ON THE COVER North Coast Journal Weekly

Going nowhere: Has the Northwestern Pacific Railroad reached the end of the line?


HUMBOLDT COUNTY IS KNOWN FOR ITS BRASH FOREST DEFENDERS, its Green Party politics and its quaint, tourist-friendly towns. Of course, it wasn't always so. The county was once a solid blue-collar area with a vast natural resource base. For the last few years, as Humboldt residents know all too well, an economic crisis has been deepening. Timber production has dwindled, and the fishing industry has all but vanished. Nowadays the county's principal export is probably its high-grade marijuana crop.

As in any provincial community left behind by post-industrial America, local elected officials and business leaders dream of finding their way into the new economy. Many in Humboldt pin their hopes on the Northwestern Pacific Railroad, a dormant old spur of the Southern Pacific currently run by the North Coast Railroad Authority, a state agency. If the port of Humboldt Bay could be connected into the national rail system, the thinking goes, it could attract cargo ships from all over the Pacific Rim. All that's lacking is the trains.

There are about 550 short-line railroads in the United States, the majority of them, like the Northwestern Pacific, running on tracks abandoned by the Union Pacific, the Southern Pacific, the Santa Fe, or one of the other behemoths that dominated transportation in the early part of the last century. It is like other short-lines in many ways; it seeks to wring a profit from an industry that seems to belong to a different era. But in at least a couple of ways, the Northwestern Pacific couldn't be more different. For one, it is operated by a government agency, one created by the California State Legislature in 1989 and ultimately owned by the public. Public funds have been poured into the NCRA over the last 10 years, with little to show for the effort. Also, the Northwestern Pacific line is ill-sited and disaster-ridden -- its critics have called it the most expensive line in the country to maintain.

Eleven years ago, in the midst of a recession, California bought the deeply troubled rail line with the intention of trying to boost the struggling economy of the state's rural north. But today, the story is of a colossal planning disaster that could force taxpayers to cough up hundreds of millions of dollars just to get the public out of the train business. It could cost them even more to keep it going.

landscape with washed-out tracks near river
Neglected tracks in the Eel River Canyon [photo by John Mahony]

A crumbly canyon

The biggest of the railroad's many problems is a remote stretch of the line that hugs the bank of the Eel River and connects Humboldt County with points south. The walls of the Eel River Canyon are constituted mostly of shale and clay, feeble materials that disintegrate when winter storms batter the region. Time after time in the railroad's 85-year history (the track was opened in 1914), rains have washed cars, engines and track into the river. Service has been down for more than four years, thanks to a stop-work order by the Federal Railroad Administration. Much of the track lies in ruin. Federal authorities say it will take $650 million to make the track work over the long term and even the NCRA concedes there's $300 million in construction needs over the next 25 years.

Over $110 million in state, federal and local taxpayer money has been awarded to revive the NWP: $43 million to buy the line, $12 million for disaster relief, and, most recently, $60 million in "traffic congestion relief" funds from Gov. Gray Davis' 2000-01 budget. Of the $60 million grant from Davis, earmarked for ground stabilization and repayment of the NCRA's debts to subcontractors, only $19 million has been doled out by the California Department of Transportation in small disbursements, with some $41 million still outstanding.

Now, with the state suffering the greatest budget deficit in its history, that $41 million allocation has been frozen indefinitely. The railroad is not being singled out -- all projects in the state that had not already signed contracts that would be paid by the fund have likewise seen their traffic congestion relief money disappear. The NCRA hopes that its $41 million will eventually be unlocked, sometime in the future when the state is flush again. But if and when that happy day arrives, there is reason to fear that the railroad will be at the bottom of the state's priorities. There's no question that since its creation the authority has caused the state many more problems than it has solved.

The suspension of state funds has caused the authority to retool, at least for now. In the past, the NCRA had always insisted that the railroad would only be viable if its whole length, from Marin County to Humboldt Bay, were reopened. After all, the bulk of the goods carried on the line -- lumber and products brought in by ships stopping at Humboldt Bay -- would be loaded onto the southbound train in Eureka.

Now, though, the only practical way to get trains running again is to focus on the south end of the line, from Marin to Willits. The NCRA believes that money owed to it by the Federal Emergency Management Agency and the state Office of Emergency Services would be enough to repair that stretch of track. Doug Christy, the authority's outgoing executive director, told the board last week that trains could be up and running in 12 months -- though, as he was reminded by board member Allan Hemphill, the authority has a "sordid history" when it comes to meeting its reopening projections (Christy announced his departure earlier this month; he is taking a job with a trucking concern in the Midwest).

