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IDAHO MINING FIRM OFFERS $1 FOR U.P.'S SILVER VALLEY LINE

SHARE IDAHO MINING FIRM OFFERS $1 FOR U.P.'S SILVER VALLEY LINE

Hecla Mining Co. is offering $1 to buy Union Pacific Railroad's Silver Valley line, set to be abandoned.

The symbolic dollar comes in the wake of the Interstate Commerce Commission's final approval of Union Pacific's request to drop the line, claiming it was not profitable.Local businesses and Idaho leaders fought the abandonment, charging it was one more factor destroying the mining companies' ability to recover financially.

Hecla spokeswoman Vicki Kok said the purchase offer is preliminary.

"This is really just a way of keeping our options open," Kok said. "Right now, the matter is going through the appeals process."

Union Pacific spokesman John Bromley said that for now, Hecla's action means a postponement of the abandonment. The railroad has set Feb. 2 for ceasing operations on the line.

Don Howell, deputy attorney general for the Idaho Public Utilities Commission, said that in the abandonment decision, interested parties can make an offer to purchase the track.

He added the ICC ruling offered two options: a company could offer to subsidize Union Pacific loses on the line; or it could agree to purchase the track for an amount equal to the opportunity cost of the line determined by the ICC.

Hecla was able to make the $1 offer since the Interstate Commerce Commission in its final approval, placed a zero value on the land, property and salvageable materials, Howell said.

However, it is unlikely Union Pacific would settle for the price offered by Hecla.

"It could be a forced sale," Howell said. "But in this instance, it's more than likely (Union Pacific) will not agree that the price should be zero."

Bromley said the offer means both sides now have 30 days to come up with their own proposals. If they cannot come to an agreement, the ICC would then set the price.

Kok said Hecla would like to see the deal take a different track.

"We're not in the railroad business," she said. "What we would really like to see is a short-line operator come in and purchase the line, that would be the optimum situation."