- Associated Press - Monday, June 1, 2015

LANSING, Mich. (AP) - A Michigan state agency said Monday it is negotiating to temporarily suspend the lease on 23 commuter rail cars that have sat unused and cost the state $11.4 million.

Michigan Transportation Department Rail Director Tim Hoeffner told reporters in a conference call that negotiations are ongoing with Great Lakes Central Railroad, the company from which the state is leasing the cars. Hoeffner said the company is willing to relieve the department of lease payments for up to five years so the company can sublease the cars to another rail project.

Monday was the self-imposed deadline Transportation Director Kirk Steudle set for reporting on whether the department would attempt to terminate the lease on the cars. Hoeffner said Great Lakes Central Railroad proposed handling a sublease on the cars while ultimately protecting them for up to five years for future operations on two commuter lines in Michigan. The lines would run from Ann Arbor to Detroit and from Howell to Ann Arbor. Those lines are not expected to begin operating until 2017 or later. Those projects were delayed by changes in federal agency involvement, Hoeffner said.

Steudle defended the leases earlier this year after an audit by the state questioned the effectiveness of leasing the 23 cars for commuter projects that wouldn’t begin for several more years. He said the money could not have been spent on roads. But he told a legislative oversight committee that he would find a way to stop the financial drain associated with the lease.

The cars are sitting idle at an Owosso rail yard.

LOAD COMMENTS ()

 

Click to Read More

Click to Hide