Reading Blue Mountain and Northern’s purchase of former KME facilities softened the blow of the firetruck company’s departure. But KME’s economic impact will be hard to replace.

“It’s a positive. It’s not going to be what it was, but the buildings are going to be put to good use,” said Kathy Henderson, economic development director for the Carbon Chamber and Economic Development Corporation.

Last week, the railroad acquired nine buildings on approximately 10 acres located on the north side of Route 54 from REV Group, the parent company of KME.

The railroad, considered a public utility under state law, used its power of eminent domain to condemn the property, according to court records. REV will receive $2 million for the value of the real estate and equipment located inside.

The railroad plans to use the facility to repair and maintain its cars and railroad equipment. It is located along a rail line which the railroad purchased from Carbon County last year for $4.7 million.

The transaction means that some of the 350-plus jobs that KME provided will be offset. But since public utilities are exempt from local property taxes, KME’s property tax revenue will not.

Overall, the fact that the railroad has spent millions on infrastructure in the county - including the $14 million Nesquehoning bridge, has local officials excited.

“The railroad continues to invest in Carbon County, and we appreciate all they do for Carbon County, and we suspect likewise this will be another positive,” county Commissioner Chris Lukasevich said.

The acquisition means that the Nesquehoning site will continue to provide some jobs for Carbon County workers. The railroad employs 200-plus employees.

When KME announced it was leaving Nesquehoning last year, there were over 350 employees at the facility. State Rep. Doyle Heffley said the loss of those jobs was devastating, but he’s excited about the outlook for the railroad. Economic sanctions on Russia have helped demand for coal from the U.S.

“The railroad is growing. It should have finances to be able to invest in the property, utilize the property to create jobs and be a good economic partner in the community,” Heffley said.

The loss of KME impacted the property tax base for Nesquehoning, Panther Valley School District and the county. Because it is a public utility, it is unlikely that the railroad will replace that loss. Rail facilities aren’t subject to local property taxes. This year, the local property tax bill for the property the railroad acquired was $52,845, based on an assessed value of $544,854.

The sale is also exempt from real estate transfer tax.

Lukasevich said the railroad’s tax exempt status makes the acquisition a “double-edged sword.”

There are still several buildings located on the south side of Route 54 which the railroad did not acquire. REV group has reportedly had interest in those buildings. It is possible that they could provide some tax revenue to offset the loss of KME.

REV will also continue to lease the buildings owned by the railroad until June 30 as it closes out operations in Nesquehoning and shifts production of KME firetrucks to a plant in Holden, Louisiana.