The
Dispatch The newsletter for Watco
January 2022
Table of Contents A Note from Watco Chief Executive Officer Dan Smith ________________________________________________ 3 Safety Anniversaries __________________________________________________________________________________ 4 Guntersville Terminal Team Earns Safe Shipper Award ________________________________________________ 4 Discovering the Meaning Behind the Name of the Ringneck Western Railroad ______________________ 5 Teammates Honored for Making a Difference _________________________________________________________ 6 Sustainability Efforts Include Two New Switchers ____________________)________________________________ 8 How Medha Became a New Watco Partner __________________________________________________________ 9 Increasing Speed to Upper Midwest Markets ________________________________________________________ 10 Team Member Anniversaries _______________________________________________________________________ 11-12 New Arrivals __________________________________________________________________________________________ 13
Highlights
On the Cover
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The sun creates a double rainbow over Watco Greens Port on the Houston Ship Channel while the recent rainstorm continues in the distance. Photo by Rae-Lynn Perkins
2 The Dispatch | January 2022
RUN THE PLAY A Note from Watco Chief Executive Officer Dan Smith Watco Team: As I look back on 2021, I want to thank all of you for your hard work. The year was filled with challenges for sure. But ultimately, it was a time of enormous success. Because of you, 2021 was another year of record performance for Watco. As we head into 2022, our focus is to Run the Play. Run the Play means to do everything the right and safe way, every time, as we’ve been trained. We need to be consistent and unwavering when it comes to doing things the Watco way. This is especially important at this time of growth when we have so many new team members joining us. There are plenty of reasons why I have a very positive outlook about the year ahead. •
This month, we’re holding our first classes in our newly expanded Safe Performance Center
(formerly the STAT Center) in Alabama. We’re delivering the same solid safety training we always
have – just with much more room to conduct it in, plus upgraded technology.
•
We expect to close soon on our purchase of 900 miles of CN track and other assets in Wisconsin,
Michigan, and Ontario, Canada.
•
We’ll put close to $100 million back into our core assets, reinvesting in track, equipment, dock
improvements, and more.
•
We’re improving our information technology systems and investing in other strategic projects
through multiple grants and investments totaling $30 million.
•
We anticipate investing over $300 million in continued growth and acquisition opportunities.
•
Given the record-level of funding available as a result of the recently passed infrastructure bill, we’ll
continue to be aggressive in seeking federal grants to drive efficiency and resiliency in our railroads.
•
We’re highlighting Watco’s commitment to sustainable practices by releasing a comprehensive
report that will be issued in 2022.
This is just a snapshot of how we’ll Run the Play this year. The prospects are bright, and I hope you’re as excited as I am about getting 2022 under way. Let’s make it our best year yet.
Dan Smith
January 2022 | The Dispatch 3
Safety Anniversaries
December 5 – Elizabeth Dedicated Terminal (NJ) – 3 years December 17 – Decatur River Port (AL) – 5 years December 20 – Alabama Warrior Railway (AL) – 2 years December 21 – New Johnsonville Dedicated Terminal (TN) – 15 years December 28 – Swan Ranch Railroad (WY) – 10 years December 30 – Coffeyville Repair and Maintenance Terminal (KS) – 1 year December 31 – Ontario Ventura Switching (CA) – 14 years
Guntersville Terminal Team Earns Safe Shipper Award Watco’s Guntersville Terminal team in Alabama was recently presented the Safe Shipper of the Year award from OmniTRAX/Alabama & Tennessee River Railway, LLC (ATN). The award is earned by a shipper with no non-accident releases that has handled more than 100 hazmat loads (over 600 cars shipped year to date) and has no customer-caused derailments or derailments due to customer track. As part of the award, OmniTRAX/ATN donated $1,000 to the Guntersville Fire Department in the name of the Guntersville Terminal. The Guntersville Terminal then matched the donation. The award and check presentation took place at Guntersville Fire Station #1 on December 22, 2021. Deputy Chief Brian Walls said he was very thankful for the donations and appreciated the efforts by the Watco Guntersville team to safely handle and ship product. The Guntersvillle team members are Kristi Nunnelley, Chris Nunnelley, Jacob Roll, Noah Hilburn, Dawson Johnson, Clay Sampson, Lowell Shirey, Terminal Manager Scott King, and Stan Bryant, who oversees the Guntersville and Decatur River Port terminals in Alabama. “The team at Guntersville has a good mix of experienced and new team members,” said King. “I’m very proud of this team and how they handled the challenges that occurred during this year.” 4 The Dispatch | January 2022
Discovering the Meaning Behind the Name of the Ringneck & Western Railroad Just like coming up with a name for a newborn baby, Watco did its research to identify a moniker for one of our newer family members — a short line in South Dakota formerly known as Dakota Southern that was acquired last year. Like some other acquisitions in the past, Watco sought to replace the name with one that better reflects the state where the railroads operate, and its traditions. The end result? The birth of the Ringneck & Western Railroad (RWRR). In honor of National Bird Day earlier this month, we thought of no better time to share more details on how the RWRR got its name: • South Dakota’s state bird is the ringneck pheasant. • Ringneck pheasants are known to take cover in tall brush like the western wheatgrass, which also
happens to be South Dakota’s state grass.
