Morse_dh2.doc

April 12, 2000

VIA FED EX

Ed Morse
Morse & Company
2101 Lakewood Drive, Suite 225
Coeur d’Alene, ID 83814

Re: Abandonment of the Camas Prairie Grangeville-Spalding Line

Dear Ed,

Pursuant to our telephone conversation of today, I have enclosed for your review a contract for technical appraisal services concerning the abandonment of the Camas Prairie Grangeville-Spalding line. Although Camas Prairie has not formally filed its Application to abandon the rail line, it is my understanding that they are continuing their preparations to formally file with the Surface Transportation Board (STB). The STB is the “new” Interstate Commerce Commission (ICC) after the ICC was eliminated as a federal agency in 1996. The STB is an entity of the U.S. Department of Transportation and some of the ICC’s railroad authority was transferred to the STB.

Until such time as the Railroad files its “Notice of Intent” to abandon the line, I do not have access to the large real estate documents. However, I have enclosed for your review several documents including a map generally showing where the rail line is located and a track profile. As you can see, the line runs adjacent to U.S. Highway 95 from about Craigmont to Grangeville.

I have also included the two 1999 right-of-way statutes authorizing the Railroad to construct its line through the Nez Perce Indian Reservation. It is my understanding that the original treaty creating the Nez Perce Reservation is dated 1855 but that two subsequent treaties (1863 and 1893) in large part diminished Indian ownership of the reservation by allowing non-Indians to acquire property on the reservation. Obviously, the issue of reversionary ownership of right-of-way located within the boundaries of the reservation will be an issue.

I have also included a copy of the Railroad’s draft Environmental and Historical Report (EHR). As you will note in the EHR on page 10, the Railroad acknowledges that it does have property deeds, profile maps, and right-of-way maps for the line to be abandoned. Although I have asked that these documents be provided to me, I have not received copies and probably will not until the Railroad files its “Notice of Intent.” You will also note that the draft EHR lists the 43 bridge and trestle structures on this line. In addition to these structures, there are also six tunnels on the line.

At this point, I am unsure whether it is necessary for you to actually inspect the portion of the right-of-way from Culdesac, up the Winchester grade, to Reubens. As you can see by the track profile, the elevation is steep on this part of the line climbing in excess of 3,000 feet. Most of the terrain is steep and may be unsuitable for other purposes. Also, it is a possibility that there may be some small amounts of timber which may or may not have any commercial value.

As I mentioned during our phone conversation, the appraiser that has apparently been retained by Camas Prairie is Kenneth Young of Kenneth Young & Associates, 1066 Florida, Suite 101, Elk Grove, Illinois 60007. Included for your information is a copy of your verified statement that we used in the Silver Valley case. I thought it might be helpful for you to have it readily available.

If the contract meets with your approval, please sign both copies and return one copy to me. If you have any questions about any of the materials that I have sent, please give me a call at [phone]. I look forward to working with you on this project.

Sincerely yours,

Donald L. Howell, II
Deputy Attorney General

Enclosures

cc: Tom McFarland
Joe Plaistow

vld/L:morse_dh2
Ed Morse
April 12, 2000
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