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Table of Contents

APPLICATION AT A GLANCE ...... 1 PROJECT DESCRIPTION ...... 2 Description of what TIGER funds will support ...... 8 Expected Users ...... 8 Transportation Challenges...... 10 How the Project Addresses these transportation challenges ...... 12 PROJECT LOCATION ...... 13 PROJECT PARTIES ...... 15 GRANT FUNDS AND SOURCES/USES OF PROJECT FUNDS ...... 15 V. MERIT CRITERIA ...... 17 i. Primary Selection Criteria ...... 17 a. Safety...... 17 b. State of Good Repair ...... 17 c. Economic CompetitiveneSS...... 17 d. Environmental Sustainability ...... 19 e. Quality of Life ...... 19 ii. Secondary Selection Criteria ...... 19 a. Innovation ...... 19 b. Partnership ...... 20 PROJECT READINESS ...... 21 A. Technical Feasibility ...... 21 B. Project Schedule ...... 22 C. Required Approvals ...... 23 1. Environmental Permits and Review...... 23 2. State and Local Approvals ...... 24 3. Fderal transportation requirements affecting state and local planning ...... 25 D. Assessment of Project Risk and Mitigation Strategies ...... 25

Results of Benefit Cost Analysis- ...... 26 COST SHARE ...... 27 FEDERAL WAGE RATE CERTIFICATION ...... 29 APPENDICES ...... 30

List of Exhibits

Exhibit 1 Port of Longview Industrial Rail Corridor Expansion Project...... 3 Exhibit 2 Port of Longview Near Dock Rail Infrastructure ...... 4 Exhibit 3 Port of Longview Aerial View ...... 4 Exhibit 5 Port of Longview Bridgeview Terminal and Berth 4...... 6 Exhibit 4 Port of Longview Terminals along the Columbia River ...... 6 Exhibit 6 Port of Longview Berth 6 Terminal ...... 7 Exhibit 7 Port of Longview EGT Terminal ...... 7 Exhibit 8 Port of Longview Future Barlow Point Development ...... 8 Exhibit 9: Project Enhancements ...... 8 Exhibit 10 Market Demand ...... 10 Exhibit 11 SR 432/433 Intersection ...... 10 Exhibit 12 High Wide Heavy Cargo ...... 12 Exhibit 13 Great Northern Corridor ...... 14 Exhibit 14 Sources and Uses of Project Funds ...... 16 Exhibit 15 Project Budget ...... 16 Exhibit 16 Wind Blade Unloading at Berth 6 ...... 17 Exhibit 17 Current IRC into Port ...... 18 Exhibit 18 Leveraging Federal Investments ...... 19 Exhibit 19 Daily congestion at RR crossing ...... 19 Exhibit 20 Port of Longview Longshoreman...... 20 Exhibit 21 Project Supporters ...... 21 Exhibit 22 Project Schematic ...... 21 Exhibit 23 Project Scope of Work ...... 22 Exhibit 24 Project Schedule ...... 22 Exhibit 25: Required Reviews and Permits ...... 23 Exhibit 26 Project Risk Matrix ...... 25 Exhibit 27 BCA Summary ...... 26 Exhibit 28 Short-term Job Creation ...... 27 Exhibit 29 Federal Wage Rate Certification ...... 29

APPLICATION AT A GLANCE

Proposed Title: Port of Longview Industrial Rail Expansion (IRCE) Project

Project Summary: This project is Phase I of the Port’s $58 million IRC Expansion Project. The project will expand capacity of the port’s current IRC to serve the bulk and breakbulk cargo facilities at the Bridgeview Terminal and Berths 4,6 and 7 (five of the Port’s eight berths). Specifically, it will bring uninterrupted unit train service to future development at Berth 4. Geospatial Information: N 46.0625 W 122.5726 County Demographics: Population in Cowlitz Co. (2015): 104,280 Median Household Income: $43,588 Personal Per Capita Income: $22,301 Unemployment Rate Cowlitz County Jan ‘16: 8.0% Persons below poverty level in Cowlitz Co.: 20.9% Congressional District: Washington 03 Economically Distressed: Cowlitz County has been designated by Washington State as an economically distressed county due to a higher unemployment rate than the state average. Project Classification: Urban

Total Phase I Project Cost: $35,900,000 Funding Request: $18,000,000 Non-Federal Match: $17,900,000

Benefit: Cost Ratio: 4:1 at 7%, Contact: Kara Metzger, Contracts / Purchasing Manager 10 port way, Longview, WA 98632 360-703-0254 [email protected] Project Documentation: http://www.portoflongview.com/275/TIGER-Grant

PROJECT DESCRIPTION

The Port of Longview (Port) is seeking $18 million in TIGER 2017 grant assistance to complete the $35.9 million Phase I of the Port of Longview’s Industrial Rail Corridor Expansion (IRCE). It is the Port’s intent to build out the full $58 million IRCE project in three phases as funds become available. Phase I of the IRCE will bring an additional running track and three support tracks (sidings) to allow for simultaneous arrival and departure of three 8,500’ unit train. Full expansion will allow for three running tracks and six support (arrival and departure) tracks each able to hold a full 8,500’ train waiting for processing or dispatch. This Phase has independent utility. The Port constructed the original Industrial Rail Corridor (IRC) in the early 2000s to provide more efficient access to existing import/export facilities. The IRC was developed to stimulate economic growth within Washington’s Cowlitz County, the Pacific Northwest (PNW) and the country, and eliminate the negative impacts associated with at grade crossings in the local community. It is achieving those goals. However, more needs to be done. This TIGER application will fund an expansion of the IRC: it will relocate the original IRC north, to accommodate the three new running tracks and six new sidings. This will allow for the Port to improve its rail configuration to handle full length trains of 8,500 feet and greater without the need to break the trains into smaller sections for delivery and processing. These improvements will bring access to unit trains for current customers and future tenants on the redeveloped, but underutilized, berths. The new rail capacity will provide the Port with the ability to continue to expand its capacity to meet growing freight capacity needs. This TIGER grant will finalize the $35 million of funding necessary to complete the IRCE Phase I. The benefit cost ratio for Phase I is 4.0 at a 7 percent discount rate. The entire IRCE project is estimated to cost $58 million. The IRCE project compliments the future improvements anticipated in the State Route 432/433 Highway improvements adjacent to the Port. In fact, the implementation of the IRCE prior to that project will provide an alternative rail line for rail movements into the Port during the construction of the Industrial Way and Oregon Way grade separation project. The added capacity of Phase I will eliminate the need for a costly temporary grade crossing during construction. The completion of Phase I of the IRCE will allow freight rail movements to be shifted to the new Port Lead Track, which will reduce road congestion on the local roads.

The IRCE project will improve the last mile connection between the BNSF Railway, Union Pacific Railroad, the Port’s marine terminals and industrial park complex. This added rail capacity will allow for the efficient movement of 100-120-car unit trains between the mainline tracks and the port facilities. The project will also improve vehicular access to the port and improve local mobility in proximity to the Port.

