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Southwestern Illinois Freight Transportation Study

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Southwestern Illinois Freight Transportation Study Southwestern Illinois Freight Transportation Study Final Report ~ August 2015 Prepared by TranSystems with GKSF Global Research Southwestern Illinois Freight Transportation Study This project is made possible through an Intergovernmental Agreement between the Illinois Department of Transportation and Madison County, Illinois, with the Leadership Council acting as a local public agency. Leadership Council Southwestern Illinois Ellen Krohne, Executive Director Illinois Department of Transportation Jeff Keirn, Deputy Director of Highways, Region 5 Engineer Southwestern Illinois Transportation Enhancement (SITE) Committee Throughout the study members of the Leadership Council Southwestern Illinois’ SITE committee were integral to the analysis and developing opportunities for the region to act on. Chair: Mark Harms, President, SCI Engineering Vice Chair: John Langa, Bi-State Development Metro St. Louis James Alexander, St. Louis Regional Chamber Rich Conner, St. Louis Regional Chamber Louis Copilevitz, St. Louis Regional Chamber Bruce Holland, Holland Construction Service Col. Edward J. Koharik, United States Air Force Mary Lamie, The Regional Freight District Mike McCarthy, St. Louis Terminal Railroad Association Dave Miller, St. Louis Regional Airport James Pennekamp, Southern Illinois University at Edwardsville Dr. Ronda Sauget, Validus Business Strategies Bob Stock, Stock Transport Inc. Jim Wild, East-West Gateway Council of Governments Dennis Wilmsmeyer, Tri-City Regional Port District Southwestern Illinois Freight Transportation Study Page i Leadership Council Southwestern Illinois August 7, 2015 Executive Summary Leadership Council Southwestern Illinois (Leadership Council) engaged TranSystems, partnered with GKSF Global Research, to conduct the Southwestern Illinois Freight Transportation Study. The purpose of the study is to identify quantitative means for Southwestern Illinois to understand its position in the marketplace and evaluate key performance indicators to prioritize areas of investment. To accomplish the purpose, the study team focused on four areas including a freight flow outlook, freight infrastructure and facilities inventory, a market survey of industry representatives, and a comparative cities analysis. While the study specifically relates to Southwestern Illinois, many of the opportunities identified can be applied more broadly to the greater St. Louis region. Background The Leadership Council Southwestern Illinois is a member-based, not-for-profit economic development corporation representing Southwestern Illinois. The organization is primarily focused in Madison and St. Clair counties. In 2011, the Leadership Council launched its new Southwestern Illinois Transportation Enhancement (SITE) initiative, creating a new working group composed of individuals representing rivers, rail, roads, transit, and runways. SITE's mission is to drive economic development in Southwestern Illinois through transportation infrastructure. In 2012, the East-West Gateway Council of Governments launched a planning effort focused on freight transportation in the region. The intent of the St. Louis Regional Freight Study was to clarify the current status of freight movement through the St. Louis region as well as the future ability of local freight infrastructure to sustain growth in jobs and economic opportunity. An outcome of the Regional Freight Study was a recommendation to create a freight district capable of coordination with the public and private sector, managing transportation and infrastructure programming, financing and marketing for the region. Recently the Leadership Council and St. Louis Regional Chamber launched a website as a collaborative initiative to create a new brand identity for the St. Louis region – and for Southwestern Illinois within that region – as a multimodal hub poised for growth. The Southwestern Illinois Freight Transportation Study is a specific undertaking targeted to identify quantitative means for Southwestern Illinois to understand its position in the marketplace and evaluate key performance indicators to prioritize areas of investment. Through a freight outlook analysis, infrastructure and facilities inventory, market survey of industry representatives, and a comparative cities analysis, the study team identified quantitative means for Southwestern Illinois to understand its position in the marketplace and evaluate key performance indicators to prioritize areas of investment. Each of these areas of study provided data and information that was used to develop opportunities and action items for Leadership Council Southwestern Illinois, and identified champions, to execute in the next 3 Southwestern Illinois