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Indiana Northeastern Railroad: Operating The ex-NYC and Wabash

Published: January 15, 2025

By: Adam Burns

The Indiana Northeastern Railroad (reporting mark, IN) is a short line operating 130 miles of ex-New York Central/LS&MS and Wabash trackage in Indiana, Michigan, and Ohio.

The privately owned independent has been serving the region since December, 1992. By 2017, it was transporting over 7,000 carloads annually.

The railroad's cargo includes a variety of products such as corn, soybeans, wheat, and flour, in addition to plastics, fiberboard, aluminum, copper, and coal. It also carries perlite, stone, lumber, glass, and rendering products, along with agricultural fertilizers and chemicals.

The system plays a crucial role in connecting rural communities and industries to the national rail network, facilitating economic growth and offering logistical solutions in a strategically important area of the United States.

Indiana Northeastern GP7 #1602 and GP30 #2230 lead an eastbound freight that is about to enter Montpelier, Ohio and the NS interchange on September 27, 2024. Doug Kroll photo.

Historical Context

The Indiana Northeastern's main line running from South Milford, Indiana, to the interchange points at Edon and Montpelier in Ohio where it interchanges with Norfolk Southern.

Founded in 1992, this privately owned railroad took over lines previously operated by larger railroad companies, preserving vital infrastructure that might otherwise have been abandoned.

It consolidated mostly former New York Central/Penn Central between Batavia/Litchfield, Michigan and Steubenville, Indiana as well as the ex-Wabash (4th District)/Norfolk & Western/Norfolk Southern between Montpelier, Ohio and South Milford, Indiana.

When Penn Central announced it would cease rail operations, leaving 200 miles of track in Michigan abandoned, the state intervened by establishing a subsidy program to sustain rail service on sections of Michigan trackage that Conrail would not acquire.

Thanks to these subsidies, the Hillsdale County Railway Company (HCRC) was formed on January 27, 1976, and began service on April 1, 1976, operating on the former Penn Central routes in Hillsdale County, extending west to Quincy and south to Stubenville.

Initially, the company managed routes covering approximately 60 miles and secured several first-generation EMDs. This setup allowed the railway to interchange traffic with Conrail in Quincy and with the Norfolk & Western in Stubenville.

By the mid-1980s, Conrail looked to abandon additional less profitable lines, including the former LS&MS "Old Road" stretching from Quincy to White Pigeon, Michigan. Concurrently, N&W was phasing out its Gary District between Montpelier, Ohio, and Gary, Indiana.

Facing the risk of losing crucial rail interchanges, HCRC expanded its reach by operating a three-mile section of underused track linking Pleasant Lake to Stubenville, Indiana. In April 1986, HCRC acquired nearly 25 miles of track from N&W, running from Ashley, Indiana, through Stubenville, to an interchange with N&W's Detroit - Fort Wayne line near Montpelier, Ohio.

In 1989, the non-profit Branch and St Joseph County County Rail Users Association (RUA) emerged, formed by the city of Coldwater alongside local business stakeholders, to purchase a 30-mile stretch from Quincy to Sturgis from Conrail.

RUA contracted HCRC to manage and maintain over 10 miles of the track between Quincy and Coldwater, while a new short line railroad, Michigan Southern Railroad, was tasked with operations from Coldwater to Sturgis.

Creation

By the early 1990s, the Hillsdale County Railway wasn't doing well financially. Its tracks were in bad shape due to deferred maintenance, leading to frequent derailments.

Things took a significant turn in 1992 when a 50-car train moving east from South Milford derailed near Hamilton, Indiana. This mishap set back the South Milford Grain Company by $30,000. In a strategic move, the grain elevator's owners decided to take on the railway's $1 million debt and consequently acquired it.

They then established the Indiana Northeastern Railroad Company, assuming control over HCRC and the Pigeon River Railroad on December 22, 1992. With urgency, the new short line set out to rehabilitate the tracks, putting $3 million into improvements over the first two years.

By 1994, they successfully won back customers who had switched to trucks, and by 1996, they were transporting 3,400 carloads annually, including goods like grain, flour, sugar, food products, fertilizer, and plastics.

Since its inception, Indiana Northeastern has consistently invested substantial amounts to enhance its infrastructure—upgrading the roadbed, rails, bridges, and grade crossings—to allow for heavier and faster-moving trains.

Diesel Roster

Indiana Northeastern SD40-2 #3084 and SD45m #3125 are westbound at Edon, Ohio with an empty unit grain train ready for online loading on September 27, 2024. Doug Kroll photo.

Present Day

The strategy of the Indiana Northeastern Railroad revolves around customer-centric values. Its nimble and responsive approach allows the railroad to offer tailored logistics solutions that cater to specific customer needs. This attention to detail and customer relationship management is pivotal in ensuring continued patronage and the growth of its client base.

Furthermore, the railroad places a strong emphasis on community engagement and sustainability. It participates actively in promoting regional development initiatives and supporting local economies.

For example, by investing in infrastructure improvements and modernizing its fleet, the railroad not only enhances its operational efficiency but also reduces its environmental footprint. This commitment to sustainability benefits both the company and the communities it serves.

The Indiana Northeastern exemplifies the importance of short-line railroads in the American transportation landscape. By offering cost-effective, reliable freight solutions and fostering regional economic growth, it serves as a vital link in connecting the Midwest to the national rail network.

Its focus on customer service, community involvement, and sustainable practices has steered it toward success while cementing its role as an indispensable partner to local industries.