The new plan, if successful, wouldn't restore rail service to Humboldt County. But it would at least demonstrate that the NCRA could run a railroad after so many unproductive years. A working railroad on the south end, it is hoped, would lend credibility to efforts to reopen the north.

But that means leaving the storm-wracked Eel River Canyon section of the line to suffer through an unknown number of winters, with additional major damage to the track a certainty. That is, unless the gravel industry -- which reportedly has become very interested in the canyon -- comes to the rescue. There has been talk of a deal to open up the canyon to mining in exchange for track restoration work in the southern half of the canyon. But so far it's just talk.

Bad omen

The "golden spike" that officially opened the Northwestern Pacific Railroad was driven in the summer of 1914 at Cain Rock, deep into the wilds of the Eel River Canyon. The new railroad was of no small consequence; with the coming of the line, the vast natural resources of the northern part of the state would finally find a ready route to San Francisco markets. At the opening, two trains -- one from Eureka, one from San Francisco -- would meet in the canyon, where dignitaries would perform the ceremony and then proceed to Eureka for a three-day festival. Future California governor James "Sunny Jim" Rolph, then San Francisco's mayor, would lead the Bay Area delegation.

But on the day the spike was pounded home, word reached the party that the tracks north of Cain Rock had slid out, leaving the dignitaries stranded until the wee hours of the next morning. Salmon were fished out of the river and barbecued, and the archival footage that survives the event shows that the several-hour delay did no damage to Rolph's legendary good cheer.

It was a portentous beginning for a railroad that would suffer such calamities throughout its history. In January 1953, the Eureka Times-Standard ran a gruesome photograph taken at the northern end of the Eel River Canyon, with this caption:

"The towering mountainsides which rise above many sections of the Northwestern Pacific Railroad tried three times last week to send the trains hurtling into the river canyons below. Twice they knocked them from the tracks to the brink of destruction. The third time they succeeded, as tons of rock, earth and debris slipped suddenly from the face of Scotia Bluffs and sent three men to their death in the swirling, flood-swollen Eel, trapped in the cab of an 80-ton locomotive."

In total, 11 railroad workers have been killed by the slip-outs and slides that plague this section of the track, with untold damages to property.

The problem is location. To get from the Bay Area to Humboldt County, one must somehow traverse the choppy mountains known collectively as the Coast Range. Geologists refer to this area as the Franciscan complex, a landmass born of the union of the Farallon and Pacific tectonic plates. The Franciscan complex is a geological infant; its rivers and mountains have far to go before they stabilize. The area is one of the most seismically active in the world.

Faced with a scarcity of relatively level ground, founders of the Northwestern Pacific chose to place most of their railroad alongside rivers. From Cloverdale to Willits, in Mendocino County, the line runs next to the Russian River. From Willits to Scotia, in Humboldt County, it runs next to the middle fork of the Eel River -- sometimes less than 100 feet above the river itself. Even barring severe floods, damage to the track in a normal winter is extensive. Now, with the line fallow for years, much of the track is in complete ruin.

Despite these headaches, the Southern Pacific was able to make a go of the line until the early 1980s. For years, the massive North Coast redwood industry provided the rail giant with a steady source of revenue. But in 1983, the SP filed a petition with the Interstate Commerce Commission asking for permission to abandon the line. Freight revenues had dropped, the company claimed, and maintenance costs had increased -- to the point where it was losing nearly $1 million a month on the line. The California Public Utilities Commission challenged the SP's petition, charging that the railroad was a vital component of the North Coast economy. The ICC concurred, ordering the SP to continue operations on the line.

In 1984, though, the company was able to unload the northern half of the NWP, including the Eel River Canyon, to one of its former managers. The new operation, called the Eureka Southern, ran trains for two years before declaring bankruptcy. The Eureka Southern limped along under a court-appointed trustee until 1992, when the newly created NCRA purchased it for $5.2 million. (The portion of the track closest to the Bay Area, more expensive due to higher land values, would be acquired later.)

