Business

August 20, 2014

Railroad resolution hits a snag

A partnership between South and North Carolina to buy Carolina Southern Railroad likely will need more work before there can be a purchase.

A partnership between South and North Carolina to buy Carolina Southern Railroad likely will need more work before there can be a purchase.

The N.C. General Assembly last week passed legislation that would allow for the creation of a two-state compact run by a commission that could buy the railroad.

The problem is that the North Carolina legislation is dependent on South Carolina passing the same law and that can’t happen until January at least.

But Horry County Council Chairman Mark Lazarus said Wednesday that negotiations over an asking price for the railroad could be concluded by mid-September.

Businesses and governments in Horry, Marion and Columbus, N.C., counties are anxious for a resolution to the lack of rail service.

Carolina Southern, which owns the track that serves all three counties, shut down service about two years ago after the federal government found defects on some bridges that needed fixing before trains could run.

A two-state rail committee has been working since that time to restore service. Carolina Southern owner Ken Pippin said he doesn’t have the $2 million to make the bridge repairs.

A recent agreement between Pippin and the committee provides for the sale of the railroad and for negotiations to set a price. Should the negotiations prove unsuccessful, the parties agreed that the U.S. Surface Transportation Board will set a price on Carolina Southern.

Businesses in Horry and Columbus counties have had to arrange alternate, more expensive ways to receive raw materials and ship goods without the railroad operating.

Henry Lowenstein, a consultant to the railroad committee, told members of the Myrtle Beach Regional Economic Development Corp. on Wednesday that the railroad could resume service next summer if everything goes smoothly with the negotiations and purchase.

The $2 million fix, he added, is but the first part of an additional $20 million in repairs and upgrades needed to allow heavier, faster trains on the line. Before those things are done, Lowenstein said trains would be limited to a speed of no more than 20 miles per hour.

Fred Richardson, MBREDC board chairman, said that rail service is essential to Horry County. He described it as one of three things that are critical to attracting heavy industry that would pay higher than average wages.

The other two, he said, are an interstate highway and natural gas service, which are also absent from Horry County.

Sen. Luke Rankin, R-Myrtle Beach, suggested Wednesday that another vehicle, perhaps a memorandum of understanding, could allow the two states to buy the railroad before the compact is approved.

The stipulation for approval by the S.C. General Assembly took him by surprise.

It could not be determined Wednesday if North Carolina could or would agree to another way to buy the railroad.

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