CHICAGO — While attorneys are sorting through its legal and financial troubles in U.S. District Court, operations at Iowa Pacific Holding’s three railroads are continuing as normal.
Earlier this fall, nearly two dozen entities associated with Iowa Pacific Holdings were placed into receivership [See: “Additional Iowa Pacific railroads placed into receivership,” Trains News Wire, Oct. 23, 2019]. A company or property is placed in receivership to protect the assets of an organization when it cannot meet its financial obligations or enters bankruptcy.
According to officials at Iowa Pacific, Novo Advisors, the receiver, is currently managing the day-to-day operations of the company and its railroads. Iowa Pacific founder and former president Ed Ellis left the company in October, according to Vice President Kevin Busath.
The ongoing case in U.S. District Court has revealed that Iowa Pacific is millions of dollars in debt to numerous creditors and contractors. According to court records, Iowa Pacific and its associated companies owe Big Shoulders Capital, one of its primary creditors, more than $4.6 million. Court documents state the railroads are also subject to “substantial claims” by the Internal Revenue Service. And, on Nov. 22, the State of Colorado filed notice that it was also owed money by Iowa Pacific’s San Luis & Rio Grande Railroad Inc.
Court documents note that the Surface Transportation Board has been notified that the railroads are being placed into receivership and that it has no objections, noting that it expects the railroads to “continue to operate and serve the public.” According to Busath, operations at the SL&RG, Mount Hood Railroad, and Mass Coastal Railroad have not been impacted by the legal issues.
While the SL&RG is currently only operating freight service, the Mount Hood and Mass Coastal railroads are both offering holiday excursions through December. The Mount Hood Railroad is operating holiday excursions every Friday, Saturday and Sunday and during the entire week before Christmas. Mass Coastal is running every Friday, Saturday and Sunday, plus Dec. 23.
None of the railroads have published a 2020 schedule. Earlier this fall, the railroad auction company Ozark Mountain Railcar had listed a number of Iowa Pacific locomotives and cars for sale. Included in the listing were two steam locomotives, multiple F and E units and two rare BL2s, along with numerous passenger cars.
Visit the Mount Hood or Mass Central websites for more information.
Dear God I hope the former MILW Coffee Creek Skytop sleeper can be saved.
It’s the only remaining Olympian Hiawatha Skytop that remains on this earth. Would be great if the Friends of the 261 group in Minneapolis could get their hands on it, and restore her to all her Pullman-standard glory.
Railroads have long operated through receivership, even for years. The champion is still the Pittsburg Shawmut & Northern which operated from August 1, 1905 to March 31, 1947 in bankruptcy, going through three generations of receivers. Changes of bankruptcy laws enacted in 1938 make such “Shawmut Shenanigans” done by creditors in no hurry to settle highly unlikely. My parents when married in 1940 lived in St. Marys PA and ate dinner through the commotion of the burning of the Shawmut’s shops a block away in 1941.
A very sad end. The Pullman co. and the Hoosier State were First Class operations while they lasted.
Thanks for the memories Ed!
How the mighty have fallen. From one of the most highly regarded operators of passenger excursions, short lines, and mainline passenger services, to receivership, bankruptcy, and untold amounts of money unpaid to those who earned it. A sad fate indeed. Hopefully some of the equipment will find good homes
Those BL-2s come complete with my fingerprints, blood, sweat and tears,
Who bought the BL-2 Locomotives ?
Note that the Mass Coastal/Cape Cod Central is not 100% owned by Iowa Pacific and is not bankrupt.
Ed brought enjoyment to many people over many years.