Intro to SSCC and its Implications for Wood Products Transportation by Rail

Almost nothing about the Coalition is business

as usualWe must invent new political and commercial relationships and new

institutional frameworks

Southwest Supply Chain CoalitionFundamentals

11/29/2021 3

Regional, corridor, and whole supply chain plans drive down negative impacts and public costs.

Collaborative practices that transcend competition will amplify the benefits for all.

Supply chains, economies, and the environment do not beginor end at state lines.

The public sector can advance coherent plans that attractprivate-sector infrastructure investment.

Nevada Governor Steve Sisolak

Nevada Governor’s Office of Economic Development

2021 Nevada State Rail Plan

OnTrackNorthAmerica

Strategic Rail Finance

Who is behind the Coalition?

What present challenges does the Coalition address?

Climate-related challenges

CO2 emissions must be reduced

Eighteen, billion-dollar weather events to date in 2021, totaling $104B damage

Climate change cannot be addressed without more efficient supply chains.

Land use challenges

Only one out of 188 warehouses in Nevada use rail.

World Logistics Center in Moreno Valley, California, 41 million sq. ft. to be built, 2625 acres—All truck served

CapRock Development, Phoenix, Arizona, 3.4 million sq. ft.—All truck served

Tourists do not visit the Southwest to sit in traffic on interstate highways!

Land is a limited resource. We can no longer squander it with random land transactions.

The community impacts of industrial development areas much about what moves to and from a property aswhat happens at a property.

Supply chain challenges

Subsidization and ubiquity of road infrastructure

Class I business model marginalizes local rail opportunities

Lack of rail education and support for land developers and shippers

Limited knowledge of rail development among economic developers

Shippers and developers turn to roads and trucks by default

Proximity to West coast market and ports exacts a burden that detracts from the benefitas supply chains move through the Southwest as much as they serve the Southwest.

Coordination challenges• Existing forums and methods are inadequate for large scale, multistakeholder problem-

solving

• Well-known problems are met with commentary, opinions, and complaints

• The public sector through its courts, agencies, and regulatory bodies is not designed for

problem-solving

• The private sector through its businesses and associations is siloed and steeped in

competition

• The public and private sectors are not experienced at working well together

• The public sector, advised by consultants, produce transportation plans that are not

commercially-relevant and not actionable

This must change to address the systemic regional issues we now face.

What new understandings about supply

chains are at the heart of the SSCC?

Supply chains do not end at city, county, or state lines.

Supply chain plans should be conceived around entire regional industrial sectors, not just individual companies.

Advancing projects within the context of whole supply chains is more productive and attractive to businesses, investors, and communities.

The supply chain sectors identified for the Coalition include:

MiningAgricultureChemicals

Wood Products

Food & beverageBuilding materials

ManufacturingScrap & recycling

How can we balance modes for greatest efficiency?

Societal investment in the U.S. highway

system has over-stimulated the trucking

industry.

It is unproductive to pit highway, air, pipeline,

and railway transport modes against each

other, either in public policy or the

marketplace.

Integration and coordination for maximum

efficiency must now guide infrastructure

planning and investment.

Coordination between modes, rather than competition

What are the benefits of optimizing the use of railroads?

Move freight on ½ to ¼ the diesel fuel and consequent emissions

A 1-mile train moves through a community in four minutes while the same

goods requires a tractor trailer every 30 seconds for one and a half hours

The goods on a 1-mile train requires a convoy of trucks 27 miles long

One tractor trailer does as much road damage as 5-9,000 passenger cars

Highways-$6MM/mile, resurface every 10-15 years

Railroads -$1.8MM/mile, last for 50 years, and are recyclable

How is collaboration more productive than competition?

• Build regional productivity by solving each other’s logistics problems, rather than competing for individual wins

• Build in each state what should be in that state, not what should logically be in another state• States, counties, towns, and businesses can advance the whole system, not simply invest in a

disparate set of competing projects• Aggregate individual business needs and opportunities into collaborative infrastructure plans• Public and private-sector information and asset sharing

Business Information and PlansFreight DataSupply Chain DataSharing Infrastructure

360-degree inclusion of businesses, communities, and projects makes infrastructure development easier, not harder.

What are some specific opportunities for the Coalition to advance?

• Convert Midwest ag and food shipments to California from truck to rail• Support removal of lower value biomass from western forests via rail transportation, solving a• national matter economically• Improve construction aggregates distribution in the region via rail• Implement the Mining Materials Supply Chain Logistics Strategy• Initiate the Reinventing Container Logistics IntelliConference• Current and former military base rail-enabled redevelopment: Hawthorne in Nevada, Castle in

California, and Camp Navajo in Arizona• Redeploy existing assets, including rail sidings, spur lines, rail yards, brownfield sites

What projects would you add to this list?

What will it take to for rail to serve the country’s unmet needs?

We must embrace a new principle in commerce, business, and governance:

Collaboration

Not just any collaboration—collaboration for the sustainable well-being of allThis is the foundation of whole-systems thinking and investment

And the only way out of our mess.

Almost everything in society goes better with collaboration.

What will it take to engage railroads in transporting wood products in the West?

Union Pacific Railroad and BNSF Railway re-committing to local rail development

Local, state, regional, and federal governments working in concert

Public sector engaging with private sector with trust and transparency

Recognition of the surging citizen concern for the environment

What is the best approach to establishing rail service?

Do not assume nearby rail is accessible

Develop a well-informed infrastructure and operating plan

Utilize existing assets as much as possible, especially at the outset

Give railroad staff the opportunity to express all their reservations

Carry the flag of the possible, not how things are now

How will the SSCC and its plans and projects be funded?

Private capital is available for all well-conceived projects

and plans … this private investment will fund needed

infrastructure when presented with compelling regional,

corridor, and systemic investment opportunities

Attract more federal infrastructure dollars by addressing

climate change

Existing businesses will invest in infrastructure that meets

logistics shortcomings and expands market reach

Create economic development synergies by moving up the

value chain, a process called Beneficiation

The Coalition will house rail development expertise and will

provide project funding support for local jurisdictions and

private-sector entities

What would you like to express about all of this?

What other questions come to mind?

Contact: Will Maus, wmaus@ontracknorthamerica.org, 215-564-3004