BNSF to take over Montana Rail Link as lease ends

Montana Rail Link (MRL) will conclude its long-term lease with BNSF Railway Co., and BNSF will resume operations and maintenance of its mainline rail corridor through southern Montana.

MRL and BNSF have had a lease arrangement since 1987 in which MRL leases and operates mainline tracks owned by BNSF between Huntley, Montana, and Sandpoint, Idaho.

Over the past several years, more than 90% of the traffic moving over MRL’s leased line were loads moved on behalf of BNSF. The line has become a critical link in BNSF’s northern transcontinental network, delivering grain, consumer and industrial products to the West Coast, MRL and BNSF officials said in a joint press release.

By MRL ending its lease and BNSF resuming operation of its line, BNSF will eliminate the need to interchange freight between the two railroads, strengthening the resiliency of the supply chain and enhancing rail capacity in the Pacific Northwest, they said.

"There have been many changes in the rail industry since this long-term lease was signed, and given the need to be competitive in the current environment, we believe that this was the right time to revisit our longstanding agreement with BNSF," said MRL President Derek Ollmann. "This agreement protects our workers, our customers and our long-term commitment to safety, and it will ensure a more seamless operation of rail services in Montana."

The new arrangement and lease termination will require approval from the Surface Transportation Board, as well as negotiation of collective bargaining agreements with affected unions. BNSF has committed to retain all union and non-union employees of MRL in their current jobs with similar pay, benefits, seniority and other terms of employment, MRL officials said.

Customers across MRL’s network will be able to maintain their service arrangements and rates. The vast majority of rail traffic moving on MRL today is subject to rates already established by BNSF.

"We are excited to bring an important part of our railroad’s history back into our operations at BNSF," said BNSF President and CEO Katie Farmer. "The line will become the MRL Subdivision of our Montana Division in recognition of the shared heritage of BNSF and MRL."