montana to open up the Tongue River Basin could change predictions of slow decline in the Montana Coal Market and open up vast coal reserves of low sulfur coal. BNSF is a key player in the proposal to develop the Basin. It has been predicted that Montana's coal production could increase from its present level of about 38 million tons per year to nearly 80 million tons per year by 2015 if the railroad is built. The proposed line would extend from the Decker area in southeastern Montana to Miles City.
Via Dave Bono

UP-SP

FIRST SP SWITCHER IN UP PAINT
Nov21--A press release from the UP North Little Rock shops was posted recently about the "first" SP switcher repaint. Ex-SP folks who KNOW at the Santa Clara yard point out that in the last week of October SP SW1500 2684 was repainted in Armor Yellow and Harbor Mist Grey as UP 1009. At that time it also received an electric heater, a refrigerator and a set of bad break pads. The breaks causes it to stop extremely hard and resulted in excessive wheel wear. The breaks were subsequently fixed.

In early November SW 1500 2597 (still in SP paint) was destroyed by fire near Brokaw road during otherwise routine switching operations.
Seth Neumann

ALTAMONT PASSENGER SERVICE
In January 1998 the Altamont Express Commuter Rail Service plans to start running two four-car trains every morning and afternoon. The trains will run on an 85- mile route from Stockton through Manteca and Tracy, over the Altamont Pass through Livermore, Pleasanton, Fremont, Santa Clara and San Jose, then back again.

According to Stacy Mortenson, program manager for the San Joaquin Regional Rail Commission, $40 million in state and county transportation funds have been earmarked for the project. She has said the commission has ordered eight bi-level cars, expected to be ready by August of '97.

Alameda and Santa Clara Counties must put up about $2.9 million each to start a three-year trial.
via Dave Bono and Jon Porter

APL TRAIN DERAILMENT
Nov21--Do you know anything about an Amer. Pres. Line (APL) train derailing in Arizona within the last few weeks?

Eleven cars derailed in Sentinel, Arizona and was carrying cargo to California. I had some cargo on the train and can't find any news stories about it.
VZAK00A@prodigy.com (MR MICHAEL C HAGERTY)

EAT-DELI-GAS
Nov21--The Union Pacific apparently plans to improve the water supply to Keene, CA near the famous Tehachapi loop. According to reports the town has had poor water supply for the last three years. The bad water reportedly is the result of railroad work that cut a water pipe to the area. The residents of the area have been using substandard well water as a replacement.

UP representatives are reported to have met with area residents at the Keene Store.
via Dave Bono

SP 0-6-0 1227
Nov23--Central Coast Chapter NRHS member Vince Piantanida spotted SP 0-6-0 1227 engine and tender on separate flat bed trucks on I-280 south of San Francisco, CA earlier this week. Unknown where it was headed or who got it but it is no longer in Alameda. Otherwise, I banged the E9's in the depot on 120mm TRI-X in San Jose at 340pm. It stopped to drop off a passenger and I got a good shot of the IDAHO theatre inspection car as a result. Dark and cloudy. Dodged traffic from MBA Warriors NBA game at arena. I am taking a short break while "in a zone" putting together "Sugar Beets Aboard the Southern Pacific, 1989-94, guest starring McCloud Railway, Santa Maria Valley Railroad and California Northern." Old slides from the Coast Line bringing back memories. Tomorrow, time to do a REAL sound track, syncronized a la WINTERAIL.
Marcellus Wallace's Catt (Matt V.)

CONTINUATION FROM LAST NIGHTS MEMO
Nov24--Last night I said I saw the Union Pacific executive train (streamliner with e-units and full consist) westbound at about 16th avenue Along the Nimitz (I-880) and assumed it was bound for the old UP yards off of the foot of Adaline St. Today I checked it out and from a few people Found out it stayed overnight in the old SP yards in west Oakland and then Was headed for the northwest and eventually Utah. By the time I got to the SP yards it was arriving at Roseville!!

All was not lost though. While filming the West Oakland yards again (lots Of changes every time I go there) I saw fifteen plus cars of the American Orient Express and a few cars from the pacific overland express in the Yards. More questions - a few answers- and from what I can surmise these cars will be shopped here and under renovation of some sort until march!

Don't hold me to this and if I'm wrong it's because it was Sunday and not much information of any kind flows on Sunday!!! In fact you may not want to print this at all and the only reason I'm sending it is to follow up on U.P. (!!!!) And the arrival of its executive train. I was hoping I could get some shots of it today in Oakland but it was not to be this time.
Rolland Meyers

CONTINUED IN ISSUE #42

TAKING STOCK

The Rail Stock Report, Compiled by Jim Czarnecki, is now available at:

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This document was last updated December 12, 1996.

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