Winning bidder overdue on paying initial deposit
By Tim Rowland
An apparent snag in financing has once again clouded the fate of the Saratoga & North Creek Railway, a bankruptcy court trustee said.
Carol McLean-Wright and her husband John Wright — operating as Doc N Dutchess Railway, a newly formed New Mexico-based LLC — submitted the high bid for the line at a March auction, but the trustee, William Brandt Jr., said Wednesday that they failed to submit a timely deposit on the assets.
A variety of interests have been involved in a tug of war over the line, which some believe can be restored as a useful piece of industrial infrastructure, but others feel should be converted into a recreational rail trail.
The railway filed for bankruptcy last year, and court administrators solicited a viable carrier to buy and run the rails.
Now, Brandt said he is negotiating with the second-highest bidder, a North Creek rail biking company, for sale of the line.
Brandt said there is still a chance that Doc N Duchess’ bid could be executed, but that the opportunity was dwindling. “From my perspective, we’re moving on, but there is a small window of time for Doc N Duchess to take advantage of, and secure, this opportunity — but only if they have real financing lined up,” Brandt said in an email.
The Wrights bid $3.3 million, well above the expected price for the 30-mile track, which has seen scant usage since a titanium mine, its primary customer, shut down in the 1980s.
In a phone interview, McLean-Wright said Doc N Duchess put up the required $35,000 deposit to participate in the auction, but was not informed that further funds would be required prior to the May 6 closing. But she was notified that the company would have to put up $250,000, and later $500,000, to keep the bid viable.
That was a problem, she said, because the Doc N Duchess investors are in Europe, and large financial transfers are under added scrutiny due to Russia’s war with Ukraine, and the desire to keep oligarchs from moving their assets. She said Doc N Duchess officials were aware that financial transitions were being held up and for that reason asked that the closing date be set toward the end of the 90-day term within which the full amount must be paid.
“This is not what we signed up for; we signed up for a May 6 closing,” she said.
She said she and her husband are determined to move forward because they view the work of obtaining a source of rare-earth metals — believed to be abundant in tailings from the old mine at Tahawus — as vital for national security. Rare earth elements are put to a multitude of uses, including night-vision goggles, batteries and a wide array of technology. Most are currently produced by China.
“This is an act of love for the United States of America, at a time that we are being threatened,” McLean-Wright said. “It is for national defense — what I care about is that every third day we hear President Biden saying that we need these metals.”
Rob Harte, co-owner of Revolution Rail, said he could not discuss details of what he said was a fluid situation, but that his company “remains committed to running rail bikes on the line.”
Brandt said there was no hard deadline for Doc N Duchess to submit the deposit, but if talks with Revolution Rail are productive “then events will overtake Doc N Duchess’s ability to do anything.”
A third bidder, the West Coast-based Sierra Railway, dropped out early in the bidding, and protested that it was the only legitimate freight hauler at the auction.
Revolution Rail had, however, said it was partnering with a short-line hauler which would run occasional loads of aggregate on the rails.
The Wrights have proposed a far-reaching plan that would run the gamut from sifting through old mine tailings for rare-earth elements to astronomy-based rail excursions that would take advantage of Newcomb’s dark skies. In an earlier interview, Carol McLean-Wright indicated Doc N Duchess was seeking capital from outside investors.
Whether the latest development will increase the likelihood of an eventual rail trail on the line is unclear. The state Department of Environmental Conservation had petitioned the federal Surface Transportation Board to have the line declared abandoned, but the appearance of three potential haulers who said they could restore the tracks had diminished that likelihood, according to Town of Newcomb officials.
The Open Space Institute had offered $1.5 million for the line with the idea of building a rail trail, which at the time was the best offer the court had. The nonprofit became ineligible because only legitimate carriers could buy the line, and OSI returned to the sidelines.
Editor’s note: This story has been updated to add a response from Doc N Duchess rail company.
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Now the fog is beginning to lift we see the true picture. They don’t really have the capital to fund their plan. They never did. It was all hyped smoke and mirrors from the start. Betting that the NYS taxpayer would be put on the hook. A real familiar formula for NYS.
I agree. I would think all bidders would have to be vetted prior to finalizing bidding. Given the broad range of goals DNDR proposed, it certainly would have been a good idea. If they DO make the proper deposit, this may draw out the fate of this line much longer. Piecemeal funding is like that. Good intentions isn’t enough.