When completed, the full buildout adds a total of 82,510 additional linear feet, or an additional 15.63 miles, of track to the Port’s current 14 miles of rail infrastructure This additional rail will accommodate growing demands for current, and future businesses. Increased rail capacity near the waterfront is necessary to meet growing pressure on the transportation system resulting from the Port’s expanding cargo portfolio. By improving the first/last-mile connectivity to growing international markets, the local, regional and national economies will benefit. This project will also establish the connections required for future track and staging areas needed for expansion to Barlow Point. The Port’s Barlow Point project, a 283-acre greenfield property planned for terminal development, is currently in the planning and engineering phase. Barlow Point backbone infrastructure (entrance, internal roads, utilities, rail), which will support private investment in marine terminal development, is slated for completion by 2030.

Legend Current Rail lines Relocated IRCE

Exhibit 1 Port of Longview Industrial Rail Corridor Expansion Project

The Port of Longview is the first deep-draft, full-service operating port on the Columbia River. It is located at river mile 66 in southwest Washington State. The Columbia River is a leading gateway for international trade. It is the second-largest grain exporting river channel in the world, and the point of embarkation for cargo originating from over 40 states. The Port’s cargo handling specialties include all bulk cargos and breakbulk commodities such as steel, lumber, logs, grain, minerals, fertilizers, agricultural products, pulp, paper, and wind energy.

Legend Current Planned

Exhibit 2 Port of Longview Near Dock Rail Infrastructure The Port purchased a second mobile harbor crane in 2014, which allows for movement of single and dual pick, heavy- lift cargo. In the American Association of Port Authorities’ (AAPA) Port Ranking by Cargo Report of 2015 the Port of Longview was ranked the 49th largest port in the country shipping 11.1 million tons domestically and internationally and ranked 21st in export tonnage of 9.0 million tons. Strong Priorities in Growth: This Project is a culmination of more than ten years of collaborative efforts, public involvement, and partnership development related to port development. This is one of the Port’s first, and highest, priority major investment projects ready to move forward. Exhibit 3 Port of Longview Aerial View This investment leverages municipal, county, state and federal funding spent on complementary projects to the benefit of the community and the entire region. The Project improvements are identified as an economic development priority in the 2016 Port of Longview’s Strategic Business Plan, the 2011 Port of Longview Strategic Plan and 2010 Port of Longview Master Plan and as a WSDOT Tier 1 Freight Project in the 2017 Washington State

Freight Systems Plan1 . Capitalizing on Federal Investments: The Federal Government has invested $200 million in the Columbia River Deepening Project (increasing the depth to 43’). Additionally, the Federal Government is investing to protect navigation, improve safety and install navigation infrastructure to improve the movement of ships through the Columbia River Jetty Rehabilitation project. The IRCE Project is, indeed, the type of project envisioned when these investment decisions were made. The project will capitalize on those federal investments by efficiently moving import/export goods from the Port to the mainline rail system. The Port is located along the Union Pacific and the BNSF Railway Class I mainlines (I-5 Corridor). These rail lines connect the Port to customers and shippers to the Great Lakes via the Great Northern Corridor. The Port’s rail link to these vital mainlines provides access for Port customers to serve domestic and international markets. At the local level, several regional transportation projects are underway to facilitate the movement of freight efficiently, and safely, along the local industrial corridor. These investments are designed to help grow cargo handling and ensure local partners along the corridor, (e.g.-Pacific Fibre Products, Inc., Pacific Lumber and Shipping, LLC, KapStone Paper and Packaging Corporation, Weyerhaeuser Corporation, and the City of Longview’s Mint Farm Industrial Park) continue to thrive. Maximizing Employment: The Port plays an important role in job creation by building the needed infrastructure to leverage private investment on both Port property and in the local community. The area’s focus has been on manufacturing and international trade. The Port develops the infrastructure, such as this project, to support job creation and retention in manufacturing, trade, and related sectors. The Port’s efforts create a positive economic ripple that strengthens the local and state community. The Port of Longview is in rural Cowlitz County, Washington. It is a county with nearly 8% unemployment, 2% higher than Washington State’s 6% average. The IRCE Project will help spark economic growth in Cowlitz County. With one in ten local jobs tied directly to the Port, projects like this will improve the ability of the region to create new opportunities, and allow the Port to deliver on its role as the community’s economic development agent. This Project will benefit a variety of users including shippers, residents, local governments, and users of the marine, rail, and highway systems. History of the Project The Port constructed the Port’s Industrial Rail Corridor (IRC) in the early 2000s to provide an efficient rail access to existing import/export facilities. The IRC is designed to (1) stimulate

1 http://www.wsdot.wa.gov/Freight/systemplan.htm

economic growth in Cowlitz County, the Pacific Northwest (PNW) and the Nation by increasing the Port’s ability to import/export goods; and, (2) eliminate the road/rail conflicts and traffic consequences associated with at-grade crossings in the community. This TIGER grant will allow for further expansion of the IRC, while maintaining the same tenants of the original IRC development. With limited opportunities to establish new terminal operations or terminal redevelopment on the West Coast, the Port is taking advantage of the available land and berths to offer existing and potential customers the ability to grow their business at the Port. Terminals served by the IRC

Exhibit 4 Port of Longview Terminals along the Exhibit 5 Port of Longview Bridgeview Terminal Columbia River Bridgeview Terminal (Berths 1&2) The Port of Longview is negotiating a lease to redevelop and operate this 20.5-acre terminal, which includes Berths 1 and 2, rail tracks, storage and existing structures. The Port’s criteria for evaluating the “best” possible use of a site includes, cargo throughput, job growth, new customers, new cargo and overall revenue to the Port. Using these criteria, the proposed five- year lease, with options to renew, offers the Port the best possible use of the site. The Port selected this operator because of their ability to increase the throughput of Berths 1 and 2, and drive increased demand for use of available backland facilities. The berths have handled a variety of bulk commodities over the years, including fertilizers, potash, soda, ash and grains. The Port is interested in broadening their cargo mix to include opportunities for other marine- dependent uses. Berth 4 Berth 4 was once operated by Continental Grain Company until it was shuttered in the 1980s. Attempts to restart the terminal date back to the 1990s, but the Port abandoned those plans when the EGT grain terminal was developed downriver on the new Berth 9 site. The Port has taken proactive measures to redevelop the Berth 4 site. In the last five years, the Port pioneered a new model for riparian habitat mitigation with State and Federal permitting agencies in order to remove the dilapidated pier. The construction of an environmentally friendly pier structure is complete, and the environmental and engineering studies to remove the upland Silo Complex are underway. The Port is actively marketing this terminal to foster private investment in developing a bulk export operation.

Currently, Berth 4 is short listed as one of two sites in the final selection process of a dry, white bulk export facility. To utilize this facility as desired, the proposed bulk exporter will build a loop track to allow the unloading of 110 car unit trains. The IRCE will bring the necessary first/last mile rail capacity required to handle the unit trains and bulk commodity efficiently and cost-effectively. The IRCE will also keep the cargo off local roads. Combined, the projects will improve the local quality of life and bring new economic activity to the community and region. Berths 6: Breakbulk Cargo Terminal Berth 6 is operated by the Port of Longview and can handle “Panamax” sized vessels with 40’ draft. Berths 6 and 7 have a continuous length of 1,500’. The Berth is currently serviced by trucks and three, on dock, rail spurs on the inland side of Transit Shed 6. This shed can provide 100,000 sq. ft. of covered storage. The berth also has 35 acres of paved, uncovered storage capacity, with 10 acres lighted.

