July 23, 2014
The vision to purchase and plan the long term development of the Santa Paula Branch line came from a shared set of partnerships. The vision; preservation of the transport asset and economic development for the valley through links to tourism, film, transit and common community, has been lost.
I still hold to that vision.
The dismantling of the vision does not mean that it need be abandoned. However, this continued attack to the vision of then by saying that there is a problem that need only be solved by one party misses the central part of why this situation exists in the first place; that it was a shared set of several partnerships. It is not one or two actors here, but several. And, while the voices have been reduced to two, there are many other players who are, in their silence or silent acquiesce, contributing to both the problem and can help forge a solution. Change is hard and inevitable. When the change is driven by partners, working together, finding common ground and sharing a common vision, solutions can come easily. We have always worked to be part of a solution on the branch line.
A series of questions to be answered.
How can VCTC in 2007 negotiate maintenance rate increases with its operator and in 2010 claim an overpayment was made that may be considered a gift of public funds, go back until 2005 without negotiating or proving their numbers and claim that their operator had been overpaid by $140,000?
In 2010 how can VCTC and the city of Fillmore claim a lack of maintenance and file a lawsuit against its operator Fillmore & Western for a levee project that was built to protect a river bottom housing project and was approved by city of Fillmore engineering, Ventura County flood control, California Fish and wildlife, Army Corps of Engineers, and engineered by a private firm, with a right of entry approved by VCTC and there was no maintenance issues cited. With VCTC filing a claim against Fillmore & Western's insurance policy without Fillmore & Western's knowledge?
VCTC contracts with other privately owned companies that provide various services for them. Why is it that VCTC uses the term, a privately owned for-profit company being subsidized by taxpayer money, other than trying to belittle the Fillmore & Western company? Other companies contracted for services are not referred to in that manner.
How is it that VCTC 'claims to be subsidizing their operator FW at the sum of $600,000 a year when they only pay less than half of that amount for maintenance done by FW to comply with another contract that VCTC signed to allow Union Pacific RR the right to operate freight service at no cost. All of those funds a little less than $300,000 were collected by leases along the branch line as provided for the original agreements and MOU. The remaining $300,000 was spent on capital improvement projects that VCTC agreed to pay to FW and several other contractors and consultants to do studies in other related things. Some of those funds were received for state and federal projects.
How is it that VCTC can unilaterally without negotiation changes the terms and conditions and past practice of the last 17 years of maintenance agreements? After Fillmore Western had been telling VCTC for years that there are things in the contract needed to be changed and had been explaining for years how to make the branch line more profitable in the long run and a lot closer to self-sufficient.
How is it that the city of Santa Paula can build a bike path on the railroad right-of-way with funding provided by VCTC and agreed to replace the railroad crossings that were affected by the bike path. Discovered that they were over budget on the bike path. Decide to take the crossing work out of the project, notify the CPUC that they had received more grant money for the railroad crossings and that the project would go out to bid very soon. That grant money went to other beautification projects and was never spent on the railroad crossings insteadVCTC accused Fillmore Western of lack of maintenance on those particular crossings.
How is it that a partnership, created by Memorandum of Understanding with specific language for making changes to the points of the memorandum has been effectively ignored by all of the signing parties?
How is it that VCTC could request and support FWRY to go to the STB to get authority for common carrier freight service; identify FWRY as the party to whom UP would relinquish freight authority for the west end of the line and then, abandon the effort and embargo UP from continuing the Process?
How is it that an embargo, properly declared by VCTC but not resolved in a timely manner by VCTC, can result in the interference with interstate commerce for a customer on the line, to the east of Santa Paula?
How is that this interference, supported by the commission, is allowed when it appears to be a violation of the interstate commerce clause?
Why is it that VCTC has not applied for any of the many grants and opportunities for special funding for railroad projects since prior to 2007? Those grants alone Could close a huge funding gap If applied for In a timely manner.
How is it that VCTC Can attempt to cancel the contract in stop paying for the ongoing cost of maintenance that is required to keep the branch line in safe operational condition?
How is it that maintenance that continues to be performed on a daily basis by Fillmore and Western as contracted by VCTC and invoiced to VCTC are no longer being paid properly by VCTC?
