Nova Scotia extends subsidy for crumbling Cape Breton rail line

The province is extending a subsidy of $30,000 a month for one more year to the owner of the crumbling railway in Cape Breton.

The last train ran across the island in 2015, but the provincial government has continued to subsidize the Cape Breton and Central Nova Scotia Railway line.

In an email this week, the Department of Inclusive Economic Growth said it will keep paying the railway owner to keep the rail line in place "while the community pursues a possible container terminal in Sydney."

"Strong transportation links are a key component of building a stronger economy and this agreement is a fair and low-cost way to preserve the existing rail line," the department said.

"COVID-19 has had a significant economic impact on our province. During this time, it is even more important that we have infrastructure in place that will allow us to explore options to generate economic activity in the region."

Cape Breton Regional Municipality Mayor Amanda McDougall welcomed the news.

"To me, it indicates they see value and potential that the rail actually could be reinstated, which is really encouraging," she said.

McDougall said she recently met some local business owners involved in the Scotia Rail Society, which formed in 2015 to try to save the rail line and promote its use.

The mayor said some local businesses hope to ship products by train in future, so maintaining the infrastructure is about more than a possible container terminal.

The business owners' arguments were "really compelling, so obviously this is bigger than any one project," McDougall said.

"This is really looking at expanding our economy here on the island."

CBRM awarded an exclusive contract to privately owned Sydney Harbour Investment Partners to try to attract investors in a possible container terminal in Sydney harbour.

McDougall said she doesn't know how strong a possibility that isbecause council has not met with the principals of that organizationfor many months.

Until last year, the province was paying the railway owner $60,000 a month to prevent the company from abandoning the line altogether to support that possibility.

Under the deal, the company was not being reimbursed for maintenance, but for overhead costs such as staffing, insurance and other expenses.

Since the line was discontinued, bridges and trestles have continued to deteriorate, the rail bed has washed away under the tracks in several places, and trees and shrubs have been growing between the ties.

A 2017 study by the Port of Sydney Development Corporation suggested the rail line would need more than $100 million in investment to repair the tracks and repair or replace bridges and trestles to a level that would support container traffic.