It leased a line from Woodburn to Stayton from the Southern Pacific Transportation Company in February 1993, as well as a branch from Geer west to Salem (partly abandoned in 1995[1]),[2] and purchased the property in 1996.

[4][5] Willamette Valley Railway began in 1980, when Mike and David Root were in search of a shortline railroad to operate.

The railroad rostered a single Alco S-1 locomotive and began hauling lumber from the sawmills in Grande Ronde and Fort Hill to its connection with the Southern Pacific in Willamina.

Hampton chose to contract with Willamette & Pacific Railroad, who now operated the line into Willamina, which ran trains into Fort Hill on an as-needed basis.

One of the SW-1200 locomotives was repainted into a scheme reminiscent of Southern Pacific's Shasta Daylight passenger train and lettered "Willamette Valley".

In 1998, the Albany and Eastern Railroad leased the Sweet Home Branch from the Burlington Northern and Santa Fe Railway (BNSF).

Since the 1930s BNSF and its predecessors used trackage rights between Lebanon and Albany, and was a steam powered branch off of the otherwise electrified Oregon Electric Railway.