Carmageddon: Progressive Rail rejects RTC’s move to take over rail operations and threatens litigation

The Santa Cruz Branch Rail Line’s current operator, Minnesota-based Progressive Rail, appears to have no plans to leave its role as common carrier for the line after the Santa Cruz County Regional Transportation Commission (RTC) recently moved to take over operating the line north of the Watsonville area.

In a letter sent by CEO Andrea Dobbelmann to RTC executive director Sarah Christensen, Progressive Rail rejected the notice of termination of its contract, calling it “factually baseless, legally invalid, and critically at odds with federal railroad regulatory law and policy.” It said the company would not participate in any common carrier transition, will “vigorously protect” its common carrier status and will not accept what it calls a wrongful termination.

The relationship between the two parties has been fraught for years, with RTC commissioners and leadership saying that Progressive Rail is difficult to work with. The RTC’s move to become the common carrier came after the commission voted in early December to build 8 miles of the Coastal Rail Trail on top of the rails, rather than next to them as previously planned, in an effort  to complete the project within budget and on time. The project has been awarded a $96.6 million grant from the state, the largest active transportation grant ever awarded by the California Transportation Commission, and that grant requires the agency to break ground on the segments by mid-2027.

Progressive Rail’s response is “unfortunate, but not surprising,” Christensen told Lookout on Friday. “They’ve been uncooperative for years and they continue to be. It’s a private business looking out for their private interests.”

In the letter, Dobbelmann disputes the RTC’s claim that Progressive has not fulfilled its freight service obligations and claims the RTC failed to complete repair projects on 4 miles of the rail line, effectively preventing freight operations. The letter also argues that the company has adequately maintained the segment of the line that it is able to operate on. It states that the contract “does not require St. Paul and Pacific Railroad Company to maintain infrastructure that RTC failed to repair in the first instance.”

Dobbelmann wrote that any operator attempting to assume any part of the freight easement or otherwise cooperate with the RTC’s move would be considered “an intentional and tortious interference” with Progressive’s contractual rights. The letter also says the company would join any third party as a respondent in a lawsuit. 

Christensen said she and the RTC are confident the agency can rightfully and legally terminate the contract, but declined to provide further details because the dispute seems likely to end up in court.

“We’re a public agency, and we can’t really mess around,” she said. “It would be irresponsible of us to take any actions we weren’t 100% confident about.”

Dobbelmann did not return Lookout’s request for comment by publication time.

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Check out our Carmageddon road project list here. This week, pay particular attention to:

• Tree work, pavement repair and utility work are shutting down one lane of Highway 9 between Hihn Street and San Lorenzo Valley Elementary, San Lorenzo Way and Higgins Road, Rowardennan Drive and Mill Street, Pike Road and Western Avenue, Riverdale Park and Monaco Lane, Riverside Drive and Pool Drive, and Pool Drive and Old County Highway from Monday through Friday between 7 a.m. and 5 p.m.

• There is a long-term closure of the southbound Highway 1 off-ramp at State Park Drive in Aptos for soundwall construction, beginning Monday and slated to run through Feb. 10. Travelers can exit at Park Avenue, make a left, then turn right onto southbound Soquel Drive, where they can rejoin State Park Drive.

• Utility relocation work is shutting down Highway 9 overnight in Felton between Graham Hill Road and the San Lorenzo Valley schools complex from Monday through Friday between 8 p.m. and 5 a.m. One-way alternating traffic control will be in effect until Saturday morning.
  
• Emergency sewer work in Soquel Village could occasionally block access to driveways, sidewalks, on-street parking and interrupt sewer service on weekdays until June 30, on Soquel Drive, Porter Street and Main Street. Work on Soquel Drive will be overnight from 8:30 p.m. to 5:30 a.m. and from 9 a.m. to 3 p.m. on Porter and Main streets. Other, shorter-duration potholing on Porter, Main and Center streets and Daubenbiss Avenue will take place from 8:30 a.m. to 4:30 p.m.
  
• A full closure of the Murray Street Bridge is scheduled to run until February. It is closed to vehicles, bicycles and pedestrians. Vehicle traffic detours are along Soquel Avenue and Capitola Road via Seabright Avenue and 7th Avenue. Bicycles are being detoured across Arana Gulch and along Broadway via Seabright Avenue and 7th Avenue. Pedestrians are being detoured around the north harbor.
  
• The installation of the Newell Creek Pipeline on Graham Hill Road between Summit Avenue and Lockewood Lane is taking place on weekdays from 8:30 a.m. to 4 p.m. and could cause delays of up to five minutes.

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