Berkshire Hathaway Agrees To Remove Stored Rail Cars From Adirondacks

Dec 27, 2017

Last week Governor Andrew Cuomo announced New York state would take action to stop Iowa Pacific Holdings from storing rail cars in the Adirondacks. Along with issuing a cease and desist order and filing a petition with the federal Surface Transportation Board, the state asked the company that owns many of the cars to cancel its contract and remove them.  On Tuesday, Berkshire Hathaway agreed to that request.

Iowa Pacific plans to indefinitely store up to 2,000 rail cars on tracks it owns in the Adirondacks.  But, on December 19th Governor Cuomo insisted New York would take legal action to stop the rail car storage.  The stance is part of the Democrat’s 2018 State of the State priorities, which he has been detailing ahead of the January 3rd address. Many of the rail cars are owned by Union Tank Car Company, a subsidiary of Berkshire Hathaway and the state asked those companies to voluntarily remove their cars from the Adirondacks.
On Tuesday, Berkshire Hathaway said their 65 rail cars would be removed by mid-January.  

Adirondack Council Spokesman John Sheehan is not surprised by the quick response.  “Our members had been writing since the end of November and have sent somewhere in the neighborhood of 1,100 letters and emails to Berkshire Hathaway. So having the governor wade in definitely added weight to all of that  and certainly we’re grateful that he and the Attorney General started putting pressure on the  railroad company to try and do something about this as well.  But clearly they had an impact on Berkshire Hathaway and so did the letters that were sent in.”

Sheehan adds that owners of rail cars contracting with Iowa Pacific for storage may not realize they are being put in the Adirondacks.  “Iowa Pacific Holdings has done very little to deal with the concerns of the community or the environmental concerns that we’ve expressed about this.  So the next step was to go to the oil companies themselves who own the cars and ask them to have them removed. And having Berkshire Hathaway step forward and do this voluntarily is very helpful and we hope will be something that will make an impression on the Surface Transportation Board.”

Protect the Adirondacks Executive Director Peter Bauer believes Berkshire Hathaway’s move to pull rail cars out of the Adirondacks is a turning point in the effort to stop Iowa Pacific’s storage plan.  “All indications pointed towards the company being receptive.  I think other companies are going to look at Berkshire Hathaway and say we don’t think it’s appropriate to site a 30 mile long linear junk yard right through the heart of the Adirondacks.”

But Iowa Pacific says it will continue to store rail cars on its Adirondack tracks.   General Counsel David Michoud  declined to be recorded but did email a copy of the company’s response to the state.  In regards to the cease and desist order, Iowa Pacific notes it has the legal right to store rail cars and “…will agree to stop storing rail cars if the State, or an agency of the state, enters into an agreement to purchase … the freight easement that [the company] owns in perpetuity… Short of such an agreement, however, SNCR [Saratoga and North Creek Railway] will continue to store rail cars on its line and, in fact, has plans to bring in hundreds of more cars over the next few months.” The Iowa Pacific letter also states there is no merit to the complaint filed with the federal Surface Transportation Board.