Railroads & Locomotives Railroad Profiles Regionals Iowa Interstate Railroad profile

Iowa Interstate Railroad profile

By Lucas Iverson | January 19, 2023

| Last updated on January 27, 2023

The Iowa Interstate Railroad is a Class II regional railroad operating across Illinois and Iowa.

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Iowa Interstate Railroad logoIowa Interstate Railroad summary

The Iowa Interstate Railroad (IAIS) is a Class II regional railroad that operates across Illinois and Iowa. It’s owned by Railroad Development Corporation, a global railway investment and management company founded by Henry Posner III, who also serves as Chairman to the railroad. Headquartered out of Cedar Rapids, Iowa, over 580 miles of standard-gauge track is operated from Chicago west to Peoria, Ill., and Council Bluffs, Iowa.


The Iowa Interstate Railroad was selected by the newly established Heartland Rail Corporation in 1984 to operate the former Chicago, Rock Island & Pacific Railroad main line from Council Bluffs to Bureau, Ill. Expansion to Chicago was made possible in 1985, thanks to securing trackage rights with CSX Transportation and Metra. By 1991, the struggling IAIS was under full ownership of Heartland, and had reached out to Posner and Railroad Development Corporation to assist as a financial investor with the option of obtaining the railroad.

In January 2004, the option was exercised, and ownership of the Iowa Interstate was transferred from Archer Daniels Midland-owner at the time since 1997-to the RDC. In 2006, the railroad leased 32 miles of track from CSX between Utica and Henry, Ill., while also purchasing the Council Bluffs Railway in its namesake city, and the Lincoln & Southern Railroad between Henry and Peoria.


While grain and grain products make up the bulk of the freight traffic, the Iowa Interstate Railroad boasts a diverse and growing business in hauling coal, sand, metal, ethanol, and intermodal. Piggyback services began in 1985, followed shortly afterwards by double-stack intermodals in 1987 with ramp facilities constructed in Council Bluffs and Blue Island, Ill. Transloading facilities are also provided at different locations along the lines.

Black, red, and yellow locomotive
Iowa Interstate ES44AC No. 519 carries the name “Paul H. Banner” in honor of the railroad’s first chairman. (Iowa Interstate)

Since operating under Railroad Development Corporation in 2004, Iowa Interstate has acquired 22 EMD GP38-2 and four SD38-2 diesel locomotives for better reliability. An additional 17 new ES44AC and ES44AC (T4C) units from General Electric were later purchased for better fuel economy and maintenance savings. Though personally owned by Posner himself, the Chinese-built QJ 2-10-2 steam locomotives, No. 6988 and 7081 have operated on the IAIS for special occasions since 2006.

With interchanges in Chicago, Peoria, Rock Island, Ill., Iowa City, Des Moines and Council Bluffs, the Iowa Interstate connects with all the Class I railroads in addition to almost all the short line regional railroads in the region. Year-round access is also provided to the Illinois River at Peoria and the Mississippi River at Rock Island.

Read more about the Iowa Interstate Railroad in Trains’ June 2011 issue.

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