Forest Opportunity Roadmap/

Transportation Committee Recommendations

April 23, 2018

Part 1 – Capital Investment Plan

In our effort to improve the competitive position of Maine’s forest products industry, the Maine Forest Economic Growth Initiative (MFEGI) supports targeted capital investments in transportation infrastructure to improve the competitive position of Maine’s Forest Products sector.

Existing Highway Improvement Priorities ‐ The first set of improvements sought are on “D” and “F” rated highway segments on specific Priority 1, 2 and 3 corridors including Route 2 from Gilead to Bangor and Route 1 from Bucksport to Calais and points north of these two highways. Maine statute sets priorities for capital investment on Maine highways and bridges. That statute (Title 23, Section 73, sub‐ section 7) establishes the goal that by 2022 MaineDOT shall improve all Priority 1 and 2 corridors (primarily major and minor arterials) so that their safety, condition and serviceability “customer service levels” are fair or better. Further, the statute states that by 2027, the Department shall improve all Priority 3 corridors (primarily major collectors) so that their safety, condition and serviceability is fair or better. MFEGI supports highway and bridge improvements consistent with this statute. However, since it is doubtful that MaineDOT will meet the improvement timelines prescribed in statute, MFEGI is recommending improvement priorities for “D” and “F” segments on Priority 1, 2 an 3 corridors.

The condition of Priority 1, 2 and 3 highways important to the forest economy and south of Route 2 from Gilead to Bangor is relatively superior to the rest of Maine. Furthermore, the economic hardships resulting from mill closures occurred elsewhere in the State where Maine’s forest resource is predominant. These factors, plus the results of a forest products industry survey conducted by the MFEGI Transportation Committee, support prioritizing highway and bridge improvements on these corridors:

a. Route 2, Gilead‐Bangor (1) b. Route 1, Bucksport‐Fort Fairfield (1,2 & 3) c. Route 17, Oquossic‐Rumford/Mexico (3) d. Route 4, Oquossic‐Farmington (2) e. Route 27, Coburn Gore(Canadian Border)‐Farmington (2 & 3) f. Route 201, Sandy Bay (Canadian Border)‐Skowhegan (2) g. Route 16, Rangeley‐Eustis (3) h. Route 6, Jackman‐Vanceboro (Canadian Border) (2 & 3) i. Route 150, Guilford‐Skowhegan (3) j. Route 23, Canaan‐Hinckley (3) k. Route 9, Brewer‐Baileyville (1) l. Route 15, Dover‐Foxcroft‐East Corinth (2) m. Route 16, Milo‐I‐95 (2) n. Route 11, Milo‐ (2, 3 & 4) o. Route 212, Knowles Corner‐I‐95 (3) p. Route 161, Fort Fairfield‐Allagash (2 & 3) q. Route 1 , Calais – Fort Kent (1, 2 & 3)

Bridge sufficiency and functionality improvements to improve safety and reliability are considered to be essential companions to the route improvements sought herein(see MaineDOT "Keeping Our Bridges Safe" report) .

Haul Route Upgrade Projects ‐ A relatively new state law (Title 29‐A, Section 2354‐D) grants discretion to MaineDOT to provide waivers for over‐dimension and over‐weight truck loads moving on public ways for limited distances. If MaineDOT determines that a waiver would require road improvements, then the law envisions a 50‐50 public‐private partnership in financing such improvements.

Given the concentration in the greater Ashland region of forest product mills, biomass generation and pellet production, the intersection of major private haul roads with Route 11 and the proximity to rail yards, the designation of a Route 11 haul road from the intersection of Grand Lake/St. Croix Roads to the south in T8 R5 WELS to Beaver Brook Road to the north in Nashville Plantation is worthy of consideration. Additional highway segments to consider include 10 to 11 miles of Route 161 in the vicinity of Allagash as a means to move otherwise stranded fiber from points north and east of Allagash south on private roads to connect with Route 11 and rail service. Other segments of state highway offering the potential to utilize the over‐weight waiver provision include a roughly one mile section of Route 1 in Van Buren to connect the Sullivan Road to a rail yard, Route 11/157 from Golden Road in Millinocket to a rail yard at Dolby and/or other nearby rail locations, Route 11 in Brownville from Katahdin Iron Works Road to CMQ and EMR rail yards and a northern section of Route 201 from Kelly Dam Road south to Lower Enchanted Road to connect these private roads to rail and area forest product companies.

