Marked Tree finalizes contract to build rail spur - KAIT Jonesboro, AR - Region 8 News, weather, sports

Marked Tree finalizes contract to build rail spur

MARKED TREE, AR (KAIT) – Marked Tree city council and Jonesborobased Baughn Construction have finalized a contract to build a railway spurfrom the Burlington Northern Santé Fe line to into the Awesome Products plant.

Mayor Wayne Nichols hopes construction can begin within a month orso after the city council authorized the contract and hopes the move willfinally bring new jobs into the city.

Construction will cost $1.1 million, and Nichols says a secondcontract will require Awesome Products to pay a railcar fee, which will helppay back loans.

In July of 2010, Awesome Products announced it would extendoperations into the old Mid South Manufacturing building on Old Highway 308 inMarked Tree. At the time of the announcement, the company indicated it wouldhire 120 employees in the Marked Tree area, citing a strongly skilled workforceand proximity to major transportation resources. As of now, the company isstill using the building as a warehouse.

"Everybody would like to see it open because some folks wanta job and of course we do too. Hopefully it'll increase our revenue in town andit's good for the whole community because you will have people employed fromprobably a 30 mile radius here. It not only helps Marked Tree, it helpseverybody," said Mayor Wayne Nichols.

Nichols told Region 8 News that only four or five cars can be seenin the parking lot each day. He said he's hopeful that will change in thefuture.

"We're waiting for approval from economic development andfrom the fed portion of it in Dallas and then the railroad has basically puttheir final approval on it," said Nichols. "It's been about $200,000(the city has) committed and hopefully that will do it, but you know, you don'tknow until you get that bid in."

Nichols said the city was hopeful the company would bemanufacturing bleach out of the Marked Tree facility by now, but obstacles havegotten in the way. He said he's optimistic the city will be able to take bidsfor construction of a rail way spur in the next few weeks.

First of all, Nichols said the city was asked to purchase oracquire two plots of land south of Old Highway 308 near the Burlington NorthernSanta Fe railroad tracks. He said the owner of Awesome Products wanted a railway spur built before investing millions of dollars to manufacture.

"The raw products will come in by rail. That's why he'swanting the rail here," said Nichols. "He's getting anxious and we'reanxious too."

Nichols said the city had to purchase one plot of land for$35,000. The city was fortunate enough to obtain the other piece of land nearthe plant as well.

"Mark Gillis, he donated some property before so he let ushave some additional property. He gave us some additional property, but the problemis you've got $150,000 increase," said Nichols, referring to a switchto be installed near the plant.

Nichols said the switch will provide a way in and out of theplant.

"This is additional cost and then purchasing the land wasadditional cost, so we've got more in it now than we had hoped," saidNichols.

Another issue is that of insurance. Nichols said representativeswith the railroad company have asked the city pay for insurance duringconstruction of the railway spur. He said the insurance will provide coverageup to $2-million. He said the city is shopping around for the insurance, butdoesn't know how much the coverage will cost taxpayers.

"We met with the utility folks yesterday and there's someextra expense there. Power lines have got to go up and gas lines have got to bemoved, so that's additional cost too," said Nichols.

Nichols said the city has $1-million in grant money; however, thatmoney hasn't been released because the construction project hasn't beenapproved by the state and federal governments. He said BNSF has approved theconstruction project.

"We're hoping it'll come in somewhere around the milliondollar range, but when they start adding a switch, you're talking about$150,000 for the switch so it gets expensive," said Nichols."The economic development and then the federal funds, they've got toapprove all the plans and it's just taking time."

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