New York, Susquehanna and Western Railway

History

Pre-company beginnings

The earliest origins of the New York, Susquehanna and Western Railway trace back to 1828, when John Langdon Sullivan surveyed the first route across northern New Jersey with the intent of transporting Pennsylvania coal by rail to industrial Paterson, New Jersey. While New Jersey industry had supply of iron ore, it needed local sources of coal to smelt it following shortages of British coal after the War of 1812. The Morris Canal had begun operation for this purpose by 1831, but was seasonal and slow; industry demanded better. Nothing was done with Sullivan's plans until the New Jersey, Hudson and Delaware Railroad (NJH&D) was chartered by a group of Paterson, New Jersey businessmen in 1832. Due to financial difficulties incurred during the Panic of 1837, the company did not construct anything until 1867, but its charter remained active. Further set back by the Panic of 1857, the railroad sold its charter to the Pennsylvania Coal Company. Following the events of the Civil War though, canals became disused, and a major railroad boom began throughout the United States.

By the mid-1860s, several companies were formed to create railroads across northern New Jersey. The earliest of these, the Hoboken, Ridgefield and Paterson Railroad (HR&P), was chartered in March of 1866 to connect Paterson with the ports along the Hudson River waterfront; various logistical issues ensured this company would not actually build anything. The most successful attempt was by the New Jersey Western Railroad (NJW), which was founded by Cornelius Wortendyke in 1867. That railroad began laying track at Hawthorne the following year. They soon completed a line between Hawthorne and Butler.

In 1866, the New York and Oswego Midland Railroad (NY&OM) was incorporated in New York State under the leadership of DeWitt Clinton Littlejohn. His plan was to provide a connection from New York City to the port city of Oswego, New York on Lake Ontario. Construction on their trackage began at Oswego two years later. However, Wortendyke had no charter to build in New Jersey, a necessity in reaching New York City.

The NJW quickly decided to shift its focus towards connecting their route with the NY&OM to benefit both railroads. Cornelius Wortendyke signed an agreement with DeWitt Littlejohn, where the two companies would lease and access each other's routes. By 1870, the NJW expanded westward from Hackensack to Hanford, but in doing so, they encountered the NJH&D[c] and the Sussex Valley Railroad, which had already obtained resources and begun work. The Sussex Valley had been chartered in 1867 to build south from the New Jersey-New York state line to the Delaware Water Gap.

Formation and expansion

In 1880, investors from the original NJM regrouped and reorganized the company as the Midland Railroad of New Jersey, with Hobart serving as their president. The company regained their finances by serving New Jersey industrial firms. The investors decided to profit from hauling anthracite out of Pennsylvania as originally envisioned, and they chartered the New York and Scranton Construction Company to that end. That company in turn chartered four other small companies to lay down portions of the NJM route from New Jersey to Pennsylvania.

On June 17, 1881, the Midland Railroad of New Jersey was consolidated with five other companies to form the New York, Susquehanna and Western Railroad (NYS&W); "Susquehanna" was incorporated in the name, since one of the company's goals was to reach the Susquehanna River.

In 1882, the new NYS&W railroad extended westward to Gravel Place, Pennsylvania, but they were originally reluctant to extend through the Pocono Mountains. They began to outsource their coal traffic to the Delaware, Lackawanna and Western Railroad (DL&W, interchanging with them at Stroudsburg. To reach the Hudson River waterfront ports, the NYS&W would transfer their coal traffic to the Pennsylvania Railroad at Marion Junction via the Hudson Connecting Railway.

The NYS&W also began operating passenger trains. By the late 1880s, the NYS&W's profitability boomed from their coal-hauling business and from their industrial and farm customers. In 1887, the railroad laid down a double-track route from Paterson to Jersey City to accommodate their rising traffic.

