Grafton & Upton Railroad seeks to take Hopedale land; hearing Wednesday

    By Alison Bosma
    abosma@wickedlocal.com
    Posted Jul 16, 2019 at 4:19 PM Updated Jul 16, 2019 at 5:11 PM

    The state Department of Public Utilities will hold a hearing from 7-9 p.m. Wednesday at the Hopedale Junior-Senior
    High School. Hearings are normally held at the DPU’s Boston headquarters.

    HOPEDALE – A local railroad company is seeking state approval to take land alongside its tracks.

    Grafton & Upton Railroad Company President Michael Milanoski said the company tried for nine months to buy the
    155-acre property on Hopedale’s West Street, but failed. The railroad is a 16.5-mile rail line that runs from North
    Grafton to Milford.

    “Notwithstanding diligent and reasonable efforts to acquire the property in Hopedale, the owner has been unwilling
    to sell the property to GURR,” the company’s petition to the state reads.

    The owners of 364 West St., listed as Charles E. Morneau and H.R. Nagel, trustees of the One Hundred Forty
    Realty Trust, did not return a request for comment.

    Milanoski said the company used a licensed appraiser to give the owners “fair market value,” but he didn’t give the
    value or any counteroffer. According to Hopedale assessor records, the property is valued at $448,754.

    “It’s significantly more than what our licensed appraiser is looking at,” Milanoski said, of the owners’ assessment
    of the property’s worth. “The law does require us to pay fair market value, but fair market value has to be done
    objectively.”

    The state Department of Public Utilities will hold a hearing from 7-9 p.m. Wednesday at Hopedale Junior-Senior
    High School on the subject. External hearings are relatively unusual for the department, which typically holds
    hearings at its Boston headquarters.

    State law allows the railroad to request approval to take the property by eminent domain. Should Grafton & Upton
    Railroad get the green light, the company will still have to pay the assessed fair market value. The property owner
    can fight the decision.

    According to the railroad’s petition to the state, the company needs the land to conduct “certain rail operations that
    are critical and essential to the ability of GURR to provide rail service that meets the demands of customers.”

    The company wants to use the land for a new transloading yard and additional tracks for storage, switching and
    maintenance. Milanoski said that means five new tracks on either side of the existing line, and likely some
    buildings.

    The petition says 364 West St. is the only property the company has identified that can accommodate the yard and
    tracks. The yard and tracks are needed to keep up with the company’s expansion, according to the petition.

    The petition labels the land, which is not developed, as not useful for “virtually any purpose.”

    “The property ... is bisected by the GURR line,” the petition reads, adding that the land “contains wetland areas and
    has a topography that is not suitable for virtually any purpose without substantial cutting and filling work.”

    If the land is secured, Milanoski said, the company will only develop the uplands. It doesn’t plan to do anything with
    wetlands and buffer areas, which are protected and cover more than half the property.

    Grafton & Upton Railroad ran afoul last year of local developer Philip Shwachman, whose Hopedale Properties
    LLC and Hopedale Industrial Center LLC own 77 acres of easements, water rights and the prominent, long-vacant
    former Draper factory buildings in Hopedale’s downtown.

    Shwachman accused the company of trying to take his land via eminent domain – the railroad runs through his
    property – and filed a lawsuit, which is still working its way through the courts, against the company and Hopedale.

.

    Grafton & Upton Railroad releases additional plans for proposed land take in Hopedale

    By Alison Bosma
    abosma@wickedlocal.com
    Posted Aug 12, 2019 at 4:31 PM Updated Aug 12, 2019 at 7:08 PM

    HOPEDALE – Responding to a state request, the Grafton & Upton Railroad has released more information on its
    plans for a 155-acre piece of land in Hopedale.

    The railroad asked for the state’s permission to take the land, at 364 West St., by eminent domain in March, after
    failed negotiations to buy it from owner One Hundred Forty Realty Trust.

    The request triggered an avalanche of legal filings from residents, local agencies, and Hopedale officials. Last
    week, the state cited those requests when it asked the railroad to be more specific about its intent before making
    a decision.

    In documents submitted Aug. 7, railroad representatives argued the company needs to expand beyond the space
    it currently occupies in three rail yards – North Grafton, Upton, and Hopedale.

    “GURR is currently operating at maximum capacity with significant growth demand from its customers,” the filing
    reads. “In order to provide freight rail service as required, GURR must obtain additional rail yard and track space
    as the GURR has no additional land to expand in these existing yards.”

