Pan Am Railways

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Pan Am Railways, Inc.
TypePrivate
IndustryRail transport
Founded1981 (Guilford Transportation Industries)
2006 (Pan Am Railways)
FounderTimothy Mellon
FatePurchase by CSX pending
Headquarters
North Billerica, Massachusetts
,
United States of America
Area served
Northeast
Key people
Timothy Mellon
David Fink
David A. Fink
Number of employees
750 (2011)
ParentPan Am Systems
SubsidiariesBoston and Maine Corporation
Maine Central Railroad Company
Portland Terminal Company
Springfield Terminal Railway Company
Websitepanamrailways.com

Pan Am Railways, Inc. (PAR), known before March 2006 as Guilford Rail System, is an American holding company that owns and operates Class II regional railroads covering northern New England from Mattawamkeag, Maine, to Rotterdam Junction, New York. The primary subsidiaries of Pan Am Railways are Boston and Maine Corporation, Maine Central Railroad Company, Portland Terminal Company, and Springfield Terminal Railway Company.

Pan Am Railways is headquartered in Iron Horse Park in North Billerica, Massachusetts.[1] It is a subsidiary of Portsmouth, New Hampshire-based Pan Am Systems, formerly known as Guilford Transportation Industries. Guilford bought the name, colors, and logo of Pan American World Airways in 1998.

Pan Am was put up for sale in July 2020.[2] On November 30, 2020, CSX Transportation announced that it had signed a definitive agreement to purchase Pan Am Railways, Inc. The sale of Pan Am to CSX is currently subject to regulatory review and approval by the Surface Transportation Board.[3][4]

History[]

Guilford[]

Guilford logo

Guilford Transportation Industries was founded in May 1981 by Timothy Mellon, who quickly looked to form a railroad company in the Northeast through purchasing some of the area's bankrupt railroads.[5] The company began by purchasing the Maine Central Railroad that same year, and also announced it was interested in purchasing the bankrupt Boston and Maine, making an offer that year.[6] The company's purchase of the B&M was approved in 1983, adding it to Guilford's network.[7]

Even as the B&M purchase was still pending, Guilford announced it intended to purchase the Delaware and Hudson Railway from its then owner Norfolk and Western Railway on September 1, 1981, marking the company's third acquisition.[8] The next month, Timothy Mellon made an offer of $500,000 for the entirety of the D&H's stock, which was identical to the amount the Norfolk and Western had paid to buy the D&H in 1968. Both the D&H's directors and Norfolk and Western accepted the offer, in part to remove a potential obstacle to the pending merger between the N&W and the Southern Railway.[5][9]

Expansion Attempt[]

In 1985, Guilford entered into an agreement with Norfolk Southern Railway (NS) to run trains to St. Louis. NS was attempting to win approval of a plan to purchase Conrail from the U.S. government and proposed allowing Guilford to lease Conrail lines to St. Louis in order to restore competition that would be lost in the merger. The plan would have allowed Guilford to use the Conrail mainline from Toledo to Ridgeway, Ohio, and from Crestline, Ohio, to St. Louis. Guilford would also purchase 955 miles (1,537 km) of Conrail track and 1,300 freight cars from Norfolk Southern for $53M.[10] NS did not prevail in its attempt to purchase Conrail in 1985, and the Guilford plan was dropped. In 1987, Guilford also placed a bid to buy Southern Pacific.[11]

The paper industry provides the largest source of business, with chemicals, clay and pulp inbound, and finished paper outbound. But the railroad has been losing ground to other forms of transportation - particularly trucking. A 2008 report issued by the American Society of Civil Engineers rated Maine at 48th of the 50 states in volume of freight traffic that moves by rail.[12]

Delaware & Hudson Bankruptcy[]

Guilford completed its acquisition of Delaware & Hudson Railway in 1984, purchasing the assets from Norfolk and Western Railway holding company Dereco. When planned western expansion failed to come to fruition, and with few prospects for growing freight traffic, Guilford cast Delaware & Hudson into bankruptcy and abandoned its operation in 1988. By Interstate Commerce Commission emergency order, New York, Susquehanna and Western Railway provided directed service under subsidy until the line was sold to Canadian Pacific in 1991.

