Federal regulators have derailed a private corporation’s plans to build a new, multibillion-dollar, 261-mile railroad to bypass Chicago’s notorious freight congestion.
The U.S. Surface Transportation Board rejected an application from Great Lakes Basin Transportation Inc., saying the Crete-based company’s financial information is incomplete and “fundamentally flawed,” making it impossible to determine if Great Lakes can meet required statutory criteria.
In its decision issued Thursday, the three-member board pointedly described the financial fitness of Great Lakes as “clearly deficient,” based on the company’s admission that its current assets at the end of 2016 amounted to only $151.
The STB also questioned an “unexplained line item” in a balance sheet submitted by Great Lakes. That line item, for a negative $1,203,545, “appears to account for a substantial difference between (Great Lakes) assets and its liabilities and stockholders’ equity,” the decision said.
Great Lakes and its founder and managing partner, Frank Patton, have long promoted the $2.8 billion project as a remedy for Chicago’s “19th Century jumble” of freight rail lines. It’s often said that West Coast trains loaded with Asian imports can take days to pass through the city’s chokepoint to Eastern customers.
Great Lakes’ plan, filed with the STB on May 1, called for building a new railroad line in an irregular arc from southeast Wisconsin through Illinois and ending in northwest Indiana, across mostly rural land.
Indeed, Canadian National Railway followed the very same strategy when it won STB approval in 2008 to purchase the little-used Elgin, Joliet & Eastern Railway, giving it a bypass around Chicago.
Great Lakes told the…