    The new documents include a map of the West Street property, showing sketched out tracks around the land’s
    existing tracks. The majority of the land is protected, and railroad officials have said they do not intend to develop
    the wetlands, except for a previously installed logging road.

    The company plans to add five tracks on either side of the existing track, capable of holding up to 200 rail cars, and
    at least one building.

    The new documents also emphasize the positive environmental and economic impact of railroads, citing the state’
    s own Department of Transportation draft rail plan, released January 2018.

    “The benefits of freight rail include economic, environmental, and highway traffic congestion and road wear
    reduction,” the documents read, “providing transport for such commodities as newsprint/paper, waste/scrap,
    cereal grains, wood products, plastics/rubber, propane , basic chemicals, gravel, and nonmetal mineral products.”

    Again pointing to the state report, the railroad’s latest submission points to an estimated 75 percent reduction in
    greenhouse gas emissions for every ton-mile of freight moved by rail instead of truck.

    The added information comes as yet another agency petitioned the state last week to intervene. A petition to
    intervene means the petitioner is asking for a metaphorical seat at the table as the state makes its decision.

    To date, about a hundred people and agencies have filed petitions to intervene.

    The new petitioner is the Franklin-based Metacomet Land Trust, a non-profit conservation organization serving 15
    communities in the area, including Hopedale. In her letter to the state, President Lisa Mosczynski said the West
    Street property is “critical” to connecting two pieces of conservation land used for passive recreation – Upton State
    Forest and the Hopedale Parklands.

    In their response to the state, the railroad’s attorneys point out that the new information had already been
    presented to Hopedale and its Board of Selectmen over the course of two public meetings.

    Selectmen have said they didn’t feel railroad officials sufficiently answered their questions at those meetings.
    Railroad President Michael Milanoski has said the railroad won’t know precisely what it intends to do until officials
    and crews have access to the site after purchase. That latter point was reiterated in the railroad’s response to the
    state last week.

    Those interested in filing a petition to intervene have until Sept. 9 to do so.

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    Hopedale officials, residents petition state in railroad land-taking

    By Alison Bosma
    abosma@wickedlocal.com

    Posted Jul 31, 2019 at 6:08 PM Updated Jul 31, 2019 at 6:08 PM

    “We are concerned that the GURR (Grafton & Upton Railroad) rather than negotiating in good faith with property
    owners is invoking laws created in the 1800s putting all property owners along the 16.5 miles railway at risk of
    facing eminent domain taking,” Sarkisian’s request reads.

    HOPEDALE – The town, a local property owner and several residents are asking for closer involvement in a local
    railroad’s request to buy land alongside its tracks.

    The property in question, 155 acres at 364 West St., includes a section of the 16.5-mile Grafton & Upton Railroad,
    which runs from North Grafton to Milford.

    Railroad leadership wants to buy the land to build a transloading and storage yard around the existing tracks,
    which could include 10 additional tracks, and possibly some buildings.

    President Michael Milanoski said the company tried to buy the land from the current property owner, Charles E.
    Morneau and H.R. Nagel, trustees of the One Hundred Forty Realty Trust, but were unable to reach a deal after
    nine months of negotiations.

    Now, the railroad is appealing to the state’s Department of Public Utilities, to take the land by eminent domain. If
    granted, that means the state would allow the company to take the land, as long as the company can prove it is
    needed for essential railroad function.
    The railroad still needs to pay the owner, and the owner can fight the decision.

    As that request makes its way through the state’s hearing process, residents and local officials say they want a
    seat at the table.
    “That’s something the railroad welcomes,” Milanoski said. “We continue to want to partner with the town, as we
    have on other projects.”

    Selectmen this week voted to send a petition to intervene, which would allow officials to follow the case and even
    request documents. Lawyers employed by the town will get a chance to determine if the railroad’s request falls
    within broad and railroad-friendly laws, or if the town has any local power.

    “I use the reference to ‘Hamilton,’ the song about (being) in the room where it happened,” Town Administrator
    Steven Sette said. “It allows the town to be a party to anything having to do with the case.”

    The song from the famous musical is about not knowing how deals are made without being there.

    The property at 364 West St. borders Hopedale’s Parklands, a 275-acre tract of land around Hopedale Pond
    preserved for conservation and passive recreation.

