The Coos Bay Rail Line Serving

The Coos Bay Rail Line. . . Serving Southwest Oregon and the Coos Bay Harbor Operated by ARG Trans Inc. as the Oregon Rail Users League Salem, Oregon Tuesday, September 17, 2013

Timeline of Events … • CORP/Rail. America Inc. embargoed the Coos Bay rail line September 21, 2007 • Port staff consulted cities, counties, shippers, state and federal officials to assess need for, interest in, support of regional freight rail service and efforts to secure rail corridor • Port filed Feeder Line Application with the STB July 11, 2008

Timeline of Events … (continued) • December 2008 STB decision allowed Port to buy line for $26. 6 million; Port appealed; STB set price of $16. 6 million • Port acquired major portion (111 miles) of Coos Bay line from Rail. America March 13, 2009 – Financing included converting Connect. Oregon I grant of $4 million and federal SAFETEA: LU grant of $7. 2 million into grants to buy the rail line; funds originally intended for Phase II rehabilitation of Coos Bay swing-span rail bridge – Port took on $5. 4 million in debt from Oregon Business Development Department; due 2014; may be deferred 2018

Rail Assets and Investments • Port District owned the Coos Bay swing-span rail bridge and North Spit Rail Spur – Port acquired Coos Bay rail bridge in 2001 – $6. 7 million investment state and federal funds – North Spit Rail Spur built in 2005 to provide freight rail access to industrial sites – $4. 8 million investment

Coos Bay Rail Line… acquired from CORP/Rail. America, Inc. Danebo Junction (west Eugene, Lane County) to Cordes (North Spit, Coos County) 111 miles of rail line, including two major swing-span bridges – Siuslaw and Umpqua, nine tunnels and 115+/- other water crossings; acquired March 2009

Coos Bay Rail Line… acquired from the Union Pacific (UP) Railroad Cordes (North Spit) to Coquille - Coos County 23 miles of main line, including rail yards in North Bend and Coos Bay, variety of water crossings, and the Coos Bay depot; acquired December 2010

Coos Bay Rail Line … restoration of freight rail service • Primarily goal following acquisition of line was restoration of freight rail service as competitive transportation option • Port published Request For Qualifications for operator; evaluated responses; entered into agreement with ARG Trans Inc. 2 nd quarter of 2011.

Coos Bay Rail Line … rail infrastructure rehabilitation funding American Recovery & Reinvestment Act (ARRA) 2009 $2. 5 million for tunnel rehabilitation 2009 Oregon Legislature – House Bill 5054 $3. 5 million for rail infrastructure rehabilitation – $1 million dedicated to tunnel rehabilitation – $1 million match for TIGER II grant – $286, 000 match for SAFETEA: LU grant 2010 Connect. Oregon III grant $7. 8 million for rail bridge/trestle rehabilitation 2010 SAFETEA: LU multi-modal pilot program grant $2. 5 million for Chemonite/ACZA-treated rail ties 2010 TIGER II grant $13. 5 million for track rehabilitation; some tunnel work 2009/2010 Funding Total: $29. 8 million

Coos Bay Rail Link – CBR service restoration and current service levels • Freight rail service was restored in phases: – October 2011 - service restored Eugene to the North Spit; CBR moved 194 revenue loads 4 th quarter 2011 – October 2012 – service restored to Coos Bay yard; CBR moved 2480 revenue car loads for 2012 – April 2013 – service restored to Coquille; CBR revenue car loads for 1 st and 2 nd quarters – 2087 • Current train schedules: – 3 train starts per day; five days week

Coos Bay Rail Line … track infrastructure; mainline and branch lines The goal of track structure rehabilitation is to increase operating efficiency of railroad by upgrading track classifications and train speeds: – FRA (Federal Railroad Administration) Track Classifications and train speeds • Excepted: <10 mph • Class 2: 25 mph • Class 1: 10 mph • Class 3: 40 mph – Main line – Danebo to Cordes will operate at a mix of Class 2 (25 mph) and Class 3 (40 mph) – Tunnels, swing-span bridges: Class 1 (10 mph) – Yards, spurs, industrial leads: Excepted (< 10 mph)

Coos Bay Rail Line Shippers … Port staff maintains regular communications with former shippers and future partners … • • • • Roseburg Forest Products / Coquille (plywood) Georgia-Pacific – Coos Bay Sawmill Oregon Resources Corp. / mineral sand commodities Southport Forest Products Ferrell Gas and Ameri. Gas propane distributors American Bridge Manufacturing (Bolon Island/Reedsport) Roseburg North Spit Woodchip Export Ocean Terminals Coos Bay Docks Swanson Bros. Lumber Co. (Noti) Swanson Group (Noti) Rosboro (Vaughn) Various commodity distribution facilities and rail transload/reload operations

Coos Bay Rail Line … 2013 legislative session • $10 million for continued rehabilitation of three swing-span bridges • HB 3276: Clarified that property in Coos, Douglas and Lane counties owned by the Port of Coos Bay is not subject to taxation

Tunnel work … Dirty, Wet and Dangerous

Bridges, Trestles and Culverts …

Track Structure … Rail, Ties and Ballast

The Coos Bay Rail Line will operate as the …

Coos Bay Rail Line … • Follow our progress at www. portofcoosbay. com • Questions? Comments. • Thank you for your attention