In 1892, the Susquehanna ended their transfer partnerships with the DL&W and the PRR, when they extended their own line eastward from their Little Ferry Yard to a new coal terminal at Edgewater. The railroad also began leasing their own newly chartered Wilkes-Barre and Eastern Railroad (WB&E) between Stroudsburg and Wilkes-Barre in late 1893. This railroad was chartered for the NYS&W to have direct coal mine access. In 1896, the NYS&W chartered the Susquehanna Connecting Railroad to further access the Wyoming Valley as a branch line from the WB&E north to Minooka

The Lehigh and New England Railroad (L&NE) was formed in 1895 as a bridge line between eastern Pennsylvania and New England. Its route through the Great Appalachian Valley in New Jersey was finally negotiated with trackage rights over the Susquehanna between Hainesburg Junction, near the Paulinskill Viaduct, and Swartswood Junction, near Newton. This provided a source of revenue for the railroad until the L&NE folded in 1961.

Erie Railroad control

The NYS&W's prosperity caught the attention of influential financer J. P. Morgan, who used his Erie Railroad as a means to control the Susquehanna. The Erie already had access to coal mines north of Scranton, but they also desired access to the mines south of the area, and they believed the Susquehanna provided the best route there via its Wilkes Barre and Eastern.

On behalf of the Erie, Morgan quietly purchased the NYS&W's stock until he obtained the majority of their shares. By July 1898, the Erie Railroad took over control of all of the Susquehanna's operations, making the NYS&W their subsidiary.

In 1908, the Susquehanna purchased their final new steam locomotive, 2-8-0 No. 140, from the Baldwin Locomotive Works; all of their subsequent steam locomotives were either leased or purchased second-hand from the Erie.

In 1911, the Susquehanna's Jersey City passenger terminus was moved from the PRR's Exchange Place Station to the Erie's Pavonia Terminal, and their freight terminus was moved from the PRR's Marion yards to the Erie's Croxton yards. By 1923, the Susquehanna's total gross income peaked at $5.5 million.

The Erie subsequently invested in rebuilding and upgrading the NYS&W's trackage and bridges. During the 1920s, the Erie began operating under the control of the Van Sweringen brothers, and they installed a new president for the Erie, John J. Bernet. During Bernet's tenure for the Erie, he initiated a major modernization program for the Susquehanna; most of the railroad's original steam locomotives and wooden passenger cars were scrapped and replaced with newer Erie equipment.

Throughout the 1930s, the NYS&W experienced some major financial problems from the Great Depression, and the Erie began to neglect them. The general demand for anthracite coal was declining, and while other anthracite-hauling railroads were able to change their freight priorities, the NYS&W struggled to follow suit.

During 1937, the railroad defaulted on some major bonds and taxes they owed, and on June 1, they filed for bankruptcy and reorganization. That same month, the bankruptcy court appointed two co-trustees to the NYS&W; Walter Kidde and Hudson Bordwell, but the latter died only five months into his position, making the former their sole trustee.

Walter Kidde-Henry Norton reorganization

Following the abandonment of the WB&E, the NYS&W did not see any benefit in continuing their Pennsylvania operations, and in 1941 they cut back the western end of the line back twelve miles from Stroudsburg to Hainesburg, New Jersey, preserving the L&NE connection there (and its revenue). Walter Kidde decided to have the Susquehanna improve their remaining suburban commuter passenger trains and make profits from providing bus services to Manhattan, and Susquehanna Transfer service began in late 1939, for this purpose.

Kidde also opted to dieselize the NYS&W's locomotive roster to reduce their operating costs. In June 1940, they began to purchase some streamlined self-propelled rail cars from the American Car and Foundry Company (ACF) to cover their commuter services. In 1941, the NYS&W began to order some S-2 switchers and RS-1 road switchers from the American Locomotive Company (ALCO) to supersede their steam locomotives. A precedent was quickly set on the NYS&W, where all of their diesels with multiple-unit controls would only receive even road numbers, while all of their non-multiple-unit diesels would only receive odd road numbers.