How is it that a Memorandum Of Understanding between The City and Redevelopment Agency of Fillmore, the City and Redevelopment Agency of Santa Paula, the City of Ventura, the County of Ventura and the Ventura County Transportation Commission for the purchase and administration of the Santa Paula Branch Line can be unilaterally changed without any of the individual signatories engaged in the change process as required in the MOU?
I wonder, VCTC acquired the Santa Paula branch line from a memorandum of understanding created by the County of Ventura, the City and Redevelopment Agency of Fillmore, the City and Redevelopment Agency of Santa Paula, and the City of Ventura. This memorandum, a contract, is still valid and in force. It is the basis of all of the agreements that are currently in force or at issue. How is it that all of these agreements are separate when they, at time of inception were connected?
In 1996, as part of the purchase agreement for the Santa Paula Branch line, the former owner Southern Pacific, now Union Pacific is allowed to operate on the branch line at absolutely no cost for maintenance or car tariffs. This purchase contract left VCTC totally responsible for all of the maintenance responsibilities for the branch line to this day. Union Pacific operates freight with no obligations for payments of any kind. As the maintainer, Fillmore and Western has provided the services required to VCTC. How is that different than Roadrunner providing bus service?
In 1997 VCTC sent a letter to the Federal Railroad administration designating Fillmore Western as a railroad of record and responsible for all maintenance on the branch line. At the same time VCTC signed a contracts with Fillmore Western to perform those services. The letter and the contracts are still in effect. This assures VCTC that the railroad is safe to operate on. How is it in anyone's interest to question the safety of the line when the agreements for maintaining that safety are at the behest of VCTC?
Under the 13th amendment of the federal constitution, involuntary servitude was declared unconstitutional. The idea is that services are paid for when rendered. How is it that VCTC can decide unilaterally to stop paying for services contracted? Is this not unconstitutional?
As part of the MOU agreement, the funds received from leases on the branch line, from pipeline, adjacent leases, fiber optics plus federal and state monies designated for maintenance of crossing protection equipment were designated for maintenance costs of the branch line. VCTC is responsible for locating funds for all capital improvement projects. Why is it that since 2007 VCTC has been reticent to work on finding those funds?
How it is that in 1996, 1997, 2001, 2004 and 2007 VCTC entered into or amended contracts with Fillmore Western to maintain and operate on the branch line and the in 2010, without negotiations or in respect to existing obligations, took the attitude that those contracts are void because they don't like them anymore?
Why hasn't VCTC gone after Union Pacific as a for profit company when the purchase agreement allow free use of a public right of way? Could this be because of the purchase agreement for the line? How are these things related?
How is it that VCTC appears to be in violation of section 424, and 425 of the Ca Penal Code; Where a contract in place obligates payment of a lawful debt?
CA Codes (pen:424-440)
“424. (a) Each officer of this state, or of any county, city, town, or district of this state, and every other person charged with the receipt, safekeeping, transfer, or disbursement of public moneys, who either:
1. Without authority of law, appropriates the same, or any portion thereof, to his or her own use, or to the use of another; or,
2. Loans the same or any portion thereof; makes any profit out of, or uses the same for any purpose not authorized by law; or,
3. Knowingly keeps any false account, or makes any false entry or erasure in any account of or relating to the same; or,
4. Fraudulently alters, falsifies, conceals, destroys, or obliterates any account; or,
5. Willfully refuses or omits to pay over, on demand, any public moneys in his or her hands, upon the presentation of a draft, order, or warrant drawn upon these moneys by competent authority; or,
6. Willfully omits to transfer the same, when transfer is required by law; or,
7. Willfully omits or refuses to pay over to any officer or person authorized by law to receive the same, any money received by him or her under any duty imposed by law so to pay over the same;--
Is punishable by imprisonment in the state prison for two, three, or four years, and is disqualified from holding any office in this state.
(b) As used in this section, "public moneys" includes the proceeds derived from the sale of bonds or other evidence or indebtedness authorized by the legislative body of any city, county, district, or public agency.
(c) This section does not apply to the incidental and minimal use of public resources authorized by Section 8314 of the Government Code.
425. Every officer charged with the receipt, safe keeping, or
disbursement of public moneys, who neglects or fails to keep and pay over the same in the manner prescribed by law, is guilty of felony.
