11 wednesday july 16,2008 talking freight seminar series integrating freight in project selection...

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Wednesday July 16,2008

Talking Freight Seminar Series Integrating Freight in Project Selection

Ohio Case Study Examples

Richard S. Martinko, P.E.Director

Intermodal Transportation Institute & University Transportation CenterWednesday July 16, 2008

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Ohio Circle of InfluenceOhio Circle of Influence

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Talking Freight Seminar SeriesTalking Freight Seminar Series

Ohio Freight Profile

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State of OhioState of Ohio

• 4th largest interstate network• 5th highest volume of truck traffic• 3rd highest in value of truck freight• 5.5% of all US freight (tons) is carried by Ohio’s

transport system• 13% by value of all freight traveling in the United States

has touched Ohio’s transportation system

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Ohio Economic and Travel IndicesOhio Economic and Travel Indices

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Macro Corridor UpdateMacro Corridor Update• 2004 Ohio transportation plan reviewed and confirmed

original macro corridor analysis• In addition, routes were added:– Freight Relievers– High Freight Growth Routes

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Ohio Project Selection

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TRAC Investment PolicyTRAC Investment PolicyCriteria Scoring Factors Percent

Transportation ADT; Truck ADT; V/C Ratio; Roadway Class.; Macro Corridor Completion 70%

Safety Crash rate, frequency, and severity

Econ Development Job Creation, Private Investment 30%

Local/Private Participation Non-state or federal investment in the project

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Multi-modal Impacts Projects that connect to other transportation modes

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Urban Revitalization Projects supporting reinvestment in an urban core

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Ohio Freight Projects

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Ohio TRAC-funded ProjectsOhio TRAC-funded Projects• Approximately 30 rail grade sep projects • Wilmington Bypass (air freight)• US 24 “Fort-to-Port” (truck freight)• US 30 (truck freight)• Cuyahoga River Valley Intermodal (water freight)• Also, urban and rural corridor projects• Rickenbacker Intermodal (air freight)

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Case Study: Financing Freight Intermodal InfrastructureCase Study: Financing Freight Intermodal Infrastructure

Case of:

NS Rickenbacker Global Logistics Park

Columbus, Ohio

Freight System Capacity Issues

Financing Freight Infrastructure

Who Pays For What and Does It Matter?

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The Good, the Bad, and the UglyThe Good, the Bad, and the Ugly

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Case Study: Rickenbacker Intermodal FacilityCase Study: Rickenbacker Intermodal Facility

• Sponsor: Columbus Regional Airport Authority• Norfolk Southern RR, rail-truck transfer facility• Existing NS intermodal facility is over-capacity (140,000

lifts/year)• Need for 243,000 lifts/year by 2015• Part of NS “Heartland Corridor”

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Heartland CorridorHeartland CorridorRickenbacker

Global Logistics Park

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Rickenbacker LayoutRickenbacker Layout

Intermodal Terminal

300 Acres.

Intermodal Campus

420 acres

Air Cargo Campus

350 Acres

RailCampus

460 Acres

NorthCampus

116 Acres

• Rickenbacker is NS’ first integrated logistics park

• Located 18 miles from downtown Columbus

• Over 15,000 acres of existing or planned development

• Anchored by NS’ new 300 acre intermodal facility and the Rickenbacker airport

• Integrates intermodal, carload and logistics capabilities

• Close to numerous industrial parks, several individual commercial property owners, more than 150 companies and over 35 million sf. of development.

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Site MapSite Map

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Request for Public FundsRequest for Public Funds• In 2003 Rickenbacker Port Authority applied for $49.6

million in ODOT transportation funding for intermodal facility– $10 million match from NS RR

• Cited public benefits– Air quality– Reduced highway congestion– Economic Development

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The GoodThe Good

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The Good: Public Benefits of the ProjectThe Good: Public Benefits of the Project• FIRST TEN YEARS OF OPERATION:– $660 million in transportation cost

savings to shippers. – A reduction of 49 million truck miles in

Ohio. – Significant reduction of emissions.

• OVER THE NEXT 30 YEARS OF OPERATION:– 9,500 direct jobs. – 10,900 indirect jobs. – 34 million additional square feet of

industrial-building development. – $1.2 billion of building construction. – $1.37 billion invested in machinery and

equipment. – $15.1 billion economic impact. – $800+ million in direct local, state and

school district tax revenues. – $1.26 billion of indirect tax revenues

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The BadThe Bad

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ODOT Initial Response Was A “No”ODOT Initial Response Was A “No”• Proportion of public funds (75%) for a

project with a private beneficiary (NS)• How can ODOT determine real NS

statement of “need?”• If the project cannot pay for itself, why is it

a good project?• Why should public highway funds be

diverted to one company and not to a publicly shared project?

