Kokomo Tribune; Kokomo, Indiana

October 2, 2012

Rail deal to reopen 12 miles of track

Companies, city partnering on $5.5 million project

By Scott Smith
Tribune staff writer

— The railroads are making a comeback in Kokomo, where 12 miles of inactive railroad track are about to be returned to service.

Kokomo Grain, US Rail and Norfolk Southern Railroads are partnering on a $5.5 million project to reroute much of the grain company’s freight, sending it south toward Tipton instead of east toward Marion.

A dormant Norfolk Southern line, which runs southeast from Home Avenue, will be placed back into use, and portions of Kokomo which haven’t seen train traffic since 1997 will again be seeing and hearing trains.

But the bottom line for the project is jobs, in the form of expanded business for local farmers, for Kokomo Grain and for the railroads.

Right now, cars full of grain are sent from Kokomo to Norfolk Southern in Tipton via Marion and Alexandria, a process that often takes up to three days.

US Rail President Gabe Hall said that once the project is complete around March, he expects to cut the time it takes to get a car full of grain to Tipton to around four hours.

The move will also cut out one of the railways currently carrying Kokomo Grain’s shipments, Hall explained.

Kokomo Mayor Greg Goodnight applauded the rail rehabilitation project, and said the city will be providing up to $600,000 toward the project, in the form of property acquisition and infrastructure improvements.

Goodnight said thinks Kokomo Grain and the railroads won’t be the only companies to benefit from having more rail options in Kokomo.

“Kokomo and central Indiana companies will benefit from this world-class transportation system,” Goodnight said. “As an economic development tool, access to a rail system is again becoming more important to agricultural, construction and manufacturing industries.”

With about $400 million in annual sales, Kokomo Grain operates a system of 10 grain elevators in Indiana and Tennessee.

Trucks may bring local grain harvests to the elevator on Kokomo’s northside, but more than 90 percent of that grain leaves the elevator on rail, Ortman said.

Increase rail efficiency and better rail rates should allow the company to make better bids on grain to area farmers, which in turn should increase the volume of grain moving through the elevator, he added.

“Part of the problem of the business is the inelasticity of demand,” Ortman said. “If you get higher volumes, you can protect your margins.”

While local business stands to benefit, neighbors along the unused rail line will also have to adjust to trains going by.

Neighbors along East Madison Street may have a good deal less train traffic to deal with, because the trains traveling along the Central Railroad of Indiana tracks will now be heading south.

That means crossing signals will be upgraded at many crossings, and trains will again be using the trestle across Sycamore Street.

The trains will head southeast between OmniSource and Future Park, cross Markland Avenue just west of Diamond Street (near the Barker’s BK restaurant), and then turn straight south to travel just west of Bona Vista.

The trains will turn back west at Bona Vista and travel to the north of the Inventrek Technology Park before turning southeast once more at Home Avenue.

Kokomo Grain shares owners with the Winimac Southern Railway (which owns the tracks running alongside the city’s Industrial Heritage Trail).

Maintaining the possibility of establishing a more direct rail connection with Norfolk Southern was the main reason the Winimac Southern owners left the tracks in place alongside the city’s walking/biking trail.

That’s also why Kokomo Grain executives asked Norfolk Southern not to abandon rail lines the railroad owns to the south of the current U.S. 31.

The new U.S. 31 bypass will travel over the top of Norfolk Southern’s line to Tipton, allowing trains to travel underneath the new road.

US Rail will operate the trains along the newly re-established line, and Hall said he’s enthusiastic about the future.

“We see a major opportunity to increase rail traffic in this region,” he said.

• Scott Smith can be reached at (765) 454-8569 or at scott.smith@kokomotribune.com.