Exhibit 6 Port of Longview Berth 6 Terminal Berth 7: Bulk, Breakbulk, Container Handling Terminal Berth 7, operated by the Port of Longview, can also handle “Panamax” sized vessels with a draft up to 40’. The Berth has two heavy-lift cranes with bucket and container lift capabilities, bulk loader, clam shell buckets, portable hopper conveyor system with capacity for 500 metric tons/hour. The berth is served by hopper to rail and hopper to truck capability. The berth also includes additional covered and uncovered storage (35 acres paved). Immediately adjacent to the to the site is a Ro-Ro berth EGT Grain Terminal The Port’s Export Grain Terminal (EGT), is the first modern facility grain facility constructed in the last 25 years. It is also the largest facility in the Pacific Northwest. EGT exports primarily wheat and soybean, and makes up 75% of Longview’s export volumes. EGT can handle “Panamax” sized vessels. The Terminal is 1,000’ long, with a trestle width of 30’. Grain is delivered via rail and barge. The development of the current IRC was the catalyst for EGT in selecting the Port. The IRCE will continue Exhibit 7 Port of Longview EGT Terminal to help facilitate unit train movement into EGT and provide more flexibility and efficiency of movement of trains.

Future Barlow Point Development The Port of Longview seized the opportunity for future growth by purchasing Barlow Point in 2010. The 283-acre greenfield acquisition is a critical supplement to the Port's 479 acres of industrial property, that significantly expands the Port’s growth potential. The site, located at river mile 64 on the Columbia River, is 4 miles downriver from the Port’s existing industrial site, and sits directly on a naturally deep portion of the Columbia River shipping channel. The property is within the Exhibit 8 Port of Longview Future Barlow Point Development Longview City limits and, like other Port properties, zoned for manufacturing and industrial use. The site, when developed, will include 4,000 linear feet of deep-draft Columbia River access. DESCRIPTION OF WHAT TIGER FUNDS WILL SUPPORT Summary of Industrial Rail Corridor Expansion Enhancements

Exhibit 9: Project Enhancements

Improvement Current Condition Future Condition with IRCE

Track 2 Leads Phase I: Additional Lead + 3 A& D Tracks

Future Phases: Additional 2 Leads + 3 A&D Tracks

Detailed Track Layout can be found in Appendix D. Planning and Engineering on the IRC Expansion The Port began investing in rail engineering design and planning for the IRCE Project in 2015. Between 2015 and 2017, the Port refined the rail concepts to the current design, began development of environmental documentation for permits, and initiated right of way purchase negotiations. The Port’s development schedule establishes a path forward to begin construction of Phase I with bid opening in 2020 with project completion in second quarter 2022.

EXPECTED USERS The IRCE Phase I, and eventually full Expansion, will service the Port’s current customers, a new lease tenant at the Bridgeview Terminal (Berth 1 and 2), bulk and breakbulk cargo operations at Berths 6 and 7 (with associated on dock rail), and redevelopment of Berth 4 into an export bulk facility. In the future, the IRCE will allow for development of unit train capability to the Port’s Barlow Point property. Upon completion of Phase I, the Bridgeview Terminal will be able to more efficiently handle

bulk import/export cargoes with unit trains at the terminal due to the additional rail capacity achieved with the completion of this project. Bridgeview terminal is a “direct hit” facility, where rail cars are unloaded direct to ship. The additional IRCE sidings / staging will provide rail storage capacity to allow more cargo to be on terminal readily available for efficient loading and unloading. Similarly, the expanded rail capacity will dramatically improve efficiencies at Berth 6 and 7. Currently, Berths 6 and 7 are multi-purpose docks with import/export operations utilizing on- dock rail. Today, unit trains must be “broken” into sections, and then strung back together to be dispatched to the mainline. This is currently done on the running track which takes up rail line capacity. The number of movements required to disconnect, and reconnect, the unit trains, results in the intersections/roadways near the Port being repeatedly blocked. This impedes local citizens’ mobility to move through the area and restricts the movement of other cargo in/out of the Port. The IRCE will allow the rail cars to be assembled into whole trains, inspected and then depart without the need for breaking the trains, and repeatedly interrupting Port operations and mobility. This will be significantly more efficient, and safer, than how the Port currently is able to manage rail operations due to the limited track space and segment lengths. Berth 4 is currently in the redevelopment phase. The Port has replaced the existing 1-acre outdated berth with an environmentally friendly lay berth. This will be the backbone for a future finger pier for bulk export products. The Port is actively marketing this site, and has interest by potential customers for the site. The IRCE brings this facility to a “state of the art”, unit train capable site. Cargo Markets Demand Upgraded Infrastructure - Sufficient cargo and rail volume growth has been identified to justify the project. The Port of Longview is positioned favorably to grow as a major import and export gateway for bulk and break-bulk commodities. Commodity forecasts show that emerging markets in Asia, the Middle East, Latin America and Africa will continue to drive demand for food and agriculture products, and construction and industrial related commodities. The Port’s 2014 market analysis showed that regional ports moved a total of 63.8 million tons of non-containerized cargo in 2013. This equates to 6.3% of the US total non-containerized tonnage. Volume growth has averaged 2.8% per annum and is expected to continue at that rate into the future. The region; however, handles 14.5% of the total US volume (excluding energy). The region has historically, and continues to be, heavily reliant on fulfilling demand from North and Southeast Asia to drive export volumes. The Port anticipates building on this strength to accommodate the region’s traditional wood products, grain, oil seed and animal feed markets. The Port’s Commodity Analysis identified potential new demands for fertilizers, inorganic chemicals, wood pellets, and project cargos

Exhibit 10 Market Demand Project cargo (machinery, equipment, etc.) is also continuing to grow. These large and heavy unitized commodities (capital equipment) produced both in the US, and elsewhere, are transported by ocean-going vessels between origin and destination countries. The United States is endowed with the ability to produce these products efficiently and effectively. The Port of Longview can serve the growing need to ship these products by strategically investing in infrastructure to move these goods The IRCE Project allows the Port of Longview to grow, to accommodate expanding international demand for US products, and to increase jobs and economic activity. It is precisely what was envisioned when the federal government invested $200 million to deepen the Columbia River, and opted to invest in new navigation and safety systems at the Columbia River jetty. TRANSPORTATION CHALLENGES Transportation Challenge I—Inadequate Transportation Systems New businesses, agricultural producers, manufacturers, and suppliers are attracted to the Port of Longview because of the investments to bring new shipping capacity to the Port’s marine terminals. The federal investment to deepen the Columbia River, and improve navigation and safety at the Columbia River Jetty, has been a major driver in the Port’s investment decisions. However, the lack of efficient / cost effective transportation options to reach the new waterfront facilities is a key barrier towards realizing the benefits of the federal investments on the River. The “lack of last-mile” rail capacity in the Longview area impedes the ability to efficiently ship and receive goods. To remain competitive in the global Exhibit 11 SR 432/433 Intersection market, the Port of Longview must be able to move cargo into their Columbia River terminals and facilities. Job growth in Cowlitz County is limited by the Port’s inability to capture these commodity movements efficiently through Longview’ transportation system. During interviews conducted to inform development of the Port’s Master Plan, stakeholders in an array of industries identified transportation as their number one concern. Responses included “lack of adequate transportation”, “cost of transportation”, or “expense of getting product to customer”. Other responders cited limited rail capacity at the Port as a detriment to doing business with the Port. Longview suffers from transportation challenges to move both people and freight. The Port is

