Support sought for rail bonds

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By Kevin Koelling, Managing Editor

Funds would go for track upgrades

TELL CITY - Three Perry County Port Authority representatives paid a visit to the county commissioners Monday, to lend their presence to a request for what the county attorney described as "a very large ordinance."

Bill Goffinet, Tom Holm and David Lynch attended the commissioners regular meeting in support of a bond ordinance intended to bring funding to upgrade Hoosier Southern Railroad tracks and bridges to handle heavier rail cars than they can now.

"It's an extremely expensive proposition," county attorney Chris Goffinet said of the upgrade. A first phase described in the 36-page bond ordinance will cost an estimated $5.3 million. Revenue bonds will cover $2.2 million of that, with the remaining funds being sought through other avenues, such as the federal Economic Development Administration.

Revenue bonds are repaid with revenues the relevant agency generates, the lawyer explained, so neither county residents' property taxes nor "any backing by the county" are involved, and they don't count against any county debt limit.

Chris Goffinet said a public notice about the bond ordinance would be published in this edition of The Perry County News and a public hearing will be conducted at the commissioners' Dec. 17 meeting, which will begin at 6:30 p.m. in the county courthouse.

If the commissioners decide to adopt the ordinance at that meeting, bids for bonds in $100,000 increments will be accepted until Jan. 4.

"Its very important that we upgrade our rail to assist our shippers," Bill Goffinet told the commissioners. Waupaca is the port-rail agency's biggest customer, he noted. The current infrastructure was built for 260,000-pound cars, and the upgrade will allow more products to be transported in fewer cars.

Part of the cost passed to customers, he explained, is based on tonnage, while part is derived from the cost of moving cars. Much of the rail industry is converting to 315,000-pound cars, he added.

The $2.2 million will serve as matching money for a $2 million Economic Development Administration grant, the port-authority spokesman said. The agency is also working to secure a $750,000 rural-electric-cooperative grant from the U.S. Department of Agriculture and a $500,000 grant from the Indiana Office of Community and Rural Affairs, and intends to apply $400,000 in industrial-rail-service funds to the upgrade over the next two years.

Bill Goffinet noted the port-rail agency is "very solvent."

"We're operating at a profit and have put millions of dollars back into the operation," he told the commissioners.

The Hoosier Southern Railroad was reborn in 1995 after being out of service for four years. From the eight rail cars moved that year, it increased its traffic to 1,279 cars and 52,513 tons in the first three years, and to 157,420 tons last year. Its cars transfer cargo from the Port of Tell City to Lincoln City, where its rails connect with those of the Norfolk Southern Railroad.

The bulk of the upgrades will be done next year, Bill Goffinet said.

"I really appreciate your hard work," Commissioner Don Sherry told the port-authority representatives. "I've heard a lot of good things about you from all over the state."

Due to the size of the bond ordinance, the county leaders took it under advisement.