The Susquehanna also settled a $7 million freight balance debt they owed the Erie by paying them $250,000 and purchasing their freight terminal in Edgewater. The railroad also obtained money from World War II, by providing an effective coastal coal barge route out of Edgewater, to aid a major coal shortage in Great Britain, since a similar route out of Norfolk, Virginia, was blocked by the 1942 submarine menace.

In February 1943 Kidde died. His deputy and executive officer Henry K. Norton succeeded him as the Susquehanna's trustee, and he opted to continue Kidde's restructuring plans for the company. By June 1945, almost all of the Susquehanna's remaining steam locomotives had either been retired or sold off, and they declared themselves as the first Class I railroad in the United States to completely dieselize. Three locomotives, 2-10-0s Nos. 2435, 2461, and 2492, were retained as yard switchers, until they were also retired by October 1947.

After World War II ended, coal continued to be shipped from Edgewater to Europe, in accordance with the Marshall Plan, until the NYS&W shut down their coal terminal in 1948. During that time, the railroad signed a contract with Seatrain Lines to provide rolling stock-shipping services at Edgewater.

1955-1961 financial troubles

Two years later, in 1955, stockholders voted to have Norton demoted to chairman and replaced by former Chicago Great Western vice-president James M. Baths due to Norton's excessively-progressive foresight. In December that same year, the railroad chose a new head: Ralph E. Sease, a former Central of Georgia executive.

By that time, the Susquehanna had run all of their passenger trains at a financial loss due to declining ridership and competition from a new park and ride service. The railroad considered filing an application to discontinue their passenger services. Further revenues were lost after a primary customer, the Ford Motor Company, closed their Edgewater assembly plant.

Following the Recession of 1957, the NYS&W experienced additional financial problems, and a portion of their other freight customers abandoned the railroad to begin relying on truck shipping. Sease opted to arrange some cutbacks for the company, which involved discontinuing a number of their commuter services and moving their Jersey City passenger terminus from the Erie's Pavonia Terminal to the DL&W's Hoboken Terminal.

The NYS&W subsequently sold off its Budd passenger cars and replaced them with used second-hand equipment. One of the other cutbacks was the abandonment of the Hanford Branch, the remains of the original NJM-NY&OM route. It had lost its farm traffic to the recession, and long-time interchange partner NYO&W had shut down.

In 1961, another one of the NYS&W's long-time interchange partners, the Lehigh and New England Railroad (L&NE), ceased operations as well. The following year, the NYS&W consequently abandoned its route between Hainesburg and Sparta Junction. The route was later ripped up and became part of the Paulinskill Valley Trail.

Irving Maidman ownership

In October 1962, the NYS&W was purchased by New York real estate developer and millionaire Irving Maidman. Maidman previously acquired the former Ford Edgewater plant for use as a rental warehouse, and since the NYS&W served the building, Maidman opted to purchase the majority of the railroad's shares to ensure their freight services in Edgewater remained active.

The first task Maidman did for the NYS&W was to obtain a $550,000 federal loan for the purchase of three EMD GP18 road switchers to assist the NYS&W's failing ALCO locomotives. In 1963, Maidman became the NYS&W's newest board chairman and chief executive officer (CEO), and he began to install new executives for the railroad, including his wife Edith Shivitz and his son and attorney Robert Maidman. The management changes also involved Ralph Sease resigning from his president position and being replaced by John P. Clark.

That same year, Maidman began to have the NYS&W prioritize on serving his warehouse business, but the railroad consequently began to neglect their other stockholders and the rest of their remaining freight customers. Maintenance on the NYS&W's infrastructure also became deferred, and in ensuing years it resulted in derailments and slower deliveries. This in turn resulted in additional customers abandoning the railroad.

