20040708transcript.pdf

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF GREAT NORTHWEST
RAILROAD'S INTENT TO ABANDON THE
JAYPE BRANCH LINE LOCATED
CLEARWATER COUNTY, IDAHO.
Case No. GNW-R-04-1
ORIGINAL
Taken at the Clearwater National Forest SupervisorOffice, 12730 Highway Orofino, Idaho
Monday, June 28, 2004 - 1:00 p.
TRANSCRIPT OF PROCEEDINGS
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BEFORE: Paul Kjellander, Commissionerj
I d a ho P u b 1 i c Ut i lit i e s C 0 mm i s s ion
P P A R N C
DON A L D L. H OW ELL, I I , E sq., 0 f the
General's Office, Public Utilities472 Washington Street, Post OfficeBoise, Idaho 83720 -0074,appearing on behalf of the Idaho PublicUtilities Commission.
Idaho Attorney
Commi s s ion,
Box 83720,
CLEARWATER REPORTING
OF WASHINGTON AND IDAHO, L.
Serving the Northwest
Legal Industry
Since 1985
[phone]
Fax: [phone]
Lewiston, Idaho 83501
631 Main Street
[phone]
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CLEARWATER REPORTING OF IDAHO, LLC
MONDAY JUNE 28,2004 - 1:00 P.
MR. KJELLANDER:Good a fte rnoon.This
the time and place for hearing in Case No.
GNW-R-04-also referred to as in the matter
Great Northwest Railroad's intent to abandon the
Jaype branch line,located in Clearwater County,
Idaho.My name is Paul Kjellander,and I'm one of
the three public utili ties commissioners and I'm the
chairman of this case.Today I I 11 be presiding over
the public hearing portion of this particular intent
to abandon case.
Before we move forward,I guess what I d
like to do is just first take the appearances of the
parties that are present today,and before we move
too far along,lS anyone here representing the
railroad?
MR.My name is Mark Demers.DEMERS:Yes.
MR. KJELLANDER:And how do you spe II your
last name?
MR.DEMERS:D-E-M-E-R-S.
MR. KJELLANDER:And are you here as legal
counsel or as --
MR.No.m just here more DEMERS:
observe.
MR. KJELLANDER:Okay.So it's not your
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
intent to cross-examlne any wi tnesses today?
MR.DEMERS:Not at all.
MR. KJELLAN DER:Okay,thank you.Would
you b e a va i lab 1 e for any que s t ion s 0 r co mm en t s fro
people after the hearing is over today,or would you
rather I not have asked you that question?
MR.DEMERS:Uh-huh.
MR. KJELLANDER:All right,thanks.Mr.
Howell representing the staff and the Attorney
General's Office of the State of Idaho,could you go
ahead and glve us your formal appearance.
MR. HOWELL:Sure.My name is Donald
Howell H-O-W-E-L-L and I'm with the attorney
general's office.I am a deputy attorney general
attached to the Idaho Public Utilities Commission.
MR. KJELLANDER:Are there any other
individuals who need to be acknowledged as making
appearance here today?Yes.
MR. McNICHOLS:My name is Mike McNichols,
and I'm appearing here on behalf of Konkolville
Lumber Company.
MR. KJELLANDER:Okay,thank you, Mr.
McNichols.But it's not your intent for
cross-examination today?
MR. McNICHOLS:Well I don t know t ha t ,
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
guess.
MR. KJELLANDER:ll reserve that right.
MR. McNICHOLS:Than k you.
MR. KJELLANDER:Anyone else?
MR. EBERT:m Don Ebert.m a
lea r ate r C 0 u n t y c 0 mm i s s ion er a n d a 11 t h r e e
commissioners or here today.
MR. KJELLANDER:Okay.Could we go off the
record for a second?
(Discussion held off the record.
MR. KJELLANDER:We can go back on the
record.The way things will work today, we have with
us a court reporter.Her name is Amy Wilkins,and
she taking your testimony down verbatim.What
have do this seat he re,andyoucome
will swear you and ask you tell the whole truth
and nothing but the truth.Then Mr. Howell will ask
you a few introductory questions and then allow you
an opportunity to provide your public testimony.
this point it really isn t a chance to sit and ask
lot of questions about the abandonment process,and
qui te honestly there s not a lot we can tell you
other than what happens in reference to our role
the Pub 1 i c Ut i lit i e s C 0 mm i s s ion a s it r e 1 ate s to t h e
Surface Transportation Board.So,I guess at this
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
point I'd like to just let you know what our
authority is to kind of help or at least guide your
c 0 mm e n t s t s 0 m e e x ten t And the way it works
that the abandonment of rail lines and the
discontinuation of rail service are governed by
federal law , most notably through the Surface
Transportation Board, which is the federal entity.
As this commission,as stated in numerous cases like
this in the past, the authority to grant or deny the
abandonment of rail lines rests specifically with the
Surface Transportation Board,not thi s commi s s ion.
However the Idaho code does require us,the Public
Uti lit i e s C 0 mm i s s ion, t s c h e d u 1 e a pub 1 i c ear i n g 0
the proposed abandonment.And the purpose of this
hear ing is for the commi s s ion to determine whether
the abandonment will adversely affect the area being
served,impair the access of Idaho shippers to vital
goods and markets and whether the rail line has the
potential for profitability.If we find that the
abandonment would adversely effect the area being
served and the line has potential for profitability,
then the commi s s ion could repre sen t that to the ta te
of Idaho in the Surface Transportation Board
abandonment proceeding.So on those three areas
you have some information you think may help guide
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
the c 0 mm i s s ion tow a r d s d e t e r m i n i n g tho s s p e c i f i c
areas that would be I think perhaps the most direct
and helpful information that we could have as
commission.Again,m 0 n e 0 f t h r e e c 0 mm i s s ion e r
and the chairman of this case.We will have the
transcript to take back to the other two
commissioners,and we will sit down and deliberate
t hat to m a k e a d cis ion i n th e ve r y i mm e d i ate f u t u r e .
Okay.With that, are there any other preliminary
matters that need to come before us?Mr. Howell
there anything I left out or something more that
should be advanced?
MR. HOWELL:(Counsel shakes head.
MR. KJELLANDER:If not,then agaln we
call our first witness and that is Lin Chamberlin.
And,Lin,We had you coming through, here we are.
the back door.Come on over here and there will be
your seat,and I'll ask you to raise your right hand.
Thereupon,
LINDA CHAMBERLIN
a witness of lawful age, having first been duly sworn
upon her oath to tell the truth,the whole truth and
nothing but the truth,testified upon her oath
follows:
MR. KJELLANDER:Than k you.Mr. Howell.
LEWIS TON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
EXAMINAT ION
BY MR. HOWELL:
Ma I am I need you to state your full name
and spell your last for the record , please?
All right.My name is Linda Chamberlin
C-H-A-M-B-E-R-L-I-N.
And where you reside?
reside Orofino.
And are you representing anybody any
capacity today?
Yes,I am.m representing the Orofino
Chamber of Commerce.
And do you have a statement you I d like to
provide the commi s s ion?
I apologize,the statement hasn I t arrived
yet,and so when that comes I will bring it forward.
MR. KJELLANDER:Okay.And if you do ha
specific statements,and I II just tell you
generally,instead of reading the entire -- do you
need me to talk louder in the back?My apologies.
If you do need to hear me and I should get softer
throughout or people should be testifying,just let
us know and we ll do our best to try to get the
volume cranked up a little bit.
I f you do h a v e w r i t ten c 0 mm e n t s ,instead of
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO , LLC
reading them verbatim what you can do when you
provide testimony is actually offer them up and
they ll be included as an official part of the
record.So that may help move things along since we
have plenty of people here willing to testify.So,
Lin,if you d like,you can glve us a quick overview
of that statement if you could,and then when the
doc u men t ar r i ve s, you can jus t sub m i t it to.. Am y ,
whom I just met today,so I don t feel too bad about
not remembering.
MS. CHAMBERLIN:Okay.The Chamber of
Commerce is in support of the railroad staying.
have fought for years for the economy of Orofino,and
we feel that this is another situation where we will
l 0 sin g job s an d s e cur i t Y i n th i s c 0 mm u nit y There
are other side lines with the railroad if it were to
close, not only would Konkolville be losing out on
transportation for their logs, but also the rail cars
tha t come up to Oro fino dur ing the summer months,
there are several that come in.The economy will be
effected by them.They stop in Orofino.They spend
time and money here,and that will be something else
we would lose out on.And that's basically what the
chamber is concerned with is the economy,and it will
effect us in many ways.And I will bring that letter
LEWIS TON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
to you when it arrlves.
MR. KJELLANDER:Than k you.Before you
leave, there s an opportunity for questions mostly
from myself and from Mr. Howell, and I guess the
first question I would have is, does the chamber have
any idea of what the financial impact is of the
railroad in this area.
MS. CHAMBERLIN:I believe they do.
sorry, I don t have that information now but.
MR. KJELLANDER:Okay.You think that
might be in the letter?
MS. CHAMBERLIN:Yes.
MR. KJELLANDER:Okay.Thank you.Mr.
Howell.
MR. HOWELL:No questions.
MR. KJELLANDER:All right.Thank you very
much for your testimony.Now we ll call.
MR. BRUCE:J. Bruce.
MR. KJELLANDER:Thank you , Mr. Bruce.
Thereupon
TRELAWNY J. BRUCE,
a witness of lawful age , having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth, testified upon his oath
follows:
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
MR. KJELLANDER:Mr. Howe 11 .
EXAMINAT ION
BY MR. HOWELL:
Would you please state your full name and
and spell your last for the record?
ll spell my first also.Trelawny,
T-R-E-L-A-W-N-Y , middle ini tial last name
Bruce,B-R-U-c-E.My address is 2266 as in alpha,
Harmony Heights Road , Orofino.
And do you represent anybody today?
I represent myself sir.
And do you have a statement you d like to
g i ve t 0 the co mm i s s ion?
I do.
Go ahead.
Thank you,lr.Clearwater County,Idaho,
is on the verge of losing an important part of its
transportation infra-structure.As reported in the
April 8th Clearwater Tribune based in Orofino, Watco
companie s,Incorporated is seeking permission
abandon about thirty miles of rail line or that
portion that connects Konkolville with the former
Jaype plywood plant near Pierce.For the record,
support the railroad be retained.The federal and
state governments,In my opinion, must think
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
strategically about the future of this region and
refuse permission for this abandonment.Clearwater
County cannot afford to lose this important part
its economy or transportation infra-structure.From
the profile that's provided by the Idaho Department
of Labor, we find that Clearwater County has an
average thirteen point four percent unemployment for
the past ten years and that the per capita annual
income is twenty-one thousand.That's nine thousand
below the national average.This county is the
Appalachia of the west.We see a trend here where
one abandonment leads to another and another and
on.First was the Spalding to Grangeville line.
Fortunately the Bountiful Green Craigmont Mountain
Railroad,that's the BGCM,owned by Mike Williams
saved the part of the line from Spalding
Cottonwood.Next to go will be the Konkolville
Jaype line.That's the one in question right now.
