Federal rail board wants to hear out mysterious coal train proposal, jeopardizing Great Redwood Trail project

A controversial, long-shot proposal to ship coal by freight rail up the North Coast is not dead yet.

The federal body that oversees the nation’s railroad rights of way indicated this week that it will consider the proposal from a mysterious Wyoming company to reconstruct defunct rail lines and ship coal out of Humboldt Bay to Asia.

The coal export proposal, widely regarded as unrealistic, is facing staunch opposition from local and state lawmakers, the tight margins of a declining coal industry and would need up to $2 billion to restore abandoned sections of track in Mendocino and Humboldt counties, according to previous state estimates.

But the decision by the U.S. Surface Transportation Board could complicate another North Coast venture: the proposed Great Redwood Trail, a 320-mile bicycle and pedestrian recreation route along former railways stretching from Eureka to San Francisco Bay.

The trail project, championed by state Sen. Mike McGuire, D-Healdsburg, and many other elected officials, conservationists and economic development officials, made significant strides in March with the creation of a state agency to spearhead the effort.

The coal shipping proposal surfaced in August 2021, when a newly-formed, Wyoming-based entity called the North Coast Railroad Co. filed documents with the federal rail board suggesting it could raise the funds to restore abandoned rail segments.

The Great Redwood Trail Agency sought to nip that proposal in the bud, asking the rail board to disregard it.

But in a May 17 ruling, the Surface Transportation Board indicated it would consider the coal entity’s proposal. The board will also consider a proposal from the company behind the Skunk Train, a Mendocino County tourism attraction, to rehabilitate a section of the rail line.

In its ruling, the rail board cited a “strong congressional intent to preserve rail service wherever possible.”

In the coming weeks, both companies will have to put forward proposals indicating they have the necessary financing to restore the rail lines. They will also have to indicate they can earn a 7.5% return on their eventual business plans, according to McGuire.

Rail lines running from Willits in Mendocino County to Humboldt Bay have not carried freight rail since at least 1998, when rain-driven landslides buried tunnels and destroyed portions of tracks, including along ecologically sensitive stretches of the Eel River. Further south, freight operations resumed between Napa and Windsor in 2011 only after a state agency spent $68 million to repair 62 miles of track.

McGuire called the rail board’s decision this week a “worst-case scenario” for Great Redwood Trail backers that opens the possibility of shadowy fossil fuel interests derailing the project.

“We can’t take anything for granted,” he said in a Wednesday phone interview with The Press Democrat, because, “the stakes are too damn high.”

The Surface Transportation Board leans heavily toward preserving freight rail corridors, even as thousands of miles of rail lines have been converted to recreational trails around the country. Four of the five members of the board were appointed by the coal-friendly Trump administration.

Little is known about the company behind the coal-shipping proposal, other than it has been pushed in the Eureka area by a consultant named Justin Wight.

Wyoming is known for loose requirements on business filings and is often used to register corporations with hidden ownership. Documents obtained by the Salt Lake Tribune in Utah indicated there was at least initial interest by Utah state officials and leaders of the Crow Tribe, whose Montana reservation is home to large deposits of Powder River Basin coal. In those records, a Utah official stated that Wight was pursuing a $1 billion loan from the U.S. Department of Transportation.

But after news of the coal proposal broke, organizations and some officials that had appeared to offer at least initial support distanced themselves, including the Utah Port Authority.

Reps. Jared Huffman, D-San Rafael, and Mike Thompson, D-St. Helena, who represent the North Coast and North Bay in Congress, are working to block any federal financing for such a project, McGuire said. In Sacramento, McGuire, the Senate majority leader, is advancing a bill to block any state funding toward restoring rail for shipping coal.

“There’s simply no chance that any freight operation is going to be able to make the investments that are needed (to restore) this line,” McGuire said. “I am confident the Great Redwood Trail Agency and the state can show how impossible it is to run a freight train up the North Coast.”

City councils and county boards of supervisors from Marin to Humboldt counties have passed resolutions expressing opposition to any coal shipping proposal and support for the recreation trail.

Beyond the immense costs and environmental risks of restoring the North Coast rail lines, the specter of coal trains is politically unpopular in a region that leans heavily Democratic and has for years rejected efforts to establish coal export facilities.

The coal train would have to make use of the Sonoma-Marin Area Rail Transit tracks through Marin and Sonoma counties. SMART’s board of directors have stated their opposition to the project and scoffed at the prospect of coal trains, often more than a mile long, passing through cities along SMART’s line.

You can reach Staff Writer Andrew Graham at 707-526-8667 or andrew.graham@pressdemocrat.com. On Twitter @AndrewGraham88.