located at the Southeast corner of SR 433 and SR 432 (Industrial Way). It is near the Highlands residential district, which includes a disproportionately high level of residents at the poverty level (20%) with unemployment rates hovering around 8%. Congestion is an immediate and future problem. Port customers commented that traffic congestion at the Port’s “front door” due to vehicle traffic on the main routes of SR 432 and SR 422 contribute to increased transportation costs. It impacts the reliability of delivery schedules, our customers, residents, and the growing tourism sector in Cowlitz County. It forces trucks and motorist to sit idle, increasing emissions and wear and tear on vehicles. Truck traffic is expected to grow through 20352. Combined with anticipated increases in vehicular traffic, the SR 432/SR 433 will be at a level of service F. The delays at this vital intersection will translate into a loss of economic productivity for the region. On average, 30% of the daily traffic on SR 433 is truck traffic. Using conservative scenarios, by the year 2035, the annual loss of economic productivity for truck freight is estimated at $1.1 million (2013 dollars). The IRC project will divert freight from trucks to rail, easing congestion, bottlenecks and lowering emissions Transportation Challenge II—The current IRC capacity is consumed by one tenant, EGT In the early 2000’s, the Port constructed the IRC to directly connect the Port to the Class I mainlines. The current rail corridor consists of one lead track and one siding which primarily serves the Port’s grain loading terminal, EGT. The completion of the original IRC allowed cargo to efficiently enter the Port, bypassing third party switching and at-grade crossings. As cargo volumes grow; however, one lead track cannot keep up with the demand for rail service at the Port. Transportation Challenge III—21st Century Rail Operations The current IRC cannot meet the needs of customers that want to run cost-efficient unit trains directly to and from the terminals. To meet this new operational requirement, the IRC must be expanded to allow for additional trains to move simultaneously in or out of the Port. The length of these trains also requires additional storage or siding tracks to hold a full 8,500’ train that is waiting to enter a terminal or be dispatched to the mainline. In addition, it is important to have available storage tracks/ sidings to hold cars that are waiting to be loaded or unloaded at the Port. Transportation Challenge IV—Required rail access to enable Barlow Point to be developed The development of the proposed Barlow Point Terminal also needs adequate rail access. Although the customer(s) are undetermined now, rail access through the community will be a requirement. Development of a dedicated, hardened rail corridor to Barlow Point is the most effective approach to limit congestion and efficiently move goods.

2 http://industrialoregonway.org/wp-content/uploads/2016/09/FINAL_PurposeNeed_updated-2016-09-13.pdf

HOW THE PROJECT ADDRESSES THESE TRANSPORTATION CHALLENGES Solution to Transportation Challenges I, II, III and IV This project will relieve local and regional traffic congestion by diverting truck cargo to rail. It will alleviate the current limitations on rail capacity at the terminals and berths bringing more efficient and safe, operations of the berths and terminals. The new running tracks and Arrival and Departure (A&D) tracks will bring new rail capacity to the Port, and be available to all rail customers. The IRCE Project results in a much higher degree of resiliency, operational efficiency, and capacity to the Port and connected rail network. This rail network will be available for a variety of cargos such as agriculture, energy, break-bulk (including high and wide cargos), and cargo that the Port would like to keep off the local, regional, and national road networks. The IRCE Project will reduce freight transport costs for Port customers due to the reductions in congestion. It will reduce emissions as more freight is moved by rail instead of truck.

The IRC Expansion Project has several benefits: Exhibit 12 High Wide Heavy Cargo Reduces Congestion by Port related trucks: This project will provide direct rail access and efficiency to two berths. Phase I will provide additional unit train and storage capacity to the new Bridgeview terminal, and provide unit train delivery to a redeveloped Berth 4. Private development is keenly interested in locating at Berth 4 with unit train delivery options available. Increases Rail Capacity and Efficiency: The IRCE Project will provide additional tracks for railcar staging and storing while awaiting loading / unloading operations to commence. Re-Opens Direct Access to Private Industries: This rail investment will re-open access to Pacific Fiber Products, Inc., a neighboring private company. This will reduce Port congestion and enhance Pacific Fiber’s business opportunities. Sets the Stage for Future Private and Public Investment at Barlow Point: The Project will prepare for rail to be extended to serve the Port’s 282 acres of undeveloped lands at Barlow Point. The development of this new facility, located north of the current port, will greatly increase freight volumes through the community. The IRCE Project will reduce the impact of freight movement through the community to the facility. The expansion of the IRC will increase capacity to enhance the vital connections from rural SW Washington to inland locations throughout the US. The Project will create additional access to rail for bulk and break-bulk commodities that need to be transported by sea-going vessels. The most efficient way to move heavy cargoes to inland and international points is to go directly between ship and rail, and eliminate the need for a truck movement on local roads.

Several recent investments to improve freight movement near the Port are resulting in heightened interest in development by businesses along the I-5 Longview/Kelso Industrial Corridor. Among the key investments are the deepening of the Columbia River and development of the Port’s Industrial Rail Corridor, which provides a direct sealed rail access between the BNSF / UP mainline and Port property. Additionally, BNSF has made multi-million-dollar capital investments in capacity improvements along their I-5 and Great Northern Corridors.

PROJECT LOCATION

46.1067 lat; -122.8985 long (East) (county landfill building) 46.1108 lat; -122.9362 long (West) (just west of Fibre Way overpass) The Port of Longview is the first-full service operating port with eight terminals on the deep-draft Columbia River in Washington State. Located just 66 miles from the Pacific Ocean, with direct connections to interstate and mainline rail networks, the Port is a prime cargo handling facility in the Pacific Northwest. Cargo handling specialties include all types of bulk cargos and breakbulk commodities such as steel, lumber, logs, grain, minerals, fertilizers, pulp, paper, wind energy, and with the purchase of a second Liehberr mobile harbor crane in 2014, single and dual pick, heavy-lift cargo. RAIL: The Industrial Rail Corridor Expansion (IRCE) Project is within the Port. It will support all types of cargoes that move through the Port including: imports and exports foreign and domestic general cargo and roll-on/roll-off cargo, including logs, steel, bulk and project cargo. In 2003, the Port completed development of the Industrial Rail Corridor to provide direct and uninterrupted rail service to Port customers. The current 1.5-mile line connects the Port of Longview to the BNSF main line, which parallels Interstate-5. RIVER: In 2010, the $200 million deepening of the Federal Columbia River Shipping Channel from 40 to 43 feet set the stage for larger vessels and volumes of cargo to be handled by Columbia River ports. The Federal Government is also investing in improvements to navigation and safety for vessels crossing the Columbia River bar. The Port has a long history with working with the Federal Government within the Columbia River. The Port was one of five non-Federal sponsors for the Columbia River Deepening, and continues to be a non-federal sponsor for development of a 20-year dredge material management plan. The Port has also assisted in negotiating and providing funding for, installation of stern buoys to ensure safe passage of vessels in the river. The Port not only benefits from the use of the Channel, but is heavily invested in its operations, maintenance, and environmental health. ROAD: The Port of Longview serves many industries in Northwest Oregon, located directly

