nymtc regional freight plan - New York Metropolitan Transportation ...

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A Freight Plan for the NYMTC Region The region requires dedicated and predictable funding for all modes of freight transportation. The highway freight needs discussed in this plan have no dedicated funding source save for the NYS Industrial Access Program, although existing sources at the Federal and state level are often used. For example, traditional Federal funding sources such as Surface Transportation Program funds (STP) or Highway Bridge Repair and Replacement funds can be used to improve clearances for interstate standard trucks, and Interstate Highway funds can be used to increase highway capacity. To the extent that funds could be spent to expand capacity or to better manage the regional highway system, this would benefit truck freight. However, little highway expansion is foreseen for a variety of reasons, including funding constraints, community opposition, and environmental issues (the region is in non-attainment of Federal air quality standards). These constraints do not preclude capital improvements that would address traffic bottlenecks or improve road geometries and clearances. Nationally, public/private funding has been used for projects that provide connections to limited access highways but not for the highways themselves. The rail funding situation is complicated by the fact that most of the rail infrastructure used for freight in the NYMTC region is publicly owned but privately operated by either a Class 1, regional, or shortline railroads. This means that public funds must be made available and/or public/private partnerships created. The public ownership of rail freight infrastructure provide certain advantages in that the responsible agencies make capital improvements and maintain the system so as to benefit both passenger and freight transportation. Public ownership also presents certain challenges given the natural primacy accorded to maintaining the viability of the region’s massive passenger rail system. In addition to the facilities owned by state and local agencies, Amtrak owns portions of the Northeast Corridor. One section, the Hell Gate Bridge, carries almost all of the rail freight traffic that currently reaches geographic Long Island. This section requires a significant sum of money for track and deck improvements solely to keep it in a state of good repair. In addition, these improvements are necessary to support heavier rail freight cars. The large private railroads spend large sums of their own funds to maintain their existing systems and do not have the capital for large new projects. Evidence of this is the operating ratios, which in most cases exceed 70 percent of most Class 1 railroads. This leaves little capital available for large expansion projects. According to the Freight Rail Bottom Line Report commissioned by the American Association of State Highway and Transportation Officials, America’s Class 1 railroads could have difficulty providing additional capacity in the future. The report examined the capacity that would be available under several financing scenarios. Under a constrained investment scenario with railroads providing additional investment above that provided today they could accommodate additional carload traffic but could not keep pace with growing demands. 1 The report estimates that Class 1 railroad state of good repair nationwide could cost $4 billion to $5 billion annually over the next 20 years and another $3.5 billion annually for improvements beyond state of 1 Invest In America, Freight Rail Bottom Line Report, American Association of State Highway and Transportation Officials, page 3. Cambridge Systematics, Inc. 7-3
A Freight Plan for the NYMTC Region good repair. Further, shortline railroads have limited capital funding for projects that directly affect them, such as providing structures that can handle 286,000 pound per axle freight cars. See Section 2.0 for more information on the undercapitalization of railroads. New York State formerly provided rail freight funding through its Local Rail Assistance Program. This program still exists legislatively but currently is unfunded. Recently, New York State, in conjunction with the PANYNJ, provided a total of $40 million dedicated to the improvement of rail freight. This money will be used for projects related to state of good repair and system enhancement (such as TOFC clearance on the Hudson Line). However, the funding is a single application and may not be repeated, and will not result in major capacity expansion. A key component in freight is storage and distribution facilities. The need for additional warehousing and distribution facilities is normally fulfilled by the private sector based on the needs of operators of these types of facilities. Where the cost of warehousing and distribution proves too onerous for the private sector, the public sector can provide tax incentives or zoning opportunities. • 7.3 Summary of Funding Sources Many of the highway actions described in this report have straightforward funding options. Most of these actions would improve both freight and passenger transportation, and hence do not need to be justified as one or the other. The Federal Highway Administration distributes Highway Trust Fund revenue from the Federal gas tax to states on a formula basis, and states in turn distribute these funds among urban and rural areas. The Federal government will typically fund up to 80 percent of the cost of eligible projects. Future funding amounts will depend on any potential changes in the formula allocation which may emerge from the reauthorization of the TEA-21 legislation in 2004, as well as overall authorization levels. In comparison, freight rail and marine actions receive little Federal funding. There is no Federal rail freight equivalent to the Federal Transit Administration’s New Starts discretionary funding program or Federal Highway programs. The Federal short line funding source, the Federal Railroad Administration (FRA) Local Rail Freight Assistance Program, was last funded in 1995 and its authorization expired in 1994. Most rail freight operations in the United States are owned and operated by private, for-profit corporations, complicating the task of public participation in rail freight projects. The best hope for funding such projects is the development of a new dedicated Federal funding program specifically for this purpose under TEA-21 reauthorization or the Congressional earmarking of funds for specific projects under existing categories. The two major legislative initiatives currently under consideration are the Congressional initiative known as the Transportation Equity Act Legacy for Users (TEALU) and the Administration’s proposed Safe, Accountable, Flexible, and Efficient Transportation Cambridge Systematics, Inc. 7-4
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