Goals, Measures, Commitments, and Results for Commerce, the Environment, and the Community

Michael Sussman, PresidentOnTrackAmerica and Strategic Rail Finance

A New Vision for State Rail “Transportation Action Plans”

AASHTO, Standing Committee on Rail Transportation, 2014, Denver, Co.

Rail Line Abandonment 2005-2013

2005 2006 2007 2008 2009 2010 2011 2012 20130

100

200

300

400

500

600

700

546

370

614575

375

289324

177

118

Number of MilesTotal since 2005 =

3,390 miles

Ford Supply Chain (Inbound Freight)

“Inbound Freight” is production material shipped into Ford Manufacturing Plants

Approximately 58% of total inbound freight is shipped via Truck, 22% Rail, 20% Water

Steel is Moving by Truck

It’s not just consumer goods that are moving by truck

Here is how the largest steel company in the world spends its transportation budget

ArcelorMittal ships more outbound steel by truck 55% than by rail 43%

Planned State Freight Modal Share (Million Tons)

2011 2030 Increase

Washington

Truck 335.5 602.7 +267.1

Rail 127.0 220.0 +93.0

Florida

Truck 677.6 949.5 +271.9

Rail 58.0 77.6 +19.6

South Dakota

Truck 382.0 558.0 +176.0

Rail 131.0 167.0 +36.0

Pennsylvania

Truck Planning a 74% tonnage increase by 2040

Rail Planning a 45% tonnage increase by 2040

The world’s largest automated and refrigerated facilityYork County, PABuilt without rail service; requested later (too late)

Convenient to I-83, Not to a Railroad:

Bumper to Bumper Truck Traffic on I-83

ToysRUs warehouse built on Morristown & Erie Railroad, NJ in 1996

Typical State Rail Plan Elements

Inventory of existing system

History of railroads in the state

General description of freight flows in/out of state

Freight trends projected to 2040 based on 3rd-party data

Higher truck growth projected than rail

Project wish list… adds up to much more than anyone can afford

Short description of existing funding sources

This is a good foundation for the next step…Transportation Action Planning

Transportation Action Planning Process Elements 1-5:

Involves all stakeholders in the entire process from inception to implementation.

Advances stakeholder collaboration beyond outdated “anti”-trust limitations, and toward the level of trust now needed to address critical infrastructure issues.

Requires stakeholder participants to commit to a specific set of participation requirements to ensure a productive planning process.

Does not proceed until participants have identified the specific opportunities to be advanced for that region’s commerce.

Establishes a new set of “Freight Transportation Land Use Strategies” for the state.

Transportation Action Planning Process Elements 6-9:

Includes the creation of an “action plan”, complete with targets, dates, action steps, and responsible parties.

Converts plans into results by asking stakeholder representatives to commit their entities to take the plans’ action steps.

Considers diverse interests as the building blocks of wise plans, not an impediment to agreement.

Utilizes a facilitation team to guide discussions, lead participants thru negotiations, stimulate idea refinement, and synthesize and digest participant input for maximum efficiency of the whole process.

Pinpointing Commercial Opportunities within a Transportation Action Plan

Identify current freight movement by shipper and lane through granular analysis

Distinguish through-traffic from in-state origination and destination

Identify opportunities to support specific new economic development initiatives

Identify existing and potential shippers’ needs to economically reach a greater marketplace

10 Steps of a Transportation Action Plan

Get Seated

Assess

Measure

Target

Strategize

Plan

Commit

Enact

Capitalize

Act

Sample Action Plan Metrics p.1

Example Metrics for Commerce Total costs to ship ($/ton/mile) Service reliability Direct rail, truck, and water service Economical, equitable access to

maximum market geography

Example Metrics for Land Use Footprint per tonnage shipped Impact on transportation system

congestion Industrial and commercial

concentration/sprawl

Sample Action Plan Metrics p. 2

Example Metrics for the Environment

Air emissions per ton-mile

Water quality impact

Example Metrics for Communities

Jobs and economic revitalization

Noise, vibration, and light pollution

Public safety

Public tax burden per ton-mile by mode

STATE OR AGENCY

NUMBER OF LOANS

DOLLARS LENT DEFAULTS

Wisconsin 2013

105 $117,000,000 0

Illinois 2013

5 $6,434,157 0

Michigan 2012 37 $15,300,000 0

Idaho 2013

3 $3,770,475 0

Iowa 2011

108 $69,761,000 0

Minnesota 2013

225 $95,700,000 0

Kansas 2013

46 $16,903,380 0

Mississippi 2007

35 $12,000,000 0

Ohio 2013

40 $33,464,731 1

Montana 2013 4 $2,078,004 0

SBA 2013

34 $14,400,000 1

TOTALS (as of year indicated) 650 $380,337,988 2

Data gathered By Strategic Rail Finance

State Rail Loan Program Repayment History

Thank you for all of your good work!

Michael Sussman, PresidentLeo Penne, OTNA Board MemberOnTrackNorthAmericaPhiladelphia, PAmsussman@ontracknorthamerica.org

SCORT 2014 Annual MeetingDenver, Colorado

Questions I would like to ask you!

What entity in your state could be enlisted to enact freight transportation land use strategies?

What legal and regulatory barriers need to be addressed to allow increased coordination between your agency and the private sector?

What has to happen for road, rail, and water to be valued and supported objectively and apolitically?

What challenges do you face in enrolling the state in getting behind rail as a conscious modal choice?