Without the revenue from that line it only makes
sense Watco will next request abandonment,and that'
already rumored,of the Spalding to Kamiah, Kooskia,
to incl ude the Konkol ville spur.Wi th the up river
revenue gone, Watco will then propose to pull the rug
out from under BGCM forcing Mr. Williams to buy the
Lewiston to Spalding line or abandon the whole works.
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
I talked to Dr. Kenneth Kassavant
(phonetic)from Washington State University.He has
done numerous studies on agricultural transportation
and he warned me that this was a possibility,these
abandonments.The Tribune article that I referred
that one on April 8th,to,leads one
--
or led one to
believe the closure of Jaype plywood plant caused
Potlatch to no longer use the line.That is not true
according to Jim Mallory,a representative of the
Potlatch Corporation who works at the Clearwater
Logging Unit , Headquarters Office.Mr. Mallory
states
--
says Jaype ' s transportation requirements
generated a need for only four hundred cars annually.
However the log hauling by Potlatch generates
requirement for ten times that number each year.
fact Mr. Mallory asserts Potlatch negotiated in good
faith with the camas Prairie RailNet , who was the
previous owner of this rail line, with a guarantee
for at least four thousand cars annually.RailNet
reciprocated by demanding an increase in the shipping
rates for the Jaype line while leaving rates as they
were for the mills on the Kamiah-Kooskia line.The
deal fell through.Mr. Mallory states that losing
the rail hauling option translates to an additional
nine thousand truckloads per year on the county
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
road system.Now even if the rail is continued,
that doesn t take trucking out of the picture,
because Potlatch's requirement for hauling logs off
the hill is twenty thousand truckloads a year.Rail
service on the Jaype line has been suspended for two
years.After two years , with the increased truck
traffic,state,and national road systemour county,
in this area has taken a real hit.The road
condi tions can only get worse,because revenue from
the trucks,and they pay a lot of revenue,m not
going to take that away from them,but it can t keep
up wi th wear and tear on the roads.The only
solution can be to hope for large federal grants,
which are ul timately funded by the nation
taxpayers.And I believe that's the reason that I
have standing in this case, because I'm a taxpayer.
Why should the taxpayer pick up this tab when the
rail line could provide the necessary relief?
We
--
I believe that the federal and state
government should serve as the arbitrator between
Potlatch and Watco,if it comes down to that,
establish a reasonable contract for hauling a minimum
of four thousand cars of logs per year with
five-year guarantee by both parties.It would be
hard,in my opinion,for Potlatch to accept
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
one-year-at-a-time deal.This solution requires
get-tough policy by the state and local county
government for limiting use of local roads for log
hauling.And talking about obeying the weight
limits that are on those roads so that Potlatch feels
compelled to use the railroad.Roads in this area
are being beat to death by overweight log trucks and
a policy of allowing hauling when roads should be
restricted due to climactic conditions.I also
believe to provide incentive to the Great Northwest
Railroad,is what Watco calls this rail line,that
federal and state government should eliminate all
taxes on their property and rolling stock to provide
incentive for their continued operation.And there
a payback.The payback is that any hauling done by
the railroad provides relief to the taxpayer in the
form of less maintenance and reconstruction cost of
the local road system.It uses less of our nation
finite oil reserves and it pollutes the environment
less than trucks do.Now the people of the state
Washington,In my opinion must be included in this
solution, because Washington has invested thirty
million in Watco , who also owns the Palouse River and
Coulee City Railroad in eastern Washington.They
made this investment to limit the wear and tear
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
their road system, but they also realize the
trickle-down benefit from the Great Northwest
Railroad as it transits eastern Washington with
products to and from Idaho which link up with the
maJor rail carriers at Ayer Junction.
Finally I believe that government and civic
leaders must seek out additional uses for this
railroad to demonstrate good faith for keeping the
railroad operational.Examples are log hauling in
addition to Potlatch's needs,ore hauling,fuel
hauling, power production,and recreation.Based on
the federal government's healthy forest initiative,
quan t i ty 0 f di seased, dead and burned timber should
be available for harvest in the near term.The Grea
Northwest Railroad,especially the portion proposed
for abandonment, provides a vital link for
t ran s p 0 r tin g t his t i mb e r to m i 11 s for pro c e s sin g i t
into wood products.Mineral deposits in the Orofino
Creek Canyon have potential for commercial
deve lopmen t In fact there s already wi thin recent
years,I believe about the 1995 to '97 time frame,
been thirteen million dollars invested In ore
exploration.The rail line would serve as a vital
link to haul the ore to processing plants.The rail
line provides the potential for two-way
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLc
transportation of fuel whether oil based or waste
wood products t 0 f a c i 1 ita t e d 0 m est i c an d c 0 mm e r cia
requirements and co-generation power production.The
Konkolville to Jaype rail line follows
exceptionally scenic route as it pursues Orofino
Creek through a canyon carved to a two thousand foot
depth.Speeder rail enthusiasts covet this route for
it crosses back and forth across the creek nearly
once every mile of its thirty mile length.It ha
exceptional potential as a dinner train and/or tour
train route and use as a motion picture set,which
has been used in the past.
The bottom line is that the American
government of the people gave huge land grants to the
rail roads to open up the west.The railroads got
rich by hauling people and articles of trade and by
selling the excess land.Now when we the people
Clearwater County need to retain this transportation
resource as a vital part of our infrastructure, Watco
is ready to cut and run.T 0 add to t his d i 1 e mm a ,
many of our government officials and civic leaders
have given up the fight.We must stop the
abandonment process and return the Konkolville
Jaype line to operational status.
I have one other thing I want to add
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
this,and this is the
--
from the Watco and RailNet
announcement of agreement for sale of the Camas
Prairie RailNet.Now , Watco assumed control of this
rail line March 1st,And the president and2004.
CEO,Rick Webb said, we are extremely pleased to be
adding this railroad to the Watco family of
properties.We have operated railroads in Idaho and
Washington for fourteen years and believe in the
customers, the communi tie s and the fu t ure of thi
region 0 f Amer i ca.To go on , he also said,
personally very much have appreciated the way the
folks of RailNet have worked to make this transaction
occur.Since RailNet purchased this line they have
been very good stewards of the railroad and have
built good customer loyalty.This should make for
seamless transition on the first day.Now I question
that, because there had already been be
abandonment,if you will,or they shut down the
operations on that portion of the rail line.Mr.
Webb went on to say, Watco will continue to work
the relationships that RailNet has fostered,and we
will be working very hard to grow the business
this line.We will also be seeking enhanced
public-private partnerships to ensure the entire line
can be preserved for the long term.Thi s ra i 1 road
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
can and will be successful for the long term if all
parties work together with a long-term vision
mind.
And I respectfully submit my letter.
MR. KJELLANDER:Than k you, Mr. Bruce.
MR. BRUCE:And would you like this
information?
MR. KJELLANDER:If you would like to leave
that with us, that would be fine.Before you leave,
Mr. Howell are there any questions?
MR. HOWELL:No questions from me.
MR. KJELLANDER:Mr. Bruce , than k you.
like to call now Mr. Robert McKnight.
Thereupon,
ROBERT McKNIGHT
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth , the whole truth and
nothing but the truth , testified upon his oath
follows:
MR. KJELLANDER:Mr. Howe 11 .
EXAMINATION
BY MR. HOWELL:
Mr. McKnight, would you please state your
full name and spell your last for the record.
Robert C. McKnight, M-C-K-N-I-G-H-T.
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
And,tell us where you reside.
I reside at
--
I work at 10230 Highway 12.
I reside at 2258 Orofino Creek Road, Orofino.
And are you representing the Department
Lands today?
Yes I am.
And do you have a statement you d like
g l ve t h e c 0 mm i s s ion?
I have a prepared statement I'd like
give, but I'd like to just paraphrase it.
Sure.
Basically, the department feels that if the
railroad is granted abandonment that in the act, the
Surface Transportation Board should be required
requlre them to remove all of the structures.
Besides the rails and the track and ties,the
trestles are a concern for the Idaho Department
Lands.We have thirteen trestles on state land.And
if those are not removed, we would assume the
liabili ty and the maintenance issues around those.
So,if the petition is granted to allow the rail
be abandoned, we would like to see a part of that to
remove those trestles.And also,to add this,if a
rails to trails type of venture becomes doable, we
would support that and that the easement that the
LEWIS TON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
railroad currently holds could be transferred to
whoever assumes that trail type of venture.
Mr. McKnight,MR. KJELLANDER:does that
conclude your testimony?
Yes it does.MR. McKN I GHT :
(BY MR. KJELLANDER) A question I would have
l s,if a rails to trails program could be put
together , would that be in lieu of then the need
remove the trestles?
it would.Yes,
MR. KJELLANDER:Okay.Mr. Howell any
addi tional questions?
(BY MR. HOWELL)theMr. McKnight,
department of lands,are they -- in terms of the
railroad location with milepost zero being in
Orofino.
. . .
Uh-huh.
. .
. and thirty-one being in Jaype,do you
know approximately how many mile posts or what
portion of the rail line the Department of Lands
would be the reversionary property owners?
You mean like how many acres or
--
no,
don
ll take it acres or miles.
Well, we have about four sections,four
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
portions that the rail crosses on state between
probably about milepost four through twenty-eight.
So more
I don 't have the distances, though.
So more on the front part of the line
Yes.
--
than the Jaype end of the line?
Yes.
MR. HOWELL:All right, thank you.
further questions.
The reupon,
MR. KJELLANDER:Thank you , Mr. McKnight.
MR. McKNIGHT:Thank you.
MR. KJELLANDER:ll call David Smith.
DAVID SMITH,
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth, testified upon his oath
follows:
MR. KJELLANDER:Mr. Howe 11 .
EXAMINATION
BY MR. HOWELL:
Mr. Smith , could you state your full name
and spell your last for the record?
David Smith is my full name, S-M-I-T-H.
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO , LLc
And,sir , where do you reside?
Moscow Idaho.
And do you represent anybody here today?
m representing myself.
All right.And do you have a statement
you d like to give?
Well,I didn t really come prepared to give
a statement, but I'll just give a brief outline
what I have.I think the previous speaker mentioned
most of the issues involved up there.d like
point out,one other thing is that the mountains
the Nor t h For k 0 f the C 1 ear w ate r R i v er a n d t hat' are a
is probably one of the nation s best examples of a
terrestrial carbon sink.And as such , with the
department of energy, their clean coal program,
looking for ways to increase fossil fuel development
at the same time mitigate for carbon dioxide
eml s s lons,one possible project would be for a clean
coal plant to locate on the western edge of this
carbon sink and that would be up in the Jaype area.
I -- what I would suggest or request is that the
abandonment petition be denied until further study
can be done to assess the feasibility of such
proj ect.That's all I have to say.
MR. KJELLANDER:Than k you.
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
MR. SMITH:I do have some information.
