Helm, No More
For several years, based on information from a trusted source, I have shown that most of the diesel locomotives used at Kennecott’s Bingham Canyon, and the railroad to the mills, were owned by Helm Financial, of San Francisco, and leased to Kennecott. New research in the filings of the Interstate Commerce Commission, and its Surface Transportation Board successor, has found new information.
Railroad equipment used on the nation’s rail network is subject to numerous regulations, including a recommendation that agreements concerning equipment financing be documented and records submitted to the ICC (and after 1996, to the STB). These records are akin to filing a document at the office of your local county recorder. These are called “recordations,” and are part of the public record for the nation’s railroads. (More here)
In January 2005, Joe Ferguson wrote describing the ICC and STB records: “recordations are not a requirement, but are highly recommended in any transaction involving the sale of a locomotive or rail car from one party to another where the buyer does not intend to dismantle the railcar or locomotive. Unlike automobiles, there are no titles to locomotives. Recordations are the only way to keep an accurate record in the event that there is a claim of ownership by one party vs. another. Most recordations are turned in by financial institutions (banks, leasing companies, etc.) because they understand this is the only way to protect themselves in a world where possession is 9/10th of the law.” (And research shows that the ICC and STB recordations are not even close to being a complete record of locomotive ownership.)
A big thank you goes to Joseph Yarbrough for helping me get started with researching these very interesting records. Among the recordations, I found lots of references to Helm Financial, and its heavy involvement with financing and leases of railroad equipment. But I found nothing about Helm Financial having any business with Kennecott Copper. There are, however, several filings for Kennecott, showing security agreements with First Security Bank of Utah. An internet search to define some of the terms used in the security agreements helped me to understand that the agreements were essentially loans to purchase the locomotives, using the locomotives themselves as collateral. While the loan was being paid, the bank leased the locomotives to Kennecott. At the end of the lien/lease period, Kennecott took full ownership of the locomotives.
The fact that Kennecott owned the locomotives at the end of the lien/lease helps explain how in the late 1990s, as Kennecott found that it no longer needed them, the locomotives started to be scattered to a wide variety of new owners. The variety showed that someone was acting as a broker agent for Kennecott, since the copper company is not in the used locomotive business. That someone was most assuredly Helm Financial, which has plenty of experience with buying, selling, and financing leased railroad equipment. Several locomotives were sold directly to Helm, which in turn leased them to several railroads. Others were sold directly to new companies. At least one Kennecott locomotive stayed in the Rio Tinto organization, and was moved to the company’s borax mine in California. All of the high-cab former mine locomotives had to have these high cabs changed to standard cabs. This conversion work was done at several locations, by companies that specialize in custom work on railroad equipment.
The past two weeks have been spent researching the recordations, combining the new information with existing research notes, to make for a much better story of the last years of railroad equipment at Bingham Canyon.