    “The Parklands, established at the end of the 19th century, is the jewel of Hopedale,” selectmen Chairman Brian
    Keyes said in the meeting this week where selectmen compiled their request to the state. “The Board of
    Selectmen has a fiduciary responsibility to preserve and protect the Parklands and is concerned that activities at
    the site may adversely impact the use of this town property.”

    Also at the meeting, Keyes said the decision could affect the whole town, citing environmental concerns. Sette
    said the land contains a possible future wellhead for the town, and pointed to the wetlands on the property.

    Two other nearby property owners have also requested intervenor status – Judith Sarkisian and Dave and Laurie
    Mazzola – and more residents and the town’s Water and Sewer Department have asked for extensions to file
    requests of their own.

    “We are concerned that the GURR (Grafton & Upton Railroad) rather than negotiating in good faith with property
    owners is invoking laws created in the 1800s putting all property owners along the 16.5 miles railway at risk of
    facing eminent domain taking,” Sarkisian’s request reads.

    In one filing this week, nearly 100 residents asked for an extension, so they, too, could file the petition to intervene,
    though that petition was not in the state system as of Wednesday.

    The group is called Residents to Protect Hopedale’s Resources, and their request says they might hire
    engineers or consultants.
    In a separate filing, Philip Shwachman, whose companies - Hopedale Properties LLC and Hopedale Industrial
    Center LLC - own 77 acres of buildings, water rights and easements in town, also petitioned to intervene.

    Some of his water rights run through the property, he said in the filing.

    Shwachman is involved in a lawsuit against several entities – including town officials and boards and Grafton &
    Upton Railroad leadership – in which his lawyer accuses the railroad of trying to take his property by eminent
    domain.

    In the West Street request, Milanoski said the railroad offered “fair market value” determined by a licensed
    appraiser, though he did not disclose the amount. The property owner, he said, countered with offers that were
    too high. According to local assessor’s records, the lot is worth $448,754.

    “The railroad does not justify why it requires such a substantial tract, raising the possibility that its activities will
    not be limited solely to a transloading yard,” Keyes said, at this week’s selectmen’s meeting. “Given the
    uncertainties surrounding the railroad’s intentions for the property, the town should be permitted to intervene in
    order to engage in discovery with respect to the railroad’s plans.”

    Milanoski said he won’t have specific plans until the railroad owns the property and can survey it, but that – aside
    from a logging road – the company does not plan to develop any wetlands or the buffer zones meant to protect
    them.

    “We want to do things in the most safe and efficient way,” Milanoski said. “It behooves the railroad to make sure
    everything is environmentally sensitive.”

    The tracks are located in the property’s “uplands,” he said, away from the wetlands.

    A transloading yard will help the railroad expand to meet significant growth in the rail transportation industry in
    recent years, according to company leadership. Milanoski said his industry’s growth in Massachusetts is second
    only to air freight.

    It’s unclear when the next state hearing date will be.

    Google Earth view. Mill River on right. Town line
    shown in white. G&U track meanders across.

    A closer look at eminent domain as Hopedale waits for the state to decide on claim on 155
    acres of land

    By Alison Bosma
    abosma@wickedlocal.com
    September 9,  2019

    Earlier this summer, the Grafton and Upton Railroad petitioned the state to take 155 acres of land in Hopedale without
    the owners’ permission – a legal move called eminent domain.

    The state, which hasn’t ruled yet, was subsequently flooded with requests for more information, coming from town
    committees to a regional land trust interested in conservation. One document featured signatures from about 100
    Hopedale residents.

    Hopedale officials, residents petition state in railroad land-taking

    The Daily News looked through state law and Department of Public Utility records, then spoke with a legal expert in real
    estate, Michael Lonzana, to learn more. Lonzana is principal attorney of Needham-based MLL Law, LLC, specializing in
    real estate-based disputes, negotiation and litigation. He’s also on the real estate section council for the
    Massachusetts Bar Association, serving as vice chairman last year.

    What is eminent domain?

    At its core, eminent domain is the legal taking of private land without the permission of the landowner. The entity doing
    the taking must pay the landowner fair market value.

    Typically, Lonzana said, eminent domain is executed through a government body, to do something for the greater
    public use, like build a highway.

