WASHINGTON — Montana Rail Link has moved one step closer to closing up shop and turning over its operations to BNSF Railway.
MRL on Nov. 18 asked federal regulators for permission to discontinue service over 656.47 miles of track in Montana and Idaho as part of the early termination of its lease with BNSF, according to a filing posted to the Surface Transportation Board website on Monday.
The STB must issue a Federal Register notice within 20 days that would outline a schedule for its review of the transaction. The regulatory process is expected to take four to five months, with an STB decision expected in the second quarter of 2023.
“The lines leased by MRL are a critical link in BNSF’s northern transcontinental network, delivering grain, consumer and industrial products to the West Coast,” MRL noted in its filing. “By MRL terminating its lease and BNSF resuming operation of the lines, BNSF will eliminate the need to interchange freight between the two railroads, strengthening the resiliency of the supply chain and enhancing rail capacity in the Pacific Northwest. Customers across MRL’s network will be able to maintain their service arrangements and rates, providing continuity for Montana shippers. To ensure that BNSF meets its commitment to current MRL rail-served customers, BNSF and MRL have agreed that BNSF will offer employment to all union and non-union MRL employees in their current jobs with comparable pay, benefits, seniority rights and other material terms of employment.”
BNSF has reached agreements with the nine unions that represent 962 of MRL’s 1,100 employees.
Once regulators approve the transaction, BNSF will resume control of the former Northern Pacific main line between Huntley, Mont., and Sandpoint, Idaho, which predecessor Burlington Northern leased to MRL in 1987.
MRL also seeks to terminate 96.04 miles of trackage rights over BNSF, primarily between Spokane, Wash., and Sandpoint.
BNSF will take over operations and maintenance of the leased routes, as well as service to MRL’s 125 customers. BNSF also plans to resume service over certain MRL-owned branch lines under a trackage-rights agreement that will be the subject of a separate board proceeding, MRL said.
The railroads announced in January that BNSF bought out the remaining years of Montana Rail Link’s 60-year lease on the former Northern Pacific main line. Terms of the deal between BNSF and MRL owner The Washington Cos. were not disclosed. But a BNSF financial report suggests the railroad paid MRL around $2 billion to tear up the lease well before it was scheduled to expire in 2047.
When BN decided to lease the trackage to MRL, it had excess capacity across Montana, favored the parallel former Great Northern main line, and was saddled with antiquated labor contracts and a poisonous union-management relationship. So BN unloaded the 590-mile former Northern Pacific between Huntley and Sandpoint.
BNSF had sought to undo the lease over the years.
It was better to have BN with one decent, well maintained route, instead of two lengthy, poorly maintained routes. Yes, second guessing is fluent here, but one route might have gone the way of the MILW if they had tried to finance both at the time.
So slowly a piece at a time BNSF has re assembled most of the NP.
Daniel:
You are right on–the BN was sorry they signed the agreement. The people in charge of the BN at that time, did not care about the BN.
The former GN was at capacity as the X NP was a reliever road. I knew a train dispatcher that proved over and over again that the BN could not starve out Dennis Washington. Another poor decision of the BN.
Ed Burns
That last sentence should read: BNSF had sought to undo the lease before the ink of the signatories was dry.