Freight Intermodal Connectors Study

Appendix. Funding Programs for Freight Intermodal Connectors

There are challenges to using existing transportation funding sources for freight intermodal connector projects. Federal transportation funding sources include programs categories such as the National Highway System (NHS) and Surface Block Grant Programs that are wide ranging and applicable to many different kinds of roadway projects, including projects not related to freight. Often, freight intermodal connector projects do not compete well with passenger-focused projects, because freight connectors tend to be local roads that are not frequently traveled by the general public. Similarly, transportation funding available at the State and local level tends to gravitate towards passenger transportation improvement projects.

The 2015 Fixing America's Surface Transportation (FAST) Act is the first of six Federal transportation funding legislations to include dedicated freight funding. The FAST Act includes a freight funding program that is allocated to States based on a specific formula. This formula funding can be used towards intermodal connectors, particularly if they are designated as a critical urban or rural freight corridor, or if the connector is already part of the Interstate Highway System.

The FAST Act also includes a discretionary freight grant program called the Fostering Advancements in Shipping and Transportation for the Long-term Achievement of National Efficiencies (FASTLANE). Under this program, the U.S. Department of Transportation (USDOT) solicits applications from the States to fund freight improvement projects that are critical freight and highway projects across the country. The FAST Act authorizes $800 million in funding for the FASTLANE program for fiscal year 2016. FASTLANE grants provide a substantial amount of funding, but for an intermodal connector to qualify for these grants, it must be considered nationally or regionally significant, and expected to contribute substantially to regional freight mobility.

Additionally, the National Multimodal Freight Network (NMFN) was established under National Multimodal Freight Policy as part of the FAST Act, which is intended to help strategically direct resources towards improving the NMFN's performance and achieve National Highway Freight Program goals. Intermodal connectors can be designated under the NMFN as strategic freight assets. Though there is no funding as part of this initiative, it will help guide investment decisions for States and private companies, and it may be used to allocate funding in future transportation legislation.

Identifying funding for improving freight intermodal connectors can be challenging. Although these connectors that are key to efficient operation of freight facilities, they are often not highly visible to public officials and decision-makers. Highlighting the needs of these connectors, generating solutions to address the needs and assembling needed funding to implement those solutions often requires the specialized knowledge and experience of freight champions (typically transportation planners).

Some intermodal connectors could receive funding via State programs that dedicate resources to freight improvement projects. However, only Texas and Florida had programs that may fall into this category. The State of Texas' Port Access Account Fund and the State of Florida's Seaport Investment Program both make funds available for port improvement projects within their respective States. In the case of Texas, however, though the program could be used to pay for improvements on port intermodal connectors the program was never funded. The State of Florida's program, on the other hand, is primarily for financing capital projects at ports.

Intermodal connector road access projects have been successfully funded through these programs and others. Table 27 summarizes projects that involved intermodal access improvements based on the 2007 FHWA Financing Freight Improvements Guidebook, including specific connector improvements made and funding sources. One takeaway from Table 27 is that successful connector improvements often leverage multiple funding sources, including private-sector funding sources. Another finding from the table is that funding for freight intermodal connector improvement projects are often part of a larger investment package.

Table 27. Examples of Successful Intermodal Connector Projects.
Project	Description	Connector Improvements	Cost and Funding Sources
Little Rock Port Authority Slackwater Harbor Improvements (Arkansas)	Railroad line extension, highway access improvements, dock construction and paved working area, warehouses, water/sewer lines, drainage, product staging area, and bank stabilization work at the Little Rock Port Authority.	Connection of Harbor Drive to Frazier Pike Road, which provided direct access between the industrial park and the harbor.	$11.8 million, split between Federal (FHWA, Corps of Engineers, and EDA), State (Department of Economic Development, Arkansas State Highway Commission), and local (City of Little Rock, Little Rock Port Authority) sources.
Stockton Airport Freight Terminal (California)	Construction of an air freight terminal at Stockton Airport, including cargo apron improvement, stream relocation, and access road shoulder improvements.	Shoulder improvements to airport access road.	$1.7 million, $1.4 million of which was provided by a Federal Aviation Administration (FAA) Airport Improvement Grant. Matching funds were provided by the State of California and the City of Stockton, as well as a small contribution from Farmington Fresh, a private company that also paid for the $6.5 million cargo terminal on land it is leasing from the county.
Chicago Area Consolidation Hub (Illinois)	Access improvements to the UPS sorting facility in Chicago, including a new rail intermodal terminal, road access work, and a grade-crossing separation.	Interchange access from I‑294 to Chicago Area Consolidation Hub, rail-highway crossing separation; and local street access improvements.	$97.6 million. The intermodal terminal was $70 million, which was 100 percent funded by BNSF. The road improvements were funded by a public-private partnership that included the State of Illinois, UPS, BNSF, and the Village of Hodgkins.
I‑55 Access to CenterPoint Intermodal Center in Joliet (Illinois)	Construction of a new interchange on I‑55 and improvements to Arsenal Road, which connects I‑55 to the BNSF logistics park.	Arsenal Road improvements.	$36 million, of which $33.3 million was provided by Illinois DOT for the new interchange; $3 million for the road improvements came from the EDA.
Kedzie Avenue Access Road/Stoplight in Chicago (Illinois)	Reconstruction of 1.5 miles of roadway, traffic signalization at a key intersection, and signal synchronization along Kedzie Avenue.	Kedzie Avenue provides access to the BNSF Corwith Yard.	$4.7 million provided by Chicago DOT ($4 million) and a Federal Congestion Mitigation and Air Quality (CMAQ) grant ($720,000).
Rochelle Intermodal Center/UP Global III (Illinois)	Providing highway and rail access to the UP Rochelle Intermodal Center.	Road access to the facility.	$9.8 million, of which $4.3 million was provided by Illinois DOT for road improvements and another $2.2 million was provided by an EDA grant for water and sewer lines and roadway improvements.
Freight Action Strategy (FAST) Corridor (Puget Sound Region, Washington)	Series of improvements to key truck and rail infrastructure in the Seattle-Tacoma area to facilitate efficient freight movement in the region.	Investment packages included several connector projects, such as Spokane Street Viaduct widening at the Port of Seattle; East Marine View Drive widening at the Port of Everett; East Marginal Way-grade separation in Seattle; and South 228^th Street-grade separation in Kent.	Funding typically is acquired from multiple sources, including public and private parties. As an example, the Spokane Street Viaduct project cost $168.5 million, split between the Federal Government, Washington State DOT, the City of Seattle, BNSF, the Port of Seattle, and the Washington Transportation Improvement Board.