MR. KJELLANDER:Can we keep tha t?Do you
have any questions, Mr. Howell?
(BY MR. HOWELL)And the reason why you
would stay the rail line abandonment would be so that
you could transport coal to a facility?
That, yeah, because rail is the only way
transport coal.
MR. HOWELL:Okay.Nothing further.
MR. KJELLANDER:Thank you for your
testimony.
d like to call now Rene ' Gingrich.
Thereupon,
RENE' JOHNSTON-GINGRICH,
a witness of lawful age, having first been duly sworn
upon her oath to tell the truth , the whole truth and
nothing but the truth, testified upon her oath
follows:
MR. KJELLANDER:Mr. Howell.
EXAMINAT ION
BY MR. HOWELL:
Would you please state your name and spell
your last for the record.
Rene ' Johnston Gingrich.Johnston is
hyphenated,J-O-H-N-S-T-O-N , Gingrich,
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
G-I-N-G-R-I-C-H.
And where do you reside?
Lewiston.
And do you represent anybody today?
am.m representing Clearwater County
Economic Development Association.
And do you have a statement you d like
make for the record?
I do.I have a statement I'd like to read
and I have a written copy I'd like to submit, please.
Good afternoon.Thank you for the
opportunity to speak at this hearing regarding the
Great Northwest Railroad's intent to abandon
approximately thirty-one miles of rail line between
milepost zero zero at Orofino and milepost thirty-one
near the closed Jaype mill site just north of Pierce
Idaho,located in Clearwater County.My name
Rene ' Gingrich,and I'm the economic development
specialist for Clearwater County.m here
representing Clearwater County Economic Development
and its board of directors comprised of elected
officials of Clearwater County, the cities
Orofino,Pierce, Weippe and Elk River.Addi tional
members of the board include representatives of the
Ne z Perce Tribe, the I daho Department of Comme rce and
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
Labor,and the Clearwater Economic Development
Association.
It is with regret that this hearing
taking place.Since 2000 the national resource based
economy of Clearwater County has suffered a number
blows that have devastated the livelihood and economy
of its people.Naturally the most severe impact has
been the closure of the Jaype plywood mill.Wi th the
trickle-down effect the closure of this mill has cost
Clearwater County over four hundred jobs.Wi thout
this mill the existence of the rail serVlce to the
Jaype reg ion and ne ighbor ing communi tie s is a
significant infrastructure asset that we,as economlC
developers are trying to build upon.The abandonment
of the Jaype branch will greatly reduce the potential
for economic development opportunities in this region
of Clearwater County.
With the decline of the natural resource
based economy,officials from Clearwater County,the
federal government and the state of Idaho have been
trying to find new ways to diversify our economy.
This is no easy task and requires a long-term funding
commi tmen t f rom all of tho se involved.There are
many untapped opportunities in Clearwater County that
would greatly benefit from access to rail
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
transportation.Existing businesses along this line
have in the past and could again benefit from the
availability of rail transportation.Working with
private industry, we are currently forming
partnership with other economic development
organizations on developing a waste to energy
facili ty near Pierce.This facility could
potentially create as many as a hundred and twenty
job opportunities for the people of Clearwater
County.It is important to emphasize that
Konkolville Lumber currently ships by rail , utilizing
the lower portion of this line and considers rail
access crucial to their operation.Konkol vil1e
Lumber is a major employer in Clearwater County.
We feel the availability of rail
transportation is important to our economlC
development future.Both the Idaho State Legislature
and Congress have identified the loss of rural
railways as a detriment to diversifying rural
economy.
In 2001 the Idaho Legislature created the
Idaho Rail Preservation Program with the purpose
evaluating and preserving essential rail serVlces
throughout the state.In 2003,Idaho Senator Larry
Craig cosponsored the Local Railroad Rehabilitation
LEWISTON , IDAHO 83501
[phone] [phone]
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and Investment Act,SB 1703, which was intended
provide incentives to help rehabilitate the short
line sector of the railroad industry which provides
service between rural and urban America.
To overcome the reductions in natural
resource based employment sectors,the economic
development communi ty is working to encourage
diversification and entry into the local marketplace
by rural entrepreneurs.The availability of rail
a transportation mechanism provides a connection for
rural enterprises into urban and global marketplaces.
In closing,I would like to encourage the
Idaho Public Ut i Ii tie s Commi s s ion to cons ider the
economic development activities currently underway
attempts to diversify north central Idaho I s economy.
Please consider the impact the loss of rail
infrastructure will have on these efforts and the
adverse effects of abandonment to the economy
Clearwater County.
Thank you for your time.
MR.KJELLANDER:Thank you.Are there any
questions , Mr.Howell?
(BY MR.HOWELL)Besides the potential for
the waste to energy facility and Konkolvil1e Lumber
are there any other economic development prospects
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
that are golng on, on the line?
Yes , there are.And I believe you ll hear
testimony from folks who know more about them today
than I do.
MR. HOWELL:All right , thank you.
MR. KJELLANDER:Than k you f or your
testimony.
d like to call now Wally Williams.
Thereupon
WALLACE WILLIAMS
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth , testified upon his oath
follows:
MR. KJELLANDER:Mr. Howell.
EXAMINAT ION
BY MR. HOWELL:
Mr. Williams,could you state your name and
spell your last for the record , please?
Wallace J. Williams , W-I-L-L-I-A-M-S.
reside in Pierce.m the mayor.
And do you have a statement you d like
g l ve the commi s s ion?
Actually,I thought I was just signing
the sign-in sheet.I didn t know that.But Rene
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
the previous speaker, has covered it very well.
not even going to take time to cross my legs.
didn t expect this.
MR. KJELLANDER:We 11,I think we should
take note that there s an elected official who
chooses not to speak publically.
MR. WILLIAMS:I concur with Rene ' a
hundred percent.
MR. KJELLANDER:Thank you for your
presence here today.
MR. WILLIAMS:No questions?
MR. KJELLANDER:ll give you a break
today.
MR. WILLIAMS:Thank you.
MR. KJELLANDER:Thank you.Mr. Williams
brought up I think an important point.If for some
reason you signed up and you decide that you do not
wish to testify, when I call your name just say so,
and that way we won I t make you come all the way up
here and go through the swearing in.
UNIDENTIFIED SPEAKER:Is there still room
on there?I didn t get to sign in.
MR. KJELLANDER:There is.In fact, when
go through this list,ll ask if there s others who
want to testify, and you can come up and do that
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
that time.
UNIDENTIFIED SPEAKER:Thanks.
MR. KJELLANDER:All right.ll call now
Charles Cline.
MR. CLINE:I don t have all the
information I need right now,so I'd like to decline
to make a statement.
MR. KJELLANDER:Okay.And if for some
reason more information should show up, we ll give
you another opportunity at the end.
MR. CLINE:Can we send in written.
MR. KJELLANDER:Good point.Usually when
we close public hearings,I generally tell people
that they can send that in.And you can , but you
need to do it rather quickly because the time line
for a Surface Transportation Board hearing is a very
short window.
MR. CLINE:Okay, thank you.
MR. KJELLANDER:You bet.and you can
also go to our web site and e-mail it in.Just try
to make sure and grab the case number for this case
when you do an e-mail filing,and we can make sure
you have that as well.ll call now Don Kimball.
MR. KONKOL:Konkol.My wife usually signs
my name.
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
MR. KJELLANDER:Okay.
Thereupon,
DONALD KONKOL
a witness of lawful age having first been duly sworn
upon his oath to tell the truth,the whole truth and
nothing but the truth , testified upon his oath
follows:
MR. KONKOL:m Donald J. Konkol,
K-O-N-K-O-L and I reside on the outer Orofino city
limits.I have addressed this letter to Jean
Jewe 1 commi s s ion Secretary,Idaho Public Utilities
Commission.Dear Secretary:Reference your letter
dated June 8th,2004.Subj ect:The matter of the
Great Northwest Railroad I s intent to abandon the
Jaype branch line located in Clearwater County,
Idaho.Donald J. Konkol , president of
Konkolville Lumber Company,Inc.Our company is
manufacturer of finished wood products and has been
continuous employer in Clearwater County,Orofino,
Idaho,since 1947,some fifty-seven years.Currently
we employ ninety people on our plant site and another
thirty to forty who harvest and deliver logs to our
manufacturing plant.Our manufacturing plant
located approximately at the three point five
milepost on the Orofino to Jaype rail line.
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLc
Reference is made to STB Finance No.34474 Grea t
Northwest Railroad,Inc., Acquisi tion and Operation
Exemption,Camas Prairie RailNet,Inc.and to the
Verified Notice of Exemption of Great Northwest
Railroad,Thefiled February 20thInc. 2004.
notice stated,among other things,no traffic moved
from the fourth subdivision extending from milepost
zero point zero at Orofino,Idaho,to approximate ly
milepost thirty-one point zero,end of track,near
Jaype,Idaho,and the majority in over two years,
the line is out of service.In fact,Konkol ville
Lumbe r Company,whose mill is located at or near
milepost three point five,shipped a hundred and
nineteen cars of lumber in 2000 a hundred and
twenty-eight cars in 2001 a hundred and sixty-one
cars in 2002,and a hundred and eighty-two cars in
2003.Thus far in 2004 we have shipped eighty-seven
cars.If current plans materialize and I emphasize
if,within two years we hope to double our mill
production therefore doubling rail shipments.
Legal counsel has advised our company
GNR was granted abandonment authority and converts
the portion of line between milepost zero point zero
and three point five into spur track for continued
service to Konkolvil1e it places Konkolvil1e at a
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO , LLC
greater risk.GNR would be able to abandon the spur
at any time at its sole discretion without the need
of securing further authorization of the Surface
Transportation Board or anybody else.49 use 10906
in part provides,the board does not have authority
under this chapter over construction acquisi tion,
operation,abandonment or discontinuance of spur
industrial,swi tching or side tracks.team,Our
legal counsel further states that if this line
abandoned,GNR's statement that it will continue
serve Konkolville with a spur line gives Konkolville
no legal rights whatsoever.
The lumber manufacturing business is placed
In a very competitive field with very narrow margins
of profit.From the purchase of raw material to the
finished product we are under acute monetary
pressure.Freight on our finished product lS
critical component to the overall economic stability
of this company.Since seventy-two percent of our
finished product was shipped by rail last year
demonstrates we cannot compete with other local
producers wi thout reasonable rail service.I would
also like to point out we could have shipped even
more wood had the proper rail equipment been
available to us.
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
In conclusion Konkolville Lumber Company
requests the Idaho Public Utilities Commission
find that the line sought to be abandoned is almost
certainly profitable and that the abandonment would
impair the access of Konkolville to vital markets and
would adversely effect the area being served.
Sincerely,Donald J. Konkol, president Konkolville
Lumber Company.
MR. KJELLANDER:Thank you, Mr.Konkol
ve got a question.
(BY MR. KJELLANDER)You mentioned that you
could have shipped some more.Was there a request
made of the railroad for additional cars?
