East Tennessee Railway keeps rolling, despite customer loss

By Kathy Helms-Hughes

STAR STAFF
khelms@starhq.com

   City and county officials are not giving up on Inland Paperboard & Packaging Inc. just yet, and East Tennessee Railway is not ready to pull up track in Elizabethton, at least for now.
   Edwin Clark, director of operations for Rail Management Corp. (RMC) in Panama City Beach, Fla., which owns the railway, said Tuesday in a prepared statement regarding Inland's closure: "This is a real jolt to us, and we're going to have to work with the present shippers and Carter County officials to try to find some business. Obviously we have to do that in order to continue.
   "As we have stated previously, we will do everything possible to keep the railroad operating and welcome any assistance from the local community."
   City and county leaders apparently are not going to let Inland go down without a fight. County Executive Dale Fair said Tuesday that they are preparing an incentive package to present to Inland headquarters in hopes that it might sway a corporate decision, announced Friday, to close the West Elk Avenue plant.
   If Inland closes, East Tennessee Railway (ETRY) will have only one customer left in Elizabethton and three in Johnson City, said Keith Holley, general manager of the railway. "We're working on a couple of prospects, but there's no guarantee."
   The good news, he said, is "we're not going to go anywhere right yet. It's going to get real interesting though if something doesn't change."
   In his nearly 26 years with the railway, Holley said he has seen 18 customers either close or quit using the rail altogether.
   "I just hope things work out. I hate it that Inland Container is going to close. There are several husband-and-wife who teams work there; brothers, fathers, sons. I hate it for the families. Those were good-paying jobs," Holley said.
   Chartered in 1866 as the East Tennessee & Western North Carolina Railroad, the line ran from Johnson City to Boone, N.C. By the time the railroad was purchased by RMC in 1983, the rail line that runs from Elizabethton, through Doe River Gorge in Hampton, to Boone had been abandoned. Today, ETRY uses only 11 miles of the original track.
   The railway also has just two engines remaining, which are stationed in Johnson City. "We keep them over here, but we use just one at a time. We have to do inspections on a 92-day basis and we run the other one while I have one down for inspection. We've got to have a spare," Holley said.
   ETRY also has cut its employee base down from approximately 14 employees in the last 26 years to two: Holley and Darrell Edwards. "We do it all. We do the office work, run the train, inspect the track, do locomotive maintenance if it needs to be done. It makes for some trying times, believe me," Holley said.
   But ETRY is not alone. "The company that owns us owns 14 railroads. I talk to them fairly regularly and they're in the same shape we are. Manufacturing is leaving and the only thing that's building new is Wal-Mart. We all can't work for Wal-Mart," he said.
   Holley blames the demise of the railway on the North Atlantic Free Trade Agreement, which opened the doors for a mass exodus of manufacturing to foreign countries.
   "That's what's killing us. NAFTA," Holley said. "And here's the thing. Every politician in Washington signed the NAFTA bill -- Democrat and Republican alike. ... They can go to China, a Communist country, and have a pair of tennis shoes made for probably a buck, then ship it over here and distribute it, and still charge $125 for a pair of tennis shoes."
   Manufactured items don't move by rail as they once did, he said, though "the trains are a lot more fuel efficient than trucks. But go down the interstate and look at all the trucks."
   One day, on a return trip from Gatlinburg, Holley said he counted 447 trucks on the interstate from the Sevierville exit to the Bulls Gap exit.
   "I didn't count any that were parked in the rest areas and service stations -- just what I could see on the road. And it's only going to get worse," he said.