Beaver Creek City Council questions rail car storage
Residents and city leaders in Beaver Creek are questioning the placement of railcars on tracks north of town with openings only at intersections.
City council member Pat Bender brought up the issue at Wednesday night’s meeting, asking how long the cars would be there.
“If we knew it was short term, that’d be different,” she said. “But this has been going on for over a year.”
Mayor Josh Teune acknowledged that the cars and the tracks are privately owned, and as such, the rail authority has a right to use the property in this manner.
However, the council discussed that the cars are a nuisance — blocking the view of Beaver Creek from County Road 4 motorists and blocking the northern view for residents in town.
The council also discussed visibility at intersections approaching County Road 4, which has carried extra traffic this summer due to I-90 construction detours.
The cars limit visibility, as do the weeds, said council member Alan Harnack.
“The 4- to 5-foot-tall weeds that border both sides of the cars — especially by the frontage road entrance, are very ugly and inconsiderate,” Harnack said.
“We are very proud of what we have for a town our size, and we strive to keep it clean and well-groomed.”
Empty cars reflect production downturn
Clark Meyer is president of Ellis & Eastern, which leases the 41-mile short-line railroad that runs through Nobles and Rock counties between Worthington and Manley.
He said it’s difficult to say how long the cars will be stored on the rail by Beaver Creek, because different companies rent the space for different reasons and durations.
Rail storage space is in demand after the pandemic economy, and leasing rail space to companies storing unused cars is a way for the railroad to secure revenue.
“It helps us pay the light bill,” Meyer said Friday. “We would prefer moving trains, but when the ethanol plant shut down, we lost a lot of business.”
The Luverne plant, which recently announced it will soon resume production, at one point moved 500 cars of ethanol per year on the local track.
And ethanol wasn’t the only product that stopped moving by rail.
Ellis & Eastern moves freight for companies like Baker Hughes, one of the world's largest oil field services companies.
Many of the empty cars stored in Rock County were used to haul fracking sand, but recent bans on fracking (to mine oil or gas) and reduced fuel demand during the pandemic brought the industry to a halt.
“They’d rather have [railcars] hauling stuff, but with the economic downturn, there’s nothing to haul so they’re looking for car storage space,” Meyer said.
CHS also rents space on the local railroad, but those cars are stored seasonally — when they’re not hauling grain and fertilizer. When harvest begins this fall, those will come out of storage.
Why by Beaver Creek?
Beaver Creek City Council members also wondered why the cars couldn’t be stored on other parts of the track, rather than so many at Beaver Creek.
That question also has more than one answer, Meyer said.
For one thing, Ellis & Eastern has active rail traffic on the east end of the short-line rail moving product between the Magnolia fertilizer plant and the terminal south of Worthington.
Meyer also said he tries to arrange the cars in the order they’ll next come out of storage, but it’s often not clear how long the cars will be there.
“Even when the customer puts them in storage, they don’t always know,” Meyer said.
But he added that some of the cars — like the ones used for grain — are seasonal and are stored on shorter term contracts.
Currently the poor condition of the rail on the South Dakota portion of the line prevents railcars from traveling from Luverne to Manley, but the line fulfills an industry need as a leased “parking lot” for empty rail cars.
As such, there are often 300 to 400 cars stored on the line between Luverne and Beaver Creek at any given time.
Longview shows promise
The Buffalo Ridge Regional Rail Authority, comprised of Rock and Nobles county commissioners, owns the short-line railroad between the Burlington Northern Sante Fe to the west and the Union Pacific to the east.
Ellis & Eastern, owned by Sweetman Construction Co. of Sioux Falls, is leasing the local track and recently secured a $14.4 million federal grant to support rehabilitation of the line by re-enforcing bridges, replacing ties and adding ballast.
Ellis & Eastern also operates the rail line from Manley to Ellis, South Dakota, and that portion of the railroad will also undergo extensive improvements.
Earlier this month the rail authority and Ellis & Eastern officials met jointly with an engineering firm that reported on a site analysis that shows promise of economic growth along the Buffalo Ridge Railroad.
Specifically four sites along the railroad — three of them in Rock County — were identified for potential development for industries seeking to move products.
Rail improvements will take several years to complete, but the improved track will mean trains are moving, not parked.
And if development occurs as predicted, the economic gain for Beaver Creek and the region might be worth tolerating the parked railcars.
“We are continually working on opportunities, And the future for rail is bright,” Meyer said.
“As the economy rebounds from the pandemic, we’ll be in a great position to help keep more freight moving, which is what I think we all want. Until that happens, these are some of the things we’ll do stay afloat.”
Meanwhile, he said Ellis & Eastern officials will consider spacing the cars at Beaver Creek so allow wider visibility.
