Not So Fast: Third Party to Challenge Tennessee Pass Lease

An eastbound train is seen at Belden, Colo., on Tennessee Pass in August 1996. Photo by Jeff Simley.

Not So Fast: Third Party to Challenge Tennessee Pass Lease

By Justin Franz

EAGLE COUNTY, Colo. — Just days after it was announced that Union Pacific would lease the former Denver & Rio Grande Western’s route over Tennesse Pass to a Texas-based short line company, officials with another railroad company are saying they will protest the deal.

On Saturday, officials with Colorado Pacific Railroad — the company that owns the former Missouri Pacific Towner Line in eastern Colorado and is backed by real estate and agriculture magnate Stefan Soloviev — said they would file an objection with the U.S. Surface Transportation Board to the proposed lease agreement between UP and Rio Grande Pacific. 

On Dec. 31, it was announced that Rio Grande Pacific subsidiary, Colorado Midland & Pacific Railway (CMP), will lease a majority of the Tennessee Pass line and file for common-carrier authority with the STB to operate it for both freight and passenger service. CMP is planning to lease the line from Milepost 171.90, at Parkdale, Colo., to Milepost 335.00, near Sage. The former Rio Grande line has sat dormant for nearly a quarter-century and has long been considered one of the most iconic pieces of mountain railroad in the American West. 

Colorado Pacific has also expressed interest in using the Tennessee Pass line for freight and passenger service in recent years and has previously asked the STB to force UP to negotiate with it on the matter. In a statement to local media, Colorado Pacific officials said they were objecting to the new deal because they believed UP had a “monopoly” on the Colorado rail system. 

“Colorado Pacific Railroad LLC (CXR) will be filing a protest at the Surface Transportation Board asking it not to approve the Tennessee Pass lease agreement announced December 31st between Union Pacific (UP) and Rio Grande Pacific (RGP) on grounds that UP thereby maintains its monopoly stranglehold across the Rocky Mountains in Colorado, in defiance of concerns about the Tennessee Pass line stated by the Board in its decision in the 1996 UP-SP merger case,” the statement read. “It appears that CXR should also request the reopening of that case, to enable Colorado’s competitive access to the national railroad network. Further, RGP has selected a business entity name deceptively similar to ours, in a purposeful effort to confuse the public. This is legally actionable and will not be tolerated.”

The Tennesee Pass route has been dormant since 1997, not long after Union Pacific purchased the Southern Pacific. A short section of the east end of the railroad, through the scenic Royal Gorge, is operated by a short line, Rock & Rail, and a tourist carrier, Royal Gorge Route Railroad. 

This article was posted on: January 4, 2021