Montana Rail Link (“MRL”) will conclude its long-term lease with BNSF Railway Company (“BNSF”), and BNSF will resume operations and maintenance of its mainline rail corridor through southern Montana upon receipt of the necessary approvals.
MRL was founded in 1987 by entrepreneur Dennis Washington and is a part of The Washington Companies. MRL and BNSF have had a unique lease arrangement since 1987 in which MRL leases and operates mainline tracks owned by BNSF between Huntley, Montana and Sandpoint, Idaho.
Over the last several years, more than 90% of the traffic traversing MRL’s leased line were loads moved on behalf of BNSF. The line has become a critical link in BNSF’s northern transcontinental network, delivering grain, consumer and industrial products to the West Coast.
“There have been many changes in the rail industry since this long-term lease was signed, and given the need to be competitive in the current environment, we believe that this was the right time to revisit our longstanding agreement with BNSF,” said Derek Ollmann, president of MRL, “This agreement protects our workers, our customers, and our long-term commitment to safety, and it will ensure a more seamless operation of rail services in Montana.”
“We are excited to bring an important part of our railroad’s history back into our operations at BNSF,” said Katie Farmer, president and CEO, at BNSF. “The line will become the MRL Subdivision of our Montana Division in recognition of the shared heritage of BNSF and MRL.”
Farmer continued, “We welcome the MRL team and customers back into the BNSF family. We will continue to invest in the business, provide great service and maintain the highest level of safety just as we have for over a century in Montana. This will best position employees, customers and the communities we serve for future success.”
Alison Vergeront, Montana Grain Growers Association Executive Vice President, commented, “MRL has done a great job as a partner to BNSF and Montana agriculture since they leased that route from BN years ago. As far as the grain business goes, the southern line relieves the pressure on our HiLine when the Midwest has a big crop. And, of course, there are a lot of other products travelling both routes at all times. We expect BNSF will be every bit as efficient going forward.”
MGGA President Tryg Koch added, “The transition from MRL operation, back to BNSF, should be pretty seamless for grain customers, as the pricing and the rail cars have been from BNSF all along. We believe BNSF’s culture of reinvestment in infrastructure will be positive for the return of this line to BNSF management.”
BNSF has offered to retain all railroad employees at current positions and salary. The Surface Transportation Board in Washington, D.C. will review the dissolution of the lease, a process normally requiring several months. The transfer is expected to enhance rail capacity, since trains and crews will no longer be required to be “handed off” at the interchange points.
Overall, MGGA says that customers should see little in the way of change, as both railroads intend a smooth transition of operations.
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MGGA/MRL
