Sep 08, 2015 — Environmental groups are pushing the Cuomo administration to block a plan to store oil tank trains on a rail line that runs through a protected part of the Adirondack Park.

Iowa Pacific Holdings, a Chicago-based company which operates a tourist train in North Creek, said it hopes to store as many as 500 of the cars over a five-mile stretch of track near the Park's High Peaks Wilderness.

Critics say the project would create a rolling toxic waste site in one of the North Country's most scenic areas.

Turmoil in America's rail industry

The debate began in late July, when Ed Ellis turned up at a public meeting in Warren County. His company, Iowa Pacific Holdings, runs small railroads, shipping lines, and tourist trains all over the United States, including the line that stretches to North Creek and Tahawus in the Adirondacks.

"Something that happened in the last couple of months that you guys probably read about in the news is that there is a severe disruption in the tank car market in the United States," Ellis said.

Ed Ellis addresses local government officials in Warren County

Disaster leading to opportunity?

The severe disruption actually started two years ago, when an American-owned train of DOT-111 tank cars filled with crude oil from North Dakota derailed in Canada. The tanks ruptured and exploded, and sent waves of fire through the heart of a Quebec village called Lac Megantic.

More than forty people died, sparking investigations and lawsuits and a review of railroad safety regulations in Canada and here in the United States. This spring, the U.S. Transportation Department issued a final ruling that the nation’s fleet of rail tank cars is unsafe. 

New safety rules and dropping oil prices mothball tens of thousands of tank cars

That ruling means those DOT-111s used for carrying toxic or flammable materials have to be either upgraded or scrapped altogether and replaced with safer models. The transition was meant to take years, but David Thomas, contributing editor with the on-line journal Railway Age, said it’s happening faster than anyone expected. "What they weren’t expecting of course is for crude by rail to experience its own collapse as the price of oil plunged," he said. "It's cheaper to bring [crude oil] in by tanker from Saudi Arabia than it was to bring it by train from North Dakota."

Suddenly those DOT-111s weren’t just unsafe, they were also too expensive to operate. Which brings us back to Ed Ellis at Iowa Pacific. He said his company is now getting into the business of storing unwanted and obsolete tank cars. He said, "There’s about 80,000 DOT 111 cars that are affected by this ruling. Of the 80,000, we think that maybe 20,000 will get modified. So that leaves 60,000 cars to go into storage somewhere."

Ellis downplayed the environmental risks. The tank cars are big, so finding room for all of them won’t be easy. "A hundred cars is about a mile, give or take, so that means there are about 600 miles to go into storage. We have recently put three miles of cars into storage on our railroad in Colorado and we know there are more coming," Ellis said.

Is the answer to the oil industry's problem in the Adirondack Park?

But the idea of railroads around the country socking away hundreds of miles of oil tank cars, many of them still gunked with a residue of sludge and heavy metal, faces pushback. "We’re walking north of the section of the Sandford Lake rail line that’s probably 75 feet from the Boreas River," said Peter Bauer with the environmental group Protect the Adirondacks as we hiked in to the tank car storage area proposed by Iowa Pacific. "We’re surrounded by forest preserve on both sides."

Iowa Pacific owns the right-of-way there, but the tracks and the sidings they hope to use for storage lie in the middle of one of the wildest, most pristine sections of parkland in the east, not far from the High Peak Wilderness.

Bauer said this idea of creating a storage area for contaminated rail cars inside the Park’s Forever Wild forest preserve took the environmental community off-guard. "We never anticipated a proposal that was going to use this line for storage of dirty oil tanker cars. It was nothing that was on anyone’s horizon," he said. Bauer described this proposal as a kind of rolling toxic waste site and said that if a five-mile stretch of these contaminated cars can turn up here in a wild park area, they could turn up just about anywhere.

Environmental groups including the Adirondack Council and Bauer’s organization have sent letters to the Cuomo administration urging state officials to intervene. "We would hope that the storage of used oil tanker cars is an economic activity that they're not going to be comfortable with. That is not what the Adirondack Park is all about," Bauer said.

State officials "concerned"

The New York State Department of Environmental Conservation and the Adirondack Park Agency responded to North Country Public Radio’s questions about Iowa Pacific's project with brief emails. The DEC said that the oil train storage plan is "concerning and presents unique issues. DEC is evaluating the potential legal and environmental implications of the proposal,” the statement read. The APA issued a statement that said their agency is researching the proposal.

If this section of track is used for storage, one question going forward is which other underused rail lines around the North Country might also eventually be eyed as places to mothball DOT-111s. In Warren County, Iowa Pacific’s Ed Ellis said tank car storage could be a lucrative new business for rail companies. He said, "We have not had any real opportunities to handle any freight, let alone hazardous freight. If these cars stay here for a year and generate this kind of money it's very helpful, so we're grateful for the opportunity."

Ellis said the revenue would mean a huge boost to the tourism train his company operates between Saratoga Springs and North Creek, which company officials have said is losing a million dollars a year.