Another milestone on the long road to a Southwest Light Rail Transit project groundbreaking was passed this week when the Metropolitan Council and Hennepin County Railroad Authority approved a settlement with Twin Cities & Western Railroad.
The agreements mean Met Council now has control of the entire 14.5-mile SWLRT corridor, which stretches from downtown Minneapolis to Eden Prairie. Twin Cities & Western, a freight rail that operates along a portion of that corridor, will be paid $18.5 million for its cooperation — nearly $2.5 million more than was in the offing when negotiations between Met Council and TC&W broke down last summer.
Met Council officials said a deal with TC&W was accounted for in the project’s budget and won’t bump up its cost, currently anticipated to top $2 billion.
“This is a major milestone, and it’s very good for the project,” said Met Council Chair Alene Tchourumoff, who noted that an agreement keeps open the possibility that construction work on the largest transportation project in state history, an extension of the Metro Green Line into the southwestern suburbs, could finally begin in October or November.
Glenco-based TC&W had fought a plan to reorganize ownership and control of the Bass Lake Spur and Kenilworth Corridor, two sections of freight rail corridor that Met Council plans to use for future light rail service. Arguing that the deal could hamper its customers’ ability to move agricultural products from eastern North Dakota and western Minnesota into the Twin Cities, the railroad petitioned the Surface Transportation Board to block the plan and also filed a lawsuit in federal court. It is expected to withdraw both the petition and the lawsuit within days.
Now, Met Council officials anticipate the STB will approve its plan, which involves purchasing the 6.8-mile Bass Lake Spur from Canadian Pacific for $27.5 million and taking ownership of the 2.5-mile Kenilworth Corridor from Hennepin County. The Kenilworth Corridor, which cuts between Cedar Lake and Lake of the Isles, is valued at $66 million.
As part of the deal, the Hennepin County Railroad Authority will become the common carrier for the Bass Lake Spur, a role it already fills for the Kenilworth Corridor, meaning that it is responsible for maintaining freight rail service. In practice, Met Council will take care of most of the track maintenance, reimbursed for the work with fees paid to the county by TC&W.
Pending approval from STB, Met Council plans to re-submit its application for a so-called letter of no prejudice from the Federal Transit Administration. A grant from the FTA is expected to cover not quite half of the cost of the total project, and by issuing a letter of no prejudice it would give Met Council the OK to begin construction work before the grant is issued.
Tchourumoff said Met Council expects FTA to award the grant in the first half of next year.
In the meantime, Met Council has asked the two bidders competing for the project’s civil construction contract to keep their offers on the table for another 60 days. The council had expected to award the contract Aug. 1, but has requested an extension until Sept. 30 so that it can secure both STB approval for its corridor plan and the letter of no prejudice from the FTA.
The two construction bids submitted this spring were for $799.5 million and $812.1 million.
Met Council officials have repeatedly warned that delays only increase the cost of the project. Asked whether this latest delay would once again require a budget revision, Tchourumoff responded: “It could, but there’s no way to know until we get farther down the line.”