• One of the top commodities the RWRR moves is grain, a favorite food of the ringneck pheasant. Thankfully, there’s enough grain to go around. The team transported nearly 5,000 carloads of grain including wheat, milo, and soybeans in the last six months of 2021. Where do these commodities end up? Flour mills receive both the wheat and milo, which are later processed into bread and baked goods. Soybeans are moved to a processor to be squeezed for oil and ultimately used as a key ingredient to make margarine, salad dressings, and even mayonnaise. January 2022 | The Dispatch 5
Teammates Honored for Making a Difference We’re pleased to honor the latest winners of the Watco Be the Difference awards: Alina Robles, Johnny DeLeonyPena, and Jesus Cepeda. “I’m proud we’re recognizing these outstanding team members,” said Chief Executive Officer Dan Smith. “They’re examples of what makes Watco
One Watco Award – Given to an individual or
such a great place – our people.”
group of team members whose teamwork
Watco established the awards in July 2021 to
a customer.
recognize team members for outstanding contributions at work and in their communities. Through the One Watco, Extra Mile, and Safe Performance awards, the company recognizes people who are living Watco’s Foundation Principles: value our people, value our customers, and safely improve every day. In October 2021, Watco named its first-ever winners. And each quarter, new winners are named out of the prior quarter’s nominations.
6 The Dispatch | January 2022
generates an exceptional result for Watco or
Recipient: Alina Robles
At a time when COVID-19 cases were rising, Alina Robles put aside any concerns about travel to help a short-staffed Watco office. The supply coordinator, based in Utah, also ignored any inconveniences she faced to make not just one but three trips to Texas to help the team that was in a jam.
Safe Performance Award – Given to an individual
Robles doubled down, working days in Texas and
or a group of team members who take action to
nights on operations back home in Utah.
ensure safety for fellow team members, customers,
Learn more about how she was able to make a difference for the team in San Antonio.
suppliers, or property. Recipient: Jesus Cepeda
Extra Mile Award – Given to an individual or a group of team members who go above and beyond the call of duty at work or in the community. Recipient: Johnny DeLeonyPena Railcar Coordinator Jesus Cepeda was driving on a Texas highway, returning from a customer site, when he witnessed a vehicle collide with a semi-truck. The accident left the driver of the vehicle temporarily unresponsive and the car hood in flames. Read on to learn how Cepeda jumped into action to care for the crash victim, earning him the Safe Performance Award. These three team members will receive $250 gift Johnny DeLeonyPena makes an impression, whether on his co-workers, customers, truck drivers,
cards to the Watco Gear store and an exclusive hard hat sticker signifying they’re an award winner.
safety managers, people in his community, or even
Read up on the Be the Difference awards, and
air quality inspectors.
nominate a deserving Watco teammate.
One person who’s known DeLeonyPena for years says, “You don’t meet people like him every day.” A fellow community volunteer called him “golden.” Keep reading to understand the ways this honoree consistently goes the extra mile.
Nominations are open through mid-March, with Q1 winners to be selected in early April. You can nominate an individual or group of team members. Find more team member stories at watco.com/stories.
