It’s all about the trains. Again.
Much of the Northwest's discussion of proposals to export coal to China has focused on the potential problems from transporting coal across the region by rail to proposed shipping facilties near Bellingham, Longview and in Oregon. And the trains are the big issue in the latest of a spate of reports on the potential impact of the region’s largest coal-export terminal, proposed at Cherry Point north of Bellingham by SSA Marine, the Seattle-based international terminal operator.
Gateway Pacific Terminal’s jobs and spending would benefit Whatcom County, which includes Bellingham, rather than the central Puget Sound area, a consulting firm told the Puget Sound Regional Council (PSRC) last week, the first of several conclusions in a $105,000 study commissioned in March 2013.
The report by PFM Group, based in Philadelphia, consolidates several previous studies but also adds a concentration on the populous Central Sound region for the PSRC. The regional council is made up of elected leaders from governments in King, Pierce, Snohomish and Kitsap counties,
The operative phrase in the 235-page document is, “it depends.”
Primarily, it depends on how the region’s major railroad, BNSF, responds to the challenge of adding 18 coal trains a day to a rail system that is already heavily burdened in key spots and expecting added growth — even without coal — including from crude oil out of North Dakota, like that carried by a train that derailed in Seattle on Thursday.
“The degree to which additional train volume will affect rail freight capacity depends on both the precise routing of the trains and BNSF’s efforts to increase capacity to meet increased demand,” the report notes, spelling out ways the rail system could work for better — or worse — in the region.
If BNSF lives up to promises that it can handle the challenge, that would benefit the area’s ports and attract more business, as SSA Marine and the Port of Seattle believe. Of particular interest is triple-tracking or additional sidings at the Port of Seattle.
The PFM Group quotes from a 2012 promise to then-Gov. Chris Gregoire from BNSF Chairman Matt Rose, “I want to assure you that BNSF will ensure that we have adequate capacity to handle current and future freight and passenger volumes.” BNSF maintains that posture.
The report by PFM adds a caveat, however: “BNSF may meet the projected increase in demand for additional rail capacity as long as it is profitable for them to do so." The report added, "In February 2014, BNSF announced planned capital investments of $5 billion nationally during the calendar year — approximately a $1 billion increase over 2013 capital expenditures. More than $900 million of the $5 billion capital plan is for expansion and maintenance in the Northern Corridor — stretching from Chicago to the Pacific Northwest.”
The downside — if BNSF is unable to adequately increase capacity — could hurt regional businesses that ship by rail. The report warns, “With constrained capacity, BNSF might focus on the most profitable cargo, potentially affecting shippers of other cargo in ways that are unknown at this time. Smaller customers could find it harder to transport goods by rail and gain access to the region’s ports. The region’s ports could experience changes in commodities and freight volume depending upon the relative profitability of each type of goods.”
For the PRSC, deeply involved in mass-transit issues, there was a warning that increased coal traffic could raise the costs of using of BNSF lines for regional Sounder commuter trains and long-distance Amtrak travel. Or it might lead to complete elimination of passenger rail services or slower times.
The consultants put a price tag on delays at rail crossings as the coal trains pass: a total economic impact for the four-county region, ranging from $3.2 million to $3.8 million annually. Waiting times due to traffic for the GPT project would be increased from 41 percent to 147 percent, depending on location.
A great deal of the “it depends” factor relates to how BNSF will route the 150-car coal trains. Using Stevens Pass to send empty trains back to the Powder River Basin coal fields would lessen the impact on the Seattle region, but the Pass is heavily used at present. Some empty trains are already routed through Stampede Pass, to lessen train traffic in the Columbia Gorge.
The study is limited to the impact of the Gateway Pacific Terminal at Cherry Point, but the consultants warn that impacts could be much heavier if other Northwest terminals are built or expanded. “If all of these projects were approved and went forward to full build out, there could be more than 110 million additional metric tons of freight — mostly coal — to be transported on rail lines in or serving the Puget Sound region: this is the equivalent of nearly double the total volume of rail freight currently traveling through Washington.”
The study sees coal as playing the major role in future growth of exports, well above grain and containers. That depends, of course, on approval of one or more of the new export terminals. The report notes but does not predict the growth of crude-oil shipments from North Dakota; growth may depend upon how effective Northwest political leaders are in demanding safer tanker cars.
The PSRC is heavily involved in trade and development; but members also have a keen interest in how added rail traffic might affect the lives and economics of individuals (voters) in the region. In this area, “it depends” is less a matter of good vs. bad impacts; impacts are primarily negative, depending on how to mitigate the inevitable increase in rail traffic.
The economic impact of added train traffic would be most heavy in communities with multiple at-grade crossings. Marysville, with 13 such crossings, is the poster child: The railroad runs parallel to and between Interstate 5 and the community's business district and backups at freeway off-ramps are already serious.
Seventy at-grade mainline crossings are located in heavy-traffic areas of King, Snohomish and Pierce counties, roughly paralleling I-5.
About half of these crossings could be considered for grade separation projects (overpasses in most cases) at costs ranging from $50 million to $200 million per project; the cost depends on the location, with dense urban areas the costliest. In Seattle, for example, the $167 million South Lander Street crossing is waiting for funding.
Railroads are limited by federal regulations to paying no more than 5 percent of the costs for the projects.
PFM emphasizes that mitigation costs would fall on taxpayers at some level: “Public funding for grade separation projects is currently difficult to acquire. Many grade separation projects will take years to complete while funds are located. Funds are awarded competitively among many other projects.”
In other words, the ability of the region to cope with the added train traffic depends on the availability of adequate public financing.