August 21, 2001 11:00 pm

By Gary Fletcher

Observer Staff Writer

ENTERPRISE Railroad owners have filed a lawsuit to prevent Wallowa County from interfering with a Montana companys plan to remove track between Elgin and Joseph.

Wallowa Countys attorney must respond by Aug. 27 to the complaint filed by the Idaho, Northern and Pacific Co. in U.S. District Court in Portland.

Jurisdiction is the issue the court will be deciding on whether Idaho Northern can proceed with track removal.

Wallowa County contends that the federal government recognized county jurisdiction when the U.S. Surface Transportation Boards 1997 railroad abandonment order for the Elgin-to-Joseph line required compliance with the countys salmon recovery plan.

Furthermore, when the Klamert railroad salvage company applied for a county permit this summer to pull the rails, it then recognized county jurisdiction, County Planning Director Bill Oliver said Tuesday.

When Klamert began to pull rails in Joseph in June, Wallowa County informed the company that it needed a conditional use permit.

All local and state permitting requirements affecting the abandonment of the line are expressly pre-empted by federal law, Idaho Northern & Pacific Railroad Companys attorney Karl Morell wrote Aug. 14.

Morell filed a 23-page reply to the Oregon Department of Transportations July 27 petition to the Surface Transportation Board seeking to cap the lines value and disallow the abandonment.

IN&P maintains that the law requiring renewing abandonments does not apply to abandonment proceedings before Jan. 23, 1997.

The railroads reply also said that given the limited amount of traffic on the line in 1995, the significant operating losses and the substantial rehabilitation costs to reopen the line, the board properly ruled to abandon the line.

An Aug. 17 feasibility study, initiated by a committee in Wallowa and Union counties hoping to save the Elgin-to-Joseph line, concluded that the line could be economically viable, Oliver told the county planning commission Tuesday night. The commission adopted findings supporting its July 31 denial of Klamerts application for a permit to remove the rails.

Wallowa Countys two wood-processing mills believe they could add 60 family-wage jobs if railroad freight service is reopened on the line, Oliver said.

The feasibility study was funded by a $9,100 matching grant from the Oregon Economic and Community Development Department for Union and Wallowa counties.

Gary Hunter, who conducted the study, is the only person who has called recently to make an offer on the rail line, said Richard Bertel, president of Rio Grande Pacific Railway, the parent company of IN&P.

The line has been appraised at $7.2 million, Bertel said.