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Port, Rail Group Want Tax Dollars to Help Pay for System Upgrades by Alex Pulaski & Brent Hunsberger The Oregonian, October 12, 2004

The Port of Portland and businesses that run and use Oregon's railroads want the public to pay for significant freight-rail improvements.

Called the Oregon Rail Users League, the coalition is marshaling support for state legislation next year that would mimic a highway and bridge improvement bill passed last year. A rail spending target has not been set, but those involved are setting their sights much higher than last year's $10 million in state rail funding.

Supporters say the improvements would create jobs and allow Oregon to compete better against California and Washington for business moving freight to and from ports. The Port organized the rail league earlier this year.

The railroads are privately owned, but say they cannot afford tens of billions of dollars in track improvements needed nationwide. Some states have elected to pick up part of the tab to better link ships, trains and trucks.

For years, Oregon businesses have complained about the slowness and fair-to-poor quality of rail service. But with diesel costs and a driver shortage increasing trucking costs, they are beginning to examine rail options more closely.

Oregon's nurseries, which account for more than one-fifth of the state's $3.4 billion agricultural industry, have avoided using railroads to move plants.

"Right now there's a whole lot of delays and inefficiencies," said John Aguirre, executive director of the Oregon Association of Nurseries. "We've got a seven-day window to get product inside a container and then outside a container at the receiver. . . . It's brutal if we don't beat the clock."

Some good-sized hurdles stand in the way of the rail league, including:

• Money. The state is struggling to pay for basic services such as education. Lottery revenues, which provided rail funding in 2003, are a potential source.

• Perception. The public moves in cars, not freight trains, and may not connect with a rail bill in the way it did over highways and bridges.

• Divided interests. Many of the businesses in the league have not worked together before, and the short-line and long-haul railroads often have competing interests.

Nevertheless, Egan has been the one to organize the league and begin building legislative support. Egan was an aide to Gov. Ted Kulongoski before joining the Port this year.

Last month, Kulongoski asked the Oregon Transportation Commission to assess the state's rail, marine and aviation needs before the Legislature opens in January.

Oregon's freight rail customers have been frustrated by major railroad service for several years. In a survey of shippers done for the 2001 Oregon Rail Plan, 60 percent said the two major railroads -- Union Pacific Corp. and Burlington Northern and Santa Fe Railway Co. -- did only a "fair" job providing reliable and timely freight service. Nearly one-quarter of the shippers surveyed rated responsiveness by the two as "poor."

Tom Hammond, president of Columbia Grain Inc., joined the rail users league in hopes of attracting public money to trim delays to the 20,000 railcars that deliver grain to his North Portland terminal each year. Hammond said a delayed 110-car grain train can mean up to two dozen workers stand idle on his dock while he pays penalties to the owners of a docked ship beneath his elevator.

"I don't know if it's as important as roads," Hammond said of public investment in rail, "but it's darn important."

Last year, the Oregon Department of Transportation sponsored an Interstate 5 rail capacity study that simulated delays on the Portland-area rail system. It concluded that the area's freight network is proportionately twice as congested as Chicago, the country's rail hub.

The report also identified $170 million of capacity improvements. At the top of the list: a $55 million two-track bypass around Burlington Northern and Santa Fe Railway's rail yard in Vancouver. A bypass would allow trains to get around the yard without slowing, Port officials say.

Gus Melonas, a spokesman for Burlington Northern, which is among the league's members, said the railroad is working with Port officials to improve freight capacity. He declined to specify projects the railroad had budgeted.

Port and state officials also say Union Pacific-owned tracks around Peninsula Junction need a $35 million face-lift. Most Union Pacific and some Burlington Northern freight trains pass through the old, four-way track crossing at the junction, located in North Portland. Trains must slow to 10 mph because of poor track conditions and grades near the junction, Port officials say.

Union Pacific spokesman John Bromley said the railroad recently replaced a bridge near the junction for maintenance purposes, but otherwise had no plans to improve the crossing.

Increasingly, major metropolitan areas, including Los Angeles, Puget Sound, Reno, Nev., and Chicago, are offering millions in public money to persuade the railroads to agree to track and crossing improvements.

A report for the American Association of State Highway and Transportation Officials estimated that the nation's rail system needs $175 billion to $195 billion of improvements over the next 20 years to keep pace with economic growth. The freight railroads are capable of paying for about $142 billion, the report said, leaving as much as $53 billion for the public to foot.

"I think you're going to see more public-private partnerships," said Tom White, spokesman for the American Association of Railroads.

In California, federal, state and port officials have ponied up $2.4 billion in bonds and public grants and loans for 20 miles of freight-rail improvements around the ports of Los Angeles and Long Beach.

In Chicago, city and state officials are trying to raise nearly $1.3 billion to help finance rail-network improvements around the nation's busiest rail hub, White said.

Related Sites:
Port of Astoria
Port of Longview
Port of Vancouver, Washington