Defunct tourist railroad line is deeply in debt

July 20, 1995|By Darren M. Allen | Darren M. Allen,Sun Staff Writer

The defunct EnterTRAINment Line excursion railroad owes money to more than 500 creditors, ranging from the state of Maryland to an 80-year-old woman in Wilmington, Del.

According to company officials and filings in Carroll County Circuit Court, the rail line -- whose assets are to be sold by a court-appointed trustee -- owes hundreds of thousands of dollars in taxes, defaulted loans and cashed tickets for trips that will never take place.

Some of the people owed by the once-profitable tourist attraction are more likely than others to recover a portion of their money -- such as Maryland's comptroller and a Carroll County bank that is holding a secured loan.

Last week, Carroll Circuit Judge Raymond E. Beck Sr. gave New Windsor State Bank the right to keep and sell 10,000 shares of Maryland Midland Railway Co. stock that the EnterTRAINment Line's owners posted in December 1993 as collateral on a $131,000 loan.

EnterTRAINment owners Donald S. Golec and Steven Hamilton still owe $130,000 on the loan, court records show. The Maryland Midland stock, the EnterTRAINment Line's lawyers estimate, could bring as much as $88,000, leaving the bank with a much smaller unpaid balance on the loan.

On June 29, Judge Beck ordered the appointment of a trustee to sell the EnterTRAINment Line's assets to make partial payments to its creditors. The line's trains stopped running in May when Maryland Midland Railway barred it from using its tracks because the EnterTRAINment

Line's owners had fallen behind on lease payments.

In addition to New Windsor State Bank, the state of Maryland will have a chance to recover some of the $500,000 that the EnterTRAINment Line owes in amusement taxes to Westminster and Union Bridge, a spokesman for the comptroller said yesterday. The state collects the taxes for the towns.

Jean Rutter won't be so lucky. The 80-year-old woman and 30 other members of the Concord chapter of the American Association of Retired Persons in Wilmington were looking forward to their second excursion on the rail line in September. In March, Ms. Rutter, the chapter's assistant treasurer, sent a $481 deposit to the EnterTRAINment Line.

She was about to send the remaining balance of nearly $1,500 last week, but first tried to call the company to ask why a similar group of Wilmington senior citizens was getting a better deal on its planned excursion.

"The [EnterTRAINment Line's] phones had been disconnected," Ms. Rutter said yesterday. "We would have sent that money in if we hadn't called. I'm so glad I found out before I sent that check."

Ms. Rutter will join a group of up to 500 creditors, Mr. Golec said yesterday. He declined to be specific, but said the company's creditors include individual customers and vendors.

The court-appointed trustee, Howard A. Rubenstein of Baltimore, could not be reached for comment yesterday.

Mr. Rubenstein has said he hopes to find someone who would buy the company "lock, stock and barrel." Mr. Golec declined to say whether such a buyer had yet been found.

The troubled rail line has blamed its demise on a recent decision by the Maryland Tax Court saying it owed the $500,000 in back taxes to Union Bridge and Westminster.

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