WASHINGTON — Rarely does a Class I railroad spinning off branch lines and secondary routes demand a federal review, but that is exactly what a group of shippers is asking for after Canadian National announced it would be selling 900 miles of the former Wisconsin Central.
On March 30, Watco Companies announced it had agreed to purchase a large chunk of the former WC in Wisconsin, Michigan and Ontario, including the former Algoma Central in Ontario and about 650 miles of branch lines in the United States. Watco planned to incorporate the new trackage into their Grand Elk Railroad, Inc. and a new railroad called the Fox Valley & Lake Superior.
But in the last week, a number of shippers on the former WC have asked that the U.S. Surface Transportation Board take a closer look at the deal. Specifically, the shippers would like to see it designated as a “significant” transaction, one that would demand a high level of scrutiny. Among their concerns is that Watco — which already owns the 600-mile Wisconsin & Southern — would be doubling its trackage in Wisconsin and thus control much of the rail network there. Shippers were also dismayed that the deal was announced following “entirely closed-door negotiations.”
On April 12, Grand Elk Railroad and Fox Valley & Lake Superior asked the STB to set a procedural schedule to consider the shippers’ concerns.
A map of the lines being sold to Watco.