• Transportation benefits of the project are not the primary project benefit

• If ODOT sets precedent, how does it respond fairly to other private companies seeking similar investments?

• The primary, immediate job creation appeared to be only 140 jobs

• Lack of local financial contributions

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What Is The Highest Use of Public Dollars?What Is The Highest Use of Public Dollars?

• Highway accident, congestion locations numerous

• Opportunity cost of $49 million is high

• Nearby I-70/I-71 split has 800 crashes annually, not fully funded

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Airport Authority Changed Funding RequestAirport Authority Changed Funding Request

• Scope of project request changed to more conventional transportation project

• NHS connector road• ODOT approved and programmed $8.2 million in fiscal

year 2008 (first year that capital funds were available).

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The UglyThe Ugly

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Process Of Title 23 Rail EarmarkProcess Of Title 23 Rail Earmark• Airport Authority and project

sponsors seek congressional earmark

• SAFETEA-LU earmarks for project total $30.4 million

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Key Policy QuestionsKey Policy Questions

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Key Policy Questions:Key Policy Questions:

• What are the public transportation benefits of a private project?

• Are economic development benefits a valid purpose and need for federal-aid funding?

• Is the public investment in a rail intermodal facility superior to alternative transportation investments?

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Cited transportation benefitsCited transportation benefits• Shift in traffic to rail-intermodal will reduce truck volume

from public roads– Truck VMT/congestion reduction– Reduction in road maintenance costs– Possible public safety benefit(?)

– Air quality benefit

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Rickenbacker Intermodal Transportation BenefitsRickenbacker Intermodal Transportation Benefits

• Reduction in Franklin County annual truck VMT of 912,500– Annual Franklin County truck VMT = 438,443,647– Reduction in total annual truck VMT = 0.21%

• Might an intermodal facility increase an urbanized area’s truck VMT?

• Road Maintenance Costs– Too small to measure

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Rickenbacker Benefits: Air QualityRickenbacker Benefits: Air Quality

Pollutant

Regional Emissions

(kg/day)

Rickenbacker Intermodal Emission Reduction (kg/day)

% Reduction from Rickenbacker

Intermodal

VOC 40,649 0.85 0.0021 %

NOx 50,412 33.75 0.0669 %

PM2.5 (Fine Particles) 2,132 0.69 0.032 %

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The Ugly IssuesThe Ugly Issues• Rail and intermodal earmarks in Title 23 don’t fit very

well• Air quality benefits minimal• Reduced VMT open to debate• Little data to make investment tradeoffs• Not in Long Range Plan or Transportation Improvement

Plan• Contracting, maintenance difficult

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Need For A New Federal ApproachNeed For A New Federal Approach

• Have federal language acknowledging intermodalism is a goal and benefit in its own right

• Create program like Sec. 646 (Recordkeeping, investigation, and enforcement) which acknowledges RR contracting realities such as labor force account agreements

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New RR approach: Give the public answersNew RR approach: Give the public answers

• Provide data to make sensible investment tradeoffs• Own up to the need to participate in short and long-

range planning process with DOT and MPO• Acknowledge public contracting constraints and

oversight

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New approach: Encourage the followingNew approach: Encourage the following

• More private beneficiaries the better• Encourage public use or benefit, such as grade separation or

reduced network delay• Develop through the metropolitan planning process (e.g.,

ensures local consensus)• Percentage of local public funding (e.g., reflects broader spread

of risk)• Degree of identifiable public benefits• Level of private sector investment (e.g., reflects broader spread

of risk)

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Into The Sunset Of The Of The Intermodal Frontier…Into The Sunset Of The Of The Intermodal Frontier…

• Few regulations fit this new frontier

• A flexible sheriff needs to bring law and order

• RRs', states and FHWA must bend

• Regulations must reflect the wild life of the new frontier

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Talking Freight Seminar Series Integrating Freight in Project Selection

Ohio Case Study Examples

Richard S. Martinko, P.E.Director

Intermodal Transportation Institute & University Transportation CenterWednesday July 16, 2008

11 wednesday july 16,2008 talking freight seminar series integrating freight in project selection...

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