Maidman also arranged for the NYS&W to sell some of their land properties to other businesses Maidman owned, and they began to lease some new land property in Edgewater for use as backup storage. He also discontinued all of the NYS&W's bus services, and he filed a petition to the state of New Jersey to terminate all of the railroad's commuter services. As a desperate attempt to eliminate all ridership, Maidman personally offered to pay the NYS&W's 200 remaining commuters $1,000 each to stop using their trains, but only five of them accepted.

Maidman's tactics were challenged by commuters, and the State of New Jersey argued on their behalf against the railroad at the US Supreme Court in December of 1963. A 9-0 decision kept passenger service continuing at the time. However, by June 1966, the NYS&W obtained court permission to terminate all of their passenger services, despite commuters' continuing efforts to keep them running. The railroad's final commuter train operated on June 30 with only a day's notice, and the following day, uninformed commuters waited to board NYS&W trains that never arrived.

Second bankruptcy protection

By January 1976, the NYS&W defaulted on $252,498 of business and property taxes owed to the state of New Jersey, and they were forced to file for section 77 bankruptcy. By that time, the NYS&W railroad was cut down to a 43-mile (69 km) line from Croton and Edgewater through Paterson to Butler. Simultaneously, Conrail was being developed to assume control of many other bankrupt railroads in the northeastern U.S., but the NYS&W was not included.

The Securities and Exchange Commission began to investigate the NYS&W's operations, and they quickly discovered that the railroad's purchase of their $2 million bond on Irving Maidman's behalf was in fact stock fraud. The bankruptcy court quickly confiscated control of the railroad from Maidman and appointed Walter G. Scott as the railroad's new trustee. Maidman's other businesses, including the Edgewater warehouse, were also confiscated by other creditors. By June 1977, Maidman's final remaining source of income was his new limited position on the NYS&W as a real-estate consultant. Scott began to rearrange the NYS&W's operations and assets; the railroad suspended all land leases Maidman began, they prioritized the maintenance of their locomotives and trackage, and they hired new industrial customers. Some other members of the new court-appointed management team believed the NYS&W would be able to regain its finances by serving as an alternative to Conrail's services.

Maidman, who often quarreled with Scott, had hopes of regaining control of the railroad before selling it on his own after it emerged from bankruptcy. He said to The Record "I expect to straighten things out. I'll get the railroad back. I'll tell Scott to go to hell." However, in June 1978, Maidman became physically weakened and hospitalized following a car accident. In October 1979, he died at the age of 82. During that time the NYS&W continued to financially struggle; track had deteriorated to the point that it held a 10-mile-per-hour (16 km/h) speed restriction. The Federal Railroad Administration (FRA) banned the NYS&W from shipping hazardous materials on their trackage as a safety precaution.

On November 21, 1979, the railroad's creditors decided to petition the ICC to shut it down and begin liquidation by February 1, 1980. The NYS&W's remaining customers appealed the petition, since they envisioned the shut down would result in 6,000 jobs being lost across the state. A public hearing subsequently postponed the railroad's closure throughout 1980. On August 15, the ICC authorized the closure, and the NYS&W railroad's final revenue train operated on August 29.

Delaware Otsego acquisition and expansion

In 1966, the Delaware Otsego Corporation (DO) was founded by a group of businessmen and railfans led by Walter G. Rich. DO's original venture was operating tourist trains over a 2.6-mile (4.2 km) section of the New York Central's abandoned Ulster and Delaware branch near Oneonta, New York. In 1971, after the section was ripped up in favor of Interstate 88's construction, DO purchased the 16-mile (26 km) Cooperstown branch from the Delaware and Hudson Railway (D&H) and began operating it as the Cooperstown and Charlotte Valley Railroad (CACV).