Pan Am Railways (2006-present)[]

Pan Am Railways headquarters

In 1998, Guilford bought the name, colors, and logo of Pan American World Airways. In March 2006, Guilford Transportation Industries changed its name to Pan Am Systems, and Guilford Rail System was rebranded as Pan Am Railways (PAR). Then in March 2009, PAR was ordered to pay the largest corporate criminal fine in Massachusetts history — $500,000 — due to the company's negligence to report a spill of hundreds of gallons of diesel fuel in violation of state and federal environmental laws and regulations.[13]

As of 2011, PAR employs 750 people and has a $40 million payroll.[14] The company continues to operate with subsidiary entities bearing the names of former railroads which over time formed the present-day company. The company's assets are housed separately in these various subsidiaries for various reasons. For example, the Boston and Maine Corporation owns the railroad property itself while the Springfield Terminal branch operates the railroad (most of the company's employees are under the Springfield Terminal umbrella.) Meanwhile, the Maine Central entity owns rolling stock.

Norfolk Southern[]

On May 15, 2008, NS announced that it had come to an agreement with PAR to "create an improved rail route between Albany, New York, and the Boston, Massachusetts, region, named the Patriot Corridor.[15][16][17] The STB approved the deal on March 10, 2009,[18] with each railroad owning 50% of a new company known as Pan Am Southern (PAS). PAR's trackage between Ayer, Massachusetts, and Mechanicville, New York, was transferred to PAS and continues to be operated and maintained by PAR's ST subsidiary. NS transferred to PAS cash and property valued at $140 million.

Improvements to the route include track and signal upgrades, and expansion of terminals, including construction of new automotive and intermodal terminals in Ayer and Mechanicville.[19] In March 2012, the Federal Railroad Administration awarded a $2-million grant to the Massachusetts Department of Transportation for preliminary engineering on removing 19 obstacles to allow double stack container trains to use the Patriot Corridor route. The project includes raising clearance by two feet in the 4.75-mile (7.64 km) Hoosac Tunnel.[20]

Disputes with local governments[]

The company has been criticized for dumping used railroad ties that contain creosote rather than sending them for safe disposal or recycling.[21]

CSX acquisition[]

Pan Am was put up for sale in July 2020.[2] On November 30, 2020, an agreement was announced for CSX Transportation to acquire Pan Am Railways. Norfolk Southern has expressed concern about possible impacts on competition. The sale was proposed as follows: CSX will own and operate between Mattawamkeag, ME and Ayer, MA. Between Ayer and Rotterdam, NY, Genesee and Wyoming Rail will be the operating party. This means the track will be owned by CSX but CSX will not dispatch it. Also, Norfolk Southern will keep its 49% stake in Pan Am Southern (PAS). With the sale, the intermodal traffic between Mechanicville and Ayer will be re-routed over the B&A to Worcester, MA. From there the traffic will come up the Worcester main and into Ayer Yard.[22]

On March 25, 2021, after numerous letters questioning CSX's acquisition of Pan Am Railways from the Massachusetts Bay Transportation Authority, the Massachusetts Department of Transportation, the Commonwealth of Massachusetts, Vermont Rail System, as well as many other local political figures and community leaders from other New England states, the Surface Transportation Board ruled the acquisition as "Significant" meaning that a more rigorous review process would be necessary.[23]

On April 30, 2021, CSX submitted a 478-page plan of purchase outlining a broad range of topics, from implementations of track upgrades to the controversial issue of Norfolk Southern intermodal routing, as well as the fate of Pan Am's hodgepodge fleet of aging motive power, which is made up of EMD and GE locomotives from railroads such as Conrail, NS, CSX, the Milwaukee Road, and Kansas City Southern.[24]

