Officials agree improvements needed on Maumee & Western

[MSchwiebert]

From Today's Defiance Crescent News

http://www.crescent-news.com/news/article/4567248

A no-brainer in that Defiance would not have a intermodal facility with North Baltimore coming on line. Also a no-brainer that the current operation of the Maumee & Western (and ownership) are a detriment to opportunities. IMO, the 40-60 million figure to rebuild the line may be a bit light.


Group discusses local railroad options

By TODD HELBERG



cnedit@crescent-news.com



An inter-modal railroad facility study commissioned in Defiance County has led to one conclusion -- improving the Maumee and Western Railroad is the best option to meet local companies' needs.



But this might require a public-private partnership, according to a Michigan consultant which studied the inter-modal idea. Joe Corradino of the Corradino Group, Southfield, Mich., shared the firm's findings during a meeting Tuesday morning of local officials from Defiance, Henry and Paulding counties at Defiance County East.



An inter-modal facility would serve as a central point where semi trailers or containers could be loaded onto rail cars, or vice versa. It would also include warehousing facilities.



However, Corradino's study found that successfully pursuing an inter-modal facility would be a "huge challenge" in Defiance. One reason: Such a facility is being constructed by CSX Railroad at North Baltimore, about 40 miles east of Defiance.



Mannik & Smith Group, Maumee, also studied Corradino's recommended course for local rail needs -- improving the short-line Maumee and Western Railroad which serves some local companies but is in disrepair and closed in sections. The estimated cost for fixing the 51-mile stretch through northwest Ohio and into Indiana, however, is $40-$60 million.



Maumee and Western, based in Indiana, is privately owned and operated. Officials from there had been invited to Tuesday's 11/2-hour meeting, but a representative did not arrive until the session was nearly finished.



Some local governmental officials would like the Maumee and Western improved, but funding is an issue. The company does not have the money to do so and its profitability is "marginal," according to Lou Jannazo of the Ohio Rail Development Commission.



A request for federal stimulus money by Defiance County officials to help rebuild the railroad was turned down, and other potential sources may not be adequate.



Corradino said there has not been "an enthusiastic push for new investment" in the railroad and when shippers were asked to contribute there was a "dead silence."



He suggested that a collaborative effort -- perhaps involving government -- would be needed. Nothing will happen, however, without the railroad's participation.



"Without them, a circle blocks the square," said Corradino.



Although for many years local officials have been in contact with Maumee and Western about improving the short-line track, not much has come of that effort. But they agreed Tuesday to work through a new agency -- the regional port authority serving Defiance, Fulton, Henry and Paulding counties.



"This is something the port authority is very willing to try to help move along ...," said Jerry Arkebauer, the port authority's executive director.



But Arkebauer cautioned Tuesday that nothing will happen unless Maumee and Western Railroad agrees to move forward. As funding is an issue for Maumee and Western, he suggested that the port authority inquire about purchasing the railroad and leasing it back to the present owners.



However, he noted that this wouldn't mean much if officials have no ability to improve the track.



"The worse thing would be to buy them out and you don't have the funds to do anything," Arkebauer said.



While many local government officials want the track improved, some expressed frustration with the railroad's present owners. Defiance County Commissioner Tom Kime referred to Maumee and Western president Spencer Wendelin as "the issue."



And, Henry County Economic Development director Ralph Lange said Maumee and Western is not charging customers for the cost to maintain the line. Under that scenario, he questioned subsidizing the railroad.



"I'm not interested in putting money in someone's pocket," he said.



Nevertheless, there remains a desire among local officials to get something done.



Defiance County Economic Development director Jerry Hayes said the line has "great potential."



The inter-modal study provided by Corradino Group was funded jointly by the Defiance County Community Improvement Corp. ($20,000), Defiance County ($15,000) and Defiance city ($15,000).

[MagnumForce]

Was going to post this. As a resident and taxpayer in the City of Defiance I really hope we don't do anything.

What is really needed is new ownership by someone who knows how to run a shortline. My short list would include Indiana Northeastern but I doubt they would want anything so far removed from the rest of their system.

The way things are now I would be afraid to go down the track in a gandy dancer let alone a locomotive.

[CSX_CO]

*If* the city really cared, they could probably 'condem' the property and force the MAW's hand. Either make improvements, or we're going to take it over. "Port Authority" sets up have worked elsewhere, Auburn, IN is an example, and that would allow the City to have more control over what happens with/on the line.

I know when I would work Defiance, MAW got daily deliveries and pulls, if they bothered to bring anything. I'm sure the Y101 has little better to do these days with the decline in auto traffic (GM) and scrap (Omni Source and Frick).

