City, Union Pacific Railroad settle dispute over rights of way

Agreement includes City purchase of railroad right of way in downtown

The Round Rock City Council approved Thursday, March 27, a settlement agreement with Union Pacific Railroad (UP) over rights of way along McNeil Road inside the City limits.

The dispute began a little over two years ago, when UP sent the City notice it would require $4.9 million for the City to continue leasing rights of way along McNeil Road from UP for the next 25 years. The City’s previous 25-year lease cost approximately $2,500.

Under the agreement, the City agrees to purchase the right of way, as well as three additional tracts, from UP for $1.6 million. UP agrees to drop its lawsuit, and donate $100,000 to a memorial of the 1927 Baylor bus crash the City is developing.

The property includes: the McNeil Road right of way west of IH 35 and east of IH; Bellview Avenue right of way, railroad right of way adjacent to Chisholm Valley Park,  some Burnet Street right of way, and a tract of land located at the intersection of Burnet Street and Bagdad Avenue, currently used by UP to store maintenance equipment.

The last property is significant because the City last year acquired the adjacent property currently occupied by Builders Gypsum Supply to redevelop as part of its downtown revitalization efforts. The property adjacent to Chisholm Valley Park will provide the City permanent access to a nearby water storage tank.

The City will construct a fence on the boundary between the UP right of way and the existing (but not used) Bagdad Street right of way from Burnet Street east to Georgetown Street. The fence is designed to discourage children from crossing the railroad tracks to get to Lake Creek Park and to establish the boundary between Bagdad and the UP.

UP also agrees expedite review and approval of Quiet Zones the City has been pursuing for more than five years.

“This truly is a win-win for the City and Union Pacific,” City Attorney Steve Sheets said. “The amount of money the City will pay to purchase the property as opposed to leasing it is significant, and this settles once and for all a number of land title issues that have been in question for years.”

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