December 6, 2013

Halt to Maine rail service jeopardizes businesses

Pan Am Railways says it’s not economically sound to keep the service going without its largest client.

By Rachel Ohm Morning Sentinel

MADISON — Freight transportation along a segment of a rail line has come to a halt after complaints about outbound service being disrupted by train derailments, while local businesses are saying the stop has been costly and forced them to search for alternative modes of transportation.

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Cousineau Wood Products employees Darrell Clark, left, and Jerry Chestnut work on flooring stock at the North Anson company on Thursday.

David Leaming/Morning Sentinel

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Madison Paper Industries has stopped shipping on Pan Am rail lines like these in Oakland because derailments hampered the paper company’s deliveries, according to a paper company official. The section of track is near Martin Stream Road and the Fairfield and Norridgewock town line.

Michael G. Seamans/Morning Sentinel

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Officials at Pan Am Railways said Thursday that they no longer are providing service to a 26-mile stretch of track north of Oakland through Madison and on to North Anson. The state in recent years invested more than $500,000 to keep the tracks open.

Madison Paper Industries historically has shipped most of its products on Pan Am and been its largest customer north of Waterville. However, the Madison paper mill no longer is using the railroad after numerous derailments during the last several years that have caused delays in delivering paper products to customers, said Russ Drechsel, president of Madison Paper.

Cynthia Scarano, executive vice president for Pan Am Railways, in turn, said it doesn’t make financial sense for the railroad to continue to service the rest of the track north of Madison because without the business of the paper mill the Massachusetts-based company would not make enough money to cover the cost of maintaining that section of track,. Scarano would not comment on why the paper mill no longer uses rail service.

“We’ve been working very diligently with the other paper mills in Maine to try and increase what we’re bringing in and taking out,” Scarano said. “Madison basically made a decision that rail wasn’t going to be their primary form of transportation, and that’s their business decision. If we’re not going to make money, it’s not a good business decision for us either.”

The decision by the mill and the effect on the railroad — unforeseen by state and local officials — means that smaller business customers on the line no longer will be able to use the service out of North Anson and are being forced to explore alternative and more expensive shipping options.

Cousineau Wood Products and ARC Enterprises both said they were notified by Pan Am about a month ago that they would not be able to be serviced at the North Anson station, officials said.

“We need the railroad. There’s no way we could do what we do without them,” said Walter Kilbreth, president of ARC Enterprises, a manufacturer of steel bridge beams in Kingfield that employs about 30 people. Without service to the North Anson station, where the line ends, Kilbreth said the company is bringing shipments of large sheets of steel, some as large as 85 feet long by 10 feet wide, via truck from South Portland, a distance of 90 miles.

Brody Cousineau, vice president of Cousineau Wood Products in North Anson, said the change in service is a financial burden on his company, which now relies on the transportation of raw materials from a loading station in Auburn via truck. He estimated that costs about an additional $500 per load. Cousineau also employs about 30 people.

Madison Paper Industries, which is also one of the larger employers in the area, provides jobs for about 225 people.

“We’re still working on determining what the exact cost is. It’s fairly fresh and we haven’t figured out what the most economical alternative is for us,” Cousineau said. He said the company expects to lose money from land that it leased to ARC for loading and storage at the rail yard as well as increased cost in bringing raw materials of plywood from the south.

Cousineau said he doesn’t blame the paper mill or the railroad company for the change in service, and acknowledged that without the paper mill there is no chance that the two smaller companies could support the rail traffic. The scenario, however, is very different from what was expected when the town of Anson and the state invested in railroad repairs less than a decade ago.

(Continued on page 2)

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Additional Photos

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Cousineau Wood Products employee Ryan Atwood moves raw wood stock that now arrives by truck to the North Anson mill because Pan Am Railways no longer carries deliveries to the company.

David Leaming/Morning Sentinel

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ARC Enterprises, a manufacturer of steel bridge beams in Kingfield is delivering shipments of sheets of steel, some as large as 85 feet long by 10 feet wide, via truck from South Portland, a distance of 90 miles.

Contributed photo


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