FR 2024-31375

General Summary

The document is a notice from the Surface Transportation Board concerning the Knoxville & Holston River Railroad Co., Inc. (KXHR), which is planning to abandon a 3.8-mile rail line in Knoxville, Tennessee. KXHR is a subsidiary of Gulf & Ohio Railways, Inc., and it cites insufficient revenue from its sole shipper, Ergon Terminaling, Inc., as the primary reason for this decision. Ergon has reduced its use of the line, leading to losses that have been accruing since 2019. As a result, KXHR is seeking an exemption from prior approval requirements to proceed with abandonment. The document also states that the line may be available for conversion to other public uses, such as a trail.

Significant Issues or Concerns

One of the key issues highlighted in the document is the lack of detailed information regarding the long-term impacts of the rail line's abandonment on the local community. There is limited discussion on how this decision might affect local transportation needs or economic conditions. Additionally, while an environmental assessment is planned, the document does not provide specific details on potential environmental impacts or mitigation strategies.

The document primarily focuses on the current financial rationale for abandonment without sufficiently addressing potential future developments in the area that could increase demand for rail services. This omission raises questions about whether there could be other viable solutions or rehabilitation efforts to maintain the line.

Impact on the Public

The abandonment of the rail line could have broad implications for the public, particularly for the transportation options available within the community. The loss of a transportation infrastructure might influence local businesses or industries that could rely on such services in the future. On the other hand, the potential repurposing of the line for public recreation, like trails, could positively impact community lifestyle and health.

Impact on Specific Stakeholders

For specific stakeholders such as Ergon Terminaling, Inc., the move might necessitate a shift to alternative transportation methods, which they have reportedly already begun to use, such as barges or trucks. This change could involve logistical adjustments and potential cost implications for their operations.

Local government and urban planners may also face challenges as they consider how to optimize the use of the land previously dedicated to the rail line. While the development of mixed-use areas might promise economic growth, planners must carefully balance this with non-commercial interests, such as environmental preservation and public recreation.

Conclusion

This notice signifies critical changes with potentially far-reaching consequences for various stakeholders. While it provides a succinct overview of the proposed abandonment and its immediate rationale, further exploration into the economic, environmental, and social facets would enhance understanding. By addressing these broader implications, the community and its planners could better anticipate and respond to the transitions that such infrastructural changes entail.

The document in question pertains to the Knoxville & Holston River Railroad Co., Inc.'s (KXHR) petition to abandon a 3.8-mile rail line in Knoxville, Tennessee. The primary financial consideration presented is the persistent economic shortfall associated with the rail line's operations.

KXHR reports that over the past five years, the average revenue from the line has been $5,343.00 per year. This is a crucial financial metric that highlights the line’s unsustainable operating model, as the operating costs surpass this revenue by more than 90%. Essentially, the costs to maintain and operate the rail line vastly outweigh the funds generated through its use, indicating a consistent pattern of financial losses.

This financial concern directly aligns with the issue of economic sustainability in the document. The significantly low usage, averaging 8.2 carloads per year from 2019 to 2024, illustrates a lack of demand, suggesting that the line's operation is not cost-effective. The fact that these revenues are insufficient to even approach breaking even underlines KXHR's rationale for seeking abandonment.

However, while these financial figures explain the current deficit, the document does not provide future economic projections or explore alternative solutions. No detailed exploration of growth projections or potential rehabilitation efforts suggests a lack of financial analysis on whether the line could become viable again should circumstances change. Additionally, while the need for rehabilitation, especially at a tunnel that limits freight types, is mentioned, no specific financial estimates for these repairs are provided. Quantifying such costs could have helped stakeholders assess the validity of abandoning versus rehabilitating the line from a financial standpoint.

Overall, the financial references provided in the document highlight a significant economic shortfall but fall short of providing a comprehensive financial assessment that could be crucial for stakeholders considering the broader consequences of the rail line's abandonment.