Yes.
And what was their response?
ll have to point out, Watco has no
control over that.The cars are furnished by either
Burlington Northern or Union Pacific,and however
when they get them then they br ing them to us.
So then, did I hear you correctly that
because the cars weren t there,you opted not to
ship
We have to ship by truck.
Okay.Were those shipped via truck?
Yes.
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
Okay.So you were able to move them
though?
Yeah.But it I S a matter of profitability,
too.
For a comparlson sake, do you know what the
cost differential is between shipping by rail versus
shipping by truck?
It depends on the destination.Anything
east of Chicago certainly should go by rail , and in
some places in California, too.So,it varies.
That I S not a question that I can just give you one
answer to.You know, you have to know the shipping
area, you have to know the amount of product you I
shipping, the weight that needs to be hauled and
varlous other things.
MR. KJELLANDER:Okay, thank you.Mr.
Howell?
MR. HOWELL:No questions.
MR. KJELLANDER:Thank you, Mr. Konkol.
MR. KONKOL:Than k you.
MR. KJELLANDER:Chris.
. .
MS. KUYKENDALL:Christina Kuykendall.
MR. KJELLANDER:Okay.
Thereupon,
CHRISTINA KUYKENDALL,
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
a witness of lawful age, having first been duly sworn
upon her oath to tell the truth , the whole truth and
nothing but the truth testified upon her oath
follows:
EXAMINAT ION
BY MR. HOWELL:
Would you state your name and spell your
last?
Christina K-U-Y-K-E-N-D-A-L-L.Sure.
live in Peck,Idaho.I work in Lewiston at 1626
Sixth Avenue North for the Clearwater Economic
Development Association.
(BY MR. HOWELL)Do you have a statement
today?
I do,S l I have a statement which I will
hit a few brief points.On the Jaype branch ine,
the Jaype mill provided the bulk of cargo transport
for the rail line under discussion today.It
unfortunate that an agreement for rail shipment
raw logs from the region s forests has not
successfully been negotiated.Such a negotiation
would reduce the need for abandonment and provide
incentive for line improvements and regular
maintenance, which would preserve this important
transportation infrastructure.In 2001 the Idaho
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
legislature created the Idaho Rail Preservation
Program.In 2003 the Local Railroad Rehabilitation
and Investment Act is being introduced and is
intended to provide incentives to help rehabilitate
short ine sectors 0 f the ra i 1 road indus t ry which
primarily provide service between rural and urban
America.This year the third phase of the Inland
Northwest Adjustment Strategy has been completed.
The strategy proposes to build upon existing business
sector clusters --
THE REPORTER:m sorry,can you slow down
a little bit while you re reading?Proposes to build
wha t ?
Let me see where I was,strategy proposes
t 0 b u i 1 d u p 0 n xis t in g bus i n e s s se c tor c 1 u s t e r s w h i c
for north central Idaho include wood-based products
agriculture and food processing, metal and mineral
production and creative enterprises.Authorization
is being sought from congress to implement regional
initiatives that will encourage entrepreneurship,
technology,commercialization and work force action
planning.Locally the economic development community
is working to encourage diversification and foster
entry into the global marketplace by our rural
entrepreneurs.The availability of rail as a
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
transportation mechanism can provide them with a cost
effective connection from rural economies to urban
and global marketplaces.
I would like to encourage the Idaho Public
Ut i 1 it ie s Commi s s ion to cons ide r the tool s made
available through legislation and to promote their
utilization for rail preservation and to consider the
efforts underway by us,the economic developers
this region to build on and diversify rural economy
and the impacts of loss of rail infrastructure has on
these efforts.Through partnerships and combined
efforts we can reinvigorate rural economies.
MR. KJELLANDER:Thank you.Are there any
questions, Mr. Howell?
(BY MR. HOWELL)Other than your reference
to Potlatch as a possible log shipper are there
other log shippers possibilities for moving logs from
t he Jay pe rea down t 0 s 0 m e mi 11 fa c i it i e
elsewhere?
Well, there are harvests that take place
state department of lands forests up there as well
national forest service lands,and to my knowledge
Potlatch has been the largest provider of logs,raw
material.
Are there other mill facilities other than
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
Potlatch?
Not adj acent to the rail line.
Okay.
Well Konkolville,excuse me.
Other than Konkolville?
UNIDENTIFIED SPEAKER:Kamiah.
Kamiah , that's true.
UNIDENTIFIED SPEAKER:And then the Port of
Wilma, Kooskia.
Yeah, Kooskia, Kamiah if you re talking
about other sections of the line.
MR. KJELLANDER:Time out, time out.
can only have one at a time and only the person who
has ei ther been sworn in or is doing the cross.And
the reason for that is it's very difficult,even
though she has all of her digits,it's tough for her
to catch all the words when they re coming from
cross-fire.So we ll have to sort of pull that back
In.And, Mr. Howell is there a way in which you
might be able to ask a question that might tie
some of the other parts that were inadvertently heard
here just moments ago?
(BY MR. HOWELL)With the exception
Konkolville, Kamiah and Kooskia,are there other
facilities in other locations, mill facilities?
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
There are a number of facilities up on the
hill, but to my knowledge none of them are using the
line.
And by up on the hill, which direction?
Pierce, Weippe area.
MR. HOWELL:Okay.Thank you very much.
MR. KJELLANDER:Okay.Alex Irby.
Thereupon
ALEX IRBY
a witness of lawful age , having first been duly sworn
upon his oath to tell the truth the whole truth and
nothing but the truth , testified upon his oath
follows:
MR.Alex J.I RBY :I rby ,I-R-B-Y.I come
before you today representing representative Chuck
Cuddy, who is from District representing
Clearwater County,Idaho, Lewis and Valley Counties.
Representative Mr. Cuddy could not be here today.
has to be in Sandpoint.He asked me to read you his
letter.I toyed with the thought of paraphrasing it,
but I think in the best interest of Representative
Cuddy,I would like to read it and then enter it In
for
--
into the minutes in its entirety.And
you ll indulge me,ll attempt to do this.
Dear Secretary, the commi s s ion has at thi s
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
point researched the proposed abandonment request and
knows that this particular rail route is the only
alternative to public highways as a means
transporting raw materials from the upper Clearwater
Basin to manufacturing facilities and to markets both
domestic and foreign.
I firmly believe the possibility for
competi ti ve methods of transporting goods and
materials are essential to help sustain local
economics, part i cular 1 y in the rural communi t ie s 1 i
the Clearwater Basin where the local economy for the
last decade has not experienced the normal economic
growth experienced in other areas of Idaho that have
efficient and competitive methods of shipping
available.
The local communi t ie s adj acen t to thi s rai
route continually pursue methods to provide
additional employment and product manufacturing in an
effort to improve the local economy.
With assistance from the state of Idaho and
local support,the city of Orofino recently developed
an industrial site and structure that will
manufacture a new and innovative product for
distribution to national and international markets.
This facility also provides the necessary floor space
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
for expansion of another expanding business.This
facility will provide seventy new local jobs with
anticipation of needing a second shift in the near
future.A local entrepreneur firmly believes that
the Clearwater area with its many scenic and
recreational attributes will experlence a substantial
increase in tourism and is constructing
multi-million dollar convention center in Orofino,
Idaho, adj acent to the Clearwa ter River and the
existing rail line.This new facility certainly adds
to the potential for scenlC rail tours along the
proposed abandonment route.
I also had a recent conversation that leads
me to believe there may be a new facility installed
at the Jaype mill site at the point of terminus
this proposed abandonment that will require movement
of large quantities of material.This potential
facility would not only provide new employment to the
communi ty 0 f Pierce,Idaho it would be an economic
asset to most if not all of North Central Idaho.
There is a well known and thoroughly
explored large lime deposit located adjacent to this
railroad that has the potential to supply lime for
number of uses provided there is an economically
feasible method of product transportation available
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
to the lime source.This site is located in steep
Orofino Creek Canyon and would require extensive road
construction to provide a feasible truck haul route.
Potlatch Corporation also continues to ship millions
of board feet via truck from the existing Jaype rail
siding.
The existing abandonment proposal
erroneous as the approximately four miles from the
beginning of this proposed abandonment there is an
existing railing road siding that continues to ship
wood products from the adj acent sawmill.This family
owned wood products plant has been in service for
over fifty years and currently requires ninety
employees to operate the plant.They also,through
contract, provide for another two hundred to three
hundred employees that are needed to deliver logs to
this mill and others.This ongoing family business
is currently in the process of upgrading their plant
and at the same time increasing productivity.This
substantial increase in production will require
additional railcars to provide product delivery.Per
my conversations with the managers of the company,
the planned improvements and increased production was
in part based on continued availability of the
existing rail transportation that is an integral part
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
of the current operation.
When one considers the potential serVlces
that are or may be available for this rail branch
service,it appears to me this request for
abandonment is,to say the least, premature and
therefore not honored.I was also of the opinion
that the railroad branch that continues to provide
rail service could not be abandoned, which is
applicable to a part of this existing line.
I would hope that the railroad company
would reassess their existing proposal and rather
than propose to abandon the railroad would work with
the communi t y to develop new and addi t iona
businesses that would benefit all entities concerned.
I believe the railroad company would gain
enthusiastic support from the whole area and find
that all entities including the rail company would
reach a successful and profitable end result.
Signed, Yours Truly,Chuck Cuddy,Idaho
State Representative.
And I'd be happy to try to answer any
questions for Representative Cuddy.
MR. HOWELL:And I have no questions.
MR. KJELLANDER:Knowing Chuck,I won t pu
you on the spot.
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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MR.Okay.IRBY:That's good.
MR. KJELLANDER:And thank you for this.
We appreciate your willingness to be here today.
call now a representative from Idaho Lime whose name
I cannot read , only because of my own inadequacies.
MR. THOMAS:And my handwriting helped.
Thereupon,
PRESS THOMAS,
a witness of lawful age , having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth , testified upon his oath
follows:
EXAMINAT ION
BY MR. HOWELL:
Would you state your name and spell your
last name for the record?
My name is Press Thomas, T-H-O-M-A-S.
reside at Grangeville,Idaho, and I represent Idaho
Lime.
And do you have a statement you d like
give?
I have a statement I would like
paraphrase,I guess.
Please be our guest.
Idaho Lime has a limestone quarry at Lime
LEWISTON, IDAHO 83501
[phone] [phone]
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Mountain, which is at mile marker eleven of the
railroad line.The quarry has approximately fifteen
million tons of limestone that we lease from the
state of Idaho.The royalty goes into the state
endowment fund for schools.We I ve been progressing
towards developing an industrial limestone quarry.
