WASHINGTON – As public comments came to a close, a distinguished group of national leaders has voiced their opposition to the loan and called on the Federal Railroad Administration (FRA) to deny a Dakota, Minnesota and Eastern Railroad (DM&E) proposal.
“The American taxpayer is being railroaded again,” George Landrith, president of Frontiers of Freedom Institute, a public policy foundation dedicated to promoting free market principles, said in a statement during the comment period. “The DM&E railroad has a history of failing to live up to its financial obligations. American taxpayers deserve to know who the money is going to and how it’s going to be paid back.”
In August, the U.S. Surface Transportation Board (STB) approved DM&E’s application to utilize a separate subsidiary to build and operate a new 280-mile rail line into the Powder River Basin.
The DM&E Railroad’s upgrade project will rebuild 600 miles of DM&E track and add 260 new miles of main line construction to clean, low-sulfur coal mines in the Powder River Basin of Wyoming.
DM&E will privately fund two- thirds of the project, and has applied for a loan from the Federal Railroad Administration – fully backed by the railroad’s assets – to finance the remaining portion, or $2.3 billion. The $6 billion project would create an estimated 10,000 direct and indirect jobs.
The DM&E plans to begin construction in 2007 and to be operational by 2010.
“Thanks to changes made to the Railroad Rehabilitation and Improvement Financing, or RRIF, the administration is considering awarding one of the largest loans to a private company in the history of the United States,” said U.S. Rep. Jeff Flake, R-Ariz., in a statement on the floor of the U.S. House of Representatives, “This would be a $2.3 billion loan to the DM&E, a loan larger than the Chrysler bail-out… the RRIF program is on the verge of being used to provide a competitive advantage. It is inappropriate for the taxpayers to finance it.”
– PRNewswire
