Without subsidy, service sidetracked: with plan in place, Algoma passenger rail supporters press Ottawa to release subsidy.

• Author: Ross, Ian
• Position: Transportation

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Supporters of a cancelled passenger rail service are waiting on Ottawa to make good on a commitment to release a federal subsidy to allow a new railroader to take over operations on the Sault Ste. Marie-to-Hearst corridor.

As the wilderness tourism season got underway in June and lodge owners along the 470-kilometre line faced cancelled bookings, Missanabee Cree Chief Jason Gauthier felt "very, very confident" service would be back on the rails this summer.

With a business plan submitted and a handpicked new rail operator ready to mobilize, the First Nation and the Coalition for Algoma Passenger Trains (CAPT) have been campaigning with letters and petitions to convince the federal government to release a $5-million-over-three-years subsidy to reinstate service.

Both groups were anxiously awaiting word from Transport Canada and Transport Minister Marc Garneau on the release of the funds, which had been promised by the previous government in early 2015.

"We have pretty reasonable assurances that the ($5.3 million) is there," said CAPT co-chair Al Errington, who was expecting service to resume in July or August.

The Sault-based Missanabie Cree has selected Keewatin Railway, a First Nations-owned passenger and freight carrier from northern Manitoba, to run the operation.

The track, historically known as the Algoma Central Railway, had seen passenger service for more than 100 years until it was terminated by CN Rail in July 2015.

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A Michigan company, Railmark, had a brief and disastrous fling last summer before being punted by CN after it was unable to secure private financing to run the three-times-a-week operation and didn't meet Transport Canada's criteria to receive the subsidy.

With the service in doubt and another operator search underway, the Missanabie Cree took the lead in March to restore service after the Sault Ste. Marie Economic Development Corporation backed out.

Keewatin Railway has signed a memorandum of understanding (MOU) with Missanabie and applied for a federal rail operating certificate to run in Ontario more than a month ago.

Transport Canada has been slow to give its stamp of approval, but neither Gauthier nor Errington believes it poses much of a regulatory hurdle.

Getting the subsidy released and striking an access agreement with CN is deemed more important.

The subsidy, which would be directed to the First Nation and funnelled to Keewatin, would be earmarked for running...