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When the federal government created Consolidated Rail Corporation in the mid-1970s, it set out to weld several bankrupt Northeastern railroads into one viable system. To railfans, “Conrail” became synonymous with the disappearance of storied and colorful names. To many communities that depended on those lines for employment and tax revenue, it meant the shutdown of local yards and car shops and the ripping up of underperforming branch lines. In different ways, both rail enthusiasts and the communities those railroads served experienced a sense of loss that went beyond balance sheets and timetables.

Little of this lends itself to the kind of endearing romance with which many of us regard earlier railroads. It may therefore seem odd to commemorate the 50th anniversary of Conrail’s creation. Yet the reality is this — without Conrail, there might not be a viable railway industry today.

The history of North American railroading is a lesson in overexpansion. For most of the 19th century, railways were seen by investors as a transformative enterprise that would make them rich. To small-town dreamers and big city boosters, this was a technology that would funnel trade and influence to their communities. To company executives, rapid growth was the key to dominance — claiming lucrative territory before the other guy did, or diverting traffic from whoever got there first. In the Northeast, the result was “irrational exuberance,” good money after bad, and too many places served by too many lines.

Such duplication could foster competition and lower rates for shippers, but it also rendered profit margins perilously thin. The rise of publicly funded highways beginning in the 1910s, followed by the growth of subsidized airports in the 1930s, further eroded railroads’ competitive position. By the mid-20th century, lines that had long been marginal were firmly in the red, and routes once justified as “loss leaders” were draining their parent companies dry. When Conrail took over on April 1, 1976, its broader mandate was to preserve rail service in the Northeast and Midwest — and, by extension, to stabilize the North American rail network itself.

Achieving that goal required what battlefield medics call “triage.” Conrail concentrated its limited resources on maintaining, repairing, and upgrading the strongest segments of the network, while allowing less economically viable facilities to close. While most jobs were protected under Conrail, drastic and often brutal cuts elsewhere were needed to make the new railroad competitive. Decisions made in the decades prior were influenced by investors looking for quick returns and a public that quickly turned to the auto and the airplane for their shipping and travel needs. Rationalization, alongside various forms of regulatory relief and government aid, allowed Conrail to reach profitability and return to the private sector in 1987.

What might the railway industry have looked like had Conrail never been created? One can imagine the eastern main lines parceled out to state governments or simply left to wither, industries relocating farther south and west, and a deindustrialized landscape more severe than even the bleakest Bruce Springsteen ballad.

Conrail was unsentimental, rationalizing the excesses of a romantic, yet often imprudent, past. But it was also a hopeful creation — one that halted a systemic collapse and preserved rail service in the most densely populated and industrialized region of the U.S. Conrail saved what it could. In doing so, it saved railroading in the East — and we are all better off for it.

—Alexander Benjamin Craghead is a transportation historian, photographer, artist, and author.

The post Conrail’s Legacy 50 Years Later appeared first on Railfan & Railroad Magazine.

by Tim Doherty/photos by the author

In 1976, everything about Conrail was big — biggest railroad employer, biggest passenger carrier, biggest railroad in terms of revenue, and along with it, big problems. Big Blue inherited the underinvested physical plant of its bankrupt predecessors as well as their service problems and a declining Northeast manufacturing base.

The former New York Central Boston & Albany route over the Berkshire Mountains gave Conrail a near monopoly on southern New England rail traffic, compared to the parallel Boston & Maine to the north. Renamed the Boston Line, it became the primary gateway rail route in and out of New England. By comparison, very little of the former New York, New Haven & Hartford to the south remained in Conrail by the 1990s.

Prior to World War II, rail traffic in New England was centered on the movement of high-value manufactured goods and passengers, both of which were disrupted by new highways being built in the 1950s and the flight of manufacturing to lower-cost locations. The prospects were bleak for the New Haven as the decimated railroad went into receivership for the last time in 1961.

ABOVE: In the early 1960s, New York Central launched “Super Van” service on the former Boston & Albany. Conrail later expanded the service to six intermodal pairs at its peak in the late 1990s. Eastbound TV-6 rounds the famed curve at East Chatham, N.Y., on February 7, 1999.