With all the noise from the people that oppose everything and the useless governor they may be rethinking this. They realize the state can impose any environmental restriction they wish and stop any progress.
Perhaps they can rip out the rails and put a string of solar panels on the land. This should make all the whackadoodles happy.
It will never be a viable freight rail again. The rail bike idea is good. They have marketed well, and have something most everyone can do. But it has so much more potential for other things such as snowmobile trail, or if the state ever steps in and stops the destruction of the Hudson fishery, through rafting, it could haul people to a float fish experience from the tressel… But this state doesn’t truly care about the environment…only what it can bring them tax revenue.
But doesn’t offend the tree huggers….if someone actually brought to light how much the Hudson river has been degraded as a fishery, by dam releases …the huggers would lose their minds.
You’re right. We will never need titanium again, because we can always buy it from other countries, like China, Russia, Japan, Kazakhstan, Ukraine, or India.
Right, these clowns are the saviors of the republic…give us a break.
Are you nuts? Buy Titanium from China, Russia, Ukraine, even India???? We’d better provide for ourselves here in the USA. We have no friends in China and Russia. Even India is iffy and Ukraine is unstable thanks to the Russian invasion.
As conspiracy theories go, these are about as lame as they come. I am sure you two can come up with something better than just name-calling.
“…Oh, there was a time in this fair land when the railroad did not run
When the wild majestic mountains stood alone against the sun
Long before the white man and long before the wheel
When the green dark forest was too silent to be real…”
Gordon Lightfoot – 1967 From Canadian Railroad Trilogy
gas hits almost $5 a gallon and there is a unique attraction that could double as a secondary form of modal to the area.
Not to mention unheard amounts of worldwide political turbulence impacting supply chains around the world and we have a critical supply of a material in our backyard.
can someone explain to me how people driving cars from all over to walk into an extremely remote area is somehow an environmental solution? rail trails need regular trash removal and infrastructure to be usable.
Why is this even a debate?
Just take a look at the southern end of the rail line, North Creek to Saratoga as an example of failure. The track is setting idle with the stations at Thurman and Hadley sitting vacant. The politician’s dream of a “ski train” to Gore mountain was laughable. Take an expensive train ride that would take a couple of hours or more to arrive at Gore when you can drive in halve the time. The only time a member of my family took the train ride it broke down. The millions of tax dollars invested were just wasted on some hairbrained scheme to drive state revenue. If the tailings were so important to national security they would be mining them already. The OSI had the best plan, IMO. But they are out of the running because they are not a “legitimate carrier” like “Doc and Duchess Railway” is.
the question is why is dormant rail line such a target for destruction?
why is all of the north country’s infrastructure being built around cars, who pollute extensively and are arguably unsustainable?
wouldnt having an alternate form of modal that is already built be beneficial?
also are the adirondacks only good as a tourism destination? why put all of a regions eggs in one basket by gearing exclusively to tourism income.
We saw during covid that unimaginable things can happen, and with the stroke of a pen travel and tourism can cease.
Finally, why must the beauty of the Adirondacks be entirely made accessible to people? Trains arent pollution free but they pollute less than cars and people leaving trash in our pristine wilderness.
A rail trail would be the worst thing for our woods, a dormant rail line atleast doesnt constantly litter, erode and leave human waste scattered around. But I would rather have a modicum of industry that exists outside of tourism in the area on an already established, irreplaceable infrastructure.
“Finally, why must the beauty of the Adirondacks be entirely made accessible to people? Trains arent pollution free but they pollute less than cars and people leaving trash in our pristine wilderness.”
Reading Article XIV reveals the intent of preservation of wilderness with human access. It wasn’t set up to promote extraction industries OR an unlimited tourism industry. Ideally, neither should be promoted without amendments to the constitution, or repealing it entirely.
Just curious have you noticed what happened in the ADKs post WWII? Sounds like you missed the massive American suburban sprawl from 50s to 80s caused by the automobile and up here what the Northway did to the ADKS, then top it off with the creation of APA? Or maybe your memory just isn’t so good anymore?
Why doesn’t the County, State, DEC somebody quit their illusionary vision of this ever becoming a viable railroad or commercial enterprise and convert to a bike trail. This is going away the best use for this rail line and a benefit to the largest volume of people.
