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Economic contribution of the Minnesota Valley Regional Rail Authority rail line: 2019

Key findings

Red River Valley & Western train
  • Rail operations: In 2019, the Minnesota Valley Regional Rail Authority (MVRRA) rail line operations generated an estimated $3.8 million of economic activity.
    • This includes $1.7 million in labor income.
    • The operations supported 30 jobs.
  • Shipper activity: MVRRA shippers generated an estimated $288.8 million of economic activity in 2019 as a result of the rail line.
    • This includes $39.8 million in labor income.
    • The rail shipments supported 620 jobs.
  • Rail line improvements: During 2018-2019, MVRRA and Minnesota Prairie Line spent $5.8 million on rail line improvements.
    • Rail line construction activity generated an estimated $7.9 million in economic activity, including $2.9 million in labor income.
    • The projects supported a total of 45 jobs.
  • Total contribution: In total, operations and shipping generated an estimated $292.6 million of economic activity in 2019.
    • This included $41.5 million in labor income.
    • The rail line also supported 650 jobs in the region.
    • The industries most affected by the MVRRA rail line included wholesale trade, real estate, and management of companies.
  • Future investment: As MVVRA makes improvements in the line, it should lead to increased economic activity.
    • First, there will be short-term impacts of the construction.
    • Second, the faster line should lead to increased shipping from both current shippers and new shippers coming online.

About this study

The Minnesota Valley Regional Rail Authority (MVRRA) rail line connects the cities of Norwood Young America and Hanley Falls in southwest Minnesota. The 94.7 miles of rail are an essential shipping route for businesses located along the line. A connection via the Twin Cities & Western Railroad Company provides shippers with access to major rail companies located in the Twin Cities, allowing shipments to and from both coasts, Canada, and Mexico. Since 2010, MVRRA has installed continuous welded rail from Norwood Young America to Gibbon. The new track has increased speed and efficiency on the line.

Minnesota Prairie Line (MPL), a subsidiary of the Twin Cities & Western Railroad Company, operates the rail line. Agricultural products, including ethanol, dried distillers grain, corn, soybeans, and fertilizer are among the most commonly shipped items on the line. Other shippers include a door manufacturer, a water softener salt company, and a transloading center.

As MVRRA continues to invest in the rail line, it was interested in understanding the role the line plays in the regional economy. Thus, they partnered with University of Minnesota Extension to conduct this economic impact study. The study area for this analysis was Carver, Sibley, Renville, Redwood, and Yellow Medicine Counties.

Read full report (PDF)

Authors: Brigid Tuck, senior economic impact analyst; Neil Linscheid, Extension educator

Reviewed in 2020

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