Narrow Gauge Railroad to pay $25K annually for three years

Lease payments will be for use of parking lot

Ten years after the Missionary Ridge Fire temporarily shut down the Durango & Silverton Narrow Gauge Railroad runs, the railroad will begin paying rent on a city-owned parking lot that the city had purchased from the railroad to keep the business viable.

The Durango & Silverton Narrow Gauge Railroad will pay the city $25,000 a year for three years for the use of 1.43 acres of city-owned property at College Drive and Camino del Rio. The city’s parcel represents about a third of the total parking lot.

Because the forest fires in 2002 had suspended train service for three weeks, the city bought the property for about $2.5 million to help the railroad through the crisis, according to city and railroad sources.

“They lost a lot of money that year,” City Manager Ron LeBlanc said.

The railroad has been earning an annual profit of $43,284 from parking fees on the city-owned property, according to a letter from Paul Schranck, the general manager of the railroad.

So the $25,000 leasing fee “is over 50 percent of the profit, but we feel it to be fair,” said Schranck in a letter to the city.

LeBlanc said the city is not asking for lease payments as a result of its own financial crisis – the city lost $600,000 this year as the result of voters rejecting a franchise agreement for the La Plata Electric Association.

Rather, “it just occurred to me that we should be asking them for some shared revenue,” LeBlanc said. “They agreed.”

In related news Tuesday, the City Council approved the expenditure of $400,000 for the extension of the Animas River Trail along the railroad’s right of way from 32nd Street to the Iron Horse Inn, 58000 North Main Avenue.

The city could spend an additional $250,000 on the river trail whenever litigation is settled with property owner Tim Wolf.

District Court Judge Jeff Wilson ruled on June 21 in favor of the railroad allowing the city to develop the trail along its right of way, but Wolf said Tuesday he will appeal Wilson’s ruling and predicted he would prevail since Wilson made a “political” ruling.

jhaug@durangoherald.com

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