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RESOLUTION NO. R-1314-108: A RESOLUTION OF THE CITY OF NORMAN URGING THE OKLAHOMA DEPARTMENT OF TRANSPORTATION AND THE STATE OF OKLAHOMA TO RETAIN OWNERSHIP OF THE SOONER SUBDIVISION RAIL LINE FOR CURRENT AND FUTURE PASSENGER RAIL TRANSPORTATION OPPORTUNITIES, AND FOR THE ECONOMIC AND QUALITY OF LIFE BENEFITS DERIVED THEREFROM, FOR THE CITIZENS, BUSINESSES, CITIES AND TOWNS OF THE STATE OF OKLAHOMA.
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BACKGROUND: In response to the increasing number of rail line abandonments in the 1970s and early 1980s, the State of Oklahoma acquired several rail lines threatened with abandonment. The State recognized the need to preserve branch lines that were important to Oklahoma’s commerce.
The Oklahoma Department of Transportation (ODOT) initially acquired over 600 miles of rail lines with $22 million in state funds. The State acquired these lines mostly as the result of liquidation of the Chicago, Rock Island and Pacific Railroad Company (CRIP) following its bankruptcy and through abandonments that peaked after the 1980 economic deregulation of the rail industry. As revenues developed from the leases of these initial purchases, the State made additional acquisitions, eventually owning close to 980 miles of rail lines. Significant mileage under the lease/purchase arrangements are reverting to the railroads as they take title to the properties. Oklahoma now owns 428 miles of rail lines. Currently, all but less than 8 miles are in service with five different operators.
One of the lines purchased by the State links the cities of Del City and Sapulpa. The line is known as the Sooner Subdivision Rail Line (Sooner Sub). ODOT currently leases the line with an option to purchase to the Stillwater Central Railroad Company. This company is a subsidiary of the Watco Companies and is considered a short line railroad operator with primary business in the handling of mined, mineral and industrial products.
In October of 2008, the U.S. Congress approved the Passenger Rail Improvement and Investment Act (PRIIA) and provided for the reauthorization of the National Railroad Passenger Corporation (Amtrak). This legislation tasked Amtrak, the U.S. Department of Transportation (USDOT), the Federal Railroad Administration (FRA), individual states, and other stakeholders with improving operations, facilities, and service throughout the nation. PRIIA authorized over $13 billion for promotion and development of new and improved intercity rail passenger services, state-sponsored corridors throughout the U.S., and the development of high-speed rail corridors.
PRIIA established three new competitive grant programs for funding high-speed intercity passenger rail improvements:
• Intercity Passenger Rail Service Corridor Capital Assistance Program
• High-speed Rail Corridor Development Program
• Congestion Grants
The U.S. Department of Transportation has been working with states to plan, fund, and develop high-speed rail services. This usually requires the construction of new track to ensure segregation from freight rail traffic. Since 1991, the FRA identified 11 high-speed rail corridors, positioning them for federal funding. The Tulsa-Oklahoma City-Dallas corridor was officially designated as a high-speed rail corridor in 2000. It is known as the South Central Corridor.
Three passenger railroad corridors are currently under evaluation for Oklahoma. Extension and expansion of the existing Heartland Flyer is being examined, as is service between Oklahoma City and Tulsa. ODOT and the Kansas Department of Transportation (KDOT) just completed a Service Development Plan looking at expansion of the Heartland Flyer from Oklahoma City to Newton, Kansas, as well as a new standalone daytime service between Kansas City and Fort Worth via Oklahoma City. The Texas Department of Transportation (TxDOT), in coordination with ODOT and KDOT, will soon begin a study looking at the corridor from Oklahoma City to southern Texas that will include examination of expanding the Heartland Flyer with a second daily train as well as performance improvements. And lastly, with funding received from an FY 2010 Federal Railroad Administration (FRA) planning grant, ODOT began developing a federally mandated high-speed rail corridor investment plan for a new service between Tulsa and Oklahoma City. The 110 miles separating Oklahoma City and Tulsa represent a distance where the economics of rail technology are very favorable. Both cities also plan to develop commuter rail services connected to their suburban areas providing linkages to surrounding population centers. The investment plan will comprise an updated service development plan and documentation required to comply with National Environmental Policy Act (NEPA) requirements. At the conclusion of the plan development, the project can enter the design phase. Initially studied in 2001-2002, a preferred high-speed alignment was identified along the Turner Turnpike. This new study will reinvestigate all options, including those previously examined.