    Eminent domain is a federal issue, rooted in the Fifth Amendment, though states have some flexibility in local
    applications. In Massachusetts, companies that operate public utilities – arguably a railroad – can petition the state
    Department of Public Utilities for permission to use eminent domain.

    That is what’s happening in the Hopedale case in front of the state now – the Grafton and Upton Railroad has
    petitioned the department for permission to take 155 acres at 364 West St. for a transloading and storage yard that
    would include tracks alongside the existing line that runs through the property, and some buildings.

    Let’s talk about railroads and eminent domain.

    Railroads have their own statutes under eminent domain in Massachusetts laws, and they’re fairly broad.

    “If a railroad corporation requires land .... and is unable to obtain it by agreement with the owner, it may apply to the
    department, which, after notice to the owner and a hearing, may prescribe the limits within which it may be taken
    without his permission,” Chapter 160, Section 83 of the Massachusetts General Laws reads, “and the corporation may,
    within one year after the decree, take such property by eminent domain ....”

    Section 83 refers to some preceding sections, which list acceptable purposes. Those include building new tracks,
    “cuttings, embankments, and for procuring stone and gravel,” stations, car houses, roundhouses, freight houses,
    yards, docks, wharves, elevators, and “other structures.”

    Lonzana said it looks like the decision is up to the state’s discretion, but the standard of proof – meaning, what the
    railroad has to prove to the state to see eminent domain granted – isn’t clear.

    A representative from the department did not respond to that question by the Daily News’ deadline.

    How has the DPU ruled in the past?

    Before the Hopedale case, there hadn’t been an eminent domain petition before the Department of Public Utilities
    since 2010.

    The vast majority of cases from 1995 to 2010, put forward by companies managing railroads, electricity, gas, and
    water, were withdrawn. Two were granted, and there is no record in the department’s online archives of a case where
    the petitioner’s request was denied.

    Withdrawals were often because the petitioner and the property owner came to an agreement where the property
    owner sold the land to the petitioner. In at least one case, the property owner granted the petitioner an easement
    instead, letting the gas company in question work on pipelines.

    The eminent domain process can be used as leverage, Lonzana pointed out, either to get the property owner to the
    negotiating table or to get a better price on the land. Most people can’t do anything if they want to buy a house and the
    owner sets a ridiculously high price, Lonzana said. Railroads are able to turn to eminent domain.

    “I have a feeling that probably what’s going to wind up happening is they’ll come to a deal at some point,” Lonzana said.

    Grafton and Upton Railroad President Michael Milanoski said he hopes to be able to work something out with the
    property owner – who he says has not provided a counter offer.

    “That’s always our preference,” Milanoski said. “We’re hoping that all parties can come to the table and negotiate a
    private to private sale. ... That value has to be based upon fair market conditions.”

    How likely is it the railroad will succeed if the case isn’t withdrawn?

    Again, it’s hard to know without the standard of proof. Considering the number of people asking to be involved – at least
    one even outright asked the state to deny the petition – the environmental concerns at play, and the age of the statute,
    though, Lonzana said this could be a long road for the Grafton and Upton Railroad.

    “Because these laws were most likely implemented in the 1800s, when railroads were the dominant commercial
    entities,” Lonzana said, “there would most likely be a strong public policy argument against invoking these laws, which
    are arguably antiquated and not applicable to today’s world.”

    Milanoski echoed his company’s filings with the state in pointing out how rail transportation fits in with the state’s
    transportation plan. Demand for transportation is growing, he said, and Grafton and Upton Railroad is expanding to
    keep up.

    “Freight rail is a critical component of the Massachusetts economy,” he said.

    Moving products via rail is more efficient and environmentally friendly than trucking, he said, and cuts down on traffic, as
    well as wear and tear on roads.

    “You’d be adding hundreds of thousands of trucks to the (state’s) infrastructure without freight rail,” he said.

    Who determines what “fair market value” is?

    That is likely not up to the state, Lonzana said. Determining fair market value will probably be a separate legal
    proceeding, where both parties will hire appraisers. Fair market value also isn’t the same as the locally assessed
    value of the property, he added. That’s often much lower.

    Hopedale assessed the 364 West St. property at $448,754.

    What’s next for Hopedale?

    The next date of interest in the Hopedale eminent domain case is Sept. 16.

    That’s when the state is expected to let the many people who petitioned to intervene – essentially asking to be kept in
    the loop as the case moves forward – know if their petitions were granted.