Cape Breton railway subsidy extended

The Nova Scotia government is extending a funding agreement to maintain the rail line inCape Breton.

Premier Darrell Dexterwas in Sydney Friday to announcefunding for the Cape Breton and Central Nova Scotia Railway would continue for three years.

"This is a demonstration of support for a key piece of infrastructure on Cape Breton Island,"Dexter said."The three-year agreement allows people who are thinking about investing in Cape Breton to have some certainty about their access to rail over that time."

Dexter said the rail line was vital for keeping shipping costs low and helping businesses stay competitive.

RailAmerica, which runs the railway, can access up to $2 million each year for working capital and maintenance costs.

Provincial politicians say the rail line would be too expensive to run without an infusion of government cash.

The Nova Scotia government has been subsidizing the railway for years. Last year, itgave $3.5 million to RailAmerica for a one-year period that ended Friday.