January 2022 | The Dispatch 7
Sustainability Efforts Include Two New Switchers It’s widely known that railroads are an
repairs. With a grant from the Texas Emissions
environmentally friendly form of freight
Reductions Plan program, Watco is building the
transportation, producing less than 2% of
switchers in partnership with Medha, a designer
transportation-related emissions, according
and manufacturer of locomotive control systems
to the Environmental Protection Agency. Watco
and other rail-related electronics.
is taking sustainability a step further with two new zero-emissions switching locomotives.
“Medha is providing key components of the power and controls systems, and Watco personnel
“Think of it as a Tesla, but a locomotive,” says
will reassemble the locomotives,” says Keith
Aaron Jensen, senior vice president of materials
Testerman, vice president and chief mechanical
services. “They are fully battery-operated —
officer. He says the locomotives “are completely
placed on a charger. They don’t directly use
disassembled now, and we’re performing some
any fossil fuels.”
sheet metal repairs. We meet weekly with Medha on
Watco is in the process of converting a pair of switching locomotives: an SW1200 built in the
the design review and come to an agreement on how to put them back together.”
1950s, and an SW1500 from the 1960s. Both are
Watco’s Brandon Jenson, director of locomotive
Texas-based machines that had been out for
support systems; Tex Inman, director of locomotive
8 The Dispatch | January 2022
How Medha Became a New Watco Partner In late 2017, Keith Testerman began getting calls
“If you want to drive to Hugo, Oklahoma, for lunch,”
from a guy pitching his company’s solution to
he said, “I’ll talk to you.”
upgrading the control system common to many diesel-electric locomotives.
The two met at a restaurant in Hugo, where Testerman lives and works. “As soon as I saw the
“We had a fleet of about 40 GP35 locomotives with
components,” Testerman recalls, “I was like, ‘This is
this system that were built in the 60s and were kind
what I’ve been looking for.’ I agreed to let him do
of complicated in terms of wiring,” says Testerman,
one locomotive. We upgraded one of our GP35s
vice president and chief mechanical officer. “They
with their control system, and that was so successful
weren’t a desirable locomotive in the marketplace,
that all of a sudden, the GP35s were desirable. We’ve
so I was unsuccessful in selling them.”
upgraded 25 to this day, very successfully. It’s just
Having also tried to upgrade several times without
been a huge success.
landing on a suitable solution, Testerman had no
“Out of that is where the idea came up, in general
interest in talking to the caller from the Dallas,
discussions about building the battery-powered
Texas, office of Medha, an India-based company
locomotive, to partner with Medha. The confidence
he’d never heard of at that time. But the Medha rep
in Medha was already there for Watco.”
was persistent, and eventually Testerman gave in.
support; and Tayler Wright, mechanic apprentice,
the cost of fueling when compared to burning
are building the new units along with the support
diesel fuel.
of some of the Scottsville, Texas, team.
Using this technology, a battery can be fully charged
By not returning the two diesel-powered
in eight to 10 hours and can operate up to 12 hours
switch engines to service, Watco estimates it
before needing a recharge. Their life expectancy is
could reduce greenhouse gas emissions by
8 to 12 years.
roughly 19 metric tons annually. In addition, the electric locomotives will provide operational cost savings, Jensen and Testerman anticipate about a 30% annual reduction in maintenance expense versus an older, diesel locomotive. “Electric locomotives will be easier to maintain; there are significantly less moving parts,” notes Jensen. While there will be a cost to charge their batteries, the electric engines also should realize about a 60% annual reduction in