On May 26, 2021, the federal regulators of the Surface Transportation Board rejected CSX's purchase application, deeming it "incomplete." The board cited "contradictions" and "lack of necessary information" to properly judge the acquisition, and therefore could not rule on the matter. While CSX has the option of re-submitting a revised application, which it has motioned toward in its official statement, the transaction stands on uncertain ground.[25][26]

On July 30, 2021, the Surface Transportation Board accepted a revised merger application for consideration, allowing CSX to move forward with the acquisition on Pan Am Railways and its short-line subsidiaries. The decision determined that an environmental and historic review are unnecessary and establishes criteria for additional filings, public comments, and a deadline for a final Surface Transportation Board decision.[27][28]

Routes[]

PAR's mainline runs from Mattawamkeag, Maine, to Mechanicville, New York, via the lines of the following former companies:

Locomotive fleet[]

Numbers Reporting
marks		 Type Quantity
007 MEC EMD SW1 1
1, 2 PAR EMD FP9 2
305‑307, 310, 313, 315‑317, 319, 321 MEC EMD GP40 10
326‑327, 330, 334 BM EMD GP40 4
345, 350‑354, 381, 383 MEC EMD GP40 7
501‑508 MEC GMD GP40-2L(W) 8
509‑512, 514‑519 MEC EMD GP40-2(W) 10
600, 604, 606, 619 MEC EMD SD40-2 4
3400‑3405 MEC EMD SD40-2 6
5930, 5933, 5936, 5943, 5946, 5948, 5953, 5956, 5958, 5963, 5966‑5968, 5972‑5974, 5976 MEC GE B40-8 17
7489, 7500, 7517‑7518, 7523, 7528, 7534‑7535, 7541‑7542, 7545, 7552, 7561, 7575, 7585, 7594‑7595, 7605, 7609, 7620, 7622, 7627, 7635, 7643 MEC GE C40-8 24
7655, 7727, 7797, 7835, 7875, 7898 MEC GE Dash 8-40CW 6
Fleet total: 106

Heritage locomotives[]

In August 2011, PAR repainted an EMD GP9 locomotive (ST #77) into the maroon and gold "Minuteman" paint scheme used on B&M locomotives in the 1950s.[29] In December 2011, ST GP9 #52 was repainted using MEC's 1950s-era "Pine Tree Route" green and gold livery.[30] Both were sold to the Heber Valley Railroad and departed Pan Am property in September 2018.

Gallery[]

  • B&M #339 in Guilford livery at Wells, Maine, 1999

  • ST #621 at Westford, Massachusetts, 2007

  • MEC boxcar in PAR livery at Rigby Yard in South Portland, Maine, 2006

  • MEC #603 in Portland, Maine, 2010

  • MEC locomotives with PAR Phase II livery at Rigby Yard, 2009

  • MEC locomotives with PAR Phase I and Guilford Rail System Phase III liveries at Rigby Yard, 2009

References[]