Facing challenges from declining market share, New York Central and Pennsylvania Railroad agreed to merge in 1962 — a move regulators would approve only if the ailing New Haven was included. Despite its massive scale and apparent resources as the sixth-largest corporation in the U.S., Penn Central was doomed from the outset by hasty merger planning, poor implementation, and questionable investments. Internal conflicts led to operational disruptions that clogged terminals and resulted in lost shipments. Revenues collapsed, and the railroad declared bankruptcy in June 1970, less than two years after the merger was completed.

The collapse of Penn Central also pulled down connecting systems, and by the mid-1970s, the Northeastern rail network was in crisis. Conrail was created to provide “adequate and efficient rail service” at the lowest cost to taxpayers. To do this, thousands of miles of excess track and facilities would be eliminated as a stronger, unified system would emerge from the ashes. Conrail’s success as planned by its creators was “heavily dependent on future projections of uncertain events.” Service would improve and traffic would return as Conrail’s track and facilities were rehabilitated. Further, and likely more problematic, was that the plan for Conrail was developed in the middle of the energy crisis where embargoes by foreign oil producers caused massive shortages and drove up prices. Planners expected new traffic to emerge as oil-fired power plants converted to coal, which at the time was less expensive.

ABOVE: At Selkirk Yard’s east end, the Boston Line to New England diverges from the River Line to New Jersey. On May 28, 1999, SEAL (Selkirk, N.Y.–Allentown, Pa.) departs with Worcester TrailVans lifted from westbound TV-7. At Kearny, N.J., the cars would connect with TV-213 for Norfolk Southern at Lynchburg, Va., and Atlanta.

By 1977, the coal conversion did not materialize as oil prices stabilized, and Conrail had a massive hole in its expected bottom line. Despite the thorough analysis of freight traffic and projections for the future, the resulting system included too much track for the business that Conrail had by the late 1970s. New England already had twice as much track as the national average. Thanks to legislation passed in the early 1980s, Conrail began a further round of rationalization, handed off its passenger operations to the states paying for the trains, and began to use the tools of deregulation to reach profitability relatively quickly.

New England was the birthplace of American heavy manufacturing in the 19th century, and to serve these new industries, some of the earliest railroads in America were chartered between 1832 and 1833. Running southwest from Boston, the New Haven — often in fiscally dubious fashion — acquired nearly every line in southern New England by the beginning of the 20th century, creating a dense web of main lines and branches. North of Boston, Boston & Maine and Maine Central operated routes into New Hampshire and Maine, as well as a western gateway to Albany, N.Y., that included the 4.75-mile-long Hoosac Tunnel. Guilford Transportation Industries consolidated these two lines into a single system in 1983.

ABOVE: Conrail NESE bursts from State Line Tunnel at Canaan, N.Y., on May 28, 1999, three days before takeover by CSX, led by four 3,000-hp B30-7As. These unique 12-cylinder GE units were prized for fuel efficiency.

Positioned between these two systems, Boston & Albany Railroad was built due west from Boston, linking the three largest cities in Massachusetts with the Hudson River. Its route and construction reflected the combined business and political ambitions of Massachusetts interests seeking a direct western outlet to the interior of the U.S. that bypassed New York City. Built and operated initially as two separate railroads, the Boston–Worcester, Mass., line opened in 1835, followed by Western Railroad from Worcester to the Hudson River opposite Albany in 1841. The two lines did not initially connect at Worcester, nor did they get along well, frequently disputing rate divisions.

Construction of the Western posed a far greater engineering challenge, requiring the railroad to cross two summits at Charlton and Washington, Mass. Fewer than eight miles of the route were level, and deep rock cuts were blasted to climb from 72.5 feet above sea level at Springfield, Mass., to a summit of 1,460 feet at Washington, just 38 miles to the west. The ruling grades lie between mileposts 128 and 138, where the railroad ascends 1,000 feet while crossing the Westfield River 15 times on a succession of sharp curves.