Engines on track  Grafitti "Stop!" painted on boxcar, grass and shrubs in foreground

Left: Engines parked at Eureka's Old Town. Right: Abandoned boxcar parked in Eureka Balloon Track.
[photos by Bob Doran]

A last-ditch attempt

Former state assemblyman and current Arcata City Manager Dan Hauser wrote the legislation that engineered the state buyout of the NWP. Today, Hauser said that he and Barry Keene, who represented the region in the state Senate at the time, were both committed to seeing the railroad continue, and that the NCRA was a last-ditch attempt to save it. "The handwriting was on the wall," he said. "Old-growth redwood was going to become a thing of the past. We were looking for ways to expand the economic base. The railroad was critical to this effort, and we had to give [the NCRA] a try."

Given the modest initial investment, Hauser said, it wasn't difficult to persuade the Legislature to pass their bill. "It was one of those types of issues that affected our district without detracting from their districts, and you tend as a legislator to support your colleagues in that kind of effort," he said. "Barry Keene was majority leader of the Senate, so he didn't have to [twist many arms], and I had developed a fairly good reputation in the Assembly."

However, the NCRA's mandate began to expand soon afterwards. The authority acquired another portion of the old NWP track, down to Healdsburg, and the sole rights to run freight on the rest of the track (as well as the responsibility of maintaining it). After trying and failing to run its own trains, it eventually entered into a long-term contract with a private operator. The authority would focus on maintaining the tracks -- a task at which it also fell short. In November 1998, the Federal Railroad Authority, citing extensive unsafe conditions on the line, issued an emergency order halting all activity on the line until it could be brought up to minimal safety standards. Apart from a few runs on the southernmost end of the line in 2001, no trains have passed down NWP tracks since.

Throughout 2002, the NCRA ran on fumes. The authority received some of the $60 million in traffic congestion relief funds that the governor promised it in 1998, but much of that was used to pay debts and to fund studies on the cost of fixing the line and the railroad's long-term financial viability. Day-to-day administration costs were recouped through the lease of NCRA property -- mainly from several miles of fiber optic lines along the NCRA's right-of-way. Last January, when the NCRA board met to fine-tune a presentation to the California Transportation Commission later that month, there was a strong fear that the authority was nearing collapse. Several members of the NCRA board endorsed the view that the CTC should be told that it was "time to fish or cut bait."

"This thing is out of gas," NCRA Director Allan Hemphill said at the meeting. He advocated a tough line with the state. "I'm not going to waste another nine years screwing around with this thing unless we can get them to move."

Rays of hope

But amid this backdrop of desperation, NCRA officials found a couple of rays of hope -- the line may not be as costly to fix as they previously imagined, and they might have found a private company to invest in the line.

Until last summer, the only hard estimate of how much long-term repairs to the Eel River Canyon might cost came from FEMA and the state Office of Emergency Services. In the mid-'90s, FEMA and the OES began to wonder whether the money it had spent on the Northwestern Pacific over the years addressed true catastrophic events, or whether storm-related damage was simply a cost of doing business in the canyon. The two agencies commissioned a study that concluded that unless some $650 million were invested in stabilizing the canyon walls, the railroad could be expected to bear extensive damage every winter, and so should not be eligible for disaster funds.

But the NCRA in 1999 hired its own consultants, Missouri firm Shannon & Wilson, to do a competing study, which came to a much different conclusion. The NCRA's consultants determined that the authority would have to spend only $40 million (coincidentally, almost the exact amount left in the NCRA's traffic congestion relief account) in the short-term, with an additional $250 million over the next 25 years -- most of which the NCRA believes will come from federal funds -- to stabilize the entire line.

The difference in costs can be accounted for by radically different approaches. FEMA and the OES assumed that the only way to shore up the track would be to build large retaining walls along much of the line. The NCRA's plan would instead use an "observational technique," the goal of which is not to eliminate but to minimize the damage visited upon the line each year. Since water is the principal cause of slides and slip-outs of the Franciscan complex's weak soils, intricate drainage systems would be cut into the hills around trouble spots. "You make the land mass think it's summer," said Doug Christy. Potential problems with this system would be spotted by train crews traveling down the line, and then would be dealt with by construction teams. The idea is to reduce the yearly damage to levels that can be dealt with by routine maintenance.

But with the entire $41 million budgeted for the NCRA in peril because of the state budget debacle, would this plan be of any use? Where would the money come from?

