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Industry, Towns Protest as Railroads Abandon Lines

July 03, 1985|Associated Press

GALAX, Va. — Like hundreds of businesses in out-of-the-way places, Webb Furniture Enterprises soon may lose its only option to shipping by truck--the railroad.

Because it is less expensive, Webb Furniture has been trucking its wares for years. Still, company President D. E. Ward is displeased about Norfolk Southern Corp.'s decision to abandon the 50-mile branch connecting Galax to a track in Pulaski that carries more traffic.

"Although we're not using it now, who knows when this will change," Ward said. "If they pull out their service now, there's no chance we'll ever have it again."

Robert Cooney, senior general attorney for Norfolk Southern in Roanoke, Va., said the railroad plans to file an abandonment application with the Interstate Commerce Commission this summer.

445 New Applications

The request is likely to be among hundreds that the commission sees this year. During the fiscal year ended last September, U.S. railroads filed 445 proposals for abandonment of branches that provide rail service to areas off main lines. That was up from 94 in 1976.

The number of abandonment applications began to burgeon as the deregulation of the railroads started going into effect.

Louis Gitomer, deputy director of the commission's rail section, attributes the increase to a growing reliance on trucks for shipping.

"The railroads need to earn enough revenue to cover their long-term costs," Gitomer said. "They can do this by increasing traffic and price or by reducing costs. Abandonments are one way for them to reduce their losses."

Cooney said the line from Pulaski to Galax became unprofitable with the shutdown of New Jersey Zinc in Austinville, Va., in 1981. That decreased the number of cars transported each year from about 2,000 to several hundred, he said.

Local Business Suffers

Harold Snead, Galax's city manager, is worried that shutting down the line will hamper the city's efforts to attract businesses.

The concern is shared by officials in nearby Wythe County, who recently got approval from the governor for establishment of an urban enterprise zone along the railroad line in Ivanhoe. Ivanhoe is the site of the former Air Reduction Chemical & Carbide Co., a big rail shipper that closed in 1968.

The enterprise zone designation allows officials to offer incentives to industry to locate in the area.

"We feel there is the potential for future growth and revitalization of the area, and we were counting on rail service being a part of that," said Sam Powers, assistant Wythe County administrator.

The arguments being made by local officials and shippers for keeping the railroad are not likely to sway the ICC, however. Since 1978, Gitomer said, the agency has approved 90% to 95% of the applications for abandonment. The ICC wants to see concrete evidence that the line will be used before it rejects a petition, he said.

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