In addition to the statutory 50‐50 financing proposition, consideration should be given to the use of MaineDOT's Business Partnership Initiative (BPI) involving one third shares from MaineDOT, the private sector and municipal/county government. A county role is a potential where highways are within unorganized townships and/or the benefit is to landowners in the adjacent unorganized townships. A variation on the above mentioned 50‐50 partnership is to fund the non‐MaineDOT share with a combination of private, local or other funding sources.

Forest Transportation Facilities and Equipment ‐ MaineDOT's Industrial Rail Access Program (IRAP) is designed to encourage economic development and increased use of rail transportation. It requires a minimum 50% private sector financial contribution with the balance provided by MaineDOT through a combination of general fund bond proceeds and state appropriations. The State typically provides funding of $1.25 million per year. Grant award decisions are made on a competitive basis. The partnership aspect of IRAP, with the requirement of private sector participation, lends credibility to award decisions and with positive operational experience dating back to the late 1990's the program enjoys Executive and Legislative support. The IRAP grant application and award process is well suited for sifting through the many competing opportunities that are out there but it is neither exclusively for the use of the forest products sector nor is it suited to support forest product truck transport.

MFEGI recommends modifying IRAP to support a broader set of freight transport investment partnerships that meet facility and equipment needs in the forest products sector. Eligible activities would include: yard development for truck, rail and marine forest product handling, loading and off loading equipment, haul route upgrade projects (see above) and all other activities previously covered under IRAP for what might become a new Industrial Freight Access Program (IFAP).

This program expansion proposal should also incorporate use of the Maine Port Authority to expand capital financing potential. The statute governing the Maine Port Authority allows for both port and rail financing and the Authority is experienced with port projects. The Authority has used state funds to build a pier, buy a crane and erect storage buildings with the expectation that a portion of wharfage fees would be retained over an extended term for the Authority to recover its investment and allow for further loans. MFEGI recommends the use of the Maine Port Authority when rail equipment and facility needs can be financed through it with the assurance that rental fees would be returned to the Authority over an extended term to recover the investment and capitalize a revolving loan fund to finance further investments.

Financing

To act on the previous recommendations, public –private financing is needed. On the public side, there exist a number of financing options but given the relatively competitive ranking of Maine’s motor fuel tax rates nationally and the need to fulfill Maine’s statutory highway investment goals, MFEGI recommends passage of an increase in motor fuel taxes (gas and diesel) dedicated solely for the purpose of funding the previously noted Priority 1, 2 and 3 highway improvements, the state share of haul route upgrade projects and the highway share of future IFAP projects. Furthermore, this motor fuel tax increase should be applied to pay principal and interest on a new Highway Fund bond that will expedite completion of the proposed capital investments. Maine’s debt burden associated with the Highway Fund is low and decreasing rapidly in the next three years. Capacity exists for new Highway Fund debt to be issued.

For port and rail related capital investments, it will be necessary to continue with the issuance of general fund bonds and direct appropriations from MaineDOT’s Multi Modal Fund.

MFEGI recognizes that it will need to collaborate with many interests to shape and revise this proposal to insure public support and the necessary State Executive and Legislative approval. MFEGI will work with private and non‐profit interests focused on transportation investment and with MaineDOT to arrive at a consensus for financing the recommendations herein. To assure success, MFEGI will need to champion these recommendations over an extended period of time to assure a public policy success.