426. The phrase "public moneys," as used in Sections 424 and 425, includes all bonds and evidence of indebtedness, and all moneys belonging to the state, or any city, county, town, district, or public agency therein, and all moneys, bonds, and evidences of indebtedness received or held by state, county, district, city, town, or public agency officers in their official capacity.
How is it that signal money, directed to the maintenance of the crossings of the Santa Paula Branch line appear to have been with-held by VCTC from the assigned maintenance railroad of record.?
Is the withholding of these funds and other federal rail funds mismanagement or a criminal act?
To withhold funds and then allege a safety issue seems more a self fulfilling act under veil of law than proper management of the public’s money. How do we, as the public, learn the truth in these matters?
The commission’s attorneys have said in court moving papers that the executive director has operated under the title and direction of the commission as a whole. So, if this is true, how will the commission be judged if these acts are in fact illegal?
What is the commission really saying? Are you going to abandon the SPBL or keep it in place? In VCTC’s submission to the STB it is clearly stated that you are going to abandon the line, but yet you have told the public in past proceedings that you have no plans to of abandonment. What are we to believe or can we believe anything that is said or written by the commission or it's director?
VCTC claims that we have not been willing to negotiate. That could not be further from the truth. In fact there have been many meetings over the past several years. The problem, from our perspective is that the deal points were never clear. Or, when they were, it was VCTC's way or the highway. When the discussion begins with one side saying, "this is the way this is going to go," there is little room for negotiation.
We still stand ready to negotiate. Clear deal points, clear understandings of foundational agreements and clear process to reach the mutual goals. This is how the partnership has run and in this time of change it can run that way again. We look forward to the re-emergence of a solution that works for everybody.
Fillmore & Western Railway
I have had several of my friends ask me how the Fillmore and Western Railroad got in this predicament. I told them I would explain to the best my ability my thoughts on how this has happened.
In 1991 the City of Fillmore (Redevelopment Agency) and S rt Line Enterprises came to an agreement to move Short Line Enterprises film production railroad to Fillmore to create an economic development factor for the City of Fillmore including film production, dinner trains and tourist trains. A lease agreement was made between Southern Pacific Company and the City of Fillmore and Short Line Enterprises to use the track between 12th Street in Santa Paula and Fillmore, California. The first movie production that was made on the stretch of track was “Chaplin”, filmed in 1991. As the railroad slowly got its feet on the ground in Fillmore, filming productions started right away. The leased equipment at that point was put in use not only for filming but also for limited tourist trains and of course the occasional dinner trains.
A contract was approved in 1994 between the City of Fillmore Redevelopment Agency and the Short Line Enterprises, (renamed Fillmore and Western) to operate on the track for these purposes. Fillmore and Western at this time was in charge of maintaining the track between 12th Street in Santa Paula to Fillmore. The track from Fillmore to Piru, California was pretty much out of service due to several landslides east of Fillmore and the severance of the track at Highway 126 due to a highway widening project. The Fillmore and Western at this time was maintaining the track at no cost to the City of Fillmore and maintaining the track Class I standards with little assistance other than some project money provided by the City of Fillmore Redevelopment Agency for buying one tamping machine (I believe the price was $4000) and some ballast. There were other donations from private individuals including Mark Deese who had his private car stored at Fillmore.
In 1994, Southern Pacific Company put the right-of-way up for sale from Montalvo to Piru. This was brought to the attention of VCTC. It was pointed out that the line and its past use lent itself very much to the need for preservation of the right-of-way for future generations. We have seen so many times a rail link torn out and then come back 20 or 30 years later as a very viable transit corridor for rail traffic and particularly public transportation. It would be a shame to lose this asset.
