Sell-off of Railroad Assets Shrouded in Secrecy

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By Linda Cicoira
Members of the Accomack and Northampton county boards of supervisors, elected by the voters of their respective counties, serve on the Accomack-Northampton Transportation District Commission (A-NTDC).
The railroad, Canonie Atlantic Company, has a board of directors made up of members of the A-NTDC, but those members meet and work behind closed doors. They won’t divulge to local economic leaders what they are doing. They say the reason for the secrecy is so competitors cannot gain information and so the group isn’t subject to the Freedom of Information Act (FOIA).
Chairman Spencer Murray, of the Northampton Board of Supervisors, is a Canonie board member. He refused recently to tell the Accomack Economic Development Authority (EDA) and the Joint Industrial Development Authority of Northampton County and its Incorporated Towns (JIDA), in a joint meeting of the panels, how much money the railroad got for the barge, Nandua. This despite that hundreds of thousands of dollars in state and local money were spent to purchase and repair the car float. The repairs totaled $1 million with Accomack and Northampton counties each throwing in $100,000.
Murray also wouldn’t disclose details of a closing agreement with Cassatt Management LLC, a private for-profit company owned by Dickie Foster of Virginia Beach who developed Bay Creek near Cape Charles and which did business as Bay Coast Railroad. Foster initially had a 30-year lease on rail property. He paid $7,000 a year and had 18 years left.
After many questions about the deal, Murray said no money had changed hands — not yet anyway.
The Eastern Shore Post obtained a recording from the joint EDA/JIDA meeting.
Murray blamed Foster for the railroad’s demise because he said Foster didn’t put profits back into maintenance. The tracks are in need of an Nandua. This despite that hundreds of thousands of dollars in state and local money were spent to purchase and repair the car float. The repairs totaled $1 million with Accomack and Northampton counties each throwing in $100,000.
Murray also wouldn’t disclose details of a closing agreement with Cassatt Management LLC, a private for-profit company owned by Dickie Foster of Virginia Beach who developed Bay Creek near Cape Charles and which did business as Bay Coast Railroad. Foster initially had a 30-year lease on rail property. He paid $7,000 a year and had 18 years left.
After many questions about the deal, Murray said no money had changed hands — not yet anyway.
The Eastern Shore Post obtained a recording from the joint EDA/JIDA meeting.
Murray blamed Foster for the railroad’s demise because he said Foster didn’t put profits back into maintenance. The tracks are in need of an sold in case the new owners desire to use rail.
But if this future company has the need, there won’t be a locomotive to pull any cars because one was sold for scrap and another engine and some cars were given to the Cape Charles Museum. The steel rails could be dismantled but Canonie would likely break even due to the cost of disposing of the ties.
“I want to know what the options are,” Chairman Wesley Edwards of the EDA told Murray. “You can’t make good business decisions without knowing the numbers.”
Accomack has hoped Tyson Foods and Perdue Farms would use the rail.
Murray said Canonie wasn’t asking for assistance.
In the past, Bill Parr, chairman of the JIDA, was distraught with the behind closed doors way Canonie operates. But his outlook at the recent meeting appeared changed. “Mr. Murray has been deeply involved in the railroad over the last couple of months,” Parr said at the start of the session. “We owe him a debt of gratitude.”
A few years ago, Parr asked the two economic groups, “How can both counties help the railroad be a more valuable usable asset? Is there a way we can get that barge back in service? Are there (potential) users on the Eastern Shore that are not using it now? They might be using the trucking industry instead. The more information we have the better.” But recently Parr was just happy knowing, “We know we have someone who can work with us.”
Murray said Canonie also gave items, which he didn’t identify, to a sawmill in Nassawadox and some cars are being sold. “There is a lot of interest in the yard. Now (the) town and about a hundred others are interested,” he said. “We want to keep all our options open. … That’s why we’re kind of where we are — raising cash by selling things. Our objective is to clean up the yard. … What happens to that land should be up to Cape Charles.”
He said it was estimated to cost $6 million to bring the rail up to a better standard. “Even if you replaced every fourth tie … It would take a lot of cars to make it financially viable.”
“I’ve done all this research,” Murray said. “We’ll still get revenue from the easements. It’s going to be difficult. You have to be very careful about doing it. If we sell Little Creek, that would be a tremendous amount of cash flow. There’s value over there.”
He also commented that Foster owes $264,000 in back taxes in Little Creek and that broadband right of ways would be maintained.