ABOVE: Conrail’s Lawrence to Selkirk freight LASE passes the shuttered GE complex in Pittsfield, Mass., on Feburary 13, 1999. With traffic off of Guilford from Eastern New England this train was one of two originating on Guilford (B&M) and handed off to Conrail at Worcester.

Leased to New York Central in 1900 — which served as its principal connection in Albany — B&A provided the longest single line route to New England. Early entrance into industrialization did not provide a lasting benefit. As early as the 1910s and 1920s, the textile industry shifted production to less expensive locations in the southern and western U.S. The precision manufacturing industry that developed surrounding Springfield in the Connecticut River Valley faced competitive challenges in the 1950s and 1960s, and it also relocated to reduce labor costs. Newer, less rail-dependent technology and scientific industries emerged in New England. The silver lining in this economic transition was that the workers in and around this growing sector would become consumers of automobiles and other goods.

In the 1970s, the freight arriving by rail in New England included perishable and non-perishable food, beer, newsprint, paperboard, tissue, flour, animal feed, fertilizer, plastics, cement, structural steel, plywood, building products, auto parts, and finished automobiles. Conrail inherited widely scattered customers located on different lines that required costly switching for limited carloads. Conrail served multiple grocery distributors, printing plants, and the few heavy manufacturers that continued to hang on. The initial freight schedules reflected the need to serve all these customers with small local yards across southern New England…

The post Conrail’s Boston Line appeared first on Railfan & Railroad Magazine.

by Victor Hand/photos by the author, courtesy Center for Railroad Photography & Art

The railroad crisis that engulfed the Northeast in the late 1960s and early 1970s was the culmination of decades of postwar economic policy that left railroads struggling with declining revenues, shifting traffic patterns, and mounting competition from government-funded highways, waterways, and aviation. In response, many carriers turned to mergers as a last-ditch solution to avoid bankruptcy. When New York Central and Pennsylvania Railroad combined in 1968 (followed by the addition of the New Haven in 1969), the resulting Penn Central instantly became one of the largest corporations in America.

Yet the 20,000-mile behemoth was fundamentally unsound, taking its first steps already off-balance. Its collapse into bankruptcy in 1970 sent shock waves throughout the region, pulling down connecting carriers and pushing the entire Northeastern rail network to the brink of shutdown. Faced with the very real prospect of losing essential rail service as the national economy entered a recession, the federal government stepped in. Congress passed the Regional Rail Reorganization Act in late 1973, and President Richard Nixon signed it into law in 1974. The “3R Act” created the United States Railway Association (USRA), charged with studying the bankrupt carriers and developing a viable plan for reorganization that would ultimately form the blueprint for Conrail.

ABOVE: Six months into Conrail, Penn Central units still powered many trains. An eastbound freight crosses the Niagara River on the Michigan Central arch bridge at Suspension Bridge Station in Niagara Falls, N.Y., on October 3, 1976. The train is TV-16 from Kalamazoo, Mich., to North Bergen, N.J., combined with Train MC-4, which operated from Detroit to Selkirk (N.Y.) Yard. The MC bridge was abandoned in 2001, but the Canadian National span to the right is still used by Amtrak trains today.

Once the Final System Plan was submitted to Congress on July 26, 1975, USRA turned its attention to the property conveyance process that would be required to transfer ownership of the designated assets to Conrail and other parties. In a traditional real estate transaction, a deed is prepared describing the property to be conveyed, sometimes accompanied by a map. USRA had nine months to prepare the deeds for what was about to be one of the most complicated real estate transactions in U.S. history. The staff had assured the board of directors that there would be no “map job”; someone would look at every location out in the field where lines were being severed, and at each parcel of property that the bankruptcy trustees claimed as not “used or useful in rail transportation.”

The job seemed impossible. A proposal was made to structure the real estate transfers as a “negative conveyance.” All of the property of a transferor railroad within a given jurisdiction would be conveyed, and property to be left with the bankrupt estates would be excepted from the transfer by describing it and marking it on valuation maps. The lawyers, of course, objected that this had never been done before. After much argument, the USRA president decided that a negative conveyance was the only viable option.

Working alongside a talented group of colleagues, I was directly involved in managing the real estate conveyance process for USRA. What follows is an overview of how that work came together.

