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Vancouver wants Arbutus rail corridor sold at a discounted price

A community garden along the Arbutus corrdor near West 6th Ave. and Cypress Street. After CP began work to reactivate the corridor and cleared community gardens that had been set up along the track, the city filed a lawsuit and sought an injunction to prevent CP from continuing its work.

DARRYL DYCK/The Globe and Mail

The City of Vancouver has fired another salvo in its long-running dispute with Canadian Pacific Railway Ltd., applying for an order that would force the company to put its Arbutus corridor up for sale at a reduced price.

The city announced Wednesday it has filed an application with the Canadian Transportation Agency, an independent tribunal that resolves transportation disputes. The city has asked the agency for an order that would require CP to sell the corridor at its net salvage value, as well as an order that would nullify CP's plan to reactivate the track.

The application comes nearly one year after the city filed a lawsuit against CP over the corridor, an approximately 10-kilometre line that weaves through Vancouver's west side and has been unused for more than a decade.

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"The city's perspective is that by abandoning rail operations on the corridor in 2001, [CP] has fundamentally breached the Canadian Transportation Act, which outlines the mandatory steps required for discontinuing a railway," the city wrote in a statement.

"Under Section 145 of the Canadian Transportation Act, [CP] was required to offer the corridor to governments for purchase at its net salvage value, which it did not do."

CP has said the corridor's potential value as a real-estate development could be $400-million. The company has reportedly asked for $100-million, while the city has said $20-million is a reasonable offer. The corridor's exact net salvage value is not listed in the application. The Canadian Transportation Agency website says net salvage value can refer to "the market value of an asset less the costs associated with its disposal."

Marty Cej, a CP spokesman, in an interview said the company was still reviewing the city's application.

However, he added CP "has been working hard in the last few months to return the corridor to operational standards."

"CP has previously discussed several options with the City of Vancouver for the future of the Arbutus corridor. Some of those options would result in the city taking possession of the corridor without any cost to the taxpayers. All of the proposed CP options have been refused. Therefore, CP continues to work with Transport Canada to ensure the safe resumption of service," he said.

Mr. Cej said one option CP proposed was a land swap, though the city refused.

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A Canadian Transportation Agency spokesperson in an e-mail said the agency does not comment on cases.

The city, in its statement, said it does not support the reactivation of cargo trains along the corridor. It said CP's plan poses a number of safety risks due to the public crossings, deteriorated infrastructure and lack of fencing, among other things.

The dispute between the city and CP kicked into high gear last year, when CP began work to reactivate the corridor and cleared community gardens that had been set up along the track. The city filed its lawsuit in October and sought an injunction to prevent CP from continuing its work. The city's application to the Canadian Transportation Agency says that while the city's attempt for an injunction was rejected in January, the lawsuit remains active.

The city's application says CP's "stated intention to resume rail operations on the corridor is simply a negotiating tactic aimed at pressuring the city to purchase the lands."

The application said the city and CP have negotiated a purchase of the corridor "on and off for a number of years" but the negotiations have been unsuccessful.

The application said use of the corridor for passenger and freight service began in the early 1900s. However, it says passenger service ended in 1958 and CP decided in 2001 to end freight service, as it was no longer economically viable on the line.

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