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Economic Development and the Railroad

Many moons ago I was the project manager for a downtown revitalization group in Laramie Wyoming. At the same time, working in a parallel job was an individual whose job was economic development. We worked together for a year and he had the harder job. I watched him trying to land economic development projects; it was the most competitive field I ever observed. Cities, counties, states, groups of states, and countries were all competing madly for economic development projects.

My reason for bringing up economic development is because it is knocking at Ely’s door. We have two economic development projects, the possible reopening of the mine and keeping the Railroad Valley oil refinery active. Both of these projects need rail access. The community has the chance of providing this access if they can purchase the railroad track from Los Angles Water and Power.

Assembly Bill 180 is a grant to the community to purchase the Nevada Northern Railroad tracks from Los Angles Water and Power. Why bother purchasing the track? Two words – economic development.

Those tracks are the economic future of White Pine County and the City of Ely. I grant you they don’t look like much now but they are tied directly to our economic health. The railroad was built to move the copper ore from the mines outside Ruth. A hundred years ago the most economic method of moving ore was a railroad. Today that still holds true. The mines still have ore; the upward movement of copper prices will hit the threshold to where it is profitable to reopen the mine. This threshold is at a lower point with rail transportation than without. That was true a hundred years ago and it is true today.

If you factor out the mine, the community still needs the railroad for its economic health. If the railroad became community property tomorrow, we have a customer, the refinery in Railroad Valley. The refinery needs oil. The plan is to move unrefined oil to White Pine County via rail. At a transload facility, the oil would be transferred to trucks, hauled to the refinery, refined, hauled back to the railroad, reloaded on to tank cars and exported to where it is needed.

The economic model of this oil project generates enough revenue to keep the railroad an economic viable operation. This project will maintain and add jobs at the refinery, create jobs in Ely on the railroad, and keep the economic lifeline of the community intact.

It is urgent that the community purchases the railroad now.

  1. The current status of the railroad allows the track to be brought into service with a small investment. But as time goes on the track will continue deteriorate and the cost of putting it back into operation will climb.
  2. The opportunity with the refinery is right now. The economics work now.
  3. We have a grant right now that will assist in funding of the purchase of the rail line. The grant is due to expire this year.
  4. A second grant has been applied for to assist in the purchase of the railroad

We have this chance right now to insure our future economic health. The bill pending in the legislature will help assure that this entire package comes together and the railroad is saved. But for this to happen, the community must pull together. The railroad bills will have a tough uphill fight due to the tough economic times in the state right now. But the failure of the railroad bills to pass will have a direct negative impact on the economic future of White Pine County. White Pine’s economy at a glance after mining industry layoffs and closures:

  • 23% job loss. Labor market relocated taking ~1,000 families (FY97 – FY02)
  • Population Loss – 12% (FY97 – FY02)
  • Student Population Loss – 23% (FY97 – FY02)
  • Decrease in Assessed Valuation – 40% (FY97 – FY02)
  • Decrease in Taxable Sales – 40% (FY97 – FY02; 49% from FY96)
  • Inadequate funding to maintain and improve facilities and infrastructure

White Pine needs to partner with the State and Federal governments to bring about economic change. This can happen with the passage of the railroad bills.

Legislative Update
The hearing date for the railroad bills is Monday March 24th from 8:00 am to 11:00 am. If you are interested in traveling to Carson City to show your support for these bills, please let either Paul Johnson or myself know. If a large enough group goes to Carson City, the school district may be able to provide transportation. If you are interested in going please contact either Paul Johnson or myself. Paul Johnson is the chairman of the Legislative Coalition group who is pushing to get these bills passed. Paul’s contact information is email: [email protected] or (775) 289-4851 x125. Working together we can get these bills passed and save a large part of White Pine County’s heritage.

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