POTENTIAL PLANS
Jack Kelley looks to revive the former Saratoga & North Creek Railway
SARATOGA SPRINGS, N.Y. >> Jack Kelley traveled the world to help bring Global Foundries, the state’s largest economic development project, to Saratoga County.
Now he’s a major player in efforts to revive the former Saratoga & North Creek Railway and rejuvenate his native Corinth, which hasn’t been the same since International Paper Company closed its Hudson River Mill that once employed 1,500 people, in 2002.
Kelley, a former Saratoga Economic Development Corp. senior vice president, is working with Las Vegas-based United Rail in an effort to resume excursion trains from Saratoga to North Creek, possibly as soon as this summer.
However, a key part of the proposal is an undisclosed energy-related firm that he says wants to locate at the former IP mill site, generating freight revenue for the rail line, too.
“It’s part of a much bigger picture than we originally envisioned,” Kelley said. “I’m very bullish on it. I don’t know of any other venture that can provide quality jobs and economic development for that part of the Southern Adirondacks than restoring train service.”
But two other firms, Denver-based OMNITrax, and Florida-based Railnet International have
“I hope that whoever takes over will make this thing successful. Warren County deserves to have a good operator.”
— Iowa Pacific Holdings LLC President Ed Ellis
also responded to a request for proposals from Warren County and the Town of Corinth, which own the roughly 60 miles of track.
Saratoga & North Creek Railway, owned by Chicagobased Iowa Pacific Holdings LLC, operated on the line from 2011-17 before closing last year after losing millions of dollars.
“We just couldn’t afford to keep going,” company President Ed Ellis said Monday. “I hope that whoever takes over will make this thing successful. Warren County deserves to have a good operator. Whoever is making these decisions needs to thoroughly check out the backgrounds of everybody involved.”
His company was the second one that couldn’t make a go of things. Previously, a firm called Upper Hudson River Railroad ran excursion trains, but went out of business, too.
Kelley says his team can succeed by taking a different approach. He’s working closely on the project with fellow consultant Steve Fisk, former Canadian Pacific Railway senior manager for business development-U.S.
Both have a proven track record of success, Kelley with local economic development (he also helped bring the large ACE and Target distribution centers to Wilton and was involved with the creation of Grande Industrial Park) and Fisk with railroad marketing.
United Rail, the firm they’re working for, has excursion trains elsewhere and plans to open an “X Train” from Las Vegas to Los Angeles this year, giving people a chance to avoid congested highways.
Fisk envisions a similar concept for the Adirondacks, inviting people to explore the area by rail instead of a car.
“We’re developing a cruise ship-type business model, planning day trips at each stop along the way,” Kelley said. “That’s all part of how revenue would be generated. We’re going to work with all the different little communities. For example, Corinth has great hiking trails, Hadley has an annual maple festival. Farther north, people can go whitewater rafting.”
Ellis tried many of these same things, but Kelley said his team has developed a broader base of partners to make such efforts work. It’s already retained Saratoga Springs-based LIFT, a marketing and advertising agency with a far-reaching network of high-profile clients.
In addition, Kelley has coordinated meetings between United Rail executives and leaders of local organizations such as Saratoga County Chamber of Commerce, Saratoga County Prosperity Partnership and Saratoga Convention and Tourism Bureau, and Mayor Meg Kelly.
But after two failed railroad ventures, some Warren County officials are somewhat cool to the idea of yet another such business. IowaPacific pulled out in the middle of its contract and infuriated environmentalists by storing out-of-service rail cars on a section of track it owns in the pristine Adirondack Forest Preserve.
Iowa-Pacific still owns the roughly 30-mile Sanford Lake Line from North Creek north to Tahawus, the site of an old mine whose waste rock and tailings might have a market for road construction and similar building projects.
“Our business plan initially does not include the third segment (North Creek to Tahawus),” Kelley said. “Long range, yes, we would very much like to own that line.”
Ellis said he would like to sell Sanford Lake Line to whoever gets the next rail contract. If that doesn’t happen, he said he would probably have the track torn up to eliminate ongoing maintenance costs.
OMNITrax spokesman Rob Margulis said his firm’s sole interest in the contract is freight service, hauling rocks out of Tahawus. “We would work with a broker or other company that would be selling the materials,” he said.
An end buyer hasn’t been identified yet, but Margulis said his firm has a great deal of experience moving materials for other firms, such as sand used for fracking projects in the South and Midwest.
Kelley said he believes the United Rail proposal would help the region more by offering both excursion and freight service.
“If you just have freight on the line, for people in Corinth, the only benefit to them is they can take their kids and have them wave at the engineer as he’s going by,” he said.
A spokesman for Railnet International couldn’t immediately be reached for comment. However, in 2010 Chief Executive Officer Donald Kress submitted a bid for the Saratoga to North Creek contract under the name Codorus Creek Railway. Its bid was not accepted.
Prosperity Partnership President Marty Vanags said, “We support the application of United Rail because they represent the best combination of tourism rail and commercial rail, both of which is needed to make this stretch of rail [from] North Creek to Saratoga viable. Their proposal is comprehensive and provides this part of the county with jobs, tourism, and leverage to do even more. We hope that Warren County officials and the Town of Corinth move to work with United Rail and their application. Their long history of success should generate much success.”
Some Warren County supervisors would like to see the entire rail corridor from Corinth north converted to a multi-use recreational trail.
But County Administrator Ryan Moore said the federal Surfaced Transportation Board would first have to declare the line abandoned, which isn’t likely.
Also, a preliminary internal study has indicated that a recreation trail on Warren County’s section of the track alone would cost $30 million. This includes the cost of rail and tie removal, plus trail construction.
John Sheehan, a spokesman for the Adirondack Council environmental group, said, “We have no objection to responsible rail service on the line. We objected to its being used as a junkyard for oil tankers and old passenger cars, but not as a railroad. We would also support a trail on that corridor, if the community agrees it is the best use of the line.”
The existing Warren County Bikeway from Glens Falls to Lake George costs about $100,000 per year to maintain. While popular with residents, it doesn’t produce a direct financial benefit to the county, which a new rail contract would do.
“We’re in the railroad business,” Moore said. “We absolutely would like to see activity that’s successful over the long term. It would be good for economic development.”
In addition to generating tourism and hauling freight out of the Adirondacks, some much-needed materials could also be hauled into the North Country, Fisk said.
For example, municipalities go through large volumes of road salt each winter. Instead of trucking it in, salt could be brought by a train to a central distribution hub in North Creek. The same could be done with heating products or any other material that residents require in large supplies, he said.
Public Works Committee Chairman Matt Simpson, of Horicon, said Warren County will likely spend nearly $200,000 on its section of track this year for things such as weed control, crossing maintenance, general repairs, and insurance.
Some hard decisions might be needed soon about the rail corridor’s future and who, if anyone, gets to operate it. But Simpson said he believes all supervisors are united on at least one thing.
“They want the best deal on behalf of the taxpayers,” he said.