The McCloud Railway is still in business as a common carrier on the 16 miles of track between McCloud and Mt. Shasta City. The Shasta Sunset Dinner Train and car storage (UPFE refers) are the only things keeping that part of the line in business. Everything I have heard and seen over the last several months indicates that the dinner train is more than holding its own and should be around for a while, or for at least as long as it continues to draw enough tourists to keep it profitable enough to support the remaining trackage.

The railroad does have some future freight possibilities involving water bottling plants (the existing one in Mt. Shasta City and the proposed Nestle plant in McCloud. There has been some talk for a few years about putting a spur into the plant at Mount Shasta, but nothing has come of that. The proposed Nestle plant has neatly divided the McCloud community into two camps, those for and against the plant. The project is currently in the permitting and environmental review phase...the Siskiyou County Planning Department released a draft Enviromental Impact Review back in August of 2006, which drew several thousand public comments. Nestle and the county have announced that the EIR will be re-written and re-released for another round of public comments sometime close to the end of this year. The McCloud Railway could stand to gain a substantial freight shipper out of this...but there are a number of ifs. The August '06 version of the EIR described a plant entirely served by trucks. It will be interesting to see what the revised document looks like when it comes out. In any case, the plant is still at least a few years off in the future, and it still faces a lot of regulatory and legal hurdles before it gets built. Opponents to the project have gone to court before and can be expected to do so again at the earliest opportunity. Until then the railroad continues to store some UPFE refers, may get some additional cars to store, and operates the dinner train year round.

The line east of McCloud is dead. There are quite a few factors that will keep it that way. The first is the physical condition of the line. It is quite frankly in terrible shape. The line is not capable of handling 286,000 lb. freight cars and could need up to $10 million in work to get it there. The line needs at least $3 million in work just to start fixing the rough spots, and that does not address the weight issue. If Red Emerson had 10 sawmills in Burney it might be worth looking into, but not for the one that is there. For that matter, the lumber industry alone has not provided enough traffic to keep the railroad healthy at any point since 1978. The McCloud Railway of 2003-2006 can best be described as a bare bones operation- the company never employed more than about ten people during that time period, and did only the most necessary maintenance on everything, and still managed to lose an average of a half million dollars a year. Under the general rule that a shortline must handle 100 carloads per mile of track per year to remain viable in the long term, the McCloud Railway at the end handled only 15% of the traffic it needed to. At its height in 1996/1997 the railroad still fell 10,000 loads a year short of meeting this guideline. The McCloud Railway simply did not ever have enough cash flow to make the level of constant capital investment that a railroad requires to remain viable, and surely does not provide the potential return that would justify any further private investment that would be needed to put the line back into operation. In the meantime the trackage rests while the railroad, the Surface Transportation Board, the California Office of Historic Preservation, and the U.S. Forest Service struggle back and forth over various issues relating to the abandonment of the line east of McCloud.

Treun hit upon one point in his post. California does provide one of the more hostile business environments, which has caused many businesses to move into adjacent states. Scraps falling off of California's table is what is really driving the impressive economic growth in western and southern Nevada. Do not confuse a California based business building impressive properties in another state in the region with the possibility that the same business may throw money at a losing proposition in its "home" state.

Jeff Moore
Elko, NV