A joint railroad venture is expected to bring millions of dollars in track and facility improvements to Ayer and once finished, could likely spur economic development in the area as well.
Pan Am Southern, a joint venture formed by Pan Am Railways of Billerica and Norfolk Southern Corp. of Virginia, is going to spend $87.5 million over three years to upgrade the railroad tracks, signals and other facilities between Ayer and Mechanicsville, N.Y., outside Albany. Pan Am Railways was formerly known as Guilford Rail System.
It will cover improvements over 151 miles of track between Ayer and New York, and on another 281 miles of secondary and branch lines in Connecticut, New Hampshire, Vermont, New York and Massachusetts.
Job Growth
The plans include $8.1 million for a new auto distribution facility and $2.5 million for a new intermodal center in Ayer, along with improved tracks and signaling that will let trains travel faster along what Pan Am Southern has christened the "Patriot Corridor."
"We think there will be many economic development opportunities, whether they are in eastern Massachusetts or in the capital region of New York, or somewhere in between," said Rudy Husband, spokesman for Norfolk Southern and Pan Am Southern.
Intermodal centers alone are not big job creators, but warehousing, logistics and distribution companies that often crop up around the centers will create a number of jobs, he said.
It's also about providing additional competition for companies that need to transport goods by rail and a chance for Norfolk Southern to break into the New England railroad market.
"This is about providing shippers with options," Husband said.
Once the improvements are in place, Pan Am Southern isn't the only entity that believes they will be a catalyst for other businesses.
"The joint operating agreement means tens of millions of dollars will be invested in Ayer," said Shaun Suhoski, the town administrator in Ayer. "It's also a positive economic development for the Northeast."
Easier shipment of goods will help a number of Ayer companies, such as vegetable and olive oil processor Catania Spagna Corp., Cains Foods LP, a food maker, and Horizon Milling LLC, a national flour milling company. Those companies get many supplies and their own products in and out by rail, Suhoski said.
"I think it's a big positive because Norfolk Southern is a major corporation, and the improvements they intend to make should only make shipping better," said Prisco Morella, process manager of the bulk operation of Catania Spagna. With improved track, including switches, Morella is looking forward to having an easier time of getting railroad cars in and out of the Catania Spagna facility.
Officials at Worcester's own Providence & Worcester Railroad Co. think the improvements are going to help them as well.
P&W will now have a direct connection with Pan Am Southern in Gardner, said Marie A. Angelini, P&W's general counsel.
"This direct connection enhances competition and further benefits our customers," Angelini said.
But there is a big environmental issue that has Ayer officials concerned.
While the town is looking forward to any economic development the improvements may bring, it is also very concerned about the construction of the automotive distribution facility on top of one of its primary drinking water supplies, the Spectacle Pond aquifer. It's also a recharge area for adjacent Littleton's aquifer.
The plan for the improvements surfaced at least 10 years ago by Guilford, and while the town successfully fought it once, eventually a consent decree was fashioned in federal court. It outlined numerous steps that must be taken by the railroad. These include covering the area where locomotives will idle with an impermeable membrane so spills cannot enter the aquifer and installing a network of monitoring wells that will detect any pollutants.
Pan Am Southern must now live up to the terms of the decree.
Formerly Guilford Railroad, and then its successor, Pan Am Railways, and the town had a very strained relationship. But now the town and Pan Am Southern are talking, and town engineers sit in on construction meetings, Suhoski said.
"We are a voice at the table now," he said.
The federal Surface Transportation Board kept the consent degree in place as part of the joint venture's approval. The board resolves railroad rate and service disputes and reviews proposed railroad mergers or new ventures.
In its decision, the board noted that it approved it in part because the joint venture and the resulting east-west main line route upgrade would significantly increase competition.
"I commend the management of Norfolk Southern and Pan Am Railways for their vision in developing a transaction that will give more New Englanders access to first-rate freight...," said Charles D. Nottingham, chairman of the board, in announcing the approval this spring.
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