Railroads in Texas began to be organized in the mid to late 1800s. For many years they were without federal regulation. In addition, the federal government promoted and helped to finance the first transcontinental railway system that was completed in 1869. The Interstate Commerce Commission (ICC) was a federal agency created in 1887 to oversee the national rail system and to act against alleged abuses and monopolistic practices. The ICC was allowed to have more broad powers generally extending to national infrastructure and regulation of commerce involving national transportation systems. The ICC was dissolved in the 1990s and railroad regulation was passed on to the Surface Transportation Board, an independent federal agency, in 1992.
The ICC identified three classes of railroads in 1911 based on annual gross revenues. Class I had the highest threshold, Class III had the lowest and Class II applied to everything between the largest and smallest classes. These financial thresholds have been increased for inflation over the years, but in 1911 they were $1,000,000 or more for Class I, under $100,000 for Class III with Class II applying to revenues between those two levels. The latest thresholds are $1.0537 billion for Class I, under $47.2998 million for Class III with Class II applying to railroads with annual gross revenues in between those two levels.
After decades of mergers and some abandonments, nationally now there are seven Class I railroads, five of which are American owned and two of which are Canadian owned. Three of them operate in Texas: BNSF Railway, Union Pacific Railroad and Canadian Pacific Kansas City. There are at present no Class II railroads operating in Texas and dozens of Class III, or short line railroads.
From time to time, we will look at some of the smaller railway systems in the state, including the so called tourist and heritage lines. The three we are looking at today are the Texas and New Mexico Railway, the Angelina and Nueces River Railroad and the Galveston Railroad.
Texas and New Mexico Railway (TXN) has been in business for close to 100 years. The line runs from Monahans, Texas to Lovington, New Mexico covering a distance of over 110 miles. The railway has been beneficial to Lea County in transporting oilfield products and other materials for the oil and gas, ranching and wind electricity generation industries as well as general business freight.
Prior to the discovery of oil in the Permian Basin, there were proposals to extend freight rail lines to Lea County, New Mexico from West Texas, but the plans were not realized. Once oil was discovered in the area in the late 1920s, rail service became more economical and appealing. The railway was incorporated on November 19, 1927 as a subsidiary of the Texas & Pacific Railway. The first train rolled into Lovington, the end of the line, on June 7, 1930. No copies of it can be found online, but the Lovington Leader issued a special “Railroad Edition” for the occasion.
Over the years, the ownership has changed several times with the longest single duration of ownership being Texas and Pacific Railway (T&P). T&P was merged into the Missouri Pacific Railroad (Mo-Pac) in 1976. Mo-Pac merged with Union Pacific to become the Union Pacific System (UP) in 1982. UP sold the line to RailTex in 1989. In 2000 Railtex was taken over by RailAmerica, Inc. Two years later, the line was sold to Permian Basin Railways, a subsidiary of Iowa Pacific Holdings. Watco, a privately held company, acquired the line in 2015. To view Watco’s description of the line, a map of its rail stops and other information, please see this page on Texas & New Mexico Railway.
Angelina and Nueces River Railroad (ANR) has been in business for over 100 years. Articles of incorporation were approved by the Texas Attorney General in August, 1900 to operate a 12 mile rail system from Keltys to Manton in Angelina County with capital stock of $75,000. Its purpose was to serve the lumber industry, which was one of the largest businesses in the area at the time. The incorporators included J. H. Kurth, S. W. Henderson, Eli Weiner and others. Kurth, Henderson and Weiner were also named as incorporators of the Lufkin Foundry and Machine company about two years later. They were local businessmen in the lumber business and related industries. Keltys is a few miles to the northwest of Lufkin and Manton is about eight miles northeast of Lufkin. The Austin American-Statesman reported on Christmas Eve that during the last half of the year 1900, eight rail lines were listed as constructing just under 143 miles of local railways in Texas. The shortest line was 6 miles and the longest was over 50 miles.
Originally, the track it acquired was laid by a predecessor, a lumber company, and was primarily a narrow gauge line. Standard gauge is 1435 mm or 4 feet 8 1/2 inches wide. Some countries use rails that are spaced wider than standard. Generally, any width smaller than 1435 mm is referred to as narrow gauge. The ANR track was converted to standard gauge soon after incorporation. Additional historical information on this railroad can be found on the website of the Texas Forestry Museum in Lufkin.
Galveston Railroad (GVSR) has been operating since 1872. The Charlotte (SC) Daily Courier in its issue of February 21, 1854 noted that the House of Representatives of the State of Texas had passed a bill authorizing the formation of the Galveston Wharf and Cotton Press Company, the incorporators of which included M. B. Menard, E. B. Nichols and A. H. Williams. A few days later, the Gonzales (TX) Inquirer reported on acts passed by the 5th Texas Legislature and confirmed the company’s incorporation. In 1860 its charter was amended to change the name to the Galveston Wharf Company. In 1870 the company received approval to build rail lines connecting the wharf with other rail lines serving Galveston and its tracks were completed and placed in operation two years later.
Over time, the line grew in length and the level of its business. The old railroad was a precursor to the current operation. It is unknown when or how the ownership changed from the original incorporators. The City of Galveston formed the Galveston Wharves Railway in 1900 to provide terminal switching services and connect with other major rail lines serving the area. Not long afterward, the area suffered a natural disaster when a hurricane struck Galveston damaging the railroad infrastructure. The wharves and rail line were restored and repaired and the railroad continued to operate until 1987. From all accounts, the wharf and rail operations appear to have initially been under one corporate umbrella but appear to have been separated at some point. The City of Galveston appears to have been a minority owner until around 1940 when it increased its interest. In the late 1980s, the railroad was leased to the Galveston Railway, Inc. Subsequently, the line was renamed the Galveston Railroad. The rail entity was acquired by Genesee and Wyoming in 2005 and is still in operation. It currently operates 32 miles of track, including sidings. More information may be found on the Genessee and Wyoming website for the line.
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