Malheur County officials are negotiating the sale of the unfinished Treasure Valley Reload Center and the county’s undeveloped industrial park to a national railroad company.
The Malheur County Court voted on Wednesday, Dec. 18, to authorize a final letter of intent pending approval by the county’s attorney and the Malheur County Development Corp., the public company established by the court to oversee the project.
County Commissioners Jim Mendiola and Ron Jacobs acted on the move while Malheur County Judge Dan Joyce was absent.
The potential sale to Jaguar Transportation Holdings would end a decade of work at public expense to turn farmland outside of Nyssa into an industrial complex.
The county, MCDC and Jaguar declined to provide any details about what might emerge from such a sale. One issue is how much money would flow back to the county and to the state. Another is how Jaguar would use the Nyssa site.
The actual use of the stalled rail project has consumed MCDC officials in recent months. With the help of consultants, they concluded the original plan to truck onions to Nyssa to put on rail cars wouldn’t be feasible. They have considered switching to an intermodal operation, which could use Nyssa to ship cargo containers.
While casting about for a new plan, MCDC has stopped talking about when the reload center would open for business.
The MCDC board disclosed the possible sale on Tuesday, Dec. 17, when it voted to enter into a letter of intent with Jaguar Transportation Holdings. The company, based in Missouri, now owns the Vale-based Oregon Eastern Railroad.
No price has been set, officials said.
Shawna Peterson, development company executive director, said the letter would put the public company, the county and Jaguar into a 120-day due diligence period to potentially move forward with a sale of the Nyssa rail center project.
She said the deadline to complete the due diligence would be June 30.
Peterson said the letter spells out that the purchase price would be “mutually agreed” by the county and Jaguar Transportation.
The reload center, funded by the 2017 Legislature, has taken over $30 million in public funds and is far from complete. Construction has stopped while officials figure out the best use for the center, which was initially designed to ship Treasure Valley onions.
Peterson said work will likely continue to complete the partially completed rail lines, but not much remains. According to Peterson, two tracks need walkway rock, and the others don’t require much more work. She did not immediately have a cost estimate.
But the site still has no warehouse structure erected. A building kit has been sitting on the ground in pieces for more than two years.
Jaguar would buy the 65-acre rail depot and the county’s adjacent industrial park. The park was never developed and much of it remains used for farming.
The county bought the 285-acre property in 2020. The land is about two miles north of Nyssa, west of the Union Pacific Railroad line serving Nyssa and Arcadia Boulevard. Dubbed the Arcadia Industrial Park, the bare land with no services was the foundation for the Treasure Valley Reload Center and an adjacent industrial park.
The county paid $3,424,550, using a $2.4 million loan from Business Oregon, the state economic development agency, and pulled $969,900 from the county’s contingency, or rainy day, fund to make the buy.
Peterson said the board discussed whether a commercial appraisal is needed to independently set the value of the land. The board took no action to seek one.
While the development company owns the Treasure Valley Reload Center, Peterson said any sale proceeds not covered by the state grant would likely be returned to the Oregon Department of Transportation instead of the development company. In 2023, the state transportation agency turned off funding for the project after years of delays and cost overruns.
State officials said it would continue funding only after it met specific benchmarks, such as getting a new operator and producing a viable business plan for the beleaguered project. Neither has happened.
Erik Havig, Transportation Department planning manager, said on Friday, Dec. 20, that the state is not planning on entering into a new agreement. The state’s agreement with the county’s development company contains language regarding working with a third party like Jaguar. He said Jaguar would be required to meet the terms of the agreement, meaning that the buyer would have to finish the project as designed and operate it as MCDC long ago agreed.
The conditions the state set for the development company remain in place, Havig said.
Havig said the negotiations between the county’s development company and Jaguar could result in the state not needing to make additional investments in the project. The state is holding about $8 million budgeted by the Legislature as the reload center costs mushroomed.
He said the goal is still to build a reload center.
Having said the state does not intend to participate in the negotiations between the development company and Jaguar.
“It’s not our responsibility to be involved in those details,” he said. “Just the end result.”
Taylor Rembowski, the county’s economic director, said he sees a sale to Jaguar as a win for the county with more jobs and families moving to the area. Rembowski said one of the most significant upsides of a potential sale to Jaguar would be the company’s long relationship with Union Pacific Railroad.
He said MCDC’s inexperience with dealing with a major railroad like Union Pacific has been one reason the project has not been able to move forward. worked.
Officials with Jaguar Transport, founded in 2018 and operated by a father-son team out of Joplin, Missouri, have since declined further comment after a phone interview with the Enterprise on Tuesday.
Tim Enayati, senior vice president of commercial development with Jaguar, said at that time the company intended “open conversations” with the community in eastern Oregon and its customers. The company owns 11 short-line railroads, including the Vale operation.
The national company established its Vale reload center in 2022 after purchasing Oregon Eastern two years before. The Vale operation primarily ships lumber.
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