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Federal Funds for Freight/Intermodal Projects: How Successfully Have They Been Used?

Federal funding can be an important component for freight and intermodal infrastructure projects. How successfully has federal spending been used for freight and intermodal projects throughout the U.S. in recent times, including those funded through America’s INFRA, FAST and TIGER programs, among others?

Intermodal Insights reached out to a number of experts for their viewpoints, including Elaine Nessle, executive director of the Coalition for America’s Gateways and Trade Corridors. CAGT is dedicated to the expansion and modernization of America’s freight and goods movement infrastructure.

Nessle said that traditionally, a relatively small amount of federal funding is available for non-highway projects. In fact, only about 10% of funds through the Fixing America’s Surface Transportation Act’s discretionary grant program, INFRA, is available for non-highway projects, she noted.

"This cap limits much-needed flexibility for states and local governments to invest in their most pressing freight needs, regardless of mode."

Port of Long Beach Deputy Executive Director Noel Hacegaba said projects that not only score well under the evaluation criteria, but also have broad-based support from elected officials, the business community, organized labor and other partners, are viewed more favorably at the federal level and thus are more likely to be funded, or to receive a larger amount of funding. Projects that create jobs, have obvious transportation and economic benefits and don’t require a large federal commitment also are favored, he said.

Jeff Brashares, director, Domestic Intermodal Sourcing and Operations at CMA CGM America, disagrees with the contention that intermodal is overlooked when it comes to freight projects.

"For my money, intermodal is more often looked at as the business continues to expand," said Brashares. "In Chicago for example, UP Global 3 (intermodal terminal) is now closed and being used as a yard; the Global 2 terminal is under expansion; and at Global 4, expansion has already taken place."

"This year in L.A., all ramps are constrained for (the) Fall peak due to the influx of (make up) retail after the Spring shutdown," he continued. "L.A. space is difficult to come by."

Federal Investments

Bolstering the argument that the federal government has not neglected intermodal is that in September, the U.S. Department of Transportation released a National Freight Strategic Plan that identifies a vision and strategic goals for America’s freight system.

The plan highlights the importance of intermodal freight to the nation’s prosperity in addition to the importance of every mode of transportation to ensuring freight-system efficiency.

There has also been increased emphasis on intermodal freight – particularly in connecting major seaports to the rest of the network via rail and highway connections – as states have developed their state freight plans over the last several years, the USDOT contends. Among those state agencies is the California Department of Transportation, or Caltrans.

In a statement, the agency told Intermodal Insights that California has been continuously implementing a proactive freight-funding posture since the passage of Proposition 1B in 2006. This includes the Trade Corridors Improvement Fund, which provided $2 billion in voter-approved bond funding for infrastructure improvements along federally designated "Trade Corridors of National Significance" in California or along other corridors in the state with high freight movement volumes.

In 2017, California enacted the Road Repair and Accountability Act, also known as Senate Bill 1, which annually provides $250 million in freight funding through the state’s ongoing Trade Corridors Enhancement Program. The freight funding provides continuous opportunities for freight planning and lining up matching funds, including federal funds, as available and appropriate.

"We look at federal funding as being an ongoing opportunity for a successful partnership. Having long-term freight planning and funding enables the state to efficiently assign federal funding where it makes the most sense," Caltrans said in a statement.

State Projects

Among examples of big state projects in California benefiting intermodal that have been successfully funded and completed with the aid of federal funding are:

  • The Freight Intelligent Transportation System. This $30 million TCEP Port of Oakland under-construction project is focused on traffic management and operations of arterial roadways in the port environment. Improvements are centered on an enhanced Traffic Management Center/Emergency Operations Center at the port that observes, monitors and manages traffic and incidents on port facilities. It includes about $10 million in federal funds.
  • The Piers G and J Double Track in Long Beach. This under-construction $25 million TCEP project at the Port of Long Beach aims to improve rail operational efficiency and increase throughput capacity of the Pier J on-dock rail yard. The project enables a full unit train to land at Pier J without blocking at-grade crossings or adjacent terminals. The new departure track would reduce roadway congestion on regional highways and local streets, facilitate increased utilization of on-dock rail, plus reduce truck traffic between the ports and rail yards. It includes $14 million in federal funding.

Another state that has been successful in leveraging federal funding for intermodal projects is Florida, which historically has been apportioned about $60 million per year in National Highway Freight Program funds. NHFP has provided $492 million for 59 projects between 2016 and 2024, according to the Florida Department of Transportation.