On May 30, 2013, Governor Mary Fallin signed into law Senate Bill 584, amending 66 O.S. 2011, Section 304, which relates to railroads; providing procedures for sale of certain railroads; requiring certain notification be delivered to the Legislature and providing an effective date. Specific language in the amendment reads as follows:
‘Prior to the sale of any railroad asset owned by the State of Oklahoma or the Department of Transportation, a process of request for proposal shall be initiated by the Department of Transportation with consultation by the Office of Management and Enterprise Services. Upon the issue date of a request for proposal regarding the sale of any railroad asset owned by the State of Oklahoma or the Department of Transportation, interested parties will have no less than ninety (90) days to provide a response. Following the close of the ninety-day response period, the Department of Transportation will conduct an evaluation of all submitted proposals, utilizing all available resources, and the Department of Commerce shall conduct an economic impact and/or activity study of all proposals. The Secretary of Transportation, Secretary of Finance, Secretary of Commerce, Secretary of Agriculture, and Secretary of Energy shall be responsible for preparing a recommendation to the Transportation Commission, based on its evaluation of all submitted proposals including the results of the economic impact and/or activity study, provided the recommendation meets all other statutory requirements needed for action by the Commission. The Secretary of Transportation, Secretary of Finance, Secretary of Commerce, Secretary of Agriculture, and Secretary of Energy will have up to ninety (90) days, upon the closing date of the request for proposal, to present its recommendation to the Transportation Commission. The Transportation Commission will be responsible for determining if the sale of railroad assets within its jurisdiction is in the best interests of the State of Oklahoma and for authorizing the sale of such assets. If a determination is rendered by the Transportation Commission that the sale of any railroad asset within its jurisdiction is appropriate, notification must be made to the Speaker of the House of Representatives and the President Pro Tempore of the Senate in writing prior to the Commission meeting where final action will take place. All proceeds from the sale shall be deposited into the Railroad Maintenance Revolving Fund.’
On November 1, 2013, ODOT began seeking Requests for Proposals (RFP) for the sale of the 97.5 miles of state-owned Sooner Sub rail line between Del City and Sapulpa, in accordance with the procedures set by state law regarding a fair and open RFP period and review by selected state officials to determine feasibility of a potential sale. All track structures and necessary rights-of-way and all appurtenances thereof and including, but not necessarily limited to, rail and fastenings, switches and frogs, ties, ballasts, roadbed, and embankments along the 97.5 miles between Milepost 536.4 in Del City, OK and Milepost 438.9 in Sapulpa, OK are included. Four bids were accepted and are being evaluated. The evaluation committee is now reviewing the bids to determine whether to accept one and sell the line. Meanwhile, ODOT continues to study viable passenger service options between Oklahoma City and Tulsa that is expected to be completed in 2015. That study includes the existing Sooner Sub line as well as other possible routes in the corridor, checking for feasibility, public support and cost analysis for each potential option. ODOT officials insist that a potential sale of the Sooner Sub line would not cancel the study. The State Transportation Commission will consider the possible sale of property to the preferred proposer during their May 5, 2014 meeting. If accepted, financial close of the property is anticipated on July 31, 2014. One of the options available to the Commission is to retain ownership of the Sooner Sub line.
DISCUSSION: In light of the potential sale of the Sooner Sub rail line by the State of Oklahoma, both the Cities of Tulsa and Oklahoma City have raised concerns over the negative impact that such sale could have on the future establishment of passenger rail service between the two cities. The City of Tulsa adopted a resolution on February 6, 2014 urging ODOT and the State of Oklahoma to retain ownership of the railroad line for current and future passenger rail service, an action that the City of Oklahoma City is also preparing to take.
Given the region’s desires and ongoing efforts to establish commuter passenger rail service in the Oklahoma City area, which could include as many as three rail stations in the Norman area, combined with the additional benefits afforded to Norman citizens through the inherent linkage of this service with future intercity passenger rail service between Oklahoma City and Tulsa, makes retention of the Sooner Sub rail line reasonable and prudent until the adopted route is finalized.
RECOMMENDATION: Staff recommends adoption of Resolution No. R-1314-108 urging the Oklahoma Department of Transportation and the State of Oklahoma to retain ownership of the Sooner Subdivision for current and future passenger rail transportation opportunities, and for the economic and quality of life benefits derived therefrom, for all of the citizens, businesses, cities, and towns of the State of Oklahoma.