Built by the Lima Locomotive Works, Lima, OH. Built November 1929, Builders NR. 3345. Class C-60-3, shop NR 500. Weight 67 tons, 36" gauge, wheel diameter 32", cylinders 11" x 12". Tractive force 25,380. The LAST narrow gauge Shay -- built for New Mexico Lumber Company, Dolores (McPhee), Co. as their Number 7 at a cost of $23,025.00 FOB Lima.

Only 8 SHAYS were newer than Shay 7 so it was equipped with most of the modern appliances -- cast engine girder, girder frame, all weather cab, superheat, 17:43 or 1.253:1 special heat treated gears, and a pilot  snow plow/flanger.  NMLCO did choose the cheaper slide valve version over the piston valve, otherwise making it almost a narrow gauge Pacific Coast Shay. New Mexico also ordered the cheaper tapered "shotgun" stack, although the Lima builder's photo shows  it equipped with a Radley & Hunter stack. Sometime unknown time later, it was equipped with the current Ruston stack. Shipped by Lima on November 21, 1929, waybilled via Montrose, CO. Held at Pueblo, Co. on orders of Lima, pending receipt of the cash or an acceptable sales order. Hofius Steel and Equipment, Co, Lima's West Coast Dealer then purchased the sales order, transferred funds to Lima's account, and released the locomotive for shipment on December 24, 1929. Erected at Alamosa, less drive shafts and towed by D&RGW (Denver & Rio Grande Western) and RGS (Rio Grande Southern) to Dolores and McPhee on January 2, 1930, just ahead of a major snowstorm. First placed in service January 3, 1930. Accepted by Lima's Traveling Service Engineer C. C. , Ring on January 10, 1930.  The SHAY proved to be too heavy for New Mexico's light logging rails breaking many old ties and rails on a run to Little Beaver Tank, bringing back a "big train of logs", so it probably only made one trip to the woods.  It is believed Shay 7 then switched the McPhee yard and ran into Dolores for interchange.  NMLCO company  and it's parent McPhee & McGinty Co. fell upon hard times during the depression after losing  a very large pulpwood contract and Lima repossessed the locomotive upon default of the purchase note.  For a time, RGS was negotiating to lease or purchase the Shay, intending it for use as a pusher on livestock trains between Placerville and Ridgeway. They offered NMLCO a quantity of spare parts for their locomotives in exchange, but neither company had the hard cash to pay the defaulted loan. Shay 7 was shipped March 26, 1931, again during a snowy day. The Colorado Railroad museum has a copy of the RGS  report for train 375 that day, showing a 25 minute delay at Dolores, getting air on SHAY of New Mexico Company, and finished their run with Engine Nr 22 (4-6-0), the Shay, 1 load, 2 empties and 2 coaches.   After towing to Alamosa, standard gauge freight trucks were put in place for the move  to Hofius Steel and Equipment Co.  in Seattle, WA. On July 7, 1937 a representative of Oregon Lumber Company inquired of Mr. Ted Satra, Hofius' agent, if he had a 36" gauge Shay available. Mr. Satra was then able to sell this locomotive for the second time, once as new, and once as a used locomotive. Oregon Lumber used Shay 7 (actually Oregon Lumber rostered it as  Nr. 107 - but it was never lettered as such) for 10 years in logging operations, then in 1947 it was used  by the scrapper to remove the main line of the Sumpter Valley R.R. It then stood idle outside the Baker, OR shops - unconfirmed reports have Nr. 7 occasionally steamed up for a few days switching carloads of finished lumber in the dual gauge yard. In 1961 when Elliott Donnelley purchased the locomotive from the Edward M. Hines Lumber firm, who had taken over the Oregon Lumber Company assets. The engine was sent to the Black Hills Central tourist line at Hill City, SD. The engine operated on a dual gage (36"/standard) line for a short time, then was stored derelict until  it was moved to Hesston, arriving on July 8, 1970. An  test run on January 1, 1971 dictated need for a major overhaul, requiring the next 5 years. 

It was rededicated in honor of Mr. Donnelley  on August 30, 1975. A feature article in TRAINS magazine for July 1977  details the restoration.

Shay 7 was damaged in an engine house fire May 26, 1985, and is slowly undergoing restoration toward operational status with a goal of Labor Day 2006 operation and re-dedication.

Information above is a compilation of data obtained by Society members Ed Rysz, Robert Aronson during the 1970-75 restoration, the books SHAY --Titan of the Timber and Steam and Thunder by Michael Koch,   and a more recent book THE RIO GRANDE SOUTHERN (Vol. 7) Dolores  to McPhee, by Sundance Publications, Denver Colorado (1998). (Also, additional notes from e-mail correspondence with W. George Cook, one of the RGS series authors).