Stewartstown Railroad may be declared abandoned

RELATED TOPICS: SHORT LINES AND REGIONALS
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YORK, Pa – A dispute over a $350,000 debt could spell the end for the dormant Stewartstown Railroad. The estate of rail preservationist George M. Hart, the railroad’s former president, has been trying to collect a $350,000 debt since April 2008. The estate is now preparing a petition to have the 7.4-mile railroad declared abandoned, which would it allow it to foreclose on the company. The railroad has offered a five-year payment plan. Estate attorney Jim Gillotti told the York Daily Record “We just can’t keep the estate open five years.” The board of directors of the railroad and an associated nonprofit, Friends of Stewartstown Railroad, launched a campaign to pay the debt and re-open the 125-year-old line for tourist runs. The railroad has not operated since 2004.

In 2006, Hart asked the company to sign a lien saying the railroad owed Hart the $352,415 that he had invested in the company over the years. Shareholders said they believed Hart would cancel the debt when he died, but after his death in 2008, they learned of a clause in his will that directed executors to “take appropriate action to retrieve said monies for my estate.”

Under federal law, the estate could not simply force the company to sell off its assets through foreclosure on the lien. Because railroads are considered an asset, they must first be officially declared abandoned. Before the end of 2010, the estate plans to ask the Surface Transportation Board to declare the line abandoned. The railroad would then have 20 days to file a response. The STB must rule on the request within 110 days of the initial filing. For more information on efforts to save the line go to www.stewartstownrailroad.com.
YORK, Pa – A dispute over a $350,000 debt could spell the end for the dormant Stewartstown Railroad. The estate of rail preservationist George M. Hart, the railroad’s former president, has been trying to collect a $350,000 debt since April 2008. The estate is now preparing a petition to have the 7.4-mile railroad declared abandoned, which would it allow it to foreclose on the company. The railroad has offered a five-year payment plan. Estate attorney Jim Gillotti told the York Daily Record “We just can’t keep the estate open five years.” The board of directors of the railroad and an associated nonprofit, Friends of Stewartstown Railroad, launched a campaign to pay the debt and re-open the 125-year-old line for tourist runs. The railroad has not operated since 2004.

In 2006, Hart asked the company to sign a lien saying the railroad owed Hart the $352,415 that he had invested in the company over the years. Shareholders said they believed Hart would cancel the debt when he died, but after his death in 2008, they learned of a clause in his will that directed executors to “take appropriate action to retrieve said monies for my estate.”

Under federal law, the estate could not simply force the company to sell off its assets through foreclosure on the lien. Because railroads are considered an asset, they must first be officially declared abandoned. Before the end of 2010, the estate plans to ask the Surface Transportation Board to declare the line abandoned. The railroad would then have 20 days to file a response. The STB must rule on the request within 110 days of the initial filing. For more information on efforts to save the line go to www.stewartstownrailroad.com.
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