“Individual (battery) banks can be replaced over time, spreading out the replacement cost,” says Jensen. “The banks are also recyclable, and can be used in lower power applications, like emergency building lighting.” The conversion timeline calls for testing at the end of the second quarter of this year, with the switchers placed in service at Greens Port by the end of the third quarter. January 2022 | The Dispatch 9
Increasing Speed to Upper Midwest Markets For shippers wanting to improve speed to market by moving product out of their facilities and closer to their upper Midwest customers, Watco has a solution. The company is currently offering a storage-in-transit (SIT) yard in Joliet, Illinois, with an additional yard opening later this year in Milwaukee, Wisconsin. “Our geographic locations in Joliet and Milwaukee are what set us apart,” says Doug Conway, vice president of sales. “The upper Midwest location provides quicker access to manufacturing or consumptive markets.” The Elwood, Joliet & Southern Railroad SIT Yard in Joliet is a former Railroad and Industrial Services (RIS) facility repurposed from a railcar repair site to SIT location. Watco acquired Glendale Yard in Milwaukee from CP for the opportunity to convert a portion of it to the Wisconsin & Southern Railroad SIT Yard. Conway says typical products handled will include both bulk and breakbulk with a focus on plastics, fertilizer, and soda ash. There are a total of 700 railcar spots available with room to expand. Both sites accommodate individual cars, blocks of cars, and unit trains. The yards also provide transloading, with abundant access to Class I’s, short lines, and highways. “The opportunity to transload at those locations is very important to customers,” says Conway. “Product is already loaded and closer to their market, so delivery is faster.” Conway points out that Watco is committed to finding ways to better serve customers in the upper Midwest market. “Acquiring these sites,” he says, “means we will be investing our resources for long-term capacity and capabilities.” For additional information, read Watco’s SIT Flyer. 10 The Dispatch | January 2022
Team Member Anniversaries Congratulations to the following team members celebrating January anniversaries:
1 Year: Jordan Anderson, Terrence Banks, Jesus Beavers, Clifford Birch, William Caldwell, Brandon Carver, Jared Caudle, Kadeem Coffey, Chad Cumberland, Robert Curll, Robert Curtis, Michael Denny, Lake Dunn, Kenneth Eaton, Michael Fant, Victor Figueroa, Victor Gregory, Kevin Hickerson, Phil Huttmann, James Mahoney, Casey Mills, Francisco Moreno, Giles Olsen, Aaron Patterson, Gary Patterson, Theron Pierson, Henry Pilcher, Raymond Plain, John Raccasi, DaNell Rasmussen, Branden Reese, Corbin Schott, Samuel Sedillo, Cody Shaw, Richard Tate, Christopher Taylor,
Stimpson, Kelly Stringer,
Cose, Stephen Dominguez,
Chad Tylicki, Andre Wheaton,
Johnny Garza, Tyler Hamilton,
Austin Wise, Joe Wyse
Clyde Harris, Esteban Hernandez,
Isaac Jaramillo, Shawna Mateo,
3 Years: Jarrod Austin, Justin
Laura McNichol, Efrain Padilla,
Becknell, Matthew Camacho,
James Riggs, Shaun Toopes,
Jason Camann, Jesse Castro,
J Bonifacio Vieyra
Alberto Cervantes, Pablo Cota,
Jason Crawford, Norman
6 Years: Michael Aleknewicus,
Dishman, Brandon Douglas, Curtis Frazier, Catina Freeman, Danielle Gosch, Jasmine Harris, Kayla , Devin Jurs, Jure Kauzljar, Matthew Lemke, Paul Lewis, Carlos Lopez, Kentrell Maxie, Charles Peak, Melvin Quiroa, Dustin Ramos, James Raney, Alexander Rodriguez, Michael Schwartz, Sami Taha,
Mitchell Alred, Joshua Breth, Jeremy Cazares, William Ethridge, Sue King, Charles March, Justin Marr, Lance McHan, Tung Nguyen, Adam Pope, Daniel Roth, Joe Valle, Richard Wampler, Neal Ward, Ryan Yanez
7 Years: Melissa Amaya,
Donnie Taylor, Willam Taylor,
Mike Berry, Jason Broadway,
John Thomas, Joe Torres III,
