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Railroad Memo <br />October 5, 2007 <br />Page 3 <br />agreement with the Canadian National/Wisconsin Central (CN/WC) to deliver coal from Wyoming to <br />Wisconsin. The CN/WC has a separate agreement with the Union Pacific to deliver the coal from New <br />Brighton to the power plants in Wisconsin. <br />The wye track is the most expensive portion of the project. Not including land acquisition, the project is <br />estimated to cost $688,000 for Minnesota Commercial's line and an additional $220,000 for the CP's <br />turnout and track. The total budget for the wye track is currently estimated at $908,800 all of which is <br />covered by the state grant ($1.0M). In addition, the City is paying $886,000 to Estes Express for the <br />land and fence relocation. These costs will be paid for out of the City's development fund (460). Work <br />on the wye track is scheduled for the spring of 2008. The closing for the Exchange Parcel with Estes <br />Express is scheduled for October 15th. <br />The LOU contemplates that the City would convey the land to the railroad once the Butcher's Spur line <br />has been abandoned and the new railroad work is completed. However, it may be necessary to convey <br />title to MT Properties before the project is completed to avoid liability with construction of railroad <br />improvements on City -owned land. Additional details on the second closing still need to be worked out. <br />Conclusion <br />Staff has been working Dave McKenzie at Short Elliot Hendrickson to review the bids and believes that <br />the amounts are reasonable for this type of work. <br />0 <br />