One product that we would be working with would be
aglime,and I will focus somewhat on that one
product.To market this we would have to have
reliable freight service.Our quarry is located
approximately three hundred feet from the railroad
line.ve been hampered in the past.The Camas
Prairie Railroad RailNet decided to charge an
additional fifteen hundred dollar per car tariff and
on a thirty dollar a ton product,a twenty dollar per
ton charge kind of hurt us.Currently,two hundred
and thirty thousand tons of aglime are used annually
in the Wil1amette Valley of Oregon.It's barged down
from Tuxeda Island in Canada to Portland.Then it
trucked into the Willamette Valley to Eugene or those
areas.The trucking costs alone are fourteen
dollars.The rail rate from Lime Mountain to Eugene,
Oregon is currently seventeen dollars and seventy
cents minus the surcharge.The average price
Willamette Valley at this time for aglime
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fifty-four dollars,so there s some opportunities for
Idaho Lime.In fact,m negotiating with some
people for about five hundred tons
--
or,five
hundred cars annually at this time.
The University of Idaho has done research
on soil acidity,and highlights from the report,
Impacts and Management of Soil Acidity under Direct
Seed Systems,Status and Effects on Cropland
Production are,s 0 i 1 a c i d i t Y i s ri s en d u e t 0 a mm 0 n i a
based nitrogen fertilizers.Eighteen hundred pounds
0 f ammonia-based ni t rogen f ert i 1 i zers have been
applied to most ground over the last forty years.
Fifty percent of the fields tested have a pH balance
of five point four or less.Twenty-one percent
fields tested have a soil pH of five point two
less.At five point two, barley yields are down
seven percent,lentil yields are down thirty-five
percent, pea yields are down thirty-two percent,
wheat yields can be down up to twenty-four percent.
At five point one pH , barley is down seventeen
percent,lentils forty-three percent, peas forty-one
percent,and wheat can be down up to thirty-three
percent.
It requires four pounds of aglime to
n e u t r a 1 i z e on e p 0 u n d 0 f a mm 0 n i a - bas e d nit r 0 g e n
LEWIS TON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
fertilizer.Therefore,the eighteen hundred pounds
would represent three point five tons per acre.
There s over a million acres of affected farm ground
here in northern Idaho and eastern Washington , which
if we had reliable freight service, we feel that we
can be in business.But we re going to be out of
business and not able to compete if the rail line is
abandoned.
MR. KJELLANDER:Okay.Than k you.Can we
get a copy of that for the record?
MR. THOMAS:This is all yours.
MR. KJELLANDER:Thanks.And I also have
question.
(BY MR. KJELLANDER)m not sure if And,
heard correctly or not, but let me just ask are
discussions between Idaho Lime and the rail line,are
they occurring now or did they occur in the past?
We were dealing originally with the
Burlington Northern and the Union Pacific,and then
it became Camas Prairie RailNet.And RailNet
purchased,I believe about the middle of March,and I
talked to Mr.Demers at that time.But I've talked
to Mr. Thrall since then,and they feel that they
need approximately seven hundred cars to keep the
line open or that was what he told me on the
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
telephone.
Do you have any idea how many cars you
would be looking at through Idaho Lime if you were
able to get the aglime product ready to market?
I feel that with the Willamette Valley
potential,there d be four hundred there.And then
think it would have to start slowly in this area,
because the economics have to justify applying the
aglime,and they have to have so much loss before the
economics start kicking in and overcoming the fact
that they ve never had to aglime before.
Now the seven hundred cars that you were
quoted to keep the line open , was that seven hundred
cars from Idaho Lime or seven hundred cars in total
on the rail line itself or was that just from you?
m not sure to be honest wi th you.I was
talking about myself,so I assumed
Okay.
--
Idaho Lime.
MR. KJELLANDER:Okay.Thank you.Mr.
Howell.
(BY MR. HOWELL)Mr. Thomas, when was the
last time you shipped lime by rail?
1998.
And,is it fair to say that the reason you
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
haven t shipped after that point was the increase
the rail rate?
In part.My own health has prevented me
from doing some things.
And other than -- have you had any other
conversations with the Great Northwest Railroad since
they took over the line than the one you referenced
you had wi th Mr.Demers?
The one wi th Mr.Demers and two I believe
with Mr. Thrall.
And
And one wi th Ray Lei terman.
And who are the two gentlemen that you
referenced last?
I believe Mr. Thrall is the general manager
and Ray Leiterman is operations manager.
Did they provide you any kind of
opportunity for lowering the rate if you could begin
shipping by rail?
Not really.I hadTo be honest with you,
to catch them in their office.They weren
returning phone calls.
MR. HOWELL:Okay.All right.Thank you
lr.
MR. THOMAS:Thank you.
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
MR. KJELLANDER:Thank you for your
testimony.d like to call now Ken Rea.
MR. REA:No statement.m just
attendance.
MR. KJELLANDER:Thank you.Thanks for
being here, and you re wi th the department of lands?
MR. REA:(Witness nods head.
MR. KJELLANDER:Appreciate your presence.
Mr. Stan Leach.
Thereupon,
ST AN LEACH
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth , the whole truth and
nothing but the truth, testified upon his oath
follows:
MR. KJELLANDER:Mr. Howe 11 .
EXAMINATION
BY MR. HOWELL:
Could you state your full name and spell
your last for the record,please?
Stan Leach L-E-A-C-H.
And,Mr.Leach where you reside?
Orof ino.
And do you represent anybody at today ' s
hearing?
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
Clearwater County,m one of the
commlSSloners.
And Mr. Co mm i s s ion e r , do you h a v e
statement you I d like to give?
Nothing really prepared.I do a little
better if I just speak freely.
That's perfectly fine.
Okay.Speaking for the county,
greatly concerned with the loss of railroad, because
a lot of products that are shipped by rail will then
be moved to road system and we have a very limited
tax base in Clearwater County.Over fifty percent
the land here is federally owned and therefore pays
no property taxes.There is some money that comes
back through programs , but it's not near enough
keep up with the work that has to be done on the
roads.Our entire road budget for the last year was
approximately one point seven million dollars,and
estimates to upgrade and fix the Grangemont Road
which would carry a lot of these products are about
thirteen thousand dollars
--
thirteen million
dollars,excuse me.As you can see,that's far
outside the scope of what the county can afford
do,so we re concerned about that.re working
very feverishly to try to strengthen our economy
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
this area,and if we lose the railroad it will be one
more tool out of the tool box that we can I t use.
There are some potentials.The waste energy plant
that was spoke about earlier there s potential
there.Also,it seems to me that the petition was
little bit in error because it said there was no
traffic on the line for two years.And,I live right
next to the rails and the train goes by there quite
regular ly going to Konkol'shipping boards.
that seems to me to be In error.If this does
proceed to abandonment we would like to pursue
rails to trails program to try to make whatever
situation,you know , make as good a situation as we
can out of what we have to work with.It's a 1 so
understanding there s a federal law that would allow
the railroad to leave the support structures the
trestles,culverts,things like that,that they don
necessarily have to remove those if it's abandoned.
We have a local flood commi t tee tha t was started
through the project impact fund and they have
res ear c h e d it a n d the y w 0 u 1 d c e r t a i n 1 y r e c 0 mm end t hat
if it goes to abandonment that all the drainage
structures be removed.That would include the
trestles and the culverts, because if there is no
access,if the rails and ties are pulled and there
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CLEARWATER REPORTING OF IDAHO, LLC
no access in there to do maintenance,it's only
matter of time before some of those drainage
structures will fail.Even if it proceeds to a rails
to trails program,there would need to be something
done with the trestles, because the trestles, much
the support for them the support pillars are set in
the creek itself.And that creates the problem,
because as debris washes down the creek it builds up
against these trestles,and without a way to get
and remove that, there again it's only a matter of
time until it builds up and could flood clear down
into Orofino.So, we re concerned about that.They
would have to be altered to allow passage of debris
so nothing would build up behind them.Than k you.
MR. KJELLAN DER:Than k you.Mr. Howe 11 .
(BY MR. HOWELL)haveC 0 mm i s s ion e r Lea c h
you 0 r an y 0 f the 0 the r c 0 mm i s s ion e r s had a c hat wit
Great Northwest Railroad expressing your concerns and
trying to have them postpone the abandonment?
We talked with them a couple different
times,once person,once phone.
And take you weren 'successful?
Well,they seemed kind have their
mind made up.
MR. HOWELL:All right.Thank you,sir.
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
MR. KJELLANDER:Than k you f or your
testimony.
Mike McNichols.
Thereupon,
MI CHAEL McN I CHOLS,
a witness of lawful age , having first been duly sworn
upon his oath to tell the truth the whole truth and
nothing but the truth testified upon his oath
follows:
EXAMINAT ION
BY MR. HOWELL:
Mr. McNichols,if youyou know the dr ill,
would?
My name is Mike McNichols,last name,
M-C-N-I-C-H-O-L-S.I live in Lewiston , but I lived
longer in Orofino than I I ve Ii ved in Lewiston.
here on behalf of Konkolvil1e Lumber Company,and I
u n d e r s tan d t hat the Pub 1 i c Ut i 1 i tie s C 0 mm i s s ion i
interested in three issues.One, whether the rail
line is profitable; two, whether the abandonment
would deny shippers acces s to markets; and three,
what the effect on the area in general would be.The
evidence so far clearly shows that the Konkolville
Lumber Company access to its critical markets would
be terminated if the abandonment were permitted.
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
You ve heard other testimony about the effect of the
abandonment on the economy of the area in general.
What you haven t heard anything about
profitability.And while the records of the railroad
are,of course, private and we have no access to
them, we understand from a transportation lawyer that
ve engaged in Washington D. c. that if a line has
forty-one cars per mile per year it should be able
be prof i table.And, as Mr. Konkol told you earlier
Konkolvil1e Lumber Company shipped a hundred and
eighty-two carloads in 2003.As I mentioned, we have
retained a transportation lawyer in Washington D. C.
by the name of Fritz Kahn and he has filed a letter
with the Surface Transportation Board objecting
the,to the Great Northwest Railroad's notice
exemption and I'd like to offer a copy of Mr. Kahn
letter into the record.With regard to
profitability,the only people that know whether the
line is profitable is the railroad,and they have
presented no evidence to you here today.And so
w 0 u 1 d ask the Pub 1 i c Ut i 1 i tie s Co mm i s s ion to d raw
from that lack of evidence an inference that the
line, particularly at least the first three and
half miles is in fact profi table.And so,on behalf
of Konkolville Lumber Company,I would as k the
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
commission to oppose the abandonment before the
Surface Transportation Board.And I'd be happy
respond to any questions.
MR. KJELLANDER:Than k you.Mr. Howell.
MR. HOWELL:I ha ve none,S l
MR. KJELLANDER:Let me make sure I don
have any before we lose you here.I think you I ve
been pret ty concise.Thank you very much Mr.
McNichols.
MR. McNICHOLS:Thank you.
MR. KJELLANDER:We now have Shaun Maxey.
Thereupon,
SHAUN MAXEY,
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth the whole truth and
nothing but the truth,testified upon his oath
follows:
EXAMINAT ION
BY MR. HOWELL:
Mr. Maxey,could you state your name and
spell your last for the record,lr.