Nathaniel Burke, Daniel Coiner,
Menno Valkenborg, Kevin
Michael Cooper, Corey
Vanhoozer, Kevin Webb
Crutchfield, Edis Cruz, Alexander
Francisco Bassols, Matthew
Cruz-Oyola, Jorge Dela Torre,
Beard, Dereck Brown, Rolando
4 Years: Jonathan Audsley,
Archie Fields, Patrick Forbes,
Edward Zyhowski
2 Years: Jamie Babetch, Cantero, Travis Combs, Jeffery Cornett, Thomas Fenton, Oluwadamilola Feyisetan, Kyle Forsman, Stephen Fulton, Matthew Grimes, Andrew Hanretty, Wendell Held, Jeffrey Holmes, Tommy L Lamb, Sharron Lankford, Leslie Liberty, William Medlen, William Pack, Justin Piland, Reandell Poindexter, Charles Polach, Patrick Reding, Humberto Rojas Zuniga, Dustin Sellars, Reginald Sharp, Matt Sobba, Heath Spence, Bryan Steinberger, Todd
Jamaar Benton, Mark Bonar, Donald Brayman, DeAnne Burdick, Jose Cardoza, Gabriel Chavez, Julio Diaz, Andrew Dill, Anthony Escobar, Nolan George, Darin Grundeman, Jody Hyndshaw, Marissa Jordan,
David Fugge, Lezli Hicks, Brittany Hodge, Jesus Ibarra, Amy Iori, Keith Lacaze, Timothy Shelley, Jordan Vasquez, Solomon Watkins, Cameron Wiles, Marcus Wiley
8 Years: Luther Boothe, Nicholas
Chelsy McQuarie, William Melton,
Coomes, Joshua Drawdy,
Scottie Shafer, Teedra Thompson,
Richardjames Drummondo,
Maxwell Tunison, Jaime Velasco,
Amanda Haggerty, Darvis Hicks,
Thomas Villarreal, Mike Womack
George Hutchinson, Casey
5 Years: Jennifer Alons, Derek
Lorbiecki, Laura McKinney, Juan
Batterton, Justin Cole, Cooper
Peot, Eric Rahmaan, Theodore
Moreno, Jessica Nielson, Brad
January 2022 | The Dispatch 11
Team Member Anniversaries Savage, Perry Thomas, Jonathan Thompson
9 Years: Michael Barajas,
15 Years: Ron Close, Melissa
26 Years: Billy Gathright
Faughn, Kevin Gonzales, Jean
Guerrier, Steve Iseli, Herman
27 Years: Shannon Knisley
Robert Campbell, John Dellinger,
Lewis, Frank Nichols, Jason Wood
Gregory Ferguson, Matt Hayes,
Jaime Henry, Travis Luinstra,
16 Years: Thomas Addison,
Kevin Martin, Ronald Seevers, Tina Swallow, Joseph Whitaker, Cyle Windsor, Michael Yoger
10 Years: Kenneth Brown, Justin Haisch, Danelle Kenny, Russell Koczur, Preston McNew, Curtis Nobis, Lee Smith, Marcos Soto
11 Years: Daniel Caine, Nathan Champion, Daniel Harkness,
Derek Brown, Johnny Fields, Michael Gray, Robert Gray, Anthony Kirkland, Joshua Leslie
17 Years: Matt Heeren, Jimmie Miller, Santos Polanco, Timothy Watson
18 Years: Gary Griswold, Brian Pflughoeft
29 Years: Sherlyn Graham, Milburn Stewart
30 Years: Michael Beatty, John Falk, John Pond
31 Years: Kirk Hawley
32 Years William Gast
33 Years: James Young
Miranda Kichler, James Lanier,
19 Years: Fallyne Deao, James
Steve Rodriguez, Todd Vaughan
Goodyear, Patrick Peabody,
34 Years: Melvin Davis
Jeffrey Volek
12 Years: Eric Bowlin, Seth
37 Years: Dewayne Dockens
Morris, Angel Vazquez
20 Years: Jonathan Evans,
Michael McGee, Leon Odom,
13 Years: James Carter,
Samuel Winegarner
Joe Martinez, James McCoy,
45 Years: Tex Inman
Servando Mendez, Abram Silva
21 Years: Kenneth Parkin
14 Years: Ricky Carter, David
22 Years: Leon Abercrumbia
Garcie, John King, Charles
Lambert, Jonathan Mihalic,
25 Years: Roger Kelley
Robert Ward
12 The Dispatch | January 2022
New Arrivals Knight Emery Ray Cameron Kley and Rachael Cameron announce the birth of their son, Knight Emery Ray Cameron, born December 18, 2021. Knight weighed 7 pounds, 7 ounces, and was 20 ½ inches long. Kley is the General Manager at the Ringneck & Western Railroad in South Dakota.
Wrenley Lynne Flores Megan and Hugo Flores announce the birth of their daughter Wrenley Lynne Flores, born November 30, 2021. Wrenley weighed 7 pounds, 14 ounces, and was 19 ¾ inches long. Wrenley is the granddaughter of Watco Executive Chairman Rick Webb and his wife Stacey and is the great-granddaughter of the late Dick Webb, Watco founder, and Kaye Lynne Webb.
To submit your new arrival send a photo and information to marketing@watco.com January 2022 | The Dispatch 13
