MDOT stops lease payments on Owosso rail cars

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OWOSSO, MI (WLNS)- Remember how the state was paying millions of dollars to fix up some old rail cars in Owosso? Well, they’re not anymore.

The rail cars, which are supposed to take passengers between Detroit, Ann Arbor and Howell, are still sitting in an Owosso rail yard off of Oakwood Avenue — right by the Shiawassee River.

Since at least 2010, these 23 passenger cars have been sitting in this Owosso rail yard. And sitting. And sitting.

Between lease payments and renovation costs, the state spent around $12 million on them. But they haven’t moved an inch.

“This is a terrible deal for the state. I think the taxpayers took it in the shorts,” said Mark Dobronski, President of the Adrian & Blissfield Rail Road Company.

Dobronski says it’ll be hard for the state to get any of its money back, because each car would have to sell for more than $900,000.

“It’s kind of a ridiculous number because those cars aren’t worth $900,000 to begin with, so they’ll never sell for that much,” Dobronski said.

But Tim Hoeffner, Director of the Michigan Department of Transportation’s Office of Rail, says the state isn’t spending anything on them anymore.

“We’ve terminated the lease so that the state’s no longer paying, as of September 30th [2015], but we’ve set prices on the vehicles so that they would be available if the services were to get up and running,” Hoeffner said.

He says although the state can’t recoup all its losses, the project can still succeed.

“It’s not a loss at this point,” Hoeffner said. “If the services never get started, then, you know, we made the wrong decision.”

But Dobronski says it’s already a loss. He says renovating these old cars isn’t much cheaper than getting a new one.

“Going forward, they could buy new equipment for what they’ve already dumped into these cars, multiple times over,” Dobronski said.

Hoeffner disagrees — and says he’s focused on putting these cars back on track.

Hoeffner says MDOT will get the rail cars back when the passenger service is ready, which isn’t expected until 2019.

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