across the Columbia River via the Lewis and Clark Bridge. Freight is trucked across Longview for export to Asia and points beyond. Additionally, the Port owns and maintains its own network of internal roadways. The Project provides the rail infrastructure to make the Port more competitive in the domestic and foreign trade markets, providing opportunities that no other Port offers; one-time spot cargo shipments that meet niche market needs. The Port of Longview is truly the “last mile” connecting the United States to international markets. This project is part of the Great Northern Corridor Coalition’s (GNCC) umbrella of regional projects as it adds vital port capacity needed for shippers along the corridor. The Great Northern Corridor Coalition works to promote regional cooperation, planning and shared project implementation to improve freight movement from Chicago through the member states of Wisconsin, Minnesota, North Dakota, Montana, and Idaho, to ports in Washington, and Oregon. The GNC system of highways, rail lines, and ports is vital in moving American products to global markets, and in bringing commodities to our communities. The Coalition is working to, (1) improve the corridor to promote economic growth for neighboring communities, states and the nation; and (2) accommodate the demand for safe, efficient, and environmentally sound transportation services. The GNCC is working to identify opportunities to improve the technology, operations and infrastructure along the corridor.

Exhibit 13 Great Northern Corridor

PROJECT PARTIES

PROJECT SPONSOR - The Port of Longview is the project sponsor and grant recipient. The Port is a municipal corporation, created in 1921 through a vote of Cowlitz County citizens. It is governed by a three-person elected Board of Commissioners and manages its policies through an appointed Chief Executive Officer and support staff. Under statute, port powers are singularly focused on economic and community development. Port related activities employ 10% of the workforce in Cowlitz County, and supports another 9,100 jobs with shippers and related businesses. The Port of Longview, like all ports in Washington, has the ability and authority to fund their operations and programs through a combination of earned revenues and property taxes. In that sense, the Port is a publicly owned business enterprise making market based investments in the support of the local economy and job creation. Port customers and their consultants have provided engineering expertise to the design of the rail plans and operations plan RAILWAY SUPPORT- BNSF and UPRR have played a pivotal role in the planning and design of the proposed rail layout. Both railroad companies have brought significant staff expertise, time and effort toward executing the many steps required to properly plan and appropriately design this project.

GRANT FUNDS AND SOURCES/USES OF PROJECT FUNDS

TIGER 2017 funding is critical to the completion of this project. Cost analysis completed by the Port’s engineering consultant shows that the cost to complete this phase of the project is $35.9 million in 2016 dollars. A non-federal match of $17.9 million has been committed by the Port. The TIGER 2017 request is for a federal investment of $18 million to complete the project’s construction. The Project’s Phase I rail improvements will be ready to bid for construction in second quarter 2020, with construction beginning in winter 2021. Work will be completed in 2022. One hundred percent of TIGER 2017 grant funds will be spent on construction of rail improvements.

Exhibit 14 Sources and Uses of Project Funds

PHASE I INDUSTRIAL RAIL CORRIDOR EXPANSION PROJECT Amount Funding Sources Status Purpose in Millions FE, Enviromental, and Port of Longview $ 17.9 Committed Construction TIGER Request $ 18.0 Requested Construction Total Project Funding $ 35.9 Total Project Cost Total Federal $18.0 50% Total Local $17.9 50% Total Project Funding $35.9 100%

Project Budget in Millions % CN $24.2 67% ROW $2.9 8% FE/ CN Engineering $4.6 13% Contingency $4.2 12% Total Cost $35.9 100% All remaining costs of the Project including engineering, environmental and right of way transactions will be paid for by the Port with non-federal matching funds. Exhibit 15 Project Budget Local Total TIGER Item Descriptions Matching Project Funds Funds Funds IRC Expansion Project Phase I ROW $2.9 $2.9 Mobilization $1.8 $1.8 Erosion Control $0.1 $0.1 Site Work $5.9 $5.9 Track Work $12.1 $12.1 Maintance / Operation Facilities $0.2 $0.2 Engineering/ Construction Mgmt $4.6 $4.6 Contingency $0.0 $8.3 $8.3 Total Phase I Cost $18.0 $17.9 $35.9 TIGER 2017 Funds $18.0 Port of Longview Contribution $17.9 Grand Total $35.9 50% 50% The project is financially feasible. Phase I of the Project is financially feasible. The full and detailed budget is in Appendix C. The Port of Longview Board of Commissioners have included this project in their current and five-year budget to provide the matching funds of $17.9 million to complete the Project.

V. MERIT CRITERIA

I. Primary Selection Criteria The completion of Phase I of the rail expansion creates increased regional access to rail and reduces dependence on trucks. This Project is consistent with the Great Northern Corridor Coalition’s goal of developing strong freight corridors to improve freight mobility, system efficiency, and operations. The mode conversion from road to rail for the transportation of heavy products will reduce highway maintenance and preservation costs. The mode conversion will also result in increased productivity due to time savings achieved by reducing congestion along SR 432 and 433 caused by the heavy truck traffic where they meet in the in front of the Port at one of Longview’s busiest intersection. A. SAFETY Shipping cargo by rail to and from the inland destinations will improve the safety of the entire transportation corridor on which the cargo is moved. The Project increases safety by diverting truck cargo to rail for two additional Port berths. This phase will provide unit train storage capacity to the Bridgeview Terminal and new unit train delivery to Berth 4. The A&D tracks will allow over-length cars that handle wind Exhibit 16 Wind Blade Unloading at Berth 6 turbine components to be assembled into strings of cars ready for dispatch to the mainline railroads for delivery to destination. B. STATE OF GOOD REPAIR Diverting freight traffic from trucks to rail will reduce the wear and tear on local roads and City streets. As congestion increases at the intersections entering the Port, vehicular movement is restricted and “stop and starts” are necessary. This adds additional pressures on local roads and highways. C. ECONOMIC COMPETITIVENESS The expansion of the IRC will increase vital connections from rural SW Washington to inland locations throughout the US. The Project will create additional access to rail for bulk and breakbulk commodities that need to be transported by sea-going vessels. The most efficient way to move heavy cargoes to inland and international points is to go directly between ship and rail, and eliminate the need for a truck movement on local roads. The additional running tracks created in the full build out will more than double the capacity and flexibility for train movements along the IRC. Phase I, will build the embankment and foundation for the full build out, add 1 running track and create a 3-track wide support yard. On average, the Port’s current rail network handles 14,000 cars per year (trains are either broken up into strings or come in manifest service, where a

