OTC Approves $51 Million in Funding for Intermodal Reload Facilities

The Oregon Transportation Commission (OTC) approved two intermodal reload facilities at their July 18 meeting in Salem. The Treasure Valley proposed site in Nyssa was quickly approved for 26 million in grant funding after the consulting firm, Tiago Group, gave it high marks for meeting their requests for additional information.

As described by Erik Havig (ODOT Planning) a three-step guideline was recommended that the commission use in approving the projects. The steps included a commitment from rail, shipping viability, an overall state benefit to transportation and a worthiness for a multimillion-dollar state investment,

The Brooks proposal at Nyssa was unanimously denied by the OTC citing a lack of rail commitment from BNSF along with zoning questions since the site is located on land zoned exclusively for “farm use.”

The commissioners voiced concerns that Millersburg would have to undercut trucking with rail rates. Currently, in Portland, the ocean carriers subsidize the intermodal reload facilities so they can compete with trucking, but there is no indication that anyone is interested in subsidizing Millersburg which could lead to an adverse rate war with the trucking industry. The Millersburg site also met some objections by Vice Chair Robert Van Brocklin who initially said he would oppose the proposal due the need for more information regarding the rail commitment. Union Pacific (UP) had written a letter indicated they would provide rail service but was unable to give rates. In contrast, UP had reached estimated rate agreements for Treasure Valley since their proposal had an economic component in providing new rail cars which would save UP money in the long run. It also provided an economic aspect of a cold storage facility that would benefit agricultural industry and onions being shipped from Nyssa into the Midwest.

Commissioner Martin Callery pointed out that the railroads will not normally give rates unless they have an awarded contract. Chair Tammy Baney recommended the commission not delay in deciding on Millersburg. There was added discussion that by allowing Millersburg more time, it would be an unfair advantage over Brooks which was denied without an additional time allotment.

As recommended by the Oregon Department of Justice, the final motion for approval for 25 million in grant funding for Millersburg had conditions applied to it that required the project have an ODOT agreement, project schedule and estimates, and that a progress report on rate agreements with UP be provided to the commission at the September OTC meeting. The motion was approved unanimously.

Watch the live stream of the OTC meeting here>>> https://www.youtube.com/user/OregonDOT/live