Luzerne County Council contacted about rail line

Facing threatened litigation over its outstanding rail line debt, Luzerne County’s Redevelopment recently submitted a briefing to county council.

A council majority voted last month to initiate litigation against the authority. The county wants the authority to turn over its railroad so it can be sold to recoup $3.28 million the authority still owes the county for the original acquisition of the line, according to letters between the county and authority.

While a delinquent loan was stated as a reason, it may be part of a broader push to put the track into private ownership, with the hope that it could retain commercial use but also add passenger rail service.

In the briefing to council, Margaret Thomas, executive director, said the authority believes “a more complete understanding of the history and operations regarding the rail lines should be presented to council.”

“It is done with the intent that it is best to have the most factual information in order to make informed decisions,” it said.

In 1996, the previous private operator —Pocono Northeast Railroad — abruptly discontinued service, it said. At the urging of then-county commissioners and state legislators, the authority accepted responsibility for purchasing the failed rail line and continuing service.

“The prime motivation for all parties was (and is) to preserve local businesses and industries, protect existing jobs and search for potential economic development,” it said.

Since then, stable service has been provided to all businesses, no matter their size, it said.

“This is important since a private for-profit company can always decide that service to certain customers is not financially lucrative and therefore discontinue service,” it said. “This has never been a potential danger over the past 30 years…”

The authority must forward money it generates from the rail operation to the county to repay the county loan.

Thomas’ briefing to council said there have been “many discussions by numerous parties, including prior administrations over the years, that the loans would be forgiven,” although no formal action was ever taken.

Unlike many other county authorities or agencies, the redevelopment authority does not receive county taxpayer-supported funding and has no ability to collect fees, she said.

The briefing outlined work completed on the rail line by R.J. Corman, which currently serves as operator. The private company has invested $945,000 of its own funds into improvements and upgrades of the county rail line over the last five years, it said.

Reading & Northern Railroad, which operates passenger rail excursions to Jim Thorpe and other locations in the region, is interested in purchasing the authority-owned rail line, according to a recent release.

County Manager Romilda Crocamo has emphasized that any potential sale of the assets would have to “adhere to the statutory bid process and will ultimately require approval from the County Council.”

The authority’s rail holdings include the active track running near the historic downtown Wilkes-Barre train station that county council recently agreed to purchase, which houses the county tourism office.

In reference to the interest in passenger train excursions, Thomas’ briefing said the concept can still be achieved under the existing structure without selling the line.

An entity interested in passenger service could obtain a trackage agreement and run excursions on weekends, when the county line is not used for freight traffic, it said. Thomas noted the track would have to be upgraded to accommodate passenger service.

“The LCRA has always been willing to work with entities, both public and private, in moving the area forward economically and progressively,” Thomas wrote. “We believe allowing the LCRA to continue its rail service program is in the best interest of the county, its citizenry and businesses.”