Coalition of suburbs holds fast against railroad merger, even with $10 million offer

A campaign led by suburban mayors against the proposed merger of two major North American railroads is gaining steam.

Some Illinois lawmakers have joined mayoral and county leaders in their resistance to the railroad megadeal. In recent filings with federal regulators, Metra and a coalition of municipalities have sought to block the transaction while demanding significant concessions if Canadian Pacific Railway's acquisition of the Kansas City Southern railroad does pass muster.

The $31 billion merger requires the approval of the U.S. Surface Transportation Board, a five-member panel overseeing the railroad industry. Combined, the freight haulers would create the first single-line rail network linking the United States, Canada and Mexico.

The merger has faced criticism on multiple fronts. Chicago-area lawmakers are raising similar concerns about growth in freight traffic, the toll it could take on public infrastructure, and potential environmental and safety issues.

"Yes, we need to move our goods and services. Yes, this is vital to the United States, and I think that we're aware of this more than ever as we look at supply chain shortages," said state Rep. Michelle Mussman, a Schaumburg Democrat. "But we also have to comprehensively think about what is the economic, quality-of-life and environmental impact, again, of these choices."

The lawmakers were flanked by members of the "Coalition to Stop CPKC," a group of eight suburbs along Metra's Milwaukee District West Line, at a news conference this week. DuPage County now supports their merger fight.

Still, at least one Kane County town has agreed to get on board with the merger effort.

Canadian Pacific points to an agreement with Hampshire as proof it's willing to compromise on noise relief and other mitigation measures.

As part of the agreement, Canadian Pacific would fund and construct a $625,000 project to establish a "quiet zone" along a stretch of tracks in Hampshire. In exchange, the village would close the East Street crossing to make the area a quiet zone - and officials won't object to the railroad merger. The agreement won't take effect unless the federal Surface Transportation Board approves the merger.

But Canadian Pacific and the coalition of suburban leaders have been unable to reach an agreement in their negotiations. The eight communities are Bartlett, Bensenville, Elgin, Itasca, Hanover Park, Roselle, Wood Dale and Schaumburg.

"We have engaged in direct talks with the coalition of suburban leaders in an effort to address their concerns about the additional eight freight trains a day projected to operate on the corridor between Bensenville and Elgin," Canadian Pacific spokesman Andy Cummings said.

Canadian Pacific offered to make a "voluntary community investment" of a total of $10 million to the eight towns. In return, the coalition would agree to not seek any mitigation conditions before the Surface Transportation Board and to drop their opposition to the merger. The coalition rejected the offer.

"Considering that the estimated total cost of the mitigation conditions the coalition believes will be required to attempt to protect their communities from the harm CPKC will inflict on them post-merger is over $9 billion, CP's offer to pay the coalition members a lump sum of merely $10 million is clearly not a serious attempt to reach a mutually acceptable settlement," Itasca Village Administrator and coalition chair Carie Anne Ergo wrote in a May 24 letter to Canadian Pacific.

Cummings countered that Canadian Pacific has made a "significant proposal" to the coalition. In response, coalition members have repeated the $9 billion demand, Cummings said.

"That $9 billion would be double the entire CREATE (Chicago Region Environmental and Transportation Efficiency) program involving freight and commuter rail lines carrying more than 1,300 freight and passenger trains across the Chicago region," Cummings said. "This is not the position of a party interested in a serious exploration of the public interest implications of the CP-KCS combination."

By comparison, when the Surface Transportation approved Canadian National's request to buy the Elgin, Joliet and Eastern railroad in 2008, the panel imposed numerous conditions on CN - including that the railroad pay about two-thirds of the costs of two grade separation projects, estimated at the time at $68 million.

There are 54 pedestrian and road crossings over the roughly 20 miles of tracks through the coalition communities. Currently, Canadian Pacific operates three or four trains per day, and the average train length is 10,000 feet, the coalition's attorney wrote in filings to the Surface Transportation Board.

Some trains are as long as 12,000 feet. Either length is enough to simultaneously block all the crossings in some coalition towns.

"The only solution for the city of Elgin and the villages of Bensenville, Wood Dale, Itasca and Bartlett would be the construction of grade separated crossings, interchanges, and/or underpasses, each of which will cost tens of millions of dollars to design and construct," the coalition's attorney wrote.

The coalition has asserted that the companies have understated the expected number of freight trains that would run through the suburban communities after the merger. The coalition also has urged federal regulators to set limits on the length of trains as a condition of any merger approval.

State Rep. Maura Hirschauer, a Batavia Democrat, worries about crossing delays for emergency responders, school buses and commuters. State Sen. Diane Pappas warned "heavy rail traffic and the additional vibrations that come along with the trains" would require more frequent maintenance and infrastructure repairs.

"The time to address these issues is now before the merger goes through so that the communities can properly ameliorate some of these potential future risks," the Itasca Democrat said.

The transportation board's Office of Environmental Analysis is in the midst of an environmental review of the proposed merger. A public hearing likely will be held later.