Provincial subsidy for Cape Breton railway line not being renewed: minister

HALIFAX — A $30,000 monthly subsidy intended to preserve a disused Cape Breton rail line will not be renewed, Nova Scotia’s economic development minister said Thursday.

Susan Corkum-Greek said the decision was made after CN Rail last fall acquired a stake in the line that runs across the island from St. Peter’s Junction to Sydney, N.S. She said she concluded there were no imminent private-sector plans to develop the line, which has fallen into disrepair.

“It was in my view time to call it,” the minister said of the subsidy, which was the result of a 2016 deal from the previous Liberal government to preserve the possibility of a future business opportunity.

“Quite a period of time has elapsed,” she said. “What is clear is that it’s going to take a business case and that will be up to the private sector to determine if there is a business case.”

Corkum-Greek said her department has seen estimates that it would take as much as $500 million to restore service on the island because of the need to repair sections of crumbling rail lines and aging railway bridges.

Freight rail service was discontinued in 2015 when Genesee & Wyoming Inc. — the line’s sole owner at the time — decided to discontinue its Cape Breton operations because of a lack of business.

The Liberal government at the time reached a deal with the company to keep the line in place, instead of abandoning it and ripping up the tracks and selling off the land it sits on. The original six-year deal was worth about $60,000 a month. It was then renewed for another three years at a reduced rate of $30,000 a month.

Corkum-Greek said there’s no word on whether CN wants to abandon the line. The company was not immediately available for comment on Thursday.

Under provincial regulations the company would have to apply to the public works minister in order to abandon the rail line and would have to submit a plan to do so. In the event the track is not removed the company would have to submit a management plan to ensure there’s no risk to the public or the environment.

Derek Mombourquette, the Liberal legislature member for Sydney-Membertou, called the government’s decision not to renew the subsidy an “abandonment of the rail line in Cape Breton.”

“We have population growth and new economic opportunities that are coming … and I would argue it’s important to try to protect that infrastructure for the price they are paying,” Mombourquette said.

This report by The Canadian Press was first published April 4, 2024.

Keith Doucette, The Canadian Press