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Crapo Wants
Better Rail Access to Ag Markets

by Jake Putnam
Idaho Farm Bureau Quarterly, Summer 2006

BOISE -- Idaho Sen. Mike Crapo is working to improve the transportation of Idaho agriculture commodities to market. Crapo has teamed up with agricultural shippers and regional railroads with a goal of refurbishing neglected railheads across Idaho.

Crapo serves on the Senate Finance Committee and has worked on rural rail development by extending tax credits on transportation investments. He wants the U.S. Treasury Department to develop rules allowing tax credits to ensure rail revitalization and investment continues in Idaho and across rural America.

Leaders of the Eastern Idaho Regional Railroad, and parent company Watco, recently joined agricultural shippers, businesses and commodity group leaders in touring rail improvements made on EIRR's line three miles east of Burley last July. The demonstration showed how the tax credits pushed by Crapo can improve freight rail service for Idaho. A number of businesses like Coors, Amalgamated Sugar and the Idaho Grower Shippers Association attended the tour.

"We are finally seeing regional railroads being able to step up and bring these lines back, after decades of deferred maintenance in some cases, creating jobs while they improve transportation options," said Crapo. "These regional railroads run efficiently and pass their efficiencies on to their customers, which improves our rural economy and business. Without them, many of our shippers would not have a rail option to market and would therefore end up with higher transportation costs."

Crapo is pushing for the Senate to extend tax rules which allow for a 50 percent tax credit on reinvestment in rail facilities for regional railroads like EIRR.

"This tax credit helps the short-line railroads maintain the necessary infrastructure," he said. "This infrastructure can be as important as highways and bridges -- they are the lifeblood that keeps commerce moving in rural Idaho and our rural businesses and industries are responding by using this system."

"When we ship grain to Mexico we've always had problems getting railcars and then we have to truck it to the railhead," said IFBF President Frank Priestley. "In the old days we could literally ship from our back yards. These timely incentives could one day cut our use of oil and save us money."

"It's very important because the rail is the lifeblood of agriculture when it comes down to it," said Gary Fuhriman, director of commodities and marketing for Idaho Farm Bureau Federation. "If the rails deteriorate much more in Idaho it would be disastrous to agriculture. They need to keep them updated, improve them and keep them online."

With diesel fuel prices going through the roof, Idaho farmers face their highest transportation costs in history with the railroad the only other shipping option.

"I think it is very important to get the rails ready as a backup," said Fuhriman. "Eventually we'd like to see more use of containers, so we can ship them directly to the barge and world markets, cutting handling and transportation costs."

"Getting Idaho products to market has been tough to plan over the last few years because of the mergers of some of the larger railroads and speculation about truck service," Crapo said.

Watco began Idaho operations in 1987 and has about 80 percent of all shortline traffic in Idaho. The company purchased the Eastern Idaho Regional Railroad line from Union Pacific before expanding into the Magic Valley, Palouse, and Upper Snake regions of Idaho. Watco also operates railcar repair facilities in Rupert and Idaho Falls.

Jake Putnam
Crapo Wants Better Rail Access to Ag Markets
Idaho Farm Bureau Quarterly, Summer 2006

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