Regulators toss out effort to force UP to sell Tennessee Pass line

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WASHINGTON – The Surface Transportation Board has rejected real estate moguls’ effort to force Union Pacific to sell its mothballed Tennessee Pass line in Colorado.

But the board’s ruling leaves open the possibility that KCVN and Colorado Pacific, which proposed buying the Tennessee Pass line and restoring it to service to haul agricultural and mining commodities, could apply again.

KCVN and Colorado Pacific sought to force a sale of the 228-mile route under a feeder line application. [see “Union Pacific opposes firm’s plan to revive Tennessee Pass route,” Trains News Wire, March 3, 2020.] The application was rejected as incomplete.

The STB said that KCVN and Colorado Pacific didn’t show that shippers requested service over the line or that UP has failed to serve shippers on the route, most of which has been out of service since 1997. They also failed to show that potential shippers sought service on the line, regulators wrote.

The decision denied as moot UP’s opposition to the feeder line application, as well as shortline operator Rock & Rail’s motion to partially reject KCVN and Colorado Pacific’s effort to operate the line. Rock & Rail provides service on the line in the Pueblo, Colo., area.

KCVN and Colorado Pacific in 2018 successfully used a feeder line application to gain control of the 121.9-mile Towner Line in Eastern Colorado. Last year Colorado Pacific spent $3.5 million to restore the line to 25-mph operation and next month plans to resume regular service.

A sale of the Tennessee Pass line to Colorado Pacific would create a nearly 400-mile route extending from Towner, Colo., to Dotsero, Colo., that would provide grain and mining shippers with a shortcut to Utah and the West Coast, KCVN says in its filing.

Colorado Pacific would spend $278 million to bring the Tennessee Pass route back to Federal Railroad Administration Class 2 track standards that would permit 25-mph operation.

KCVN is controlled by New York real estate developer Sheldon Solow and his son, Stefan Soloviev, who reverted to the traditional spelling of the family’s name.

Soloviev, who controls Colorado Pacific, has extensive land holdings in the West totaling more than 350,000 acres, including cropland in Colorado, Kansas, and New Mexico. His companies, which operate under the name Crossroads Agriculture, own grain elevators in eastern Colorado and western Kansas.

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