Colorado will be able to run a passenger rail service between Denver and Craig for the next 25 years without paying a fee for use of the tracks under a newly agreed upon deal between the state and Union Pacific.

The negotiations come as a 99-year lease for the Moffat Tunnel between the state and a predecessor of Union Pacific is set to expire in January. 

The Moffat Tunnel, which connects Gilpin and Grand counties, is the only functioning rail tunnel through the Continental Divide in Colorado. The state owns the tunnel, but Union Pacific pays rent to run its tracks through it. Under the 1926 contract, the company pays $12,000 per year for use of the tunnel.

Now, instead of paying rent, Union Pacific will allow the state to use its tracks for free for the mountain passenger rail project. In other negotiations, Union Pacific would have charged a fee for that access.

The framework announced Monday says the state can use Union Pacific’s tracks for up to three round trips per day. The number of trips allowed per day does not include already-existing routes, like the Amtrak Winter Park Express and the Amtrak California Zephyr.

“We need alternatives to I-70 and the high mountain passes, and Moffat Tunnel and Union Pacific’s line provides that whether you’re traveling with kids or freight,” said John Putnam, the governor’s chief negotiator for Moffat Tunnel.

The state could negotiate for additional round trips outside of the Moffat Tunnel contract. 

At 9,200 feet, the 6.3 mile-long Moffat Tunnel is the highest railroad tunnel in the United States and the highest point on Amtrak’s national network.

The next step for the mountain passenger rail project is a service development plan, which is underway and set to be completed by the end of January. 

The current Moffat Tunnel contract will be extended for four months while the details of the agreed-upon framework are determined. The new contract will begin in May.