The Wright’s proposal stated that all the work to try and extract rare minerals would be done elsewhere, hence the need for a rail connection to ship the many tons of tailings to where the minerals would be extracted. This made sense, and I’m all for reducing the amount of tailings left at the mine site. However, in addition to the cost of buying the rail line, there would need to be a huge amount of capital spent to both rehab the rails and create the infrastructure at the mine site to excavate and load the tailings onto the rail cars; and I question whether the economics add up.
As for the possible future need for whatever titanium is left in the ground, I would be quite sure that the rail-banked right-of-way could be brought back into serviceable condition faster than the mine would be ready to start shipping any titanium. Having visited the mine on a college geology field trip in 1970, and more recently having walked through the mine area, none of the equipment I saw working in 1970 was still there. Additionally, a new power line (or maybe an on-site power plant), would have to be built/rebuilt, since the original line in from Ticonderoga is either in total disrepair or has been removed on the Nature
Conservancy land that they acquired from Finch, Pruyn.
I love the short sighted views here, the same type that have cut the legs out from under natives of the Park since the 60’s at least. This is one of the few common sense non-tourism related ideas that I’ve seen in 60 years. But it appears that the game is being played in such a way that Duke and Duchess will never get a chance to develop a viable industry that might also be a way for Bartons to ship their tailings. Funny how there can never be anything that might actually create a solid base for the residents in the lower income brackets, just more special exemptions for the “right” people. They’ve killed logging off, they’ve killed off mining to a large extent, they’ve killed off the idea of drive in tourism, of ATVs/snowmobiles, horse trails and pretty much everything else. When I was a kid there were 7 ski areas within 30 minutes of North Creek. Now there’s just Gore- state gov’t in competition with private enterprise! Can’t lose! This rail idea will be killed off too, and it will all be done quietly, behind the scenes and the $$$ will flow to the “right” people.
The point of the article is they won the bid and have not come up with the deposit yet. Who is shooting them down??
A bike path Saratoga to North Creek would be a tourism win for all communities. Turn it over to snowmobile clubs in the winter months.
Northeast Kingdom in VT is a mecca for cycling tourism
Duke and Duchess of delusion. Good to see that they dropped the ball. They no doubt would have brought in an old, worn-out locomotive that was retired from elsewhere to run their tailings. It would have been the same result as the tourist train failures… massive unburnt hydrocarbon pollution from the worn out engine wet-stacking and stinking up the entire North Creek village.
I think I understand “wet-stacking” but exactly what does that mean. I agree that many of these short-line “revivals” end up using very old engines that not only pollute the air but also often leak oil.
I am laughing my butt off here. If you read my comments the first time this deal was announced you would have realized they aren’t even remotely qualified to finance or take this task on. And if you do any level of investigation about their failure at running Stony Creek Ranch, you would have realized their game. “Show me the money” is a line I always loved from the movies. This is a classic but there is NO chance they ever complete the purchase and operate a successful anything there. PT Barnum said, “There’s a sucker born every minute!” Were you one when you first read about this?
If the money for this was coming from Russian Banks, are these folks just laundering money? Probably should be investigated.
Thanks for being a voice of reason. I don’t want to get sued, but I had to threaten to sue to get paid for the work I did for Stony Creek Ranch when these people reneged on their word. I also found several lawsuits filed at Warren County and had email proof that they were smoke and mirrors. You can’t fix stupid, and we have far too much of it up here.
In a phone interview, McLean-Wright said Doc N Duchess put up the required $35,000 deposit to participate in the auction, but was not informed that further funds would be required prior to the May 6 closing. But she was notified that the company would have to put up $250,000, and later $500,000, to keep the bid viable.
That was a problem, she said, because the Doc N Duchess investors are in Europe, and large financial transfers are under added scrutiny due to Russia’s war with Ukraine, and the desire to keep oligarchs from moving their assets. She said Doc N Duchess officials were aware that financial transitions were being held up and for that reason asked that the closing date be set toward the end of the 90-day term within which the full amount must be paid.
So the bidding didn’t come with a written contract spelling out deposits and earnest money? Seems like a bankruptcy firm would be pretty detailed on the procedure before bidding started. So we seem to be hearing two different stories. Either the Wrights ignored the fine print, or the bankruptcy firm omitted it. Either way, it sounds the cart was put before the horse. And the line sits… Status quo.