Colorado inks deal with Union Pacific for Moffat Tunnel use, passenger rail service

The office of Colorado Gov. Jared Polis on Monday issued the following press release on the signing of a lease agreement with Union Pacific Railroad to use the state’s Moffat Tunnel at Winter Park and bolster passenger rail throughout the state, including a line that will pass through Eagle County:

Today, Governor Polis and Union Pacific Railroad President Beth Whited, celebrated the signing of a historic lease agreement for Colorado’s Moffat Tunnel, replacing the original 1926 lease. This new agreement follows the Memorandum of Understanding signed on November 1, 2024, and includes a 25-year lease, a 25 year access agreement for Mountain Passenger Rail, and finalizing the purchase and sale of the Burnham lead line which will unlock transit-oriented development potential for the Burnham Yard property. This public-private partnership assures continued freight operations through the Moffat Tunnel for 25 years with established passenger rail access from Denver through the Moffat Tunnel to Winter Park, Granby, Steamboat Springs and Craig for soon-to-be Mountain Passenger Rail Service, bringing new transportation options and economic opportunities to Colorado communities. These three agreements demonstrate a new model of collaboration that can support the state’s needs for moving goods and commerce and giving Coloradans more transportation options. 

“This agreement begins a new era of partnership between the State of Colorado and Union Pacific that will expand passenger rail into our beautiful Rocky Mountains, assure continued freight movement through the Continental Divide, and unlock access to the Burnham Yard, a very special state property with unparalleled transit-oriented development potential. Moffat Tunnel represents an important part of Colorado’s history, as well as a bright part of our future. With this work, we are showing the country a new model for pursuing passenger rail through collaboration with the railroad. I am thrilled with the three new agreements and look forward to seeing the positive benefits to our state,” said Governor Jared Polis. 

“Mountain rail Service will soon run year-round from Denver Union Station to Winter Park, to Fraser, to Granby, Steamboat Springs, Craig and Hayden, a corridor renowned for its scenery and  beauty,” continued Governor Polis.

“Union Pacific is proud of the hard work and spirit of collaboration that went into this agreement with the State of Colorado. We came together as true partners and the result is an agreement that benefits the citizens of Colorado and the businesses and people who rely upon Union Pacific to deliver the goods and material vital to today’s economy,” said Union Pacific President Beth Whited.

“It was an honor to help lead the Colorado negotiation team on this unique partnership that will benefit the state of Colorado for the next 25 years. When this daily train service begins connecting Denver to Winter Park, Granby, Steamboat Springs, and on to Craig it will undoubtedly be one of the most beautiful train rides in the country if not the world and provide a safe, affordable alternative to being stuck in traffic. I am thrilled we were able to purchase the Burnham Lead line, a short freight line easement. This purchase unlocks safe passage into the Burnham Yard property, the original rail yard of Colorado that predates statehood and one of the last undeveloped parcels in Denver. The new lease, the new access agreement, and the purchase of the Burnham lead line are a win, win and win for the state of Colorado. I want to thank the Union Pacific team for their efforts and creative problem solving that made these agreements possible,” said Lisa Kaufmann, Senior Strategic Advisor for Governor Polis. 

“Today’s agreement will offer residents and visitors throughout Colorado new opportunities and choices to get where they’re going. More passenger rail trips between the Front Range and mountain communities in Winter Park, Granby, and beyond will offer an option in addition to the drive over Berthoud Pass. The purchase of the Burnham lead line will also improve local mobility surrounding Lincoln Park in Denver, ensuring this historic neighborhood can continue to offer residents safe access to all the surrounding amenities,” said CDOT Chief of Staff Sally Chafee.

The 25-year access agreement establishes Colorado’s license for three daily roundtrips or up to 506,000 train miles annually for Mountain Passenger Rail, as the payment from Union Pacific for their use of the Moffat Tunnel for 25 years. The state plans to start a daily roundtrip year-round to Granby by 2026 and flexibility for the state to expand service in future phases to connect Denver to Winter Park Resorts, Granby, Steamboat Springs on to Craig and Hayden. Future phases will commence after a procurement process for a designated contract operator and upon needed capital improvements completed that are identified in the access agreement.  

The Moffat Tunnel has been one of the first and most successful public private partnerships in Colorado’s history, where 6 counties and private investors came together over a 100 years ago to build the Moffat Tunnel to ensure Denver as the commerce hub of the Rocky Mountain West, after Union Pacific the first transcontinental railroad bypassed Colorado and routed through Wyoming instead. For 99 years Union Pacific or their predecessors have held a lease that expired on May 1, 2025. 

The 100-year-old, 6.2-mile-long Moffat Tunnel cuts through the Continental Divide at 9,239 feet above sea level. Created to provide an important east-to-west connection from Denver to the West coast for commerce, the Moffat Tunnel helped Denver become a center of commerce and growth in the Rockies.

Demand for rail transportation in Colorado is significant. In partnership with Amtrak and Winter Park Resorts, the state made investments to lower the cost and increase the frequency of the Winter Park Ski train. During the 2024-25 ski season, Coloradans and visitors booked more than 44,000 trips on the Ski train compared to 17,500 last season – a 153% increase.