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On July 1, the Surface Transportation Board denied Pioneer Industrial Railway Co.'s (PIRY) petition to stay an exemption granted to Central Illinois Railroad Co. (CIRY) to operate the Kellar Branch, a 8.3-mile line running through Peoria and Peoria Heights, Ill.

On July 10, an operating agreement expires between PIRY and the cities — which own the line — and CIRY will begin operating the branch under a new contract with the municipalities.

Because PIRY officials refuse to relinquish branch operating authority, the line will have two authorized operators, according to an STB filing. The two short lines will operate the branch by coordinating traffic moves.

In their motion, PIRY officials claimed the city of Peoria granted the Peoria & Pekin Union Railway Co. (P&PU) a permanent easement to operate the line and that PIRY — which is owned and operated by Pioneer Railcorp — acquired P&PU's easement in 1998. Joint operation of the line would result in numerous problems for railroads, shippers and motorists because the unsignaled line traverses an urban area with several major grade crossings and includes a curvy, steep grade up an Illinois River bluff, PIRY officials stated.

STB members denied PIRY's motion, but required CIRY to coordinate dispatching with PIRY before July 10. Members still are considering PIRY's separate motion to revoke the exemption.