Freight Transportation Study Page ii Leadership Council Southwestern Illinois August 7, 2015 to 5 years. It is through fostering these opportunities that Southwestern Illinois can benefit from growth in the freight and logistics industry. Freight Outlook Analysis Key Findings . Freight growth is projected for the St. Louis area, including Southwestern Illinois, with the principal drivers of growth being economic expansion in the St. Louis area and its main domestic trade partners. St. Louis has a long-held, dominant position in lower value/bulk commodities. While growth is expected in lower value/bulk commodities, higher value/warehouseable/manufactured commodities are projected to grow at a faster rate. Shipments by rail (carload) are projected to grow at a slower rate than truck and multiple modes (includes intermodal rail). This results from faster growth of truck-friendly and intermodal commodities combined with the dominance of truck in short haul corridors. Outbound freight of higher value/warehouseable/manufactured commodities is projected to grow at a faster pace than inbound shipments reflecting the potential for continued growth of manufacturing activity. A continued imbalance in the intermodal market is expected – the region generates more outbound intermodal freight than inbound consumer-driven intermodal cargo. Figure E-1: St. Louis Freight Activity by Direction and Mode in 2012 St. Louis MO-IL CSA St. Louis MO-IL CSA Estimated Freight in 2012: 210 Million Tons Distribution by Transport Mode Domestic Rail 23.8% Outbound 34.5% Truck 42.2% Domestic Inbound 54.1% Pipeline 16.1% Air 0.0% Export* Import* 6.9% Water 4.5% Multiple Other 0.5% Modes 10.4% 6.9% Source: FAF3 Infrastructure Inventory Key Findings . Over $100 million in roadway and bridge project investments was recently completed in Madison and St. Clair counties. This investment is significant and fosters growth in freight- based industries. Southwestern Illinois Freight Transportation Study Page iii Leadership Council Southwestern Illinois August 7, 2015 . Over $700 million in additional roadway and bridge investment is programmed over the next five years along with other investment needed in rail and port infrastructure. Continued support for transportation investment is important to foster economic growth. Highways in Southwestern Illinois avoid traffic congestion in downtown St. Louis and improve linkages to Chicago, allowing for growth in trucking along highway corridors. Eastbound rail service is a particular strength for the St. Louis region, especially as compared to Chicago due to congestion or to Kansas City due to St. Louis’ closer proximity to eastern states. The distribution service area is within a 300 to 400 mile radius of St. Louis; however, shipments originating from St. Louis can reach anywhere in the U.S. within a three-day truck drive. The existence of UPS and FedEx hubs provide additional transportation mode and delivery time options that make St. Louis attractive for eCommerce Fulfillment Centers, manufacturers, and others that require all transit time options, varying from overnight to a week or more, and transport reliability. The North American transportation landscape has been in constant flux over the past two decades, which may create openings for St. Louis as logistics managers evaluate the reliability of their existing supply chains and prepare contingency plans. The combination of reliable river barge service and access to six Class 1 North American railroads creates substantial opportunities for bulk and break-bulk transload services serving Midwest, Gulf Coast, and International markets. The St. Louis region has 5 airports with cargo capabilities. Currently, air cargo is mostly limited to charter services. MidAmerica Airport has cold storage capabilities for shipping perishable goods via air. Market Survey Key Findings . The St. Louis area has many logistical advantages, but is often overlooked because of competing logistics hubs’ aggressive promotional efforts. Aggressive business development campaigns of competing regions tend to overshadow the region’s advantages, such as central location to key Midwest markets, ample access to key transportation modes, and available workforce. The Port of Houston may receive consideration as an alternative Asia cargo gateway due to the prospect of continued labor disruption on the U.S. West Coast and a key gateway for the Latin America trade. St. Louis has faster intermodal rail service to and from the Port of Houston than do regional rivals, such as Kansas City or Chicago. Southwestern Illinois Freight Transportation Study Page iv Leadership Council Southwestern Illinois August 7, 2015 . Persistent trucker shortages are causing shippers to divert truck freight to the intermodal rail mode. Favorable intermodal rail service to Eastern markets from
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