Defunct railroad may be stifling development with pricey fees, residents say

A railway that has been out of service for more than a year could be stifling development in Cape Breton, says a resident, because of how much it costs to build across the tracks.

Mike Johnson, who heads the Railway Victims Association, is building a house in Big Beach on Bras d'Or Lake. His driveway crosses the Cape Breton and Central Nova Scotia Railway, where freight rail service was discontinued in October 2015 between St. Peters Junction and Sydney.

Johnson said when he was planning to build, he had no idea he would be paying so much money.

"I'm somewhere north of $25,000 to put in electricity," he told CBC News. "I was not aware of the fees of that magnitude."

Why does it cost so much?

Genesee & Wyoming Inc., which owns the railway, says fees for each new utility crossing can add up to about $4,000. That includes items such as pipes and cables.

For each utility, there is an additional ongoing fee of $300 a year.

Those fees are "fairly standard" across the North American railroad industry, according to Michael Williams, a spokesperson for Genesee & Wyoming.

If Johnson wants electricity from Nova Scotia Power, he must also pay the utility roughly $10,000 for an engineering assessment because there are higher standards for installing power lines that cross railways.

Bev Ware, a spokesperson for Nova Scotia Power, said it costs $4,000 to submit that special application to Genesee & Wyoming and an additional $1,800 if someone wants that application processed faster than the usual six to eight weeks.

Johnson said he would like to install electricity and other utilities but hasn't moved ahead based on the estimates to do the work. 

"This railway isn't functioning in any way, shape or form," he said. "Yet, they continue to charge."

Case to drop rail fees

Johnson is also irked because there's a small tree growing up against the rail line near his driveway and the growth isn't being cut back.

"The rails, the ties — nothing has been maintained."

The company said that because the line is not in service, it is only doing brush control that is mandated by Transport Canada. 

Kevin Miller, who owns KG Miller's Builders and Renovators, does construction work in the area and said companies like his would be busier if fees associated with rail lines were dropped for properties that now sit empty.

"I think it would be developed. There's no doubt," he said.

"It would actually have an impact on the tax base for this area, too. Developed land pays more taxes."

Genesee & Wyoming said while the train service in that area has been discontinued, there are still fees associated with using or crossing the property.

"Whether or not trains are running, there is potential for liability any time a person is granted permission to enter the property of another," spokesperson Williams said in an email.

'No ongoing financial arrangement'

The Railway Victims Association recently met with Transportation Minister Geoff MacLellan, who said he's met with senior staff and legal advisers to see what action the province can take. MacLellan said the issue is complicated and he's asked for a meeting with Genesee & Wyoming to discuss the fees.

The company used to receive a subsidy from the province, but that ended last year when the Nova Scotia Utility and Review Board approved Genesee & Wyoming's application to discontinue the service.

"There is currently no ongoing financial arrangement related to that section of track," said Brian Taylor, a spokesperson for the Department of Transportation.