In 1995 an agreement was made between the Ventura County Transportation Commission (VCTC), County of Ventura, the City of Fillmore, the City of Santa Paula and the City of Ventura and their Redevelopment Agencies to purchase the branch line from the Montalvo Wye to the Los Angeles County line east of Rancho Camulos, in Eastern Ventura County. The purchase was made. To govern the asset, the Santa Paula Branch Line Advisory Board was put together by VCTC, the Cities (Their Redevelopment Agencies) and Ventura County. Early on there was numerous meetings called and everyone got in the business of putting this asset to work. The Santa Paula Branch Line Advisory Committee (SPBLAC) began by hiring a consulting company to assess the branch line and to find projects that could reasonably be done. At this time Fillmore and Western was still maintaining the track between Santa Paula and Fillmore at no cost to either Fillmore or the Commission. Southern Pacific Company had made an agreement that they would continue to haul freight to Santa Paula and they would maintain the branch line between Montalvo and Santa Paula. This commenced in 1995. In 1996 the Wilkinson family purchased Short Line Enterprises from Jim Clark and Stan Garner. All of the agreements and contracts were transferred to the new company of Fillmore and Western under the DBA, Short Line Enterprises being the production division.
In 1997 the Branch Line Committee (SPBLAC) had an opportunity to upgrade the segment between Montalvo and Santa Paula. They chose to do this upgrade -- understandably so -- by hiring a private contractor by the name of So Pack Rail, to take that portion of the branch line from excepted track to Class One track. At that point Southern Pacific Company took exception stating they had union obligations and liability issues and they would not maintain the track at Class I standards per the purchase agreement and would no longer be responsible for the maintenance. They did however agree to continue freight service with no financial obligation. This put the Branch Line Committee (SPBLAC) in the position that they had no one to maintain that portion of track between Montalvo and Santa Paula.
In 1997, having looked at options to hire a contractor to maintain and inspect this portion of the line, they asked the existing operator of the line between Santa Paula and Fillmore. The Fillmore and Western agreed to provide maintenance services and signed a maintenance service contract to that effect. I was the first to point out the obvious: Southern Pacific Company was now delivering freight for absolutely no maintenance provisions monetary or otherwise, in other words a free ride plus the fact that the purchase agreement also had the commission paying $100,000 a year to Southern Pacific for this privilege. Everyone agreed that the situation would not be resolved immediately.
VCTC and Fillmore & Western continued to repair and build on the branch line. Fixing soft spots, repairing and replacing the comp areas that went from 80 pound rail to 110 pound rail and replacing ties. Our agreement with the Transportation Commission stated that we were in charge of everyday maintenance that would replace joint bars, occasional rotted ties, tamping, and maintain grade crossing signals. The monies for capital repairs such as replacing grade crossings, replacing signal components that have failed and need replacing with updated equipment were to come from VCTC. Note that equipment projects over two pieces of rail, replacing more than several ties in a soft spot or two ties between a joint bar were considered as capital improvements. Highway 126 crossings were also considered capital improvements not because of the train operations, but because of the heavy truck traffic and the speed that they were traveling simply destroyed the concrete panels, causing those panels to have to be replaced every two or three years. Bridges also needed more attention than simple maintenance so they were also included in capital improvements. This was the agreed practice with VCTC for more than 17 years.
There is ample evidence to these practices and there was obviously a lot of participation with the Branch Line Committee (SPBLAC). By the time Chris Stephens, the Assistant Executive Director of the Transportation Commission transferred to the County, everyone, included ourselves. had a fairly good understanding of what was and what was not included in capital. The Branch Line Committee (SPBLAC) was called in to be advisors to most all situations that were out of the ordinary.
There were also interesting times with the other railroad on the branch line. In 1998, Southern Pacific was bought by Union Pacific Railroad (UP). Operations remained about the same, with their trains delivering freight to Santa Paula three days a week. This consisted of generally four cars going to Weyerhaeuser Paper Products. There was an occasional car of lumber that was delivered to a Santa Paula lumber facility on the South track Santa Paula. When I say occasional, I mean once or twice a year. With Fillmore and Western being in charge of the maintenance on the branch line our work crews were out on the branch line constantly doing their job.
At one point, in either 2000 or 2001, a Union Pacific train ran over our red flags and put one of our crews in danger. They had also been exceeding the 10 MPH speed limit on several different occasions. We took exception and contacted the Federal Railroad Administration. At that point the Federal Rail Administration (FRA) instructed Fillmore & Western to take dispatch control over the branch line. We also created and agreed upon time windows for the UP to deliver freight on the branch line.
