Railway closure drives economic uncertainty

Lumby and Vernon officials watch the impact on business closely

There are concerns that a failed rail venture could throw economic development off the tracks.

Kelowna Pacific Railway has filed for bankruptcy and that means train travel between Vernon and Kamloops and Vernon to Lumby has ceased.

Lumby Mayor Kevin Acton said the move is another setback in trying to attract new business to the village.

“Any industry that’s been looked at wants viable rail access,” said Acton.

Also considering the potential impact is Kevin Poole, Vernon’s economic development manager.

“We are well aware of the situation and are discussing it with industry,” he said.

Canadian National Railway, which owns most of the track, isn’t speculating on whether another company may take over or if rail service will end permanently.

“We are working with the receiver on the process going on,” said Emily Hemer, CN’s regional manager of public affairs.

Hemer added that Kelowna Pacific still has a lease to the track.

Vancouver-based Boale, Wood and Company, which is overseeing bankruptcy,  also wouldn’t say if rail cargo will resume.

“We hope to come up with a game plan in a week or so,” said John McEown, a trustee with Boale, Wood.

A number of businesses are being impacted by the lack of rail service including Tolko Industries.

“We have a contingency plan for transportation interruption,” said Janice Lockyer, Tolko’s communications advisor.

All product from the mills in Lumby, Lavington and Spallumcheen is now being transported by truck.

“We are reaching out to our customers and informing them on how we will get their shipments to them on time,” said Lockyer.

KPR had been operating the short-line since 2000 and it had between 40 and 50 employees mostly based in Vernon.

“We are very concerned about the situation with Kelowna Pacific Railway. They are a vital part of the transportation infrastructure in the region and the cessation of service is having an immediate impact on the shipment of goods to export markets,” said George Duffy, Greater Vernon Chamber of Commerce general manager.

“We have contacted both the B.C. and Canadian chambers of commerce to seek assistance in finding solutions as quickly as possible.”