Word was received Sept. 3 that the U.S. Department of Agriculture loan to the Snowflake Community Foundation to secure the future of the Apache Railway has been denied.
A Sept. 3 letter written on behalf of the Little Colorado Water Conservation District stated that district officials believe “the conclusions drawn by USDA were incorrect.”
U.S. Senator John McCain has reached out to Navajo County Supervisor Jason Whiting to determine how he can support and help the foundation, Whiting reported in a phone interview.
Whiting noted that Congresswoman Ann Kirkpatrick is also doing what she can to help.
The railroad is vital to the communities and Navajo County to bring economic development. Currently, Snowflake is on the short list for an egg farm, but that is contingent on the railroad.
Hackman Capital Partners purchased Catalyst paper mill, and had agreed that the railroad and its stock could be formed into a nonprofit foundation, and Hackman would extend a short-term loan to this foundation, allowing it and local leadership time to find a long term funding source.
Hackman leaders maneuvered to take over railroad operations in May, and as a result, the foundation filed for bankruptcy protection. The railroad is estimated to be worth $11 million if scrapped.
There have been several hearings regarding this, but it was recently announced that the foundation has given in to demands of its creditors.
“If they cannot come up with $7.2 million by Nov. 30, the process of a 363 creditor sale starts, and is scheduled to end on or before Jan. 30, 2016,” Snowflake Mayor Tom Poscharsky wrote in an email.
“Local leaders are working together,” said Whiting, reiterating that they have support from state and federal leaders.