In 2001, we went into another negotiation with the City of Fillmore, its Redevelopment Agency and VCTC. We sought a 20-year contract. To make the branch line more financially reliant on itself, we suggested again trying to secure the freight service from Union Pacific. This would allow Fillmore and Western an operation that would create more income and also be able to pay a maintenance fee from the percentage of tariffs collected. We agreed to go to the Surface Transportation Board at the request of the VTTC and SPBLAC to request authority to haul freight. We received that permission uncontested and we also proceeded with a renewed 20-year contract.
There were many projects going on at the branch line at the time, spending millions of dollars for the Piru track extension and station complex, Fillmore Promenade Park, City Hall, and station projects to rehabilitate the Santa Paula Depot and create a passenger loading platform. We also attempted to transfer freight service from Union Pacific to Fillmore and Western Railway. According to the contract between VCTC and Union Pacific Railroad. It was a relatively simple process of requesting by letter and they would turn over the freight service in a period of six months. Union Pacific took exception and felt that they had a pretty good deal hauling freight up the branch line for absolutely no maintenance fees plus getting $100,000 a year as part of the purchase agreement which is one half of the existing pipeline leases that were in existence at the time of sale from Southern Pacific to VCTC. VCTC at the time concluded that they had higher priorities, so no action was taken on this.
The Santa Susanna tunnels were also owned by and property of the Commission. Like many other Southern Pacific assets, they hadn't had proper maintenance in years. Train speeds were reduced to 10 MPH, which was an ongoing problem for Metrolink schedules. The tunnels had to be rebuilt and the speed restrictions removed. VCTC was also working on the development of the Camarillo Metrolink depot complex. It was decided by VCTC not to bother Union Pacific Company with this pesky little freight situation with the Santa Paula Branch Line and Fillmore and Western.
With our 2001 contract also came a clause that would allow us to go back approximately every three years and renegotiate some terms and conditions, mostly the cost of maintenance. We did this in 2004 and again in 2007. Just one example when we renegotiated, the price of fuel was $1.79 a gallon. Other costs such as insurance equipment and so on did nothing but go up. All these increases were taken to the VCTC and passed in their annual budgets so the money for maintenance was approved. Other expenses as in capital improvements and consultant fees for studies of the branch line were also approved those budgets for capital improvements.
Also included were the Highway 126 crossing; capital bridgework and other crossings scheduled for replacement. The full Commission in their annual budget review and adoption each fiscal year also approved these budgets.
In 2007 the Executive Director of the Commission retired. The Fillmore and Western ran the branch line and was considered the “boots on the ground.” Whenever there was a problem the person in charge of the branch line for the Commission appointed by the Executive Director contacted us In some cases, if that person was on vacation or had other assignments they were simply unavailable. It took me over a year to get a meeting with the new Executive Director. It wasn't until two of their staff invited me to a gathering in Ventura I was introduced to the new Executive Director. We arranged a meeting soon thereafter, at which I asked to renegotiate some the points of the contract, which by that time had long been outdated.
From my point of view we were going to make this branch line work by strengthening tourism and motion picture production and also start reviewing adjacent land leases. Some property owners have been encroaching for years and some land lease rates were ridiculously low. We brought this up previously to the former Executive Director and she felt that her staff time could be better spent by seeking grants and she had proven this time and time again. In the next year or so we were in a state of limbo continuing to do what we have done for the past 17 years. We also identified projects that were considered capital improvements not maintenance, presenting them to VCTC staff. For the most part the projects were approved as identified, the work done, the invoice submitted and with the Executive Director's approval paid. In this period of time there were few if any Santa Paula Branch Line Committee (SPBLAC) meetings, just the interaction between Fillmore and Western and VCTC staff.
In June 2010 the Executive Director came to the conclusion that he had been over paying Fillmore and Western by a few thousand dollars more each month than he thought they should be paying us and stood before the commission stating that Fillmore and Western had been receiving a gift of public funds. This was without explaining how they determined the amount that we claimed for maintenance was excessive. The Executive Director felt that he had overpaid Fillmore and Western by approximately $140,000 and wanted it back. Of course we objected. We asked for a Santa Paula Branch Line Committee (SPBLAC) meeting to discuss these matters. We felt that the monies received by Fillmore and Western were legitimate and the work had been done. If they wanted to reduce the agreed upon rate after we renegotiate the rate, that's fine. We would adjust the amount of maintenance to accommodate that new rate because the price of maintaining the railroad has certainly not gone down.
