The term “corporate welfare” gets bandied about a lot but sometimes it has nothing to do with taxes. Sometimes, it’s with leases, and the CSX railroad is looking to get a really sweet deal thanks to our State Senate.
The Western & Atlantic Railroad is a 137-mile rail line that runs from Atlanta to Chattanooga, and is presently an integral part of CSX Transportation. CSX relies on the W&A as a crucial part of their 21,000-mile system. About 55 to 60 freight trains a day travel on this crucial link from the South to the East and Midwest.
And CSX gets use of this railroad for a relative pittance. Presently CSX pays Georgia, specifically the Georgia Properties Commission, around $22,000 a day for the use of the line. That comes to $8 million a year. That value was set some 20 years ago during the last round of negotiations. And because that $12 million goes to the Properties Commission instead of the Georgia Department of Transportation, those funds get put in the General Fund and do not help with our state’s transportation issues.
In 2004, when Georgia got as close to beginning operations of a commuter train from Griffin to Atlanta as it ever would, there was a short, two-mile piece of CSX’s railroad that we needed in order to run these trains into Atlanta. Guess how much CSX wanted the state to pay to have access to that bit of track? Amazingly, it was the same as what they paid Georgia for the use of the 137 miles of the state-owned W&A.
A 2006 “fact” sheet published by GDOT said that a line from Canton to Atlanta would begin operations in 2016. There was the problem of the CSX lease, however, because there was nothing in it that required the railroad to cooperate with the State in running passenger trains over the route, or even to allow access to the property. One wonders if CSX would have had the temerity to charge the state for the use of its own rail line?
We did assume as much, and back when there was an actual Georgia Passenger Rail Program, we put a lot of thought into how a new lease with CSX might be negotiated to give the state the rights to use its own railroad.
Of course now the Georgia Rail Passenger Authority exists only on paper and the state’s Rail Passenger Program that involved the GRPA, GDOT and the Georgia Regional Transportation Authority is nothing more than scores of notebooks stored in a closet somewhere in a state office, so there is no one available to mind that particular store.
So, in the absence of anyone who gives a damn at the state level to keep an eye on things, the Georgia State Senate has voted to let CSX keep their sweet deal going. Buried deep at the very end of Senate Resolution 228, on the 22nd page, we learn that the state wants to extend the lease of the W&A to CSX for 50 years at just $33,150 a day ($12.1 million a year). That would go up annually by 2.5 percent (around $300,000 each year). By 2070, the railroad would be paying somewhere in the range of $27 million a year.
This amount is nowhere near anything like “market rate.” If we were to charge CSX the rate that the railroad wanted to charge us for the 2 miles of track we needed to run a commuter train in 2004, they would be paying Georgia $584 million, not $12.1 million.
Now, that’s a deal, and I salute CSX for its political skills and its temerity. Perhaps someday the state senate will have the nerve to stop just giving away the people’s assets. This obviously is not that day.
Former Atlanta City Council Member Doug Alexander served as Rail Program Manager for the Georgia Rail Passenger Authority from 1999 until 2005.