Fremont council rejects city sponsorship of Rail Modal Group’s $5 million federal rail grant application

At a special meeting, the Fremont City Council voted 3-5 to reject Resolution 2026-150, which would have authorized the city to be the lead applicant for a Consolidated Rail Infrastructure and Safety Improvement (CRISI) Program grant on behalf of Rail Modal Group (RMG).

City Administrator Jody Sanders told council members that RMG cannot apply directly for the federal grant administered by the Federal Railroad Administration and that a local government must serve as applicant. Sanders said staff requested an assurance that RMG could provide a $5 million match—ideally via escrow or a letter of credit—but received only a bank statement showing a balance on a single day. She said staff had prepared a receipt/grant support and indemnification agreement “designed to protect the city” in case of audit or ineligible reimbursements, but acknowledged no contract can provide a 100% guarantee against legal challenge.

The vote followed more than an hour of questions from council members about timing, documentation, property easements and risk. Angie Olson, the city’s grant coordinator, said an earlier LB 840 application from the same project did not move forward after the Citizens Advisory Review Committee tabled it and the applicant did not submit requested revisions. Utilities General Manager Jeff Shanae said the applicant declined the city’s request for a gas easement adjacent to the existing easement and that the city would have to seek an alternate route for its gas line.

Several council members and a public commenter told the council they were uneasy that no company representative attended the meeting to answer questions. Councilman Peterson called the application “vague” and said the absence of RMG leadership at the meeting was telling; resident Steve Ray said he had worked at the site and raised safety and maintenance problems in the past. Councilman Marsh cited reports of OSHA violations and an on-site death; Olson said she could not speak to those allegations without a company representative to answer specifics.

Council members also discussed an option Sanders described in the staff packet: if an award were made, the city could seek to transfer administration of the grant to the Nebraska Department of Transportation (NDOT), which Sanders said had verbally expressed willingness in other communities such as Grand Island and Lincoln. Several council members asked for more than verbal assurances from NDOT; Sanders said she had only verbal confirmation from an NDOT contact and that any transfer would require federal- and state-level approvals and would return to council for approval before the city signed grant documents.

Councilman Horner made the motion to approve the resolution; Councilman Jensen seconded. After the roll call, the motion failed and the clerk announced the tally as three ayes and five nays. After the vote the council moved to adjourn and the meeting ended.

The council’s rejection means the city will not act as the applicant in this CRISI grant cycle; staff said the program is anticipated to continue in 2027 but that availability is not guaranteed. If the council had approved the application, Sanders said the next formal step—should an award be issued—would have been a transfer request to NDOT and, if transfer were denied, a later council decision on whether to accept or decline the award and associated contracts.