Surface Transportation Board Rules in North Judson’s Favor

Posted on June 2, 2017
Author Mary Perren, WKVI

An attempt by the Chesapeake and Indiana Railroad Company (CKIN) to force the town of North Judson to sell its rail line has been rejected by the Surface Transportation Board.

CKIN operated the short-line railroad under an arrangement with the town for 10 years. Their agreement also allowed the North Judson-based Hoosier Valley Railroad Museum to operate excursion trains on the line.

During that time, freight rail transportation on the line “grew more than eightfold” between 2005 and 2015. By the numbers it went from 506 to 4,312 cars. Co-Alliance, LLP is the primary shipper on the line.

In the spring of 2015, North Judson officials advised CKIN they would not be renewing the 2004 contract and would be seeking a new operator at the end of the year. CKIN refused to terminate operations, and both parties entered into a mediation agreement. CKIN officials contend in their filing the “spirit of the agreement” was that the town would lease the line to Co-Alliance for a new 10-year term, and Co-Alliance would then contract with CKIN to remain as the operator.

Instead the Town of North Judson chose Michigan-based Lake State Railway to lease the line after soliciting requests for proposals. CKIN claims the RFP process put the Hoosier Valley Railroad Museum’s needs to access the line over those of freight customers.

Based on that, CKIN sought to require the town to sell the line to them under Board-supervised negotiations. The railroad operator argues the freight rail service was only a secondary consideration to the town.

However, the Surface Transportation Board pointed out the town has “clearly demonstrated that it has met that obligation” by significantly increasing freight traffic on the line since taking over operations.

Click here to read the full Surface Transportation Board Decision.