Within ensuing years, DO's tourist operations were shut down from low ridership, and they pivoted to reactivating abandoned branch lines as short line freight railroads, finding this profitable. Throughout the 1970s and 1980s, DO acquired and leased multiple short lines: in 1972 they acquired the Erie Lackawanna's Richfield Springs branch and began operating it as the Central New York Railroad (CNYK) until 1988,[d] from 1974 to 1984 they owned and operated the Fonda, Johnstown and Gloversville Railroad (FJ&G), and from 1976 to 1989 they were contracted to operate the Lackawaxen and Stourbridge Railroad (LASB) in the northern Pocono Mountains, DO's first venture outside New York State.

By 1979, DO's shortline renovations caught the attention of New Jersey state and county officials, who were exploring ways of having the NYS&W continue operations under new ownership. They asked DO to submit a proposal to purchase the NYS&W, and in turn, DO sent a team of inspectors to evaluate the railroad's trackage.

Two other parties also offered to purchase the railroad, but in June 1980, the bankruptcy court accepted DO's $5 million offer. On September 1, DO took over the NYS&W's operations under lease before purchasing all of their assets two years later. DO quickly rebranded the railroad as the New York, Susquehanna and Western Railway, with Walter Rich becoming their newest president and CEO. He opted to retain the New York, Susquehanna and Western name out of his fondness for the New York, Ontario & Western. The first NYS&W train under Delaware Otsego operated on September 2, 1980.

That same year, DO established their own real-estate unit to begin arranging for the NYS&W to lease and sell line-side land property that was deemed unessential for railroad purposes. Within the next two years, the NYS&W retained their status quo in serving industrial customers, having kept most of their pre-DO executives and employees. DO and the New Jersey Department of Transportation (NJDOT) jointly funded a $1.35 million reconditioning of the NYS&W's trackage. By that time, seven of the NYS&W's twenty-seven locomotives were still operable: three GP18s, three RS-1s, and one S-2; the rest had deteriorated outdoors and were subsequently scrapped.

Launch of intermodal trains

In 1984, Delaware Otsego began negotiating with SeaLand, an international shipping corporation, to form an intermodal container-shipping partnership. Emphasizing the Susquehanna's Little Ferry yard location's proximity to major highways and the metro New York City area, they offered to lease part of the yard for use as a container facility. SeaLand previously negotiated with Conrail for the partnership, but they were unimpressed with Conrail's terms where only their container facilities would be used; SeaLand preferred to establish their own facility.

In 1985, SeaLand signed a contract with the NYS&W where they would lease 22 acres (110,000 square yards) of their Little Ferry property for twenty years, and they quickly began construction on their new facility. At the same time, the NYS&W signed a partnership contract with the D&H and CSX to ship SeaLand trains from Little Ferry to Chicago, Illinois.

On August 5, 1985, the NYS&W operated their first SeaLand intermodal train. It was quickly followed by many other trains bound between Little Ferry and the western U.S., and for shipping east of Little Ferry, the containers were shipped via truck to nearby shipyards. The intermodal operations quickly boosted the NYS&W's income by 125%, and the following year, the railway turned a profit of $3.2 million out of a gross take of $19 million.

DO decided to purchase some additional diesels to accommodate their expanding intermodal operations. They originally planned to purchase four ALCO C636s from Conrail, but after some coaxing from CSX for compatible motive power, DO instead purchased a fleet of EMD SD45s and F45s from GATX, which previously leased them to the Burlington Northern Railroad (BN). The NYS&W subsequently began to retire their ALCO diesel roster.

Despite Conrail being kept out of the partnership, the NYS&W still used Conrail trackage and crews, as per their haulage agreement. Conrail became slightly agitated by having to haul competing intermodal trains. On April 1, 1986, Conrail renewed their haulage contract with the NYS&W with higher rates, hoping the railway would quietly abandon their intermodal operations. In doing so, Conrail allowed the NYS&W the opportunity to restore their Butler-Sparta route and to exercise their proposed trackage rights agreement. DO quickly initiated a rehabilitation and upgrade program on the embargoed original NYS&W route, along with their former L&HR trackage, in order to accommodate the new mainline intermodal traffic. The rehabilitation process lasted six months and cost $8 million to complete, for which the railway utilized a grant from NJDOT and a low-interest loan from the FRA.

