Jefferson, Lewis and St. Lawrence counties work on Newton Falls rail line

Jefferson, Lewis and St. Lawrence counties are working together on a strategy to reconstruct the Newton Falls rail line, which economic development officials say they believe will preserve hundreds of jobs at several north country businesses.

Economic development leaders met Nov. 18 to talk about a strategy to rebuild the 44-mile line, which has not been used since Appleton Papers, Appleton, Wis., closed its Newton Falls mill in 2000.

The St. Lawrence County Industrial Development Agency is the lead on an application to the state for $9.6 million to work on the project. The North Country Regional Economic Development Council chose the three-county project as one of its priority projects in the strategic plan the council recently submitted to the state.

The rail project would cost $69.3 million, the council’s strategic plan said. It would enable Newton Falls Fine Paper to expand, adding 155 jobs, as well as preserve other businesses and jobs.

“When we look at a regional approach, we all support St. Lawrence County in their application,” said Donald C. Alexander, CEO of the Jefferson County Industrial Development Agency. “At the end of the day, we want to protect the essential rail infrastructure.”

St. Lawrence County IDA took the lead on the project, as it would most benefit from the mill were it to reopen. Newton Falls Paper Mill owner Scotia Investments is continuing to work to find a partner to help with the reopening. Mill owners have said a working rail line would help the long-term sustainability of the mill.

In that county, revitalization of the rail line would benefit Benson Mines, which has millions of tons of granite left over from iron production near Newton Falls. The granite is too expensive to ship long distances by truck, but rail would make it marketable.

For example, the company once had an opportunity to sell 200,000 tons of rock for the Onondaga Lake remediation but lost out because of transportation costs.

The line also could be of value if a business comes to the former Jones & Laughlin Steel Co. site. Although much of the 54-acre property is contaminated, St. Lawrence County and the state Department of Environmental Conservation are working to have 18 acres of it made usable. The property is one of only a handful that are zoned industrial in the Adirondack Park.

In Lewis County, Harrisville Dry Kiln may use the line and a buyer for the talc mine owned by IMI Fabi just north of Natural Bridge may require rail service. And in Jefferson County, Slack Chemical Co. Inc. and Climax Paperboard Inc. depend on the line for freight shipments and deliveries.

The challenge in Jefferson County has been to find a new agreement for taxation for the line. Mr. Alexander said this week that local taxing jurisdictions have a general agreement on how to handle a payment-in-lieu-of-taxes agreement that expired in 2006.

“We tried to get a general agreement then and couldn’t do it,” Mr. Alexander said. “The question is how to convert from a PILOT scenario to a full taxation scenario so we don’t require any PILOTs.”

Mohawk, Adirondack & Northern Railroad Corp., which controls tracks that connect to CSX Corp.’s spur to Philadelphia, has said full taxation as previously established would make the line lose money.

Without the railroad, CSX’s railroad cars would be able to reach Carthage village limits, but would not be able to go past those limits into Carthage, West Carthage and Champion.

The parties must have further discussions on how to handle the payments in arrears.

“It’s complicated because we have the old PILOTs and conversions,” Mr. Alexander said. “The pieces that are no longer used could be converted into trail systems, but we may want to rail bank those so they could be converted back if there were a use for them.”