Union Pacific Railroad has acquired ownership of a rail line that slices across Oklahoma from Kansas to Texas 30 years after state officials preserved the line by buying it from a bankrupt rail company.
Union Pacific and state officials signed documents during Monday's state Transportation Commission meeting that transfer 351 miles of rail line — most of which runs parallel to U.S. 81 — to the railroad company. Tony Love, assistant vice president of real estate for Union Pacific, praised state officials for “having the foresight to preserve these lines.”
The agreement was written 30 years ago when the Chicago, Rock Island and Pacific Railroad Co. filed for bankruptcy, placing the critical line that linked Texas and Kansas through Oklahoma in jeopardy.
The state of Oklahoma bought 351 miles of track, which runs through Enid, El Reno, Oklahoma City, Chickasha and Duncan. The state also bought a spur that connects Oklahoma City to El Reno, as well as ones that run from the main line near Chickasha to Lawton and from Waurika to Walters.
The railroad tracks were operated by the Oklahoma-Kansas-Texas Railroad Co., according to the agreement signed Nov. 1, 1982. Union Pacific acquired the tracks after several mergers and recently finished paying $35 million plus accrued interest for the rail line.
“This type of agreement was unique, but we felt it was critical that we preserve the rail corridors and work toward getting them back in the hands of private industry,” state Transportation Secretary Gary Ridley said.
“Sometimes government does not do good at something. We mess up from time to time, and we don't do what we should do,” he said. “But sometimes we do the right thing, and sometimes things go well, especially when we can include the private sector in part of our decision-making process and move forward. This is a prime example of that.”
Love said it would be cost-prohibitive to buy the land for the line today.
“I have to applaud the state of Oklahoma for what I think is just a brilliant, strategic decision to make — to preserve rail corridors,” he said. “I've been buying and selling property for the railroad for over 25 years, and it would be nearly impossible to replicate that rail corridor today.”
John Dougherty, head of the state Transportation Department's rail programs division, said most of the line would have been sold for scrap if the state hadn't bought the route 30 years ago.
“When the Rock Island went out, it left nearly 1,400 miles of abandoned track in Oklahoma,” he said.
Legislators and then-Gov. George Nigh appropriated money in 1980 and 1981 for the state to buy critical rail corridors, Dougherty said.
“The one north-south corridor is the one they picked,” he said. “The state of Oklahoma would have really liked to have saved more areas, but we just didn't have the money so we had to pick and choose on what would be the most critical.”
Union Pacific has spent more than $100 million maintaining and upgrading the line, Love said.
Ridley said the railroad company took good care of the line.
“It is a very valuable corridor for them,” he said.
Love said trains using the line carry a variety of freight across the state. The north-south line is a route favored by oil and natural gas companies operating in the Anadarko Basin. Trains deliver sand and pipe used in the hydraulic fracturing process.
The railroad outlook is much better than 30 years ago, he said.
“Rail is good right now because we are a very fuel-efficient means of transportation,” Love said. “We are getting a lot of conversion from truck to rail, which is good for the highways because it takes those trucks off and the weight.”