Yes.My name Shaun Maxey,that's spelled
S-H-A-U-N last name Maxey, M-A-X-E-Y.m an
economlc development specialist for the Ida-Lew
Economic Development Council.I live in Grangeville
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
and also work out of Grangeville for Idaho and Lewis
Counties.
MR. KJELLANDER:And do you ha ve
statement for us today?
ll provide a copy of this,Yes.and I'
also like to provide a copy of this rail map which
ll refer to.
MR. KJELLANDER:Thank you.
d have to provide a copy.Here we go.
Mr.Pre sid en t, C omm is s ion e r s ,Elected Officials and
Representatives of Great Northwest Railroads and
Concerned Citizens and Businesses of North Central
Idaho:Thank you for the opportunity to speak today
concerning Great Northwest Railroad's proposal to
abandon the rail line between Konkolvil1e and the
closed Jaype Mill near Pierce.As I said, my name
Sha un Maxey.m the economic development specialist
of the Ida-Lew Economic Development Council.I have
two of my board members here today, Tony Snodderly
(phonetic)at the back from Craigmont and Craig
Johnson from Kamiah.
Ida-Lew s mission is to grow and expand
existing local businesses,to assist the startup
new local businesses and to help recruit new
businesses to come to the area.Our organization
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
comprised of board members representing Idaho and
Lewis Counties,the cities of Cottonwood,Craigmont,
Kamiah Kooskia,Grangeville,Nezperce and the
unincorporated Elk City area.Addi tional ex-officio
members of the board include the Idaho Department
Commerce and Labor and the Clearwater Economic
Development Association.
My purpose here today is to explain the
adverse impacts that Ida-Lew believes will occur
approval is granted to abandon and remove the Orofino
to Jaype rail line.ll address the impacts that
the abandonment and removal can be expected to have
on our region s economic development potential and
upon Idaho and Lewis County businesses.
The Ida-Lew Economic Development Council
extremely concerned about loss of rail service to an
existing lumber shipper as part of the proposed
abandonment.The Pub 1 i c Ut i 1 i tie s C 0 mm i s s ion pre s s
release indicates that the proposed abandonment would
begin at milepost zero point zero in Orofino.This
would eliminate the direct rail service to
Konkolvil1e Lumber Company.Konkolville is one of
the largest rail shippers east of Lewiston.The
proposed abandonment,if approved,will significantly
raise Konkol's loading and shipping cost and reduce
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO , LLC
the amount of carloads on the Lewiston to Kooskia
rail line.
The Lime Mountain Quarry is owned,
stated previously,by Idaho Lime,Incorporated.
Idaho Lime also owns a mineral crushing facility
Grangeville that's capable of sorting and reducing
material down to micron level Slze.Lime Mountain is
1 0 cat e d on tat e and i mm e d i ate 1 y a d j ace n t to t h e
Konkolville,Jaype rail line and has current
operating permits.Limestone from this quarry
suitable for processing into a wide variety
products that are used in many industries.Limestone
and derived products are used in making paper
agriculture lime to adjust soil acidity,for
whiteners used in plastics,for livestock feeds,
addition to many other products.
Ida-Lew has been working with Idaho Lime to
overcome some of the obstacles to a resumption of
rail service to Lime Mountain.ve been working to
identify customers for lime In sufficient quantities
to resume rail shipment and to repalr flood damage
the line below Lime Mountain.ve recently become
aware of a potential industrial customer for lime who
may need five hundred rail car loads annually.
also investigating sources for possible financial
LEWIS TON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
assistance for bridge repalrs.Loss of rail service
to Lime Mountain leaves trucking as the only
alternative for moving lime out of the quarry.
The raw material,if processed at Idaho
Lime 's Grangeville facili ty will probably have to
travel through Kamiah over State Highway 162 and the
Nezperce-Grangeville Highway,also referred to as Old
Highway 7 , which is indicated on the map I provided.
This may lead to additional highway maintenance
expenses for the state of Idaho and for Idaho and
Lewis County highway districts.
Ida-Lew is concerned about the impact that
the abandonment and removal of this rail line may
have on the long-term viability of rail service east
of Lewiston and our business retention and
improvement efforts.Removal of this line will
reduce the amount of logs that can be shipped via
rail to the mills in Kamiah and Kooskia.This may
also reduce the number of outgoing rail shipments
lumber.Removal of this rail line is also more
likely to make it more difficult to recruit and
retain businesses that want rail service as
transportation option.Businesses that require rail
servlce are frequently large employers.
That concludes my statement,and I'd be
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
happy to answer any questions.
MR. KJELLANDER:Thank you, Mr. Maxey.Are
there any questions?
(BY MR. HOWELL)Mr. Maxey,you made
reference to a potential of five hundred rail cars
for Idaho Lime s product.Would that be the same
agriculture use of lime suggested for
--
that Mr.
Thomas mentioned about in Oregon or is that
different use?
This would be a different use.No.
only become aware of this in the last couple of days
and it would involve lime used for an industrial
application other than aglime.I t would be an
industrial application.There would be other
chemicals used as well.That operation wouldn
n e c e s s a r i 1 Y b e sit e d her e i n 0 u r i mm e d i ate are a , but
it would -- the Idaho Lime quarry at Lime Mountain
would be a source of raw materials to supply that
industrial operation.
In your endeavors and activities with the
Economic Development Council not knowing whether
ll have a witness from Potlatch today,do you
know can you describe what activities have taken
place between Potlatch and the railroad as far as why
Potlatch is not able to ship logs anymore?
LEWISTON , IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
Well I don t think I would use the term
not able to ship logs anymore at this point.
not aware of the contractual details of the
contractual arrangements that exist currently between
Potlatch and their current suppliers of
transportation services to move logs between the
Jaype and Pierce areas to Lewiston,and I believe
there are other people that could testify that
probably would be better informed about that than I.
But yeah there probably leave
that.There are people that
That'fine.
--
are more knowledgeable about that than I
certainly.
MR. HOWELL:All right.lr.Than k you
MR. KJELLANDER:Thank you for your
testimony.That concludes our list of those that
signed up, but we did mention earlier that if others
would like to testify that it certainly is an
opportuni ty and now would be that chance.I believe
that you had suggested you wanted to testify,and if
you want to come forward and we can get you into the
record.And are there others who wish to testify
we 11 ?Two more , three more okay,good.
Thereupon
LEWISTON, IDAHO 83501
[phone] [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
DONALD I. EBERT,
a witness of lawful age , having first been duly sworn
upon his oath to tell the truth , the whole truth and
nothing but the truth testified upon his oath
follows:
MR. KJELLANDER:Thank you.Please be
seated.Mr. Howell.
(BY MR. HOWELL)Could you state your name
and spell your record
--
spell your name for the
record?
My name is Donald I. Ebert,E-B-E-R-T.
Mr. Ebert, where do you reside?
I reside in Weippe,Idaho.
And are you representing anyone today?
Clearwater County.
All right,Sl r.
m a commissioner as well as Stan and
Pete.
C 0 mm i s s ion er E b e r t the n do you ha ve
statement you like glve the co mm l s s i on?
Yes.Like Stan better just
talk.heard some interesting points here
today, and a lot of bases have been covered.One
that I think is very important is that we re talking
about abandoning a portion of the line that is very
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
much still in use,and that's from zero to three
point five,Konkol vil1e and I believe it'
profitable and necessary.Another point is that
believe you have to take consideration onto the
impact of roads once the railroad is abandoned.But
it's kind of a technical snafu,I think, because our
road is already being hammered because the railroad
is not being used.And then that leads to
profitability.And,I was sitting here thinking
about this,and it's one point that Mr. McNichols
touched on but I kind of got to thinking about
and it brought to me a question,how profitable does
it have to be.Does it have to be just break even
plus you know,a dollar or two, but what it made me
think was,is there any consideration by the PUC for
the railroad was once profitable,I believe very
profitable,and perhaps they took too much of the
profit.Maybe some of it should have been put back.
And so then you can easily take something and gouge
all the profit out of it and sell it to someone else,
and they can say, well , we can t make a profit out of
it.But over the life of this rail line I believe
could probably shown to be profitable.And, we can
know the numbers, but I be ieve tha you know, how
much profit has been made off the railroad in the
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO , LLC
last hundred years.Another thing that concerns me
is that I wish
--
I would hope that you would
consider that you can measure the value of the
railroad today, but I would wish that you would
consider the value in the future potential for profit
you know,uses that we are trying to develop.
You know , there s a lot of things,there s a lot
things that could happen that we would be dependent
upon the railroad.And, without the railroad our
county here could basically make a shift from
industry to a playground , because it would pretty
well wipe out our industrial capabilities from
Orofino up,and that's the greater portion of the
county.We don t want that.We want to work.
want to make a living.You know we don t want
people to gi ve us handouts.We just want to be able
to make a living here,and I think it would be
prudent to consider way into the future,not just the
next few years.The life of that railroad you could
show a period of time certainly with that or any
business where it was quote, unquote not profitable,
but I believe one day again it will be profitable
and I believe it has been in the past.
I guess that'
--
that I s about all I have
to say.People have touched on some very interesting
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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points here, and I just hope that,I hope we can hang
on to it.And one more thing I'm against,okay,
are against abandonment, that's our position.We are
also against reversion of the right of way.Is that
how you say it,reverslon,reverts back to
--
we are
against reversion of the right of way as well.
MR. KJELLANDER:Okay.All right.Mr.
Howell do you have any questions?
(BY MR. HOWELL)Commi s s ioner Ebert,
abandonment is granted and under the STB,or the
Surface Transportation Board criteria,if they can
if the railroad can demonstrate that no traffic has
moved at least on part of the line for more than two
years, there s an assumption on their part that it
unprofitable.But if it were abandoned is -- would
the county like to see that converted to a rails
trails or some other recreational opportunity?
Did you just ask me the question if it were
abandoned, would we like to see it go to rails
trails?
Correct.
We would like to see it glven serlOUS
consideration,and most probably we would be for
that.Although, we haven
--
I can t sit here today
and tell you that we absolutely would be for it.
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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would have a long ways to go to determine that.
would be very interesting in looking at it.
MR. HOWELL:All right.Thank you
C omm is s ion e r .
MR. KJELLANDER:Thank you.Thank you for
your testimony.We had a hand here and a hand there.
Why don t we take you since you re closest.
Thereupon,
JOSEPH PIPPENGER
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth, testified upon his oath
follows:
MR. KJELLANDER:Thank you.Mr. Howell.
EXAMINAT ION
BY MR. HOWELL:
Sir, can you please state your name and
spell your last?
Joseph B. Pippenger,P-I-P-P-E-N-G-E-R.
And,sir, do you reside in Orofino?
Yes.
And do you represent anybody today?
We 11,and I 'm the mayor of Orofino,
also the chair of the Clearwater County Economic
Board,and I do have a wri tten statement and I'd like
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
to submi t that.And,a lot of the information that
put in here has basically been stuff a lot of it'
been covered already.ll try and skip through some
of this , because as I said these points have been
touched on.