  1. ^ "Transload and Warehouse Sites". panamrailways.com. Pan Am Railways. 2018. Retrieved December 1, 2020. Pan Am's headquarters location at Iron Horse Park in North Billerica, MA.
  2. ^ a b "Maine's Biggest Railroad Is For Sale". MPBN.org. July 2020. Retrieved July 1, 2020.
  3. ^ "CSX to Acquire Pan Am Railways in New England" (Press release). Jacksonville, Florida: CSX Corp. November 30, 2020.
  4. ^ Luczak, Marybeth (November 30, 2020). "Definitive? CSX Acquiring Pan Am Railways". Railway Age.
  5. ^ a b Associated Press (September 2, 1981). "N&W To Sell Rail System In Northeast". Toledo Blade. Retrieved October 12, 2021.
  6. ^ Cleaves, Herb (November 26, 1981). "Railroad Empire Growing". Bangor Daily News. Retrieved November 19, 2021.
  7. ^ Cleaves, Herb (July 8, 1983). "Two Railroads to Share New Management Team". Bangor Daily News. Retrieved November 19, 2021.
  8. ^ Associated Press (September 2, 1981). "Mellon buying 3rd losing railway". Pittsburgh Post-Gazette. Retrieved October 12, 2021.
  9. ^ Associated Press (October 21, 1981). "Timothy Mellon to buy Delaware-Hudson Rail". The Telegraph. Retrieved October 12, 2021.
  10. ^ "Firm Conditions Conrail Bid on Approval This Year." Los Angeles Times, June 6, 1985.
  11. ^ The New York Times, November 25, 1987
  12. ^ "2008 Maine Infrastructure Report Card - Maine Section of the American Society of Civil Engineers". Maineasce.org. 2015-09-15. Archived from the original on 2008-12-03. Retrieved 2016-02-29.
  13. ^ Arata, Mary E. (12 October 2011). "Ayer may weigh injunctive relief against Pan Am". Nashoba Publishing. Retrieved 13 October 2011.
  14. ^ Billings, Randy (19 May 2011). "On the right track? Rail officials, South Portland residents hope to forge solution to idling trains". The Forecaster. Archived from the original on 28 May 2011. Retrieved 21 May 2011.
  15. ^ "Pan Am Railways and Norfolk Southern Create the Patriot Corridor to Improve Rail Service and Expand Capacity in New York and New England" (Press release). Norfolk Southern Corp. 2008-05-15. Retrieved 2008-05-15.
  16. ^ Norfolk Southern Railway and Pan Am Railways (2008-05-16). "Introducing the Patriot Corridor" (PDF). Norfolk Southern Corp. Retrieved 2008-05-16.
  17. ^ "2 railroad freight companies combine effort". AP Business News. Worcester Telegram & Gazette. Associated Press. 2008-05-15. Retrieved 2008-05-16.
  18. ^ "STB approves Pan Am Southern transaction". 11 March 2009.
  19. ^ "Pan Am's second takeoff". Trains Magazine. Kalmbach Publishing. January 2010.
  20. ^ "Olver, Kerry, Brown, Neal: Massachusetts Awarded $2 Million to Initiate Improvements Needed to Expand Freight Rail Service Into New England". Archived from the original on September 15, 2012. Retrieved May 21, 2012.
  21. ^ Ashline, Shelby (July 6, 2017). "Buckland Board of Health: What can we do about dumped railroad ties?". The Recorder.
  22. ^ Stephens, Bill (November 30, 2020). "CSX to acquire New England regional Pan Am Railways (updated)". Trains Magazine. Retrieved 2021-03-28.
  23. ^ "Federal regulators put higher hurdle in front of CSX-Pan Am deal (updated)". Trains. Retrieved 2021-08-01.
  24. ^ "Rail News - CSX files amended application for proposed Pan Am acquisition. For Railroad Career Professionals". Progressive Railroading. Retrieved 2021-08-01.
  25. ^ "The Board Rejects as Incomplete the "Significant" Application Filed by CSXT & Pan Am in Control and Merger Proceeding". www.atlp.org. Retrieved 2021-08-01.
  26. ^ "Federal regulators reject CSX-Pan Am merger application as incomplete (updated)". Trains. Retrieved 2021-08-01.
  27. ^ "STB accepts updated CSX-Pan Am merger application". Progressive Railroading. Retrieved 2021-08-11.
  28. ^ "SURFACE TRANSPORTATION BOARD DECISION - Docket No. FD 36472" (PDF). Progressive Railroading. Retrieved 2021-08-11.
  29. ^ Sprague, Bob (14 August 2011). "ST 77". Railroad Picture Archives. Archived from the original on 30 December 2011. Retrieved 10 October 2011.
  30. ^ Smith, Kevin. "ST 52". Railroad Picture Archives. Archived from the original on 24 May 2012. Retrieved 16 December 2011.

External links[]

Media related to Pan Am Railways at Wikimedia Commons

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