West Virginia entered the railroad business yesterday, formally taking deed to a 52-mile stretch of track that has been unprofitable for the Chessie System.
In an unusual procedure that may set a precedent for maintaining railroad service along routes with a relatively small amount of freight shipments, Chessie donated the branch line and associated real estate to the state.
At an elaborate Capitol ceremony hosted yesterday by Senate Majority Leader Robert C. Byrd (D-W. Va.), Chessie Chairman Hays Watkins handed over title to the property to West Virginia Gov. John D. (Jay) Rockefeller IV.
Chessie officials estimated that a "fair market" price for the tracks, facilities and real estate involved would be about $800,000. West Virginia plans to operate its first train over the line, from Green Spring to Petersburg, next Monday.
Byrd suggested a name for the train, "the South Branch Cannonball," but the state's Railroad Maintenance Authority will operate service as South Branch Valley Rail Road. The only significant state-owned railroad in the nation has been the Long Island Railroad, owned by New York, which provides mostly passenger service.
From 1912 until yesterday the 52-mile line was the South Branch of the Baltimore Ohio railroad, a subsidiary of Chessie. B&O will continue to interchange freight cars with the state line at Green Spring. West Virginia purchased two locomotives to operate its trains.
Chessie also owns the Chesapeake & Ohio and Western Maryland railroads and the holding company has identified a number of other lines as potential abandonment candidates, because of an unprofitable level of freight business. Watkins said after yesterday's ceremony that he would consider donations of these lines to other states, given similar circumstances.
In the case of the South Branch line, the circumstances were a poultry cooperative and 1,200 jobs for a depressed state - all of which would have been lost if rail service was abandoned.
Chessie asked the Interstate Commerce Commission in 1975 to abandon the line but withdrew the petition after criticism by state officials. Subsequently Rockingham Poultry began construction of a new feed mill at Moorefield W. Va., which required 90 percent of its shipments by rail. Then Chessie surprised state and business leaders with another abandonment application in 1976.
Rockefeller and Watkins met in June, 1977 and the rail official agreed to donate the line to the state, which would seek federal assistance. West Virginia wants to rehabilitate the line with $1.7 million of aid received under rail modernization legislation, plus $300,000 in state funds.
Rockingham Poultry has announced a $5 million expansion in the wake of West Virginia's rail takeover and Rockefeller is hopeful that the state's decision will encourage new industry to locate in the region.