1988-1995 expansion

In 1988, the Norfolk Southern Railway (NS) partnered with Hanjin to operate intermodal trains between North Bergen, New Jersey and Chicago, subcontracting the NYS&W and the D&H to haul the trains between North Bergen and Buffalo, New York. In June that same year, the Delaware and Hudson filed for bankruptcy via their parent company, Guilford Transportation Industries. They disbanded the D&H following two labor strikes. To preserve their intermodal partnership, Rich convinced the bankruptcy court to appoint the NYS&W to take over the D&H and their operations.

CSX gave the NYS&W some financial support to operate the D&H by underwriting their financial losses and leasing a fleet of GE Dash 8-40Bs. The NYS&W also gained access to the D&H's trackage rights over Conrail from Binghamton to Buffalo. In 1991, the bankruptcy court began accepting bids to purchase the D&H, and DO made an offer, losing out to the Canadian Pacific Railway (CPR). CPR succeeded the D&H in the NYS&W's intermodal partnership.In 1992, the NYS&W installed various freight transloading facilities for their industrial customers in New Jersey, to diversify their freight operations. From 1992 to 1994, the NYS&W operated their intermodal trains at a $4.1 million loss, since the intermodal-shipping industry was affected by the early 1990s recession.

The NYS&W reversed their losses by renewing their intermodal contracts with NS and CSX to increase their intermodal traffic, and the NYS&W and NS began to jointly haul container-on-flatcar and trailer-on-flatcar trains for CSX Intermodal. In 1995, the NYS&W turned a profit of $1.6 million. However, in 1996 the NYS&W experienced a $1 million loss following that year's blizzard and a further decline in intermodal traffic.

In 1994, Onondaga County, New York purchased Conrail's former DL&W trackage between Jamesville and Syracuse, with the provision that the NYS&W provide shuttle commuter service between Syracuse University, Armory Square, and the Carousel Mall. Further routes were considered but not implemented. The NYS&W utilized $7 million in state grants and loans, and initiated a rehabilitation of the route to raise its speed restriction. A new intermodal interchange with Conrail was also built at Syracuse. The shuttle commuter provision became OnTrack, which the NYS&W operated in exchange for property tax relief on the route. Three former New Haven Rail Diesel Cars were acquired and restored for the service. With OnTrack, the NYS&W operated their first commercial passenger trains since 1966.

Conrail split and management buyout

Throughout the 1990s, Norfolk Southern negotiated merging with Conrail, with DO and CSX both fearing the merger would affect their freight operations. DO made an offer to outright purchase Conrail's Southern Tier Line, along with their Meadville Line between Hornell and Youngstown, Ohio, but was swiftly rejected. DO and CSX then secretly financed a regional development authority's purchase of the Meadville Line, to prevent Conrail from ripping it up.

The NS-Conrail merger subsequently fell through, but in October 1996, CSX unexpectedly announced their plans to merge with Conrail. Following some subsequent disputes by NS, it was announced in April 1997 that the Surface Transportation Board (STB) would authorize Conrail to be split between NS and CSX. Since NS and CSX would both receive direct routes into the New York City area, the NYS&W would lose all of their intermodal operations, which by that time, provided 70% of the railway's annual income. Walter Rich quickly mulled his options to satisfy his fellow DO stockholders.

One option was to carry out their proposed "Northeast Network" alliance with the Canadian National Railway (CN), where the NYS&W would have provided a New York City connection for CN, and the two railways would have jointly purchased Conrail's Montreal Line, while the NYS&W would have either purchased Conrail's Southern Tier Line or extended their trackage rights to a Conrail-CN interchange at Buffalo. DO's stockholders were looking into selling their DO shares to secure the corporation's future, and they contacted fourteen parties for a buyout. Only NS and CSX expressed interest. In June 1997, Walter Rich, along with DO Vice-President C. David Soule, negotiated with both railroads. Rich, CSX chairman and CEO John Snow, and NS executive David R. Goode arranged a transaction between their three companies.