We took that argument to the chair of the Santa Paula Branch Line Committee (SPBLAC) and were told that the $140,000 payback was to be dismissed. Our argument was it should never have been decreased and that the payment was negotiated by both parties in good faith and that negotiation has never been renegotiated.
The Santa Paula Branch Line Committee (SPBLAC) should therefore sit down and renegotiate a new rate for maintenance if they didn't like the contract they had created. Remember that $140,000 in maintenance fees was approved by the full Commission in its annual budgets.
We again told the Branch Line Committee (SPBLAC) that we very much felt that the branch line could be financially self-sufficient. The basic things that needed be done included maintaining the tourist business, maintaining the filming, and VCTC seeking federal and state railroad grants to help maintain the crossings.
As the contract between us stated VCTC would be responsible for replacing old crossings and bridges, maintaining signal systems, managing the adjacent leases on the right-of-way and increasing freight traffic on the branch line to generate more income.
For instance, in 2012 there was $40 million available for shovel ready projects for railroad crossings and signals available from the State PUC. Other funds were available from the FRA in grants for bridges and other infrastructure. None of this was applied for that I know of. This is the responsibility of the Commission as owner of the SPBL not the railroad.
In 2010 Bill Bartels and I approached the Executive Director and told him once again we wanted to try to convince Union Pacific Railroad to allow Fillmore and Western to take freight deliveries.
We again discussed the benefits of being full-service and how that would hopefully help tremendously in bringing the Branch Line closer to paying for itself. We were given the okay to go to Omaha by the Executive Director to negotiate with Union Pacific. Bill and I set a meeting with the two local California representatives for Union Pacific. We were told by those representatives that Union Pacific was happy that it could operate on the Branch Line for nothing plus it was still getting $100,000 a year. They also stated that they had never gotten any formal request from the VCTC to transfer the freight rights.
In the summer of 2011 we went back to Omaha with another request to transfer freight. At this point in time we did have a document from the Executive Director with the request for transfer of freight service and for Union Pacific to please work with Fillmore and Western to achieve those goals.
In June 2011, International Paper, which bought Weyerhaeuser , announced the shutdown of the Santa Paula facility. At that time Union Pacific would have no problem giving up freight service for there was no more freight on the branch that was of regular service. We negotiated with Union Pacific's area representative, at which time they were willing to talk about transfer. They said it would be a relatively easy process and that we would have to establish an interchange point. We suggested the Montalvo Wye area .
At the same time we had our first FRA bridge inspection. FRA had at this time released the new bridge standard for inspections and load limits. The branch line did pretty well all things considered. We were surprised that the Ellsworth Baranca had several rotten stringers that needed to be replaced, resulting in the branch line being shut down for further operations over that Baranca. It took over a year for those repairs to be approved and completed. There was also another small bridge that the piles were rotted and Fillmore and Western replaced all 12 piles and both header beams within three days of the report to keep its scheduled trains running. Having rebuilt that bridge we felt it was a capital improvement and a bill should be sent. It was rejected on the basis it was no longer considered a capital improvement although for over 17 years these were considered capital improvements.
In January of 2013, Fillmore and Western was approached by Jim Meaney of CB Richard Ellis representing a potential buyer who was interested in rail service for a facility in Santa Paula. Needless to say, we were quite excited about a new potential anchor for freight service on the Branch Line. This client would potentially bring more that 200 jobs to the valley and up to 30 car loads of freight a month. We also secured two more clients, one dealing in steel and the other in lumber, for potential trans-loading at the Santa Paula facility. With the Commission's embargo of UP to interchange with Fillmore and Western, stating liability as the issue when in fact all parties are insured and informal interchange has been occurring since 1996 all of these possible sources of income went away. As for the Meaney client, Speers Plastic bought the former Weyerhaeuser facility and is expecting to begin operations in early 2014. This operation will still be serviced by Union Pacific.
In late 2012 there was another interesting change of mind by the Executive Director about what exactly was a capital improvement on State Highway 126 crossings and other crossings located in the cities of Santa Paula and Fillmore. Fillmore and Western had been maintaining this branch line for 17 years, which we felt was a pretty good definition by the practices that had been done in the past. Regardless things changed again without negotiation or even consideration.