This report was prepared by FOR/Maine using Federal funds under award number 01 69 14749 from the Economic Development Agency of the Department of Commerce. The statements, findings, conclusions and recommendations are those of the author(s) and do not necessarily reflect the views of the Economic Development Agency or the United States Department of Commerce Operating Forest Product Companies Softwood Sawmills Manufactured Wood Mills Chester Forest Products - Chester Columbia Forest Products - Presque Isle Hammond Lumber - Belgrade Huber OSB - Easton Hancock Lumber - Bethel LP OSB - Houlton Hancock Lumber - Casco ESTCOURT NMW Hancock Lumber - Pittsfield Pellet Mills J. D. Irving - Ashland Corinth Wood Pellets - East Corinth J. D. Irving - Dixfield Lignetics, LLC - Strong Madawaska P&PM Katahdin Forest Products - Oakfield Maine Wood Pellets - Athens EMRY 011 Limington Lumber - East Baldwin Northeast Pellets, LLC - Ashland Fort MNRMNR Grand Isle Lovell Lumber - Lovell 1 Frenchville Pulp and Paper Mills Kent 01 Lowell Lumber - Buckfield St. A gatha 011 Catalyst - Rumford EMRY Maibec Lumber - Masardis St. EMRY 162 John 161 ³ ± ³ ± Sappi Somerset - Hinckley St. N. C. Hunt - Jefferson Francis LITTLE Van Buren Sappi Westbrook - Westbrook NMW Parker Lumber - Charleston BLACK 161 Twin Rivers - Madawaska NMW ³ ± ST. FRANCIS Pleasant River Lumber - Dover-Foxcroft Verso - Jay NMW Pleasant River Lumber - Hancock DICKEY Allagash Woodland Pulp - Baileyville NMW MNR Hamlin ALLAGASH Pleasant River Lumber - Jackman Stockholm 011A Eagle Lake Pleasant River Lumber - Sanford 011 Robbins Lumber - Searsmont Stratton Lumber - Stratton 161 ³ ±

ST. PAMPHILE NMW 11 ³ ±

89 ³ ± Hardwood Sawmills Limestone

228 ³ ± 223 Cousineau - North Anson Caribou ³ ± Perham Hardwood Products - Guilford 161 1A ³ ± 01

164 ³ ± Kennebec Lumber - Solon CHIP 228 ³ ± Fort FISH Washburn Lumbra-Oscar & Rueben - Milo NMW Fairfield HARDW MNR MNR

164 ³ ± Portage 011 Maine Wood - Portage AROOSTOOK POWER MNR

227 ³ ± MNR Pallet One/Isaacson Lumber - Livermore Falls CO. MFG MNR Mapleton Presque Isle

Biomass Power Generators 8 MILE 163 MFG ³ ±

10 ³ ± NMW Easton 42 Railroad Avenue, LLC - Stacyville Ashland Catalyst Paper Cogenerator - Rumford PELLET SOFTW MNR 011A Covanta - Jonesboro POWER Scopan NMW Covanta - West Enfield ST. JUSTE Mars Hill ReEnergy Ashland - Ashland SOFTW Masardis Blaine ReEnergy Fort Fairfield - Fort Fairfield

ReEnergy Livermore - Livermore Falls NMW ReEnergy Stratton - Stratton OXBOW Bridgewater 011 Sappi Somerset - Hinckley Sappi Westbrook - Westbrook

Monticello

Verso Paper Cogenerator - Jay 11 ³ ± Woodland Pulp Biomass - Baileyville MNR

Chip Mills Li ttleton 212 Carrier Chipping - Hinckley ST. AURELIE NMW ³ ± Costigan Chipping - Costigan CHIP STATE 012 Farmington Chipping Enterprises - Farmington MATAGAMON Smyrna Mills ¦§¨95 MFG MNR 012 Gardner Chipping - Chester Houlton

159 ³ ± SOFTW Oakfield Gardner Chipping - Houlton NMW Hodgdon TELOS Gardner Chipping - Millinocket Li nneus

159 ³ ±

Midwest Price - West Paris Island Falls Patten Milo Chipping - Milo MNR¦§¨95 012 RenTech - Baileyville 11 ³ ± N. A mity Seven Islands - Portage NMW NMW 20 MILE CARIBOU POWER Sherman Sandy Bay Twp. Mills 011 Haynesville (Jackman Crossing) STATE TOGUE 012A Orient

POND 11 ³ ±

012 01201 PISCATAQUIS MNR Rockwood CHIP 171 Danforth Kokadjo STATE Millinocket ³ ± CO. EMRY Moose River SOFTW HENDERSON ¦§¨95 EMRY 157 Wytopitlock Jackman ³ ± Macwahoc Medway 169 ³ ±

