Req. #10154
RESOLUTION NO. " '6301 1
WHEREAS the City of Tacoma, Department of Public Utilities, Beltline
Division (d.b.a. Tacoma Rail), Tidelands Division (TMBL) has been negotiating
2
3 terms for an agreement with The Burlington Northern & Santa Fe Railway
4 ("BNSF") to acquire rights to provide freight service between South Tacoma
5 and Nisqually, St. Clair and Quadlok, and Olympia and Belmore, Washington,
6 and
7 WHEREAS BNSF intends to outsource carload service to about fifteen
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existing customers in these areas, moving approximately 2,600 loads per year,
9
10 by the end of September 2004, and
I I WHEREAS BNSF is selling its line between South Tacoma and
12 Nisqually (the Lakeview Subdivision) to Sound Transit for improvement for
13 commuter rail use, and has reserved a Freight Service Easement and
14 negotiated a Joint Use Agreement with Sound Transit as part of that sale, and
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WHEREAS under the proposed agreements, Tacoma Rail will purchase
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a permanent Freight Service Easement from BNSF and will be assigned
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18 BNSF's rights under the Joint Use Agreement with Sound Transit, and will
19 purchase a ten-year lease over the lines between St. Clair and Quadlok and
20 Olympia and Belmore, together with trackage rights to use BNSF and Union
21 Pacific main lines for access, and
22 WHEREAS, initially BNSF will continue to retain trackage rights over the
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Lakeview Subdivision to provide freight service to Fort Lewis, but BNSF may
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25 eventually transfer these rights to Tacoma Rail as well, and
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res10154.doc-TPU/cm
LEG 004 (11/89)
WHEREAS Tacoma Rail will assume some switching responsibilities, it
will assume maintenance responsibilities for the approximately nine miles of the
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3 St. Clair and Quadlok and Olympia and Belmore lines at its own expense, and it
4 will assume maintenance on the approximately thirteen miles of the Lakeview
5 Subdivision line subject to reimbursement from Sound Transit and BNSF
6 proportionate to those entities' use until Sound Transit completes upgrades to
7 the line, at which time Sound Transit will assume maintenance of the Lakeview
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Subdivision line subject to reimbursement from Tacoma Rail and BNSF, and
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10 WHEREAS the proposed agreements establish a ten year rate schedule
1 1 set by BNSF, that includes an escalation clause, after which time Tacoma Rail
12 may set its own rates on the Lakeview Subdivision, and
13 WHEREAS Tacoma Rail recommends approval of the purchase of the
14 Freight Service Easement and the ten year lease in the form approved by the
15
City Attorney, including exhibits consisting of Interchange Agreements that
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define the parties' responsibilities for interchanging traffic between BNSF and
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18 Tacoma Rail; lists of property related agreements and trackage agreements to
be assigned to Tacoma Rail; definitions- rights of entry for conducting an
19 1
20 environmental assessment; insurance requirements; disposition of
21 telecommunications equipment; and Trackage Rights Agreements, and
22 WHEREAS the Public Utility Board has approved the execution of the
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agreements with BNSF to acquire the right to provide freight service between
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25 the specified lines, and
res10154.doc-TPU/cm
LEG 004 (11/89)
WHEREAS it is determined to be in the best public interest of the
citizens of Tacoma and Tacoma Rail to approve the proposed agreements;
2
3 Now, Therefore,
4 BE IT RESOLVED BY THE COUNCIL OF THE CITY OF TACOMA
5 That the proper officers of the City are hereby authorized to execute the
6 proposed agreements with The Burlington Northern & Santa Fe Railway for the
7 acquisition of rights to provide freight service between South Tacoma and
8
Nisqually, St. Clair and Quadlok, and Olympia and Belmore, Washington, for the
9
purposes hereinabove enumerated, said documents to be substantially in the
10
I I form of the proposed agreements on file in the office of the City Clerk.