Florida also received $459.6 million in discretionary federal funds for 33 projects through Better Utilizing Investments to Leverage Development Transportation Discretionary Grants; the Infrastructure for Rebuilding America Discretionary Grant Program; Advanced Transportation and Congestion Management Technologies Deployment; and Consolidated Rail Infrastructure and Safety Improvements programs over the last decade.

Example projects that have been completed include:

  • Intermodal Container Transfer Facility at JAXPORT. Completed in 2014, the $45 million ICTF is used by CSX Transportation and includes a five-track rail yard, two wide-span electric cranes, and a paved area for stacking containers. In addition, the facility provides several support uses, including a road for truck movement of cargo. The project received a $10 million TIGER grant and serves existing and future port customers, including the TraPac container terminal.
  • Berth, channel and intermodal cargo yard improvements at Port Manatee. Begun in 2010, the port constructed a $32 million container terminal adjacent to the existing 1,000-foot berth, 20 acres of which were paid for with TIGER II funds. The yard expands Port Manatee’s cargo storage capacity, both for the Marine Highway operation and for other tenants, including CSX.
"Despite the multitude of benefits offered by intermodal, including improvements to highway passenger and freight movement, intermodal is often overlooked due to the relatively small amount of federal funding available for non-highway projects."
Elaine Nessle
Coalition for America's Gateways and Trade Corridors

Other projects that are currently planned or programmed in Florida include $19.5 million in cargo yard improvements at PortMiami, which began in 2019, and $55 million new cranes, berths and channel-deepening project at Port Tampa Bay.

The USDOT has also highlighted other state projects awarded funding this fall:

  • Modernization of PhilaPort’s Packer Avenue Marine Terminal, to improve berthing and capacity for future intermodal containers. The project is part of the port’s overarching $300 million development plan, which includes a deepening of the Delaware River main channel and a new containerized auto shipping facility, which opened in December 2019.
  • The Linking Intermodal Needs and Rural Freight Knowledge Project in Portland, Maine, which in October was awarded a $4 million grant to fund the modernization of gates and scales, improvements to existing warehouses, and rail improvements at a bulk transfer facility to improve the intermodal efficiency of the port.
  • The Missouri River Terminal Intermodal Facility in Kansas City, Missouri, which has been awarded $9.8 million for a project to provide regional access to the marine river network, rail, and highway transportation network. The project includes advanced project planning and redevelopment activities of the MRT site, including rail access development.
  • The Howard Street Tunnel Project, sponsored by the Maryland Department of Transportation, which was awarded INFRA funds in 2019. The project will allow double-stacked trains to move from the Port of Baltimore up and down the East Coast once it’s completed.

CAGTC’s Nessle also mentioned the nationally significant Chicago Region Environmental and Transportation Efficiency Program, which includes 70 projects aimed at improving freight throughput and passenger mobility in Chicago. The largest rail hub in North America, the Chicago Terminal, handles a quarter of the nation’s freight rail traffic and half of all intermodal trains. In 2018, CREATE’s 75th Street Corridor Improvement Project received $132 million through the INFRA competitive grant program.

Funding Process

Nessle, however, added that CAGTC has documented over 70 significant freight projects across the country deserving of federal contributions in the latest edition of its "Freight Can’t Wait" booklet, published in 2019.

The lack of transparency in the federal competitive grant selection process has been a concern shared by lawmakers, applicants, and oversight entities, she said, citing a 2019 Government Accountability Office report stating that in the USDOT’s fiscal year 2017-2018 combined award round, the DOT failed to provide insight into why projects were selected for awards.

"Improving the selection transparency will go far in improving the quality of applications and earning trust in the program and federal awards process," she said.

"While the Department of Transportation establishes criteria for its discretionary grants, there is a lot of subjectivity in the process since grant programs tend to have significantly more applicants than available funds," Hacegaba added. "Additionally, Congress has imposed quotas on the number of grants that states can receive … and has mandated that a certain percentage of funds go to rural areas. As a result, large states like California that are a major gateway for goods movement are often disadvantaged in terms of discretionary grants."

He suggested that there are various reforms that may benefit freight and intermodal funding.

"First, more funds should be suballocated to cities," he said.

"Additionally, there should be more funding that goes into discretionary grants that fund freight and intermodal projects. This includes creating a Projects of National and Regional Significance grant program."

"Finally," he added, "Congress should consider restoring Congressionally directed spending, since members of Congress best understand their community’s needs."

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