Davila: Despite lawsuit, service will continue

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STB, NETEX to work together for “seamless” transition

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NETEX

Northeast Texas Rural Rail Transportation District (NETEX) executive director Phil Davila is going on record to provide clarification about the source of continued rail service for the possible discontinuation by Blacklands Railroad in the wake of the pending lawsuit between the two parties.

“Blacklands’ potential discontinuance of service as filed with the Surface Transportation Board (STB) does not mean abandonment,” Davila stated.

From April 27 to May 1, Blacklands posted a series of public notices in the Greenville Herald Banner, Cooper Review, Sulphur Springs News-Telegram, Mount Vernon Optic-Herald and the Mount Pleasant Tribune.

The public notice outlined that due to a lawsuit filed in the 62nd District Court in Hopkins County against NETEX on April 18 for greater than or equal to a million dollars, there might be a disturbance in service if Blacklands discontinued their operation on the line.

At the regular June meeting of the NETEX board, the board then unanimously approved a measure to explore “investigation of alternative and emergency services and possible termination of emergency services.”

This was previously discussed in the executive session according to the agenda.

In speaking with the News-Telegram, Davila stated that NETEX has contacted the STB, a federal agency that regulates rail commerce.

“We are to start thinking of, first, emergency services, in case he [Blacklands] stops running trains,” Davila said. “We are also to start looking at a successor for an operating contract.”

“There is a process that takes care of this... and this is all a negotiation,” Davila stated. “When it ends, Black-lands and NETEX will work together to transition to an operator that’s in our best interest, that’s in Blacklands’ best interest… We will reach a transition that is seamless.”

Davila, an Arlington native, stated he has over twenty years experience in the railroad industry, including projects with New York high speed rail and Henderson, Texas Luminant lignite rail service. Davila also worked with large national and international businesses, such as Genesee Wyoming, Lockheed Martin Australia, and the World Bank in Azerbaijan, he said.

“This is a complicated issue to tackle in the newspaper and for the public,” Davila said. “It would take about a day to cover the history, responsibilities, authority, federal and state guidance and relationships related to this issue.”

One thing that is conveyed properly and that is important to remember about rural rail transportation districts, according to Davila, is that they struggle to gain new funding sources.

Despite receiving checks from Mount Vernon EDC and Titus county, NETEX continues to seek more funds, Davila said.

“It doesn’t go far,” Davila said. “It’s a gift. It’s not every year.”

Davila says NETEX’s main source of income is lease revenue from utilities and $20 per car load that comes in on their tracks. Empty cars do not collect a fee, Davila said.

From 2009 to 2015, NETEX submitted TIGER grant applications each year to the federal government to attempt to secure funding for track repair. They were not successful in those applications although Davila said he believed the applications had made it far along in the process.

In 2016 NETEX even opened up to “expressions of interest… from outside parties interested in partnering, purchasing, or leasing NETEX-owned right of way.” According to Davila, they never received any bids from private businesses.

“We have about $300,000 and that’s it,” Davila said. “We keep getting asked for more than what we have.”

The News-Telegram has requested access to NETEX’s financial records through a public information request. As of July 17, NETEX has requested an opinion from the Texas Attorney General that the records be withheld due to their ongoing lawsuit.

Overall, Davila said, the most important thing to focus on is that there will be continued rail service.