In 2013, Fillmore and Western became responsible for all maintenance on the branch line whether it be regular maintenance or capital improvements. We were in charge of it all and in charge of paying for it all. For example the Highway 126 crossing repairs that had always been capital maintenance because of truck traffic is in the railroad’s responsibilities to pay for. Also the bridges, there was a long record of them being capital improvement repairs; they now will be regular maintenance to fall on Fillmore and Western shoulders financially without negotiation or consideration.
One of the more interesting situations is crossing replacements in the City of Santa Paula. Santa Paula had been planning to put a new bike path along the railroad tracks for quite a number years (ten that I know of.) They went out to seek funds for this path with the help of VCTC. The funds were appropriated and plans were made. In these plans were the replacement of all the railroad crossings or at least the lion’s share along the bike path -- six that we know about. The entire bike path was funded. VCTC asked Fillmore and Western to submit the grade crossing paperwork California Public Utilities Commission as required (GEO 88B).
Shortly before the project was to start, Santa Paula fell short of funds so they decided to take the grade crossings out of the project. Three of these crossings were in much need of improvements. They were wooden decks with asphalt layover and they were worn out. Transportation Commission staff and the railroad looked at this crossing project as a way to upgrade the crossings that were in need of replacement in Santa Paula. Well, needless to say, the crossings got left out.
I understand that VCTC went out and secured another $1.2 million to replaced these crossings. This still has not happened nor have we even heard if it’s close to happening. Nonetheless, the Executive Director feels the Fillmore and Western should replace these crossings at its expense and that is one of his claims of lack of maintenance against Fillmore and Western.
April 2013, at their monthly meeting, VCTC presented financial documents looking at the past 10 years of expenses of the Santa Paula branch line. This presentation stated that Fillmore and Western had been subsidized at an average of $600,000 per year. At no point in this presentation was a fact ever brought up that Fillmore and Western had been maintaining, through a maintenance service contract, the Branch Line in order for Union Pacific to operate for absolutely nothing nor was it mentioned that over the past 10 years that Union Pacific had probably brought up more than 7000 cars at no charge or contribution for maintenance. It was also not mentioned that in that $600,000 were numerous expenses of capital projects and consultant studies over that same period of time contributing to that amount.
Fillmore and Western had never been paid over $312,000 for annual maintenance fees. These fees derived from the original MOU that stated that the monies derived from the income of the branch line was to be paid for maintenance on the branch line. This was always calculated by the Transportation Commission assigned branch line staff. I feel that is very unfair for the VCTC to accuse us of being subsidized when we were not. Also not brought to anyone's attention was that the maintenance contract with Fillmore and Western only covered 15 feet of either side of the center-line of track. The right-of-way for the most part the right-of-way is 100 feet wide. There are exceptions in Santa Paula and Fillmore area but nevertheless the maintenance and weed abatement outside the covered maintenance area were added to that expense called a “subsidy.”
In June 2013, VCTC canceled Fillmore and Western its contract, leaving a six-month period that was required by the contract, citing lack of maintenance. This lack of maintenance was Highway 126 crossings, bridge maintenance and crossings in Santa Paula, which were typically classified as capital improvement projects until recently. We sought remedies for this in the contract. We asked for mediation and were ignored. We then had one negotiating meeting in which we were told that we were welcome to run the railroad at our total expense according to a new contract that would be negotiated; we again asked for mediation. At this time it was granted and we met with the mediation judge stating that the Executive Director just did not want us on the branch line anymore. We could stay, but VCTC would get a new operator and that we would answer to the new operator. As you might imagine this is a pretty tough blow when you have worked as hard as we have to keep this railroad safe and sound.
With all these matters taken into consideration I feel that we are owed our day in court and that there is no real cause to cancel our contract. In addition, we have always stood ready to negotiate. We well understand the value of running this Branch Line as a 'cost neutral' operation.
With this being said I am prepared to present all documents to prove these points and to work with the Transportation Commission to find a mutually agreeable solution that benefits the taxpayers and the Heritage Valley.
Thank you Dave W .