12 Adopted SEP 1 4 2004
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14
15 Attest:
1 6
City Clerk
17
18 Approved as to form & legallt@
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20
Chief Assistant City ney
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22 PUB Resolution No. -
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25
101%
26 li It
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res10154.doc-TPU/cm
LEG 004 (11/89)
CITY CLERK USE
"QUEST FOR ORDINANCE Request CA 15 4
Tacoma OR RESOLUTION Ordinance
Resolution
1. DATE: August 16, 2004
2. REQUESTING DEPARTMENT/DIVISIONIPROGRAM 3. CONTACT PERSON'(fiff questions): PHONE/EXTENSION
Tacoma Rail, Tidelands Division Dennis Dean, Superintendent x8891
4. PREPARATION OF A RESOLUTION IS REQUESTED FOR THE CITY COUNCIL MEETING OF TUESDAY, SEPTEMBER
14,2004.
5. SUMMARY TITLE/RECOMMENDATION: (A concise sentence, as it will appear on the Council Agenda)
Authorize Tacoma Rail's Tidelands Division to execute a Purchase and Sale of a Freight Service Easement and a
ten-year Lease with The Burlington Northern & Santa Fe Railway (BNSF) to provide freight service between South
Tacoma and Nisqually and St. Clair and Quadlock and Olympia and Belmore, Washington.
6. BACKGROUND INFORMATION/GENERAL DISCUSSION: (Why is this request necessary? Are there legal
requirements? What are the viable alternatives? Who has been involved in the processT
BNSF selected Tacoma Rail as its preferred operator to assume short line freight rail service between South
Tacoma and Nisqually (the Lakeview Subdivision) and St. Clair and Quadlock and Olympia and Belmore,
Washington. BNSF has sold the Lakeview Subdivision line to Sound Transit, reserving for itself a Freight Service
Easement. BNSF would deed this Freight Service Easement to Tacoma Rail. The service between St. Clair and
Quadlock and Olympia and Belmore would be conveyed by means of a lease. In all, BNSF proposes to outsource
carload service to about 15 customers moving about 2,600 loads per year. Most of this traffic is BNSF line-haul, but
a small portion is reciprocal switch for the Union Pacific. Tacoma Rail would assume 9 miles of maintenance
covering the leased areas, and another 13 miles covering the Lakeview Subdivision line until Sound Transit
upgrades the line. Gross revenue from the lines is estimated to be approximately $1 million annually.
7. FINANCIAL IMPACT: (Future impact on the budget.)
8. LIST ALL MATERIAL AVAILABLE AS BACKUP INFORMATION FOR THE REQUEST AND INDICATE WHERE FILED:
Source Documents/Backup Material Location of Document
Memo from Mark Crisson dated August 16, 2004 City Clerk's Office
Draft Purchase and Sale and Lease Agreements City Clerk's Office
9. FUNDING SOURCE: (Enter amount of funding from each source) Na
Fund Number & State S city S Other S Total Amount
Name:
If an expenditure, is it budgeted? NA R Yes R No Where? Org Acct
10. ATTORNEY CONTACT: (Enter Name of Attorney that you've been working with)
Anne Spangler .4,4 ,2
Approved as to Availability of Funds
4+4tv-
IL ;,WUtitity Division Approval Director of Finance r Utilities Approval
(;SW,,hA4g,1D-.-t.,.,,+ Office Systents CD
Resolution No. 2f;3(I
Adopted: (4-, "LoCA
Maker of Motion: Ev Om S
Seconded:
Roll Call Vote:
MEMBERS AYES NAYS ABSTAIN ABSENT
Ms. Anderson
Mr.Evans
Ms. Ladenburg
Mr. Lonergan
Mr. Manthou
Mr. Phelps
Mr. Stenger
Mr. Talbert
Mayor B arsma
MEMBERS AYES NAYS ABSTAIN ABSENT
Ms. Anderson
Mr.Evans
Mr. Ladenburg
Mr. Lonergan
Mr. Manthou
Mr. Phelps
Mr. Stenger
Mr. Talbert
Mayor Baarsma
g:IcitycIkIfbrmsIresoI.doc