By J. Bruce Richardson, Corridor Rail Development Corporation; March 30, 2021
Life, is good if you are a CSX shareholder. Your company has just concluded a long-percolating deal to sell track and right-of-way in the Commonwealth of Virginia to the state for $3.7 billion. It’s 223 miles of active track and 386 miles of right-of-way.
It’s all for the benefit of improved passenger rail throughout the East coast.
The deal is a combination deal between the commonwealth, Amtrak and commuter agency Virginia Railway Express, commonly known as VRE.
This is what CSX is selling:
• Half of the right-of-way of the former RF&P Railroad between south of Washington Union Station and Richmond. The RF&P has a wide right-of-way which is currently double-tracked. Plans call for two more tracks to be added with the end game of two for freight and two for passenger trains.
When the RF&P was created early in 1836 the Commonwealth of Virginia held a substantial position in the ownership. To protect the investment the Virginia legislature passed a law prohibiting any other railroad to be built in Virginia in a north/south alignment competing with the RF&P. When CSX swallowed the RF&P in 1991 there was no other competing railroad directly north and south.
As a result of this, every freight train and every passenger train going between Washington and Richmond had to use the RF&P. It was like owning a toll bridge over a river. Want to get across? Pay us. And pay us well. When it was still an independent railroad, it was a rich independent small railroad.
For many years the 100+ mile long RF&P was considered one of the busiest pieces of railroad in the country. When VRE began commuter operations, it just added to the riot of trains.
One of RF&P/CSX’s assets is the Long Bridge over the Potomac River connecting Washington with Virginia. Long Bridge is double tracked and has been operating at capacity for several years. No new passenger trains can be added until this capacity problem is solved. The deal includes the advancement of a second, new Long Bridge with two tracks for $1.9 billion. One two track bridge will continue for freight trains, the second bridge dedicated to passenger trains.
Creating a new Long Bridge has faced a myriad of problems, including as one wag as said in the past, “There is a real possibility George Washington may have gone fishing one day right in the spot where the new bridge will be built. Therefore, a great deal of study has to be done to ensure no ‘history’ is disturbed.” Much of that is behind planners now, and hopefully the new bridge will become a reality soon.
When a new bridge is completed, new passenger trains will be able to travel south of Washington Union Station.
• Purchase of the former C&O trackage between Doswell (just north of Richmond where the rail line crosses the former RF&P) and Clifton Forge. This former C&O main line has been leased by CSX to the Buckingham Branch Railroad, a Class III short line. Part of the line also hosts Amtrak’s Cardinal tri-weekly service from Orange through Charlottesville and Staunton to Clifton Forge and into West Virginia.
CSX has previously used the line in one direction westbound to return empty coal cars. Buckingham Branch has scheduled its trains working around the Cardinal and the empty CSX westbound trains headed back to the coal fields. It’s notable the coal business is a mere shadow of what it once was in its heyday.
This piece of track is critical to Virginia’s rail plan to provide cross-state passenger train service from the mountains to the beaches at Hampton Roads and Virginia Beach.
So, CSX has sold an asset which it lightly uses, gets to keep trackage rights, doesn’t have to pay property taxes on any longer and someone else has to pay to maintain.
• The third piece of the sale is the former Seaboard Air Line main line right-of-way from Petersburg south to the North Carolina border. The track has been gone from this right-of-way for decades and the highest and best use has been to grow wild vegetation on the land.
This right-of-way has been designated as the future passenger train high speed rail route between Richmond and Raleigh, North Carolina. The State of North Carolina has agreed to purchase some of the empty right-of-way south of the state line.
All of this is a template on how to turn under-used assets into positive use for present and future passenger trains. The freight folks get to have a more fluid network, the passenger trains get to have priority on trackage and precedents can be set for future expansion.
CSX has had a habit of making good deals with states. Back in the 1980s CSX sold the former Seaboard main line from West Palm Beach to Miami for the start of Tri-Rail. More recently, CSX sold the former Atlantic Coast Line main line in Central Florida through Orlando for the start of SunRail. The two deals together brought CSX about three quarters of a billion dollars, took the trackage off the tax rolls, eliminated the cost of maintenance, and still allowed trackage rights.
The senior managers at CSX are no slouches when it comes to figuring out how to deal with governments and government checkbooks.