Practice Safe CSX

[Y@]

It figures that their rep. was late... they cant do anything right or on time these days.

Hopefully they find a way to save the MAW. I don't want to see them go.

[CSX_CO]

Hopefully they find a way to save the MAW. I don't want to see them go.

If another individual or firm can come in and provide better service, improve track, etc. would you rather see that or the 'status quo' for the MAW maintained (about the only time you would hear MAW and Maintain in the same sentence)?

Practice Safe CSX

[MagnumForce]

Y101 is still a pretty busy fellow. Remember Defiance is one of only two GM foundries and the plant is still running 3 shifts a day.

The MAW stays pretty busy too, at least between Naptown and Defiance.

[Y@]

By MAW I meant the status of ANY operation by any operator on it.

[JDavis21835]

Y101 is still a pretty busy fellow. Remember Defiance is one of only two GM foundries and the plant is still running 3 shifts a day.

The MAW stays pretty busy too, at least between Naptown and Defiance.

What would be the other GM foundry you are speaking of?

[MagnumForce]

Saginaw

[JDavis21835]

Saginaw

Not trying to upset anyone, but I have to say, Saginaw Metal Casting Operations is far from a foundry. A plant that employed 10,000 people 20 years ago barely has 400 these days. Last year all the furnaces were torn down. They have 1 furnace that is used to keep metal that is melted by someone else in a molten state. They have gone over to casting aluminum. The place that melts it for them filed bankruptcy a few months ago. Gm has also found they can get better emissions out of an iron block. All of this combined leads me to believe that GM will close that facility as part of their upcoming Bankruptcy.

Not only did they remove the furnaces from SMCO, but they also removed them from the Mallable plant on the south end of the town. It wont be long, and gm will be completely gone from the Saginaw area.

[MagnumForce]

Well sorry to say it but more good news for Defiance. Another saving grace is that we are only an hour from the Ft. Wayne Assembly plant, even if trucks are "evil" they are still about the only Vehivle GM makes money on.

[Y@]

The longer GM stays afloat, the better. I know alot of the workers at GM, not to mention I don't want to see the yard in Defiance cut back to less than what it already is.

[MagnumForce]

Even if GM files for bankruptcy the company will still be around. I don't know where the idea comes from that bankruptcy equals liquidation.

[JDavis21835]

Even if GM files for bankruptcy the company will still be around. I don't know where the idea comes from that bankruptcy equals liquidation.

Bankruptcy does not mean liquidation, that is true. You will see GM get split, already in the works, Financial, and Auto are the first split. Saab is already set up to be on their own. I think you will see Saturn get sold. I would also think you will see some consolidation of GMC and Chevy. What I get a kick of is the bond holders not wanting to give any concessions to GM. Wait until a bankruptcy judge gets ahold of this, they will be out a ton.


Defiance will stay strong, Thats GMs favorite foundry.

[MSchwiebert]

The idea of a new operator has been kicked about a few times over the last decade or so, but nothing seems to come of it. The line does have good potential and a good traffic mix (not overly dependent on one shipper) but does need a lot of work to get beyond it's 10 MPH (at best) state (to say nothing of being able to accomodate 286K cars) but considering it hasn't seen "real" MofW work in a generation (the N&W did little toward the end either) I guess that's to be expected.

Another unknown to throw into the mix is that this line has been selected as a portion of the preferred alignment for the Midwest High Speed passenger system's route for Chicago-Ft. Wayne-Toledo. Normally that would not be much of an issue as that has been talked about for quite some time, but considering the government is now trying to spend our (and our children's, grandchildrens & great grandchildrens) money as soon as possible - it may actually come to pass. Which if it does, would mean that the line's future would be secured - but who would provide freight service on it? I have my doubts that it would be current operator, but who would own it?

As for GM in Defiance, yes they look to be the last GM foundry standing in the states, but what about globally? Are they competitive with other operations in say India, Poland or China? That is who they are up against. (I have friends that work there too and worry about their future). Other engine manufacturers are already doing things like this. For example, Navistar (International) has just launched a 11 & 13 liter truck engine line, the blocks are cast in Brazil, sent to Huntsville Alabama for machining & assembly, and the finished engines are sent to either Chatham Ontario, Garland TX or Escobedo MX for installation in trucks. If it can be done for a large truck engine why not for a car?
Keep in mind that Defiance is just the foundry, the castings are still sent elsewhere for machining (that's a lot of what Hornish Trucking carries)and assembly, so very little goes directly from Defiance to a final vehicle assembly plant.