Kirkland city officials are still defending plans for the city-owned Cross Kirkland Corridor after a federal lawsuit to stop rail removal was shot down by a U.S. District Court judge last May.
Kirkland, King County and Sound Transit officials submitted arguments June 4 to the federal Surface Transportation Board, which is located in Washington DC. The arguments came after attorneys for the Ballard Terminal Railroad Company, LLC, filed a motion in May for preliminary injunctive relief.
The motion with the board came days after the first injunction was denied because the judge deemed federal court did not have the jurisdiction to appeal a Surface Transportation Board order.
If the board grants the current proposal, it would prevent the city from removing the railroad tracks and its assets along the 5.75-mile-long corridor until the board makes a decision on the railroad company’s pending petitions they filed on April 2. The city planned to remove the rail tracks and ties in April but plans came to a halt when they were served a federal lawsuit on April 1.
The Ballard Terminal Railroad Company’s petitions seek to “partially vacate” the board’s 2008 Notice of Interim Trail Use order, which currently allows for a rail-banked recreational trail on the Eastside Rail Corridor as long as the track is salvaged upon removal.
The petitions outline the railroad company’s hopes to secure the right to reactivate rail service along the Woodinville to Bellevue rail line, even though it doesn’t operate or own property along the corridor, according to court documents. The company also asked the board to transfer the rail assets to them at net liquidation value.
City argues delay would cost Kirkland taxpayers
Court documents filed by the Ballard railroad company’s attorney Myles L. Tobin with Fletcher & Sippel, LLC, state that the company will be irreparably harmed if the city is not directed to stop rail removal. Removal would “moot the pending proceeding” for their petition and would “impede their efforts” to reinstate rail service, they say. Also, reinstalling the rail and crossing materials would cost $10 million, a substantial cost for the railroad company.
Byron Cole, a general manager and co-founder of the Ballard Terminal Railroad Company, said in a statement to the board that his company would also lose significant business, as he has been in “active discussions” with several shippers – the owners of CalPortland and Wolford Trucking and Demolition, who submitted letters to the board in support for restoring rail service. The companies would likely ship commodities by road or find another rail carrier if freight service wasn’t restored, Cole said.
Attorney Hunter Ferguson with Stoel Rives, LLP, argued on behalf of the city of Kirkland that these shippers never had contracts with the railroad company to begin with. Because of this, “Ballard cannot show that denial of injunctive relief will cause Ballard any harm, let alone irreparable harm.”
Court documents filed on behalf of King County state that freight demand has declined since 2008 and noted the Ballard railroad company has seen an approximate 10 percent loss of freight volume each year since 2010. They assert the company lacks the finances to reinstate rail service even if they secure the residual common carrier rights for 12.6 miles along the Eastside Rail Corridor. In addition, the railroad company “typically operates at a loss,” according to court documents.
Alternatively, the Ballard railroad company contested the city will not be harmed by the potential injunction because “the city has always been aware that any trail use established along the line would be subject to the reactivation of rail service” and, besides, they say the city could install a trail alongside the railroad.
But city officials state the contract with A&K Railroad Materials Inc. to remove and salvage the rails will only remain valid if the board reaches a decision before Aug. 1. A delay “would cost Kirkland taxpayers about $500,000, including increased costs of maintaining the right-of-way,” as well as an “absence of any return on Kirkland’s $5 million investment in the corridor,” according to city court documents.
And while the Ballard Terminal Railroad Company claims the public will be served by this injunction – it could positively affect interstate commerce, economic development, jobs and traffic congestion – the city said these assertions are unlikely even if the injunction and petitions are granted because they are “speculative in distance and time.”
Rep. Luis Moscoso and Sen. Rosemary McAuliffe with the 1st Legislative District, along with three other legislators, wrote a letter to the board detailing why it was necessary for freight, commuter and excursion rail use to be in conjunction with trail use.
“Our concerns stem from our belief that existing transportation infrastructure must be retained,” the letter said. “We share concerns of the Eastside TRailway Alliance as expressed by co-chairs, Snohomish Mayor Karen Guzak and Woodinville Councilmember Les Rubstello. Specifically, the imminent removal of the 5-mile section of track by Kirkland is counter to facilitating Snohomish-King County discussion on coordinated investments in rails and trails.”
But when Sound Transit purchased a 1.1 mile segment of railroad in Bellevue for its East Link project, officials also purchased a high capacity transportation easement over the remainder of the Eastside Rail Corridor and Redmond Spur for a combined $15.75 million.
Kirkland officials said in court documents they welcome a future with both trails and a commuter rail line, and Sound Transit’s high capacity transportation easement is likely to be considered as they continue to craft the Cross Kirkland Corridor’s master plan throughout the year.
If the board rules in favor of the railroad company, Kirkland officials have requested the board requires the Ballard railroad company post a bond of $500,000 to guard against “unwarranted harm” to Kirkland’s interest.
It is unknown when the board will issue a decision on the preliminary injunctive relief, but is expected to rule on the petitions’ requests no later than Jan. 18, 2014.
Eastside Community Rail formed
The board’s 2008 agreement came after the Woodinville subdivision’s predecessor, the Burlington Northern Santa Fe Railway Company, asked to abandon the railroad.
“BNSF declared that there was no longer any demand for rail freight service on the line,” said court documents filed by King County officials.
Upon approving abandonment, the board would not issue the 2008 order until an offer of financial assistance process was completed. Court documents state the Ballard Terminal Railroad Company and its then-partner GNP Rly Inc. considered paying $81 million for the railroad in 2008 but “opted not to make an offer.”
After the trail-use agreement between BNSF and King County was put in place for the railroad from Woodinville to Renton, in 2009 BNSF sold its property rights to the Port of Seattle for $81.4 million. With the Port of Seattle’s approval, BNSF selected GNP to provide freight service on the northern part of the railroad – the Woodinville-Snohomish line.
Because they were partners, the Ballard railroad company provided freight rail service on that portion but GNP went bankrupt and Doug Engle, a former GNP officer, created Eastside Community Rail, LLC. Engle lives in California but owns a home in Kirkland.
In February, Engle told the Reporter of his hopes to obtain a $6.2 million grant from the Washington Legislature to upgrade the Woodinville-Snohomish rails for commuter access, specifically for his “Bounty of Washington Tasting Train.”
He said he’s come together with the Eastside TRailway Alliance and has written Kirkland officials numerous letters explaining his business proposition.
Ultimately, city officials commissioned KPG, an engineering firm, to estimate the cost of building a trail alongside the tracks and discovered it would cost an estimated $17.3 million and they decided to go forward with the planned interim trail.