Talks with gravel interests

The NCRA board of directors learned of its second reason to hope at its January meeting, just after the depth of the state budget crisis had fully sunk in. At that time, Christy told the board that he was in talks with gravel interests and was close to cutting a deal that would bring in $55 million in private funds to the line. The deal was this: In exchange for a stake in the Northwestern Pacific Railway Company (the private company that holds rights to haul freight on the line) and rights to rock quarries owned by the NCRA in the Eel River Canyon, the company or companies -- which, with talks still pending, Christy could not name -- would, on its own, fix up the line from Island Mountain, the canyon's midway point, down to the Bay Area. The company would also pursue rights to other sources of gravel in the canyon. And as a bonus, Christy told the board, the use of private money would allow the NCRA to dramatically accelerate their timeline for reopening the line. Since the line would be rehabilitated without the use of public funds, he said, the NCRA would not have to wait for the completion of an environmental impact report before beginning work. NCRA counsel Christopher Neary cited the Interstate Commerce Commission Termination Act of 1995, which reorganized that agency into the Surface Transportation Board, provisions of which pre-empted state or local environmental regulations when they "frustrate or delay the reactivation and operation of a [private sector] railroad line." Those provisions have been tested and upheld by the 9th Circuit Court of Appeals and the Supreme Court.

No agreement has been announced yet, but last week John Darling, president and CEO of the Northwestern Pacific Railway Company, confirmed that the parties are still negotiating the deal.

Naturally, when then-Executive Director Christy detailed this potential deal, the NCRA's board of directors was relieved. But because of likely environmental opposition the jubilation could be short-lived. Two endangered birds, the marbled murrelet and the spotted owl, live along the Northwestern Pacific's right-of-way, and local environmentalists have said that construction on the tracks and the noise of locomotives would disturb their nesting. Three threatened runs of salmonids, vulnerable to chemical leaching and hillside erosion, live in the waters of the Eel. Because of the waterway's decimated steelhead and coho and chinook salmon populations, American Rivers, a nonprofit advocacy group, named the Eel the third-most endangered river in the United States in 2001. Given the likely scale of gravel extraction in the canyon under the private investor's plan -- $55 million in rock to recoup costs, to say nothing of profit, is a lot of rock -- it wouldn't be surprising to see Humboldt County's corps of direct-action specialists climb down from their treesits to lash themselves to the tracks. That's on top of the certain legal challenges from groups like the Environmental Protection and Information Center and Californians for Alternatives to Toxics, both of which had stated their opposition to the railroad even before the gravel plan was announced.

tracks with overgrown grassA rock and a hard place

State politicians and bureaucrats -- to say nothing of local elected officials -- would probably find all of this an extremely unappetizing prospect. They may yet be forced to face it. What's the alternative? If the state were to deny additional funds to the NCRA -- or, further down the road, if any state agency were to take the side of environmentalists and therefore queer the deal with the railroad's potential investor -- it would mean bankruptcy for the NCRA. One NCRA study estimated that decommissioning the railroad, which, due to environmental regulations, would require the removal of the entire track as well as bridges and tunnels, would cost upwards of $170 million dollars. And since the Eel River Canyon, the most troubled section of line, cannot be reached by road, the only way in is by rail (doing the decommissioning job by helicopter is impractical). Which means that track would have to be fixed before it could be removed. The Southern Pacific had planned to do all this work when it proposed to retire the line in the 1980s. Now, it's the state's problem.

And to be sure, it would be California's responsibility. "If there are no assets, no resources, the line becomes the state's problem," Hauser said. "When we set up the NCRA, we kept it separate from the counties. We made sure, because of the potential liabilities, that the state couldn't say, `Counties, you take over.'"

Call it the NCRA's ultimate bargaining chip in dealing with the state. At a January meeting of the NCRA's board of directors, Director Hemphill quoted Hauser -- who, after leaving the Legislature, served for a time as the NCRA's executive director -- colorfully suggesting what the NCRA should do should the state not cough up the money for the beleaguered railroad.

"Throw the keys at them," Hauser reportedly said.

This ace in the hole means that whether or not the state has doubts about the NWP's potential economic stimulus, the viability of the NCRA's new geotechnical plan or the wisdom of introducing a major industrial plant into an environmentally sensitive watershed, it may find few options but to let the authority forge ahead. It can pay now -- or it can pay more later. Whichever course it chooses, its lawyers had better prepare for a long, expensive ride.

See Northwestern Pacific System map

Hank Sims is freelance writer living in Westhaven. An earlier version of this article, by the same author, appeared in the March 2003 issue of the California Journal, a Sacramento-based publication that covers state politics.




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