train holds a mixed type of cars and cargoes). The EGT facility (see Figure 1) brings in approximately 600-unit trains (110-120 cars/ 72,000 cars) per year. These unit trains enter the IRC and then are directed to the EGT owned facility track system that can handle up to six-unit trains (four full, two empty). With improved capacity and efficiency for unloading at EGT and at the Port, the A&D tracks will add the ability to hold up to six-unit trains entering or departing from the Port’s industrial area. Currently, an EGT train can be positioned, unloaded and dispatched in six to eight hours. With the improved access created by this project, this cycle-time could be reduced to four hours, a significant operational improvement over today's experience. The relocation of the corridor will allow Pacific Fibre the ability to expand their business which is dependent on unfettered access and rail consistence which is currently restricted by existing Port operations. These benefits translate into improved economic competiveness: Increases Rail Capacity and Efficiency: The IRCE will provide additional tracks for railcar staging and storing while awaiting loading / unloading operations to commence. Re-Opens Direct Access to Private Industries in the area: This rail investment will re-open access to Pacific Fiber Products, Inc., a neighboring private company. This will reduce Port congestion and enhance Pacific Fibers business opportunities. Sets the Stage for Future Private and Public Investment at Barlow Point: The Project will prepare for rail infrastructure to be extended to serve the Port’s 282-acre undeveloped lands at Barlow Point. The development of this new facility, located north of the current port, will greatly increase freight volumes through the

Exhibit 17 Current IRC into Port community. Rail transportation will reduce the impact of freight movement through the community to the facility. Leverages Recent Investments: Several recent investments to improve freight movement near the Port are resulting in heightened interest in development by businesses along the I-5 Longview/Kelso Industrial Corridor. Among the key investments are the deepening of the Columbia River and navigation/safety infrastructure at the Columbia River Jetty. Additionally, the previous development of the Port’s Industrial Rail Corridor provided a direct sealed rail access between the BNSF / UP mainline and Port property. BNSF has made multi-million-dollar capital investments in capacity improvements along their I- 5 and Great Northern Corridors. Because of its location, land base and surrounding industries, Longview can provide opportunities that no other Port offers; one-time spot cargo shipments that meet niche market needs. The Port can leverage these strengths to increase jobs and economic activity in this rural

part of Western Washington. It is truly the a “last mile” connecting the United States to international markets Increased rail access to Port berths will provide the Port with an additional tool when working with potential tenants and customers. This trade related business is anticipated to create new jobs paying wages at or above the county average wage. Coordinates and leverages federal policies and investment Exhibit 18 Leveraging Federal Investments Federal Investment to Date Federal Deepening of the Columbia $200 Million River Planning for SR432/ 433 $35 Million Improvements ARRA High Speed Passenger Rail $800 Million Improvements Total Funds Expended to Date $1.035 Billion

D. ENVIRONMENTAL SUSTAINABILITY The use of rail transportation for new cargo generated by the Project will improve the safety of local and regional transportation corridors. Reduction of truck traffic along the highway route between the Port and destinations that are over 1000 miles east of the Port will reduce the number of trucks on the road which will reduce emissions.

E. QUALITY OF LIFE Exhibit 19 Daily congestion at RR crossing Keeping cargo off city and regional roads will reduce roadway congestion for everyone moving into, out of, or through, the area. Significantly, the Project will alleviate the congestion that creates challenges for nearby residents to access city services and transportation. Reducing truck traffic near the Port will improve safety, and allow pedestrians and bicyclists to move through the area safely. TIGER 2017 funding of the Project would continue to transform this community into an economically viable, more environmentally sustainable and energy efficient center for living and working. Added rail capacity in the Port district, provides the Port the ability to in-fill its under- used property and facilities to generate additional Port revenues, as well as generate additional local and state tax collections due to a higher utilization of current and future facilities. II. Secondary Selection Criteria a) INNOVATION The Port is considering a range of innovative features to enhance this project. The Port and its partners are exploring intelligent transportation systems, such as dynamic message signs and

adaptive traffic signals, for the nearby intersections to improve traffic movements near the modernized terminal. The design team will investigate newer technologies, materials, and techniques for the modernization of the terminal structures, embankment, and maintenance. The project will emphasize the importance of building resilient infrastructure to improve rail and roadway networks in the region. These improved networks will enhance mobility for regional and international trade.

Public and stakeholder engagement has been, and will remain critical to the success of this project. The Port and its partners will continue to employ innovative approaches through social networks, project website, blog postings, and use of creative in-person engagement techniques. Upon completion of the planning activities proposed in this application, the Port and its partners propose to share a “lessons learned” document with USDOT that summarizes the application of any innovative planning practice and reflects on their success and applicability elsewhere. b) PARTNERSHIP Exhibit 20 Port of Longview LOCAL PARTNERS – The collaborative inter-jurisdictional Longshoreman approach used to develop this project concept, and implement the earlier phase, is a core strength of the Project. The City of Longview, City of Kelso and Cowlitz County are critical to the success of this Project, and the collaborative effort will continue to serve as a distinguishing feature of the project. This community has its eye on the goals of job creation, community revitalization, and improved transportation systems for people and freight. The Port and its Partners are working together toward these interdependent goals. The Port works closely with Longview, Kelso and Cowlitz County in their planning efforts to ensure that Port projects are in alignment with local and regional economic development efforts. Longview is the largest city in Cowlitz County, and serves as the regional hub. Regional coordination is essential, and will remain a core feature of economic development, environmental planning, restoration, transportation system funding and improvement in the region. The Port is committed to proactively include public and private sector stakeholder participation in the project.

STATE PARTNER – The Port works closely with Washington State Department of Transportation (WSDOT) on transportation. This Project has been approved by the state as a Tier 1 multimodal freight project to be included in the state’s 2017-2019 prioritized list of projects.

RAILWAY SUPPORT- The rail layout was conducted in collaboration with BNSF Railway, UPRR and Longview Switching (a joint operation of BNSF and UPRR). The rail line, designed to accommodate the expanded ship to rail operations, was approved by all parties earlier this year. BNSF and Union Pacific Railroads have been partners in designing the plan and in development of the Rail Operations Plan for the Port’s rail system.

LETTERS OF SUPPORT Exhibit 21 Project Supporters

 Cowlitz County  City of Kelso  Pacific Northwest Waterways Association  Columbia River Steamship Operators  Great Northern Corridor Coalition  Washington State Representative Herrera-Beutler  Washington State Senator Maria Cantwell  Washington State Senator Patty Murray

Letters of support for the project may be found at the project’s webpage on the Port’s webpage: http://www.portoflongview.com/275/TIGER-Grant

PROJECT READINESS

A. Technical Feasibility DETAILED STATEMENT OF WORK Exhibit 22 Project Schematic This Project is ready to move forward. The rail improvements are technically feasible and ready to move into final design and permitting. Final design of the Project will be prepared by the Port in collaboration with BNSF Railway and UPRR. The design team foresees no complicating or project ending factors. The project will meet all local requirements for approvals and permits. State and federal requirements will be met late 2019 or early 2020. Accordingly,

USDOT could obligate funding well in advance of September 30, 2020 deadline for obligation. Project risks have been identified and mitigation strategies incorporated (see below). The Project schedule illustrates that contract bid documents will be finalized and the Project ready for bid fall 2020. PROJECT SCOPE OF WORK Exhibit 23 Project Scope of Work

Engineering Bid Letting & Construction  Procurement of Consulting Engineering  Final PS&E Review Services  Advertisement and Bid Letting  Task 1: Surveying & Mapping  Procurement of Contractor  Task 2: Utility Coordination  Notice to Proceed  Task 3: 30% Plans and Estimate Update*  Shop Drawings and Submittal Reviews  Task 4: 60% PS&E  Fabrication of Structural Supports  Task 5: 90% PS&E  Mobilization, Demolition and Disposal  Task 6: Final PS&E  Temporary Traffic Control  Task 7: Local Agency Permits  Utility Demarcation  Task 8: Public Involvement  Structure Construction  Task 9: Project Management  Site Visits and Inspection  Task 10: Quality Management  Record (“As Constructed”) Drawings  Task 11: Project Team Meetings  Meetings Tasks 1 through 6 will be completed in the order shown, while Tasks 7 through 11 will be ongoing throughout the course of the engineering.

