By KayLynn Roberts-McMurray
The Ely Times The Ely City Council held a two-hour special meeting this week regarding a settlement offer that S&S railroad was offering.
Mike Williams, owner of S&S Railroad, attended the meeting and spoke before the council.
“I’m open for any questions, and what I’m really here for is, and I truly mean this, is that I would clearly like to see this resolved,” he said. “You know it’s a little hard to negotiate from one person, we have three parties involved here and it gets a little hard, whatever has been done in the past, those days are gone, all we are looking to do is settle this.
“I could tell you I have been railroading for about 42 years.”
Williams went on to explain that he felt the city, S&S and foundation should work together as a group to open the line and preserve it, noting that the life of the mine would probably be extended by the savings in the freight alone.
Several questions by the council were asked. Councilman Kurt Carson asked Williams how he would work with the foundation?
Williams answered, “The mayor wants to settle the dispute, no one wants to be paying attorney fees. This is a great benefit, as far as bringing the track to the McGill junction, and to the mine.”
Councilman Sam Hanson asked Williams if he had a chance to look at the materials of the appraisal that was done in 2010. Hanson said, “As you are aware in 2010 was pretty much the cusp or wave at the end of the recession? Has the market not conceivably gone up?”
Williams asked, “We’re looking at one appraisal, who had that appraisal done?”
Hansen said it was the city and the foundation.
“The value would be more of the revenue generating off of it. Out here we have an asset,” Williams said.
Councilman Ernie Flangas asked Williams if the line would ever be opened for transport down to Yucca mountain?” Williams replied, “I’ll be dead before any project like that happens.”
Williams went on to explain the offer he was giving the railroad, and explaining some of the processes of railroad, specific to the steel.
“This railroad has 60 pound rail, that means in a mile, there’s a 100 ton of rail, there is a little less than 20 percent of that value…120 tons of mile, on this entire line, per mile and you take that times a mile, and it comes out to 15,000 tons of rail,” he said. “Let’s just say like the scrap market is $300 per ton that’s $4.5 million dollars in steel. To take that up in steel would cost you a $100 dollars per ton, so take a million five off of that and you’re at $3, take the transportation cost off of about $7 dollars per ton, there’s another million, about $2 million, I only want to buy half, you own half and the foundation owns half.”
Williams, “If we can’t get it settled, then we say I’m done, a half a million dollars, someone is gonna win, someone is gonna lose, again I’m open to…do you guys have something else you want to do?”
Discussion of leasing the land from the city began, and City Attorney Chuck Odgers stopped Williams stating that this was part of mediation and could not be discussed in public.
Odgers said, “If we could take a 5 minute recess, with all clients involved in the lawsuit and their counsel.” A five minute turned into a 25 minute session and when the meeting was brought back, Odgers said, “Having discussed with council and perspective clients, Mr. Kay who is the attorney for S&S will convey the offer that was made during mediation and you can ask questions about the offer, but not about the mediation.”
Hanson made the motion to reject the offer as presented, and Councilman Tony DeFelice seconded it. It was approved unanimously. The lawsuit will move forward as of this date.