ABOVE: A westbound freight behind two E-44 electric units passes Gwynn tower in Baltimore on Amtrak’s Northeast Corridor on October 15, 1978. Conrail would end electric freight operations in 1981.

First, the bankrupt estates were asked to submit valuation maps marked with properties that they contended were not “used or useful in rail transportation,” and should not be conveyed. Valuation maps were detailed maps of railroad property and facilities that were prepared by all the steam railroads in the U.S., pursuant to the Valuation Act of 1913. Congress was considering placing a cap on railroad profits calculated as a return on invested capital. Unfortunately, there had been such financial chaos in the building of the railroad system during the 19th century that no one knew what the invested capital was. Ten years and many millions of dollars were spent in preparing these maps and cataloging and photographing railroad facilities. The process was never completed, but the maps became the basis of the property and engineering records of the railroads, and for the most part, were kept up to date as changes were made to facilities and property. These maps were invaluable in carrying out the conveyance process.

There were more than 1,250 “line cuts” where lines were being severed from the system, and more than 8,000 individual parcels of property claimed by the trustees. The USRA operating staff became property inspectors who examined all the property involved and made recommendations that were sent to USRA headquarters. The inspectors were accompanied by operating officials of the involved railroads, and often were joined by representatives of local government, major shippers, and commuter agencies.

ABOVE: lue Conrail units are eastbound at Bethlehem, Pa., with Train ALOI (Allentown, Pa. –Oak Island Yard, Newark, N.J.) on October 30, 1983. In the background is Bethlehem Steel’s massive Bethlehem Works, which closed in 1995.

Each Monday, the inspectors would come to the Washington headquarters to report their findings, and to receive packages of maps for the next week’s inspections. Based on the inspector’s recommendations, the trustee’s valuation maps were either accepted, rejected, or modified. USRA had four lawyers writing deed language, four draftsmen modifying maps, and an army of clerks to keep track of all the paper.

The Penn Central trustees retained Victor Palmieri & Company, a large real estate firm, to help them with the preparation of the valuation maps, while most of the smaller estates did the work with their own real estate staff. As an aside, Palmieri had previous involvement with the company as PC quickly sold off its real estate investment subsidiary Great Southwest Corporation in 1970 when it was revealed that top executives were benefiting from fraudulent transactions and insider information (which also contributed to PC’s bankruptcy). Palmieri later became a director of Pennsylvania Company (which was owned by PC and controlled all the non-rail properties) in an effort to untangle the railroad’s obligations from its real estate holdings.

I saved a few of the more interesting field inspection trips for myself. I spent two days traveling in a hi-rail truck with Lehigh Valley’s director of real estate and operating officials. We traveled from Jersey City, N.J., to Buffalo, N.Y., inspecting properties along the way. I also performed inspections on various Erie Lackawanna and Penn Central lines.

ABOVE: Train TV-1 (Kearny, N.J., to Chicago) is westbound at South Fork, Pa., on October 29, 1985. The tracks on the right lead to South Fork Yard and the South Fork Secondary Track.

Based on the results of the inspections, deeds were prepared for each transferor and transferee in each county. There were more than 480 deeds required to carry out all the real estate transfers. The transfers of rolling stock, shop and office equipment, and inventory also required the preparation of voluminous documents. I was busy with the real estate transfers, and did not participate in this work.

For each of the more than 1,250 “line cuts” where lines were being severed, a detailed description of the exact location of the cut was required. For example, the Final System Plan might have designated the “X Branch” between milepost 0 and mile 1.2 be conveyed to Conrail. The exact location of the line cut might read “1,200 feet west of the west abutment of the bridge over Noname Creek.” This is where the field inspections proved useful, to not only determine these physical locations, but to also make sure they actually existed as they were indicated on the maps. A determination of Conrail’s need for each of the more than 8,000 individual parcels of property claimed by the trustees was made, based on the recommendations of the field inspectors and railroad operating staff. A bit of “horse trading” went on, but not much…

The post Countdown to ConRail: Part 3 appeared first on Railfan & Railroad Magazine.