IM Rail Link may be bought by DME by the end of the week

Published 12:00 am Thursday, July 25, 2002

Requests by certain labor groups and the Iowa Department of Transportation haven't apparently worked, as the groups have failed to hold up the efforts for a rail corporation to buy the I&M Rail Link that runs through Austin.

Dennis Watson, with the Surface Transportation Board, said possible sale of the I&M Rail Link to the Iowa Chicago & Eastern Railroad Corp., which is affiliated with the Dakota, Minnesota & Eastern Railroad Corp. can move forward.

One of the concerns voiced by the Iowa Department of Transportation and the U.S. Department of Transportation were issues between the IC&E and the DM&E upgrading its existing system to build a rail line into the Powder River Basin in Wyoming.

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The DM&E announced in June 1997 that it planned to build more than 260 miles of new railroad, extending the reach of its current rail system into the Powder River Basin. DM&E president Kevin Schieffer has said the basin is rich in low-sulfer coal deposits and could be an economic boon for the company, "offering excellent opportunities for future economic growth."

The objections by the Iowa Department of Transportation and the U.S. Department of Transportation specifically have focused on the "cumulative effects of potential new DM(&)E coal traffic from the Powder River Basin move over IC&E lines."

With the objection now lifted, the sale of the I&M Rail Link can now go forward. However, Watson said the deal with still be subject to further scrutiny when the Surface Transportation Board hears requests to "revoke" a class exemption.

The exemption procedure specifies that a noncarrier, like the IC&E, may acquire the lines of other rail carriers without having to file an application and to wait for approval from the Surface Transportation Board.

Employees at the Austin I&M office will retain their jobs and for the most part keep their current positions, said David Bublitz, who has worked for I&M since 1997.

"We're looking forward to it to keep the railroad going," Bublitz said.

Bublitz said he has not heard DM&E's specific plans for the rail, but does not think train traffic will increase in the near future. Currently four to five trains run on the track per day.

"They have talked about upgrading between Owatonna and here, but I don't know if it will happen or not," he said.

The Southeastern Rail Shippers, a group of shippers in the area from Albert Lea to Austin, will meet with DM&E representatives today at its annual meeting.

"The rail shippers are an organization of shippers and concerned citizens that formed an organization 20 years ago to preserve rail systems in Austin through Jackson and up through Owatonna," said Wayne Kromminga, head of the Rail Shippers and owner of Hayward Elevator. At the meeting, members are to find out more about D M & E's plans.

The DM&E has more than 1,100 miles of track in South Dakota, Minnesota, Iowa, Nebraska and Wyoming. The I&M Rail Link has more than 1,400 miles of track in Illinois, Iowa, Minnesota, Missouri and Wisconsin.

-- Staff editor Cari Quam contributed to this report.

Dan Fields can be reached at 434-2230 or by e-mail at