Tunnel 13 remains closed as costs soar

The parent company of the Central Oregon & Pacific Railroad says its insurance may fall more than 10 percent short of repair costs to re-open its line from the Rogue Valley into Northern California.

Tunnel 13 near the Siskiyou Summit remains closed more than 11 months after vandals set a fire that caused a cave-in.

The 3,100-foot tunnel's repair has been delayed by repeated collapses and the once-projected opening date of June has long passed.

RailAmerica Inc. said Thursday in reporting its third-quarter financial results that it was setting aside &

36;1.4 million in a contingency fund to augment reconstruction costs. The Boca Raton, Fla., company has insurance coverage up to &

36;10 million to cover the tunnel's reconstruction.

However, at this time it is estimated that the expense will exceed the company's insurance coverage, RailAmerica said in a release.

The company maintains 3,580 bridges and 37 tunnels throughout its system.
— In our history, we have never had destruction like this, said Susan Wright Greenfield, assistant vice president for investor relations and corporate communications.

At this point we're just accruing the money, because we don't know how much it's going to cost, it could come in under the &

36;10 million, Greenfield said. It could take more, going 6 feet a day. The projection is based on what our accounting firm, controllers and everyone involved is estimating.

RailAmerica reported a net loss of more than &

36;30 million from continuing operations in the third quarter.

The closure has delayed lumber and other freight deliveries that have been rerouted between Weed, Calif., and Eugene via Klamath Falls. About 20 timber companies use local rails to move their lumber.

Trains have been rerouted north to Eugene, then south to Klamath Falls, taking 10 to 13 days for products to reach California destinations, instead of five.