The Clearwater County Economic Development
Board ba icall y is made up 0 f the commi s s ioners,the
c 0 u n t y c 0 mm i s s ion e r s ,the Nez Perce Tribe, the Idaho
Department of Commerce and Labor,and the Clearwater
Economic Development Association,CEDA.And,as we
work , well, beginning in the early ' 80s we had the
unfortunate distinction of having the highest
unemployment rates in the state.It was not uncommon
for the county unemployment to hi t fourteen to
eighteen percent, and in 2000 when Jaype Mill
unexpectedly closed its doors,the unemployment
skyrocketed to basically near depression-era levels
of close to twenty-five percent,and it was the
highest in the nation at that time.We even made USA
Today as the highest in the entire United States, not
a distinction we were proud of.But, the closure
the mill devastated the livelihood of our citizens
and forced many people to relocate elsewhere.
also forced the local leaders to find ways
diversify the economy and reestablish our job market.
LEWISTON , IDAHO 83501
[phone] [phone]
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The rail service to old Jaype region and neighboring
communities lS a significant infrastructure asset
that we are trying to build upon.The abandonment of
the Jaype branch will greatly reduce the potential
for economic development opportunities in the region
of Clearwater County.
As has been touched on before about going
from zero zero clear to the mill site wi th
Konkolville Lumber in that corridor,there s ninety
to ninety-five jobs right there,and that doesn
even touch the timber harvesting arena which is
probably over three hundred additional people,not
including spouses and dependents.That closure of
the rail line would have devastating consequences
the citizens and business for Clearwater County.
When we re in the midst of trying to rebuild and
diversify the damages from our last mill shutdown
this is very difficul t to face.
Wit h the n a t u r aI r e sou r c e bas e 0 f t i mb e r
dwindling,we I ve worked wi th our state and federal
officials to find new ways to diversify the economy.
W e 're 1 0 0 kin g for Ion g - t e r m fun din g c 0 mm i t men t s ,and
that's difficult to do with the future of the rail
servlce.There have been many businesses on the hill
looking to locate there,and then with the
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CLEARWATER REPORTING OF IDAHO , LLC
uncertainty of the rail system it has left them in a
position where they re not sure what they want to
there.The rising cost of trucking fuel costs,
mean , the county and state roads are in need
repair.All of these things state that the rail
could be and should be competitive with these means
of transportation.
As mentioned before about the waste
energy proj ect in Pierce,that would require tons and
tons of material being moved and the most economical
way to move that material would be by rail rather
than truck.I don t think Highway 11 and Grangemont
Road could handle those kind of weights,and I think
the corridor that was looked at in this was probably
a six- to seven-county region,and the rail would be
the only probably feasible way to do this.
If you look at the beauty of this,as was
mentioned before about the Orofino Creek corridor,
probably one of the most untouched scenlC
through-ways in this state or northwest.I mean,
it's a beautiful, beautiful area.There s been tal k
before,and I know sometimes it I S talk, but the
seaport has been bringing in their tour boats again,
and that's part of the package they re looking
offer is go from the tour boats, put them on the rail
LEWISTON , IDAHO 83501
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and travel up to this area and possibly a destination
resort at the end.That has been discussed.It wa
brought up at a meeting we had with Watco about two,
three months ago,and since then I haven t heard
But,I don I t know if Watco has hadanymore about it.
anymore interest from that party or not.
Basically all of these things,you know
that works the other way,too, with the Lewiston
Seaport , but that does open up Clearwater County
the rest of the world wi th the seaport.And being
that's not that far away from the seaport to the
heart of Clearwater County,that is our main tie to
the world.
So, and I guess in closing,1 i ke to
encourage the Publ i c Ut i 1 it ie s Commi s s ion to cons ider
the economic development activities currently
underway in diversifying Clearwater County.Please
consider the impact the loss of rail infrastructure
will have on these efforts and the adverse effects
abandonment on the economy of our county.like
to thank the public utili ties commi ttee for this
hearing today,and please consider our input in your
f ina 1 recommendation.Thank you very much for your
time and consideration.
MR. KJELLANDER:Than k you.
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
MR. PIPPENGER:Do you have any questions?
MR. HOWELL:Thank you , Mr. Mayor.
MR. KJELLANDER:Okay, thank you.Can we
have a copy of the comments?Thank you.Thank you
for your testimony today.
Was there another hand that went up too?
Good, thank you.
THE REPORTER:Can you excuse me just one
second?
(Discussion held off the record)
MR. KJELLANDER:All right.ll go back
on the record.
Thereupon,
CLARK E. CALLEAR,
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth , the whole truth and
nothing but the truth , testified upon his oath
follows:
MR. KJELLANDER:Mr. Howe 11 .
EXAMINAT ION
BY MR. HOWELL:
Sir, could you state your name and spell
your last for the record,please?
Ye s.Clark Edmond Cal1ear,
C-A-L-L-E-A-R.Ahsahka,Idaho.
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
And do you represent anybody today?
Myself taxpayer.
And do you have a statement you d like
give the commi s s ion?
Yeah , please.m against the abandonment.
An important issue I think needs to be stressed,
was said earlier that over half of Clearwater County
is national forest,and millions upon millions
board feet of dead and dying timber are available
continuously,regularly on the national forest.And
that I S basically over recent years been shut down
logging,it's just been sitting there becoming a fire
hazard.And six months ago congress passed the
Healthy Forest Restoration Act, which will allow that
timber to be logged on a regular basis.And,this
in the works,it's coming down through the pipe.
re going to see essentially a whole lot of
vai 1 able t imbe r to us comlng f rom the na t iona 1
forest, which we haven t seen for recent years.And
I think that this,golng into this hasty shutting
down of the railroad,lS a huge mistake.We need
time, we need time for local governments and the
state governments to negotiate with the railroad.
Can you imagine how much shipping it's going to take
to get that timber out of the woods,and I think
LEWISTON , IDAHO 83501
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that's really worth taking our time and looking at
this close.Let's not rush hastily into this,
please.Thank you.
MR. KJELLANDER:Thank you.Any questions?
MR. HOWELL:No questions.
MR. KJELLANDER:Thank you very much.And
I believe I saw your hand, too.Is there anyone else
who would like to testify?
Thereupon,
BRENT THOMSON
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth , testified upon his oath
follows:
MR. KJELLANDER:Please be seated.Mr.
Howell.
EXAMINAT ION
BY MR. HOWELL:
Could you state your full name and
My name is Brent Thomson 588 Crestline
Circle Drive in Lewiston.here representing
myself.
THE REPORTER:Could you spell your last
name, please?
MR. THOMSON:T-H-O-M-S-O-N.
LEWISTON, IDAHO 83501
[phone] [phone]
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THE REPORTER:Thank you.
MR. THOMSON:I prepared a comment and sent
it as an e-mail , which you already have.And the
co mm en t s I' d 1 i k e to m a ke n 0 w ar e l s sue s t hat I t hi n k
require a little bit more emphasis to be sure that
they re understood and cons idered.
The first point I would make is that our
entire five-county region and three counties in
Washington depend heavily on a railroad network.
Economic development cannot be successful if you do
not have a rail network.The cost of shipping goods
is going to be cheaper not only now by rail but more
so in the future because of the increased cost of
energy.In addi tion to tha t,the energy i sn ' t just
used for trucks.It's used in our every day life.
That's going to contribute to electricity costs,
things besides just costs of transportation,
production cost.
And so, when we talk about the rail system
that serves the port,d call your attention to the
fact that Carl Moore who was the original chairman
the Port 0 f Lew i ston, the commi s s ione r s,and that
was also the director of the Idaho State
Transportation Department,and his goal for the port
was for it to be the terminal port on the Snake River
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CLEARWATER REPORTING OF IDAHO, LLC
and that it would provide intermodal transportation
to facilitate shipping into the interior of the
United States and from the interior of the United
States that would be transferred in Lewiston to boats
from trains and trucks,and the reverse was also to
be true.Now we have largely failed totally
succeed with that goal.And when you look at the
it's easily traced to the failure of thereason,
railroad system.We have abandoned the key sections
of the railroad that allow us to connect the port to
the inland empire and the center portion of the
Uni ted States.It's been done in an insidious way
the point where we wonder, how did we allow this to
happen.We have to as k the questions.We had
flood in '96 and ' 97 I believe, was the winter.
was a pretty serious flood,and it caused some
damage.One of the lines that was damaged ran from
Arrow to Moscow.A million and a half dollars would
have ta ken care of it.Nobody even bothered to file
f or loans or grant s through FEMA and the Federal
Transportation Department,to my knowledge,to allow
that line to be restored.We just simply covered
up and put the highway on it,and that was our
arterial lifeline.That was the beginning of the
end.
LEWISTON , IDAHO 83501
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The railroads sold
--
the major railroads,
Union Pacific and Northern sold the Camas Prairie
RailNet that they had owned and operated at a profit
for many years,and when they did it,they didn
sell it to the highest bidder.They sold it to the
third one down the row.In addition to this,the
deal was financed by putting things into a deal with
the salvage companies to collateralize their loan to
buy the railroad with.These kinds of things aren
made public.They turn out later.And we found then
there was another branch of the line that went from
Bovill to Harvard that was abandoned just like that
(indicating) One day the salvage company was out
there taking the ties up, the rails off.It turned
out that that wasn t owned by the railroad anymore.
A salvage company had used that as collateral.The
company was behind on the loan,so just go get the
ties and sell it and that I s that.So there s two
breaks.Now we come up here to Grangeville, we have
right of way being sold off,and when the right of
way was sold off I believe that there was not
adequate right of way sold to allow even the salvage
of the trestles, because the trestles are outside the
right of way of the railroad.So how do these things
happen?I don t understand.We I re supposed to have
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CLEARWATER REPORTING OF IDAHO, LLC
some kind of protection for public things,certainly
the railroads were created by this.So,the - - the
issue is, why didn t we use the resources available
to us to rebuild these lines.Why didn t the
companies try to get the loans and the resources
rebuild the lines when they were damaged by the
washes and so forth?in fact,Was there,a decision
made several years ago that we re going to abandon
this line and we re just going to milk it,put no
money back into it,take all the money we can out of
it until finally it's going to fail and then we
going to say,okay,it's time to sell the tracks and
the ties and pull out?I don t think that's how
you re supposed to run a railroad,m sorry.
Finally, we have an issue of,what could we
do if we did have the railroad.And if you go up
Pierce and the Jaype area,you 're si tting right
the middle of a whole bunch of timber,and we ve had
some prohibitions on cutting now for about fifteen
twenty years,and t hat t i mb er g row s pre t t Y f st.
forty years you re pretty well up to where you
getting some pretty good timber out of there.But,
we also have a lot of insect damage and the potential
for fire.those things are there,So,and the
protests that have been filed in the past have
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
completely shut down the opportunity for a continuous
sup ply 0 f t i mb e r .So anybody that goes in with the
idea that we I re going to build a plant to use this
timber has to be able to rely on getting it every
But if any John Dick or Harry can come year.
and ask for a protest to keep it from happening,then
you aren I t going to have a timber supply that you can
co un t on.So, who s going to risk their money to put
in a plant to do that?And now we 're si tting at a
crossroads.We have a whole bunch of timber that'
small,that's insect infested.It is a fire hazard.
