Transportation District Commission, Canonie Board, Discuss Future of Railroad

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By Linda Cicoira — If and when millions of dollars are received from sales of Canonie Atlantic Company’s railroad property in Cape Charles and St. Julian Yard in Little Creek, Va., about $1 million could be spent to update and reopen nearly seven miles of railroad tracks between Hallwood and Parksley.
It’s a move that would allow Richard Lewis, of Associated Grain Inc., to return to shipping wheat, corn, and other commodities strictly by railroad cars. And open the way for other businesses.
But before that can happen, there is much work to be done, Lewis was told Tuesday during a joint meeting of the Accomack-Northampton Transportation District Commission and the Canonie board. The properties in Cape Charles and Little Creek will need to be appraised. And it will have to be determined if a new manager for the railroad, who’s position has not yet been advertised, will be able to sell the parcels or get a national commercial real estate agency to do so. Canonie’s board hopes to look over resumes in September. The position will pay around $60,000 and will be considered contracted, so it will not include benefits.
Nearly two years ago, much of the railroad tracks that once ran from Cape Charles to Pocomoke City, Md., stopped being used. The tracks had not been properly maintained, the bank account was down to $800. It all had an effect on Lewis’ business.
Years ago, $1 million was spent on repairs to the barge Nandua used to take containers from Cape Charles to Little Creek. Accomack and Northampton counties threw in $100,000 each to finance the overhaul, and when the railroad went under, the barge was sold for a mere $179,000.
And there was poor business ventures like a 30-year lease to Dickie Foster, of Virginia Beach, for $7,000 a year that has a dozen years left. Negotiations with him are ongoing. But he will be responsible for half the fees for rail abandonment. Canonie also owes $120,000 to the Virginia Department of Rail and Public Transportation. Sales of equipment  and leases have brought in some cash. The bank balance is up to $60,000.
Northampton Deputy County Administrator Janice Williams and Chairman Spencer Murray of the Northampton County Board of Supervisors have been working together on railroad issues. “It’s time for us to put in some administration,” said Murray. “It’s a tremendous, tremendous job. Legal, insurance, there are a number of things that this general manager is going to have to sort out.”
Murray is also on the Canonie board and the Accomack-Northampton Transportation District Commission as are several other members of the boards of supervisors in Accomack and Northampton counties – John Coker, Dave Fauber, Oliver Bennett, Donald Hart, Paul Muhly, Ron Wolff, and Reneta Major
Murray said Canonie’s offer to sell the 40-plus acres in Cape Charles to the town has been fruitless. “Our negotiations … have broken down. They have decided not to negotiate with us any longer. I can tell you there are people who are interested.” Murray noted that if zoning regulations are made too stringent, the town could devalue the property. He said the mayor and other council members are in the railroad’s corner.
“John Kemp is calling again,” Murray said. “I’m not talking formally to anyone. (It) would have to be in writing and to this board.”
The Cape Charles property was once valued at $4 million.
The abandonment also means getting VDOT to take over the crossings, taking up the rails, ties and gravel. “We may wind up being one of the largest gravel companies in the State of Virginia,” Murray said. He gave Coker and Coker’s grandson credit for tying up all the traffic arms and disconnecting batteries. The property along the tracks is also important because the broadband runs along the area and a sewer line could be run there. “One of these days, natural gas,” said Murray.
In April 2018, Eyre Baldwin, who has partnered with Kemp, presented a plan to the Cape Charles Town Council for a project where owners of large yachts could refuel, buy supplies, and have light maintenance done on their vessels. Baldwin compared the Atlantic Ocean to Interstate 95 and the Chesapeake Bay to an exit. Kemp already owns a large share of property that was once the site of plans for condos and a hotel with a total of 435 units in Cape Charles. Owning the rail yard would be the clincher.
The property in Little Creek could also be the real jewel. Murray said the site is where Amtrak cleans its cars and it is sought after by Norfolk Southern and the DRPT.
Murray also discussed turning to the Rails-to-Trails Conservancy to solve some of the issues of abandonment. According to the group’s website, www.railstotrails.org, the nonprofit organization is “dedicated to creating a nationwide network of trails from former rail lines and connecting corridors to build healthier places for healthier people.”
Murray said since the abandonment has been requested, lawyers from Missouri have been writing to local adjacent landowners telling false tales of government condemnation.
Two members of the Parksley Town Council, Dan Matthews and Frank Russell, also attended the session to support Lewis’ request. Lewis is the third generation in the 98 consecutive years of his business. He just spent $500,000 to upgrade his facility in Parksley and guaranteed to send 250 cars a year for three years from there. He ships to flour mills in Culpepper, Va., and Pennsylvania, and has had to be in the trucking business to compensate for the railroad loss.
“It was sad when we saw the last rail cars going to Pennsylvania not knowing what the future would look like,” said Lewis. In the beginning, there was “not much hope that something would work out.”
Delmarva Central Railroad is leasing the tracks from Hallwood to Pocomoke City. Upgrading to Class 2 status from Lecato to Pocomoke City will soon be completed. That means the cars could go 25 mph. The job involves replacing 2,300 ties per mile. From Lecato to Hallwood, 700 ties per mile were replaced making that area Class 1, which allows cars to go 10 mph.
Cliff Grunstra, of DCR, estimated it would cost $3.4 million to make the track from Parksley Class 2, upgrades that he said would be needed to accommodate Lewis’ business. Linda Balderson, of VDRPT, said there are grants that would involve a one-third match of more than $1 million.
“I only need servicing three or four times a month,” said Lewis. “It’s not like it’s an every day thing.” Lewis said trucks could be taken off the roads if the tracks were upgraded. He also seems content to go 10 mph. “There’s no carbon footprint doing it this way,” said Lewis. “Until someone tells me ‘No, it’s not going to happen,’ I’m going to make Parksley the southern most destination.”