Iowa Pacific seeks to sell Tahawus rail line

By Michael Virtanen

Owners of a thirty-mile rail line in the central Adirondacks who sparked controversy by storing dozens of empty tank cars on the tracks say they’re losing money and want to get out.

Iowa Pacific Holdings President Ed Ellis told Warren County supervisors on March 29 that he’d sell the county the tracks for $5 million or less. The county rejected the offer.

Iowa Pacific owns the tracks running from North Creek to an old pit mine in Newcomb, while Warren County and town of Corinth own the tracks from Saratoga Springs to North Creek. An Iowa Pacific subsidiary, Saratoga and North Creek Railway, had been operating a tourist train on the tracks owned by the county and town. However, the railway plans to shut down the tourist train on April 7, with no plans to resume.

Ellis told the supervisors that he needed the revenue from storing tankers, which he is now losing, until the freight traffic develops and that the tourist train alone doesn’t make enough money. “There’s either the purchase of the Tahawus line or we are done,” he said.

Most of the seventy-five or so tank cars stored on Iowa Pacific’s tracks are owned by a subsidiary of Berkshire Hathaway, which is headed by billionaire Warren Buffett. Under pressure by the state and environmental groups, Buffett agreed this past winter to have the cars removed.

Horicon Supervisor Matt Simpson, who heads the county Public Works Committee, where Ellis proposed the track sale, said he expected the cars would be removed once the snow cleared.

Meanwhile, New York authorities are moving ahead with a legal fight against Iowa Pacific. The state has notified the federal Surface Transportation Board, which adjudicates railroad disputes, that it will ask the board to declare the North Creek-Tahawus line abandoned. That would give the state Department of Environmental Conservation the authority to impose state regulations and order the cars gone.

DEC spokeswoman Lori Severino said the department is pursuing “all options” to ensure that the corridor is not used for rail-car storage, including the potential acquisition of the line.

Ellis has said he wants to store up to two thousand cars in the rail corridor, which runs through forever-wild Forest Preserve. Many of the cars are stored near the Boreas River or Opalescent River, but Ellis contends they pose no threat to the environment.

In papers filed with the Surface Transportation Board, however, DEC says storing a few thousand cars on the line “will result in a 20-mile long visual blight and environmental and ecological hazard in the heart of New York’s most valued parkland.”

Iowa Pacific acquired the line several years ago with the intention of transporting rock tailings from the Tahawus mine. However, that business never materialized.

Paul Mitchell, the owner of Mitchell Stone Products in Tupper Lake, bought the old titanium and iron mine from NL Industries this year. For a decade prior, he had been trucking stone from the mine under a contract with NL, which stopped mining at Tahawus in 1989.

After acquiring the mine, Mitchell was considering shipping stone by train. “When there was such controversy over the stored railroad cars, we thought there might be an opportunity to kind of change the narrative about moving stone on the line,” he said. But given Ellis’s desire to sell the line, he said, “I don’t know that it will ever happen.”

In its application for mine reclamation filed with DEC in March, Mitchell’s company said material will be removed by truck, and its operations will affect twenty-three acres.

“That’s the way we’ve been doing it for the past ten years, and it’s pretty much the way we’ll continue doing that,” Mitchell said. He bought almost 1,200 acres from NL Industries, and he said there are tailings on about eight hundred acres.

Mitchell sells crushed aggregates for driveways, septic systems, and construction uses to a variety of customers. “There’s literally one hundred million tons of byproduct over there,” he said. “… I’ve always looked at it as a reclamation plan. You’re cleaning up a previous mine site. It’s already mined material. You’re not opening any new mines to do it.”

Iowa Pacific didn’t respond to queries about its plans.

Neil Woodworth, executive director of the Adirondack Mountain Club, wants the state to buy out Ellis and convert the rail corridor into recreational trail. “I think anything close to a million he’s going to take. I think he realizes that railroad is worthless,” he said.

Warren County officials say they also intend to look at the best use of their rail corridor, including the feasibility of converting it into a recreational trail.

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