It's too close together needs to be thinned and
needs to be taken care of.The forest management
plan is saying we should do that.Congress is
providing money to do that.This is the opportunity
to use that kind of timber.And so,if we could
establish a uniform supply of that type of timber
then it could be used to,first,in a small log mill,
the best of it.ll have a whole bunch of
that's not sui table,it will be chipped,and it can
be used in a production facility for power by burning
it.It could also be used to generate ethanol.
You re familiar wi th ethanol plants.They come in
two varieties,and that from corn by fermentation
the most common thing,gralns.And the state
LEWISTON , IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
Idaho has funded plants heavily for that sort of
thing.
But I'd point out that a second process
ex is t s to use t imb e r ,and the process involves using
an ac id to hydrolyz e the t imbe r followed by
en z yme tha t brea ks the sugars down to alcohol s .The
improvements that are needed for enzymes are being
done.These have been the forefront of the federal
energy program for the last several years.There has
been progress made.There also is the knowledge that
some of the enzymes can operate at a higher
temperature which is needed for them to be more
efficient.That problem has been addressed by
research.So two of the major obstacles are on the
brink of being solved.The plants that have been
pi lot pI ant scales f or ethanol with t imbe r have
produced ethanol at about ninety cents a gallon.And
if you put on that the subsidy for the fuel,it could
be sold economically.
If you consider what we I re paYlng for gas
right now ethanol from timber is feasible.I f you
think the folks are going to reduce their oil prices
to us after the war in Iraq,then maybe we shouldn
build that.But if you think maybe they are going to
keep their prices up, maybe we should be looking at
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO , LLC
some of this.
The ethanol plant of that order would
require something to hydrolyze the enzymes,and
you ll want to neutralize the acid that's used.And
the limestone that you have at Lime Mountain just
happens to be at the right place.In addition to
that,there s another very large deposit of
crystalline calcium carbonate or marble that exists
in the Headquarters area in the other direction.
Potlatch happens to use that stuff.They ship it In
from a long distance away and are paying freight
costs by rail up to forty,sixty dollars a ton to get
it here.So I would submit that we should be able to
get that material,run that back down the rail.
In addition to that,if you I re going to
have a coal plant to create power,one of the things
that comes out of it is fly ash.And the newer
processes for handling fly ash allow you to mix that
with lime,in the burning process,and you canagaln
create a silicate,that's an alumino-silicate in the
fly ash.And that alumino-silicate is useful
roads,and it I S been found that it can be used
generate a high strength concrete that has strengths
up to four times greater than normal concrete has.
And so it allows you to surface roads with that
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
material the top couple of inches and extends the
life of the road.
So,those kinds of products can be used
also together with the clays that are in this region
as well.Limestone with clay,a s you know can also
be used to make Portland cement.In fact,Portland
cement was a product that was done just below
Orofino,and that's where it got its name.The
original stuff was produced right here in Clearwater
County along the Clearwater River.
If these things are to occur they have to
have a railroad to work.They won t work wi thout the
railroad,and I'd just like everyone to know that'
wha ti s on the table.And I apologize for being maybe
more concerned about this than I should be, but it
important,and I thank you for your courtesy
listening to me.
MR.KJELLANDER:Mr. Howe 11 .
MR.HOWELL:No questions.Thank you very
much for your testimony.
MR. KJELLANDER:Thank you for your
testimony.
And I saw your hand,so we ll have you
move forward.
Thereupon,
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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CLEARWATER REPORTING OF IDAHO, LLC
JOSEPH PETE CURFMAN,
a witness of lawful age, having first been duly sworn
upon his oath to tell the truth, the whole truth and
nothing but the truth testified upon his oath
follows:
EXAMINAT ION
BY MR. HOWELL:
Would you state your name and spell your
last for the record?
Joseph.I go by Pete
--
my middle name
Curfman C-U-R-F-M-A-N.m a Clearwater County
commissioner.
And Commi s s ioner Cur fman,do you have
statement you d like to give us?
I would Ii ke to say a few words.
listened to all the other testimony coming out here,
and most of everything that needs to be said has been
said.But, we have a few things that haven t been
brought up,and one is if we went in for the lime up
on Lime Mountain there s a bridge up Orofino Creek
that's limited tonnage-wise to less than what a truck
can ha ul And if we was going to make it profitable
for trucking off of there, we d have to have adequate
roads and bridges to haul a hundred and five
thousand.That would be the only profitable way
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
trucking industry could make it.With the railroad,
that's already done.The railroad can haul that.
The lime, Mr. Thomson was very, very good at what
said about what he
--
the lime and so forth and the
productivity that Clearwater County used to have
right here in Orofino,Idaho.They hauled out many,
many train loads of Portland Cement right out
Orofino.There used to be the Orofino locks deal
down here until 1963 and it burned and many carloads
of grain went out.So,in a lot of these instances
it was so much easier to call the trucking industry
than it was to rebuild the facilities.And with
Jaype,I feel that's what happened there.It was
much easier to call trucks than it was to rebuild
facilities or come up with something different.
keep hearing this abandonment procedure.Every time
we try to make an economic development decision
Clearwater County, we get hit with the bad news that
the railroad is going to be abandoned.To me this
just a detriment to all our solutions of trying
build something.With the problem of our roads being
hit terribly hard with the extra transportation
logs since they closed down the Jaype log shipping
department, when we talked to Watco they said
possibly they might come up with something here
LEWISTON, IDAHO 83501
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CLEARWATER REPORTING OF IDAHO , LLC
Orofino that could be a reload, where you can truck
in to Orofino.But to me it seems kind of senseless
when we have this railroad to have to haul to Orofino
out of the high country and then reload just to get
them to Lewiston.That doesn t compute too well.
So,the main thing is,as far as I am
concerned,and my vote on the commission would be to
not abandon.But if we do,the trestles need to be
reverted.And if we do abandon , we need to go to
program such as rails to trails or some situation
where the county would maintain the right of way.
a -- what do they call it -- rail banking situation
where the county could maintain the right of way
there was such a time that it decided to go back in,
that it would be possible in the future,the right
way would still be intact to be put in place.
I believe that's all I really have to say.
Any questions?
MR. KJELLANDER:Thank you.Mr. Howe 11 .
MR. HOWELL:I ha ve none.Than k you,
Commi s s ioner.
MR. KJELLANDER:Appreciate your testimony.
Is there anyone else who would like to testify before
we bring this to a close?Yes.
MR. BRUCE:Sir,d like to add one point.
LEWISTON, IDAHO 83501(800) 247-2748 [phone]
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m T.J. Bruce.
MR. KJELLANDER:Okay.And you re still
the record.Do you want to just do it from there?
MR. BRUCE:Okay.There was talk from the
Economic Development Council about facilities that
would be impacted by the closure of this line.
MR. KJELLANDER:Uh-huh.
MR. BRUCE:And, we have three ports down
at Lewiston Port of Lewiston Port of Clarkston and
Port of Wilma.And,items of trade can go both
directions out of those ports,and this railroad
provides an essential link to those port facilities.
I would just like that to be added to expand
what's further
--
, what the other testimony was.
MR. KJELLANDER:Thank you.We certainly
do appreciate everyone s willingness to spend their
afternoon with us today.Appreciate the
a c c 0 mm 0 d a t ion s he r e ,and I also want to thank you
Amy,for your efforts and for all the work you ll be
doing for us to try to turn that around rather
quickly.Notice how I got that on the record.Also,
i f you w 0 u 1 d 1 i k e t 0 add fur the r c 0 mm e n t s 0 r t 0 add
further support to some of the comments you made here
today,you can do so e ither by writing Public
Uti 1 it i e s Commi s s ion in re f erence to thi s cas e or
LEWISTON , IDAHO 83501
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CLEARWATER REPORTING OF IDAHO, LLC
golng to our Webs i te and filing addi t ional comment
via our Websi te also referencing this specific case.
The time line for that is relatively quick.I don
know exactly how many days we have, but cases like
this typically are processed rather quickly once they
are filed with the Surface Transportation Board.So,
we need to be hearing from you rather quickly on that
if you ha ve addi t ional comment s What will happen
from this point, then is once we receive the
transcript,the commi s s ioners wi 11 de ibera t e and
then render a decision with regards to our statutory
requirements,and we ll certainly be notifying you.
You ll hear about that when the time comes,and again
that will be a relatively quick turn-around.Sorry,
was there a question?
UNIDENTIFIED SPEAKER:Would you repeat the
case number, please?
MR.KJELLANDER:I knew you were going
ask,and it is,GNW-R-04-01.Okay, well thank you.
Yes?
UNIDENTIFIED SPEAKER:When you say
relatively quickly,are we talking one week,two
weeks?
MR.KJELLANDER:I wouldn t wai t more than
a week if you d like us to be able to consider that.
LEWISTON, IDAHO 83501
[phone] [phone]
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UNIDENTIFIED SPEAKER:And, could you tell
us your e-mail address?
MR. KJELLANDER:Could I?
MR. HOWELL:WWW .
MR. KJELLANDER:Oh,thanks a lot.Yeah,
we ha ve three W' s there.
MR. HOWELL:Puc. state. id. us.
MR. KJELLANDER:Okay, thank you.All
right.There being no further business today, before
this commission, again we do appreciate your
comment s .And, again,if you d like to file
addi t iona 1 comment s, pleas e do so quic kl We intend
to have a deliberation and conclude at least our part
in that,so wi th tha t then we are adj ourned, and we
hope you all have a good remainder of the week.
(Proceedings adjourned at 2: 47 p.
LEWISTON , IDAHO 83501
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I F
STATE OF IDAHO
County of Nez Perce
S S .
, AMY WILKINS, CSR, Freelance Court
Reporter and Notary Public for the States of Idaho,
Idaho CSR No. 679, and Washington , Washington CSR No.WI-LK-IA-*25205, residing in Lewiston, Idaho, hereby certify:
That I was duly authorized to and did
report the proceedings held on June 28, 2004 in theabove-entitled cause;
That the foregoing pages of this transcriptconstitute a true and accurate transcript of my
stenotype notes of the testimony of all witnesses and
all on-the-record proceedings held.
I further certify that I am not an attorney
nor counsel of any of the parties; nor a relati ve or
employee of any attorney or counsel connected with
the action, nor financially interested in the action.
IN WITNESS WHEREOF, I have hereunto set
hand and seal on this
~~y
of
2004. LJI
lJ
AMY W LKINS, CSR
Freelance Court ReporterNotary Public,
States of Idaho and Washington
Residing in Lewiston, Idaho
M y C 0 mm i s s ion s Ex P ire: 0 1 - 11 - 0 and 5-10-04
LEWISTON , IDAHO 83501
[phone] [phone]