On August 17, a new privately held holding company, DO Acquisition LLC, completed their $55 million purchase of Delaware Otsego via a stock tender offer of $22 per share. The purchase brought the NYS&W under control of DO Acquisition LLC, with Walter Rich obtaining 16% of DO's shares, while Norfolk Southern and CSX collectively received 84%, along with the right of first refusal to purchase the Susquehanna, if Rich chose to sell it.

The transaction was completed on October 3, and the NYS&W's Northeast Network alliance plan with CN was quickly dropped. In 1999, the Conrail split between NS and CSX was finalized, and they began to operate intermodal trains out of New Jersey on their own. The NYS&W's final intermodal train operated on February 3, 2001, after their intermodal contracts expired.

Post-Conrail activity

The NYS&W reoriented their freight operations to solely serve their industrial customers, but Rich explored other opportunities for the railway to gain additional profits. Following the Conrail split, CSX and NS both experienced overflowing freight traffic on their new routes, so the NYS&W allowed CSX to use their trackage as a detour for their River Line trains, and they allowed NS to use their Southern Division as a relief route to prevent their Southern Tier trains from conflicting with NJ Transit's commuter operations.

Concurrently, NJ Transit negotiated with the NYS&W to provide commuter service in the Southern Division between Hawthorne and Sparta, to alleviate roadway congestion on Route 23. The proposal was postponed, when a suitable location for an NJ Transit storage yard around Sparta could not be agreed upon. In 2005, the NYS&W leased the section of the Southern Tier Line from Port Jervis to Binghamton from Norfolk Southern under the Central New York Railroad (CNYK) name,[d] whose charter was reactivated as a paper railroad. All operations and maintenance of the route would be performed by NYS&W personnel, while NS retained overhead trackage rights.

In 2006, NYS&W's Utica branch experienced major storm damage, with some sections of track in Chenango County being washed out. The branch was consequently removed from service, and the NYS&W began to rely on CSX's connection in Utica to serve their customers on the isolated section of the branch between Utica and Sangerfield.

On August 9, 2007, Walter Rich died of pancreatic cancer at the age of 61. The CSX and NS bought the remaining ownership of the NYS&W from Walter Rich's estate, bringing ownership to a roughly 50-50 split with neither corporation having a controlling stake. Nathan Fenno succeeded Rich as president of the NYS&W, and he ordered all passenger operations discontinued, including the cost-prohibitive OnTrack service. The railway's remaining passenger equipment was subsequently sold off, along with many older diesel locomotives.

In July 2011, NYS&W obtained ownership of five leased CEFX locomotives to aid their increasing power shortage. The five locomotives were used to supplement the railway's fleet in mainline service and occasional local freight service.

Modern Operations

As of 2026, the NYS&W operates over 400 miles (640 km) of trackage in New Jersey, New York, and Pennsylvania and services over 60 customers. With the exception of occasional bridge traffic for the Middletown and New Jersey Railroad (M&NJ), all of the annual carloads generated or destined for the NYS&W are for online customers. Commodities are diverse and include Asphalt, Construction Waste, Food Oils, Frack Sand, Plastics, Lumber Products, Aggregates, Paper Products, Sugar, and Propane.

A nocturnal, twice weekly haulage train, the SU-100, runs 250 miles from Binghamton to Ridgefield Park, New Jersey, carrying Syracuse (CSXT) and Binghamton (NS) interchange traffic destined for New Jersey customers. This train would work customers along the CNYK Division including the interchange with the Stourbridge Line at Lackawaxen, Pennsylvania. The crew would lay over in NJ and return to Binghamton the next evening as the SU-99.

