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Central Oregon & Pacific Railroad shut downs operations

01:52 PM PDT on Friday, September 21, 2007

Associated Press

COOS BAY, Ore. -- Central Oregon & Pacific Railroad was closing operations between Eugene and Coquille Friday because of unsafe tunnels, a step that may hurt several Oregon businesses that rely on it.

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"The rail line segment has nine tunnels, each more than 115 years old, several of which are no longer safe to transit," the railroad's parent company, RailAmerica said in a statement.

The company estimated repairs to the tunnels could cost up to $7 million over the next five years. It's seeking a public-private partnership to pay for it. State and federal officials say there's no money set aside for emergency railroad repairs.

The company declined to say how long the line may be closed.

At least four companies locally rely on the railroad.

"It's quite devastating. We ship probably 70 percent of our product out on that line," said Jason Smith, manager of the Southport Forest Products sawmill on Coos Bay's North Spit.

Without rail, lumber goes out on semi-trucks to Eugene for reload on rail there. That hikes the shipping costs an estimated 10 to 15 percent, Smith said.

Southport's not alone.

American Bridge has used the rail line to bring in raw materials and ship out bridge segments. The Georgia-Pacific sawmill loads lumber aboard railcars. And Roseburg Forest Products' Coquille plywood mill does, too.

"This has serious impacts to the state of Oregon, not just to Coos Bay," Sen. Joanne Verger, D-Coos Bay, said Thursday.

While the railroad are cooling its operations on the line, tempers in offices from Coos Bay to Salem are heating up.

"It's just taken us all by surprise. I don't have any documentation to look at," said Kelly Taylor, administrator of the Oregon Department of Transportation's Rail Division.

Taylor said she's asked the company to send engineering reports to justify the closure. So has the governor's office, according to Chris Wagner, Gov. Ted Kulongoski's transportation adviser.

"Frankly, if we found something that we felt was a danger, we have the authority to shut it down," Taylor said.

But the state hasn't.

The Oregon International Port of Coos Bay Commission has authorized the port's executive director to sue.

"It affects the Port of Coos Bay because we have a lot of businesses here that rely on affordable and effective rail service and they are going to be left holding the bag," said the Jeffrey Bishop, the Port's executive director "Our position is the railroad is the tenant and the tenant is responsible for repairing the bridge. We're going to hold them accountable for that."

The railroad still owes money for bridge repair.

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