B. PROJECT SCHEDULE Port of Longview Phase I IRC Expansion Project Schedule Exhibit 24 Project Schedule

2017 2018 2019 2020 2021 2022 2023 Industrial Rail Corridor Expansion Project 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 NEPA/SEPA PERMITTING PROPERTY ACQUISITION ENGINEERING CONSTRUCTION SCHEDULE DESCRIPTION Initial tasks associated with the IRCE Project have already begun, with preliminary engineering under way and the environmental processes initiated. If the requested TIGER grant amount is awarded to the project, the funding package will be complete, and construction can begin in 2021. The Project can be constructed in 36 months. The schedule adds in a contingency to ensure that the Project is completed by October 2022 and open for full operation January 1, 2023. DETAILED PROJECT BUDGET As a public port authority, this TIGER project will meet all county, state and federal

requirements. It will be managed utilizing public procurement standards that comply with Federal and State of Washington law. Accordingly, any risks will be mitigated prior to and during construction. The project budget has been developed internally with the assistance of consultants with extensive port planning experience. The estimates are conservative, and include $8 million for contingencies. The Port understands its obligations for annual Operation and Maintenance costs to cover the related IRC costs post- construction. The Port’s Planning and Finance Departments have the capacity to manage a federal grant of the size requested with rigid internal processes and controls. The Port complies with audit requirements performed under pursuant to the Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards found in 2 CRF part 200, as well as other applicable federal regulations and requirements. TIGER 2017 Project audit requirements will be the responsibility of the Port as the Grantee. This TIGER request does not include administrative cost allowances; those costs will be borne by the Port. A Detailed Budget can be found in Appendix C. C. REQUIRED APPROVALS 1. Environmental Permits and Review a. NEPA The Port will be proceeding with the Project’s NEPA and SEPA documentation in 2018 with the expectation to receive permits no later than first quarter 2020. b. AGENCY REVIEWS The Port anticipated the following agency reviews and permits:

Exhibit 25: Required Reviews and Permits

Agency Authority Permit Notes

Port/City/County SEPA Determination City and County have determined not to pursue co- lead agency City Critical Areas – frequently Critical Areas Floodplain permit Would not be flooded areas necessary if area removed from Possibly wetlands floodplain through LOMR or CLOMR Wetland permit may be required for vegetated area of pond County Critical Areas – Wetlands and Critical Areas For Wetlands on Port property frequently flooded areas not excluded in Log Pond Jurisdictional Determination Corps CWA Section 404 Jurisdictional Determination Determination will say which Individual Permit (will trigger parts of pond or wetlands are Section 106 NHPA and Section jurisdictional under federal 7 ESA reviews) CWA, IP will allow fill in wetlands determined to be jurisdictional (see county note above)

Exhibit 25: Required Reviews and Permits- continued

Agency Authority Permit Notes

Corps Section 106 NHPA Determination of effect Investigation will be required (possible adverse effect would require MOA) Corps/NMFS Section 7 ESA Determination of effect Previous rail corridor project determination was no effect Ecology CWA Section 401 Individual permit See Corps note above It is expected that all required reviews and permits will be in hand by Spring 2020. This will ensure that the Project can be obligated well within the deadline requirement under TIGER FY17 of September 30, 2020. c. ENVIRONMENTAL STUDIES The following Environmental Studies will be completed by the Port to support the NEPA and SEPA process. • Wetland Determination • Wetland Mitigation Plan • Floodplain Analysis • Habitat Assessment • Contamination Investigation • Cultural Resources Technical Report • State Environmental Policy Act Checklist and Analysis • National Environmental Policy Act Documentation D. DISCUSSIONS WITH USDOT The Port has had on-going discussions with MARAD on port development projects. MARAD has been very helpful to the Port in providing support for this project, and other initiatives to modernize terminals to meet future cargo demands. They have also provided guidance on the Port’s efforts to expand marine facilities onto their Barlow Point property. E. PUBLIC ENGAGEMENT The Port is actively engaged in keeping their citizens and stakeholders informed of Port activities and future developments. During the 2016 Strategic Business Plan development, the Port held four public workshops and a Community Open House which showcased and discussed future capital projects. Additionally, through the budget process, the Port holds open workshops where it discusses short term and long-term capital investments. The Port has also had meetings with the local planning and engineering departments, elected officials, and state and federal permit and transportation authority’s regarding this Project. Further, during the permitting process, the public will also have the ability to provide public comment on the permit applications. 2. STATE AND LOCAL APPROVALS No legislative approvals are necessary for the project. The required permits are listed in above.

3. FEDERAL TRANSPORTATION REQUIREMENTS AFFECTING STATE AND LOCAL PLANNING This Project has been approved by the state as a Tier 1 multimodal freight project to be included into the state’s 2017-2019 prioritized list of projects. Traditionally, port projects in Washington State have not been included in either local Regional Transportation Improvement Projects or the State Transportation Improvement Project list. This is changing as all parties implement the FAST Act. The Port continuously keeps both the local agencies and the State Rail and Marine Office appraised of their future development plans. This Project will be included in the RTIP and the STIP in early 2018. D. ASSESSMENT OF PROJECT RISK AND MITIGATION STRATEGIES The Port routinely conducts community and stakeholder outreach as part of their planning processes to ensure it addresses concerns residents or stakeholders have on a plan or project. Feedback on this project has been favorable. This is indicative of Port’s history of honoring commitments made through their planning process, keeping interested parties informed, and diligently implementing the Port’s Master and Strategic Plans. This history, and public engagement, demonstrates that the project risks are relatively low. Mitigation strategies have been identified for each potential risk areas.