As this train runs over a portion of Metro North's Port Jervis Line from Hudson Junction to Sparrow Bush, New York, these trains are required to operate with Positive Train Control. The SU-100/SU-99 also traverses the Hudson Secondary from Warwick to Hudson Junction near Campbell Hall under a trackage rights agreement with the Norfolk Southern, though the operation is currently leased to the M&NJ.

Excursion operations

Under Delaware Otsego management, the Susquehanna began to operate public excursion trains, with the first one taking place in October 1981 for the Jersey Central Chapter of the National Railway Historical Society (NRHS). In 1982, DO purchased a fleet of dome cars from the bankrupt Auto-Train Corporation and began to use them for additional excursion trains on the NYS&W's Northern Division. Passenger ridership on the trains barely broke even. Thus in 1985, the excursion services were reduced and most of the dome cars were sold to fund the rehabilitation of the NYS&W's Butler-Sparta route. There was subsequently a hiatus of excursion operations until July 1988, when the NYS&W hosted some additional trains as part of that year's NRHS Convention.

In 1989, during their temporary takeover of the D&H, the NYS&W was contracted by Steamtown National Historic Site and the Lackawanna County Rail Authority to operate their steam-powered excursion trains over the D&H between Scranton and Kingsley, Pennsylvania, while their line to Moscow was under repairs. The NYS&W subsequently decided to host their own steam excursion program, taking inspiration from similar programs hosted by Norfolk Southern and Union Pacific (UP). They originally planned to restore and operate Southern Railway 385 and United States Army 4039, both of which previously operated on the defunct Morris County Central tourist railroad. Those plans fell through after it was determined the restoration of both locomotives would be too costly.

In June 1990, the NYS&W decided to import a new steam locomotive from China, taking inspiration from the SY-class Nos. 1647 and 1658 on the Connecticut Valley (VALE) and Knox and Kane (K&K) railroads respectively. The railway contracted the Tangshan Locomotive and Rolling Stock Works to construct a modified copy of the SY class, and its boiler design was altered to abide with the American Society of Mechanical Engineers (ASME) boiler code and Federal Railroad Administration (FRA) regulations. The new locomotive, numbered SY-1698M, was planned to be numbered NYS&W No. 141. Following several months of shipping delays, the locomotive was loaded on board the Norwegian vessel Braut Team, and began its voyage to the U.S. in May 1991. The following month, on June 7, Braut Team sunk at the Bay of Bengal after its hull sprung a leak, and SY-1698M was lost.

The NYS&W subsequently explored multiple steam locomotives to acquire and replace their lost SY. In November that same year, two operable steam locomotives became available for purchase; No. 1647 by the VALE and Canadian National 6060 by the Canadian government of Alberta. The NYS&W began negotiating with both parties to purchase their locomotives, but the group that operated No. 6060 at the time protested to keep the locomotive from leaving Canada, and the Alberta government subsequently began to reconsider the locomotive's future. The Susquehanna believed the reconsideration would be a long process, so they dropped their negotiations with them, and by December 2 finalized their purchase of No. 1647 from the VALE.

Connections with other railroads

The railroad has connections with two Class I railroads:

CSX Transportation - Syracuse, New York; Utica, New York; North Bergen, New Jersey

Norfolk Southern Railway - Binghamton, New York, Marion Junction (New Jersey) and the Passaic Junction (rail yard) rail yard in Saddle Brook, New Jersey

The railroad has connections with five other railroads:

Morristown and Erie Railway and New Jersey Transit - Passaic Junction (rail yard), Saddle Brook, New Jersey

Middletown and New Jersey Railroad - Warwick, New York

Finger Lakes Railway - Syracuse, New York

Mohawk, Adirondack and Northern Railroad (MHWA) - Utica, New York

Stourbridge Railroad - Lackawaxen, Pennsylvania

Equipment