Exhibit 26 Project Risk Matrix Potential Risk Area Risk Type Current Status/ Proposed Mitigation Risk Level Technical Feasibility Feasibility Preliminary design developed with input from Low customers and the railroads Design Standards Feasibility Preliminary design developed with input from Low Conformance customers and the railroads Partner Approvals Schedule Preliminary design developed with input from Low customer and railroads Local Jurisdiction Schedule Past history of multi-agency cooperation and Low Approvals collaboration is anticipated to continue. Environmental Cost, schedule Multiple permits are required for this project. Low/Medium Approvals The Port anticipates that all permits will be processed and received in a timely manner Public and Stakeholder Cost, schedule Extensive public involvement effort was done Low/Medium Support as part of the port’s planning and budgeting processes. Level of public interest is high, in particular from nearby residential neighborhoods as well as labor. Construction Cost, schedule Currently entering into final design phase for Low the rail improvements. To mitigate potential risks, conservative prices and quantities were used. In addition, Project Budget contains $3 million in contingency funds

RESULTS OF BENEFIT COST ANALYSIS- The Benefit-Cost Analysis shows that Phase I of IRCE Project will provide cost-effective benefits to the region. These monetized benefits are substantial at a 7% discount rate of 4:1. Exhibit 27 BCA Summary Benefit Cost Analysis of Port of Longview Industrial Rail Corridor Expansion Phase I Project Benefit and Cost Analysis Summary (40-year analysis)

Zero Discount Discount Rate Discount Rate Category Rate* @3% @7%

Project Benefits

Benefit of Reduced Vehicle/Truck Delay $ 97,079,834 $ 52,946,772 $ 27,496,795

Rail Train Operating Efficiencies $ 57,040,000 $ 30,738,012 $ 15,654,101

Port Lease/Wharfage Revenue at Berth 4 $ 232,500,000 $ 125,290,808 $ 63,807,476

Residual Value of Capital Improvements in Year 40 $ 12,744,500 $ 3,906,914 $ 851,083

Total Benefits $ 612,246,839 $ 320,691,959 $ 107,809,454

Project Cost

Industrial Rail Corridor Expansion $ 35,900,000 $ 32,312,196 $ 28,255,829

Total Cost $ 35,900,000 $ 32,312,196 $ 28,255,829

Benefit-Cost Ratio

Calculated Benefit Cost Ratio 17.1 9.9 3.8

Benefit-Cost Ratio (rounded) 17:1 10:1 4:1

Net Present Value

Calculated NPV $ 576,346,839 $ 288,379,762 $ 79,553,625

* These values are expressed in year 2016-dollar amounts, based on BCA Narrative and Spreadsheet found in Appendix A & B.

The BCA estimates that over the 40-year post construction period, 186 million metric tons of volume will move from the terminal on rail to destinations over 1000 miles east of the port. The Port has been short-listed by a potential customer to use the modernized berth facility with a decision expected within the next 120 days. Using characteristics of the potential customer as

the basis for the BCA provides an estimates of net present value (NPV) and benefit cost ratio. The bottom line is that at discount rate of 3%, the present value (PV) of the costs in 2016 dollars is $32 million and the PV of social benefits is $321 million. This analysis yields a NPV of $288 million and a benefit-cost ratio of 10:1. The greatest share of benefits is in Economic Competitiveness that show $125 million in increased Port revenues at the terminals. The second major contributor is time savings from both vehicles and trucks totaling $53 Million. The third major contributor is a train operational cost savings of $31 million due to cost saving of $27.60 per unit train rail car. When a discount rate of 7 percent was used, the PV of costs in 2016 dollars is $ 28 million and the PV of social benefits is $108 million. This analysis yields a NPV of $80 million with a benefit-cost ratio of 4:1 over the 40-year analysis. The greatest share of benefits is again in the Economic Competitiveness Category from increased Port revenues of $64 million, followed by reduced travel delay benefits of $27 million and operational saving of $15 million over the 40- year analysis period. The Project is appropriately capitalized up front and uses asset management approaches that optimize its long-term cost structure. Additionally, a sustainable source of revenue is available for long-term operation and maintenance of the Project. Short-Term Impacts on Employment and Economic Growth: Job creation impacts from the total Project are estimated to be 467 family wage jobs at $76,900 per job year in the five years spanning the final design, ROW purchase, final approvals, and construction period of Phase I rail components. Positive economic impacts resulting from these jobs are not included in the benefit-cost ratio. Construction Jobs Created by the Total Project

Exhibit 28 Short-term Job Creation

Short-Term Direct Jobs 2018 2019 2020 2021 2022 Total Capital Spending in Mill. $ 3.8 $ 3.8 $ 9.5 $ 9.5 $ 9.5 $ 17.0 Total Annual Jobs at 49 49 123 123 123 467 $76,900/yr

COST SHARE

The Port is an independent quasi-public entity within the State of Washington. Washington State does not financially support ports; therefore, there are very limited resources for funding transportation projects of any kind. The Port is authorized to levy 45 cents per $1,000 of assessed value of real property within the

Port District, which is used for Port operations and capital projects. The Port will have limited bonding capability available for this project in 2019/2020 (as has been indicated in the funding sources exhibit on pg. 10). The Port is not authorized to collect any other tax revenues. Ports are largely restricted to Port generated cashflows to fund major projects. For projects of this nature, it is necessary to receive assistance. This may change for Phase II or III, when customer commitments are secure. The Port has not applied for any other funding opportunities for this specific Project. It plans to submit funding applications to local and state funding sources. The potential for private investment is limited: The Port has made a conscious decision to retain control of the rail connections to Port docks and industrial properties. This allows the Port control over their future versus having a private party price the Port out of rail options. Selling this asset to a private party would not be in the best interest of the Port nor its customers and stakeholders. TIGER 2017 funding will serve as the final piece of a multifaceted funding package of public, private, state, and local investments. This Project could not be readily or efficiently completed without federal assistance from a source like TIGER. This Project is the direct result of Port’s mission to excel in international and domestic trade through efficient services and strategic investments to stimulate commerce and development for the benefit of our communities. The Port’s mission dovetails with the City of Longview’s mission to mindfully develop and implement sustainable environmental, economic, and social strategies that protect and improve the quality of life in Longview. These organizations’ efforts to work with BNSF and Washington’s Department of Transportation to improve the community’s transportation system will result in the twin economic development goals of job creation and community livability.

Federal Wage Rate Certification Exhibit 29 Federal Wage Rate Certificate The Port of Longview certifies work performed Exhibit 29 Federal Wage Rate Certification under the contract will be required to comply with all applicable state and federal laws including, but not limited to Subchapter IV of Chapter 31 of Title 40 of the United Sates Code (Federal Wage Requirements) as required by the FY 2017 Appropriations Act.

The Port further considers this a letter of certification of the availability of non-federal matching funding of $17,900,000 to complete this project.

In Conclusion Taken as a whole, the Industrial Rail Corridor Expansion Project is transformative. It provides added rail capacity to support the redevelopment of old terminals into modern terminals that are able to handle the current and future port cargo mix. This Project is a great example of local and regional collaboration that reaches across political jurisdictions; addresses environmental sustainability and furthering economic growth of the community and the expansion of international trade. The Port has worked at every step to find solutions to the current challenges on the ground and create solutions that will make Longview and Cowlitz County more viable and livable for future generations.

APPENDICES

Port of Longview Industrial Rail Corridor Expansion Project webpage: http://www.portoflongview.com/275/TIGER-Grant

Appendix A: Benefit Cost Analysis Executive Summary Narrative

Appendix B: Benefit Cost Analysis Excel Spreadsheets

Appendix C: Detailed Budget and Schedule

Appendix D: Schematic of Rail Layout

The following Documentation can be found on the project webpage.

Additional Documents include:

• Letters of Support • Market Analysis

Appendix C: Detailed Budget and Schedule

Appendix D: Schematic of Rail Layout