6 ³ ± East Millinocket

15 ³ ± CMQR NBSR

11 157 ³ ± ³ ± Kingman EMRY 170 Vanceboro CMQR ³ ± CMQR STATE

116 ³ ± CMQR JO-MARY Mattawamkeag 6 ³ ± STATE Winn EMRY Greenville HEDGEHOG CHIP 168 ³ ± West Forks STATE PARI SOFTW Topsfield KATAHDIN Chester IRON WORKS CMQR 012 Springfi eld Coburn 27 ³ ±

6 ³ ± CMQRCMQR Brownville Jct. Lincoln Lee

Gore 6 ³ ± 15 ³ ± Sebec Lake EMRY Monson CHIP 011

HARDW 11 ³ ± 6 Milo Greeley Landing ³ ± Enfield

6 H³ ± owland Caratunk 16 Princeton ³ ± W. Enfield POWER Burl ington Abbot SOFTW ¦§¨95 NBSR Passadumkeag Grand Lake Vil. EMRY Calais SOMERSET HARDW Dover-Foxcroft Stream CHIP 1 Lagrange 01 Guilford Sangerville 15 POWER Baring Stratton 16 ³ ± CO. ³ ± 01201 PENOBSCOT Baileyville

Kingsbury P&PM Not SOFTW Parkman Carrabassett 23 1 ³ ± CO. 2 In 01 16 ³ ± Valley Mayfield 150 191 ³ ± Robbinston 16 ³ ± Charleston SOFTW 01 ³ ± 16 ³ ± WASHINGTON Moscow Cor. Operation 7 ³ ±

POWER 9 ³ ±

Bradford

27 11 ³ ± ³ ± Alton CO. Crawford Meddybemps Brighton Garl and Cambridge Dexter PELLET Costigan CMQRCMQR

214 ³ ± E. Corinth Hudson CHIP Perry 151 ³ ± Wilsons Harmony 43 ³ ± ved Mills Oquossoc Rangeley Kingfield HARDW Wesley Pembroke

43 ³ ± 16 ³ ± Milford 4 Solon Remo ³ ± Glenburn Cen. 190 Eastport 16 ³ ± ³ ± 11 ³ ± 221 ³ ± Old Town FRANKLIN Athens Dennysville PELLET St. A lbans 43 ³ ± Corinna Bradley 191 201 W. Levant Kenduskeag ³ ±

17 ³ ± 01

8 ³ ±

43 ³ ± Stetson New Portland 151 Track CO. ³ ± 86 ³ ±

16 ³ ± PARI 9 7 ³ ± HARDW Hartland ³ ± Corridor Lubec Levant Orono Aurora PARIPARI N. Anson Cornville Beddington Rail 189 ³ ± Lakewood Newport 15 Amherst 1 Phillips 150 ³ ± 01 ³ ±

23 9 ³ ± ³ ± 2 192 PELLET 01 ³ ± Etna Clifton Strong New Eddington Whiting 189 E. Newport Bangor ³ ±

Anson 191 ³ ± Vineyard 148 ³ ± Carmel Hermon Pittsfield Detroit 012 Brewer

142 ³ ± Madison

East 181 179 ³ ± 148 PARI ³ ± ³ ± 180 Eddington ³ ± Skowhegan 012 SOFTW Plymouth ¦§¨95 Not Canaan §¨395 Marshfield ¦ East 193 ³ ± 43 ³ ± Hampden HANCOCK East Machias 27 Starks Holden ³ ± Orrington Mariaville 4 Allens POWER In Machias Weld ³ ± Waltham Upton Norridgewock PARIPARI Operation CO. 1A 1 Mills Newburgh Vil. 01 01 191 ³ ±

CMQR Dedham Machiasport Temple CMQR Eastbrook Hinckley P&PM Columbia PARI PARI Burnham Farmington 2 Dixmont Falls Jonesboro

11 ³ ±

156 ³ ± 01

139 ³ ± ¦§¨95 DSRX Cutler Andover CHIP 46 1A ³ ± 01 Frye CHIP Farmington New Sharon Clinton Harrington POWER Carthage Falls Smithfield 201 Winterport Bucks H br. 01 Unity PARI Monroe Addison Fairfield Cen. Not 180 1 P&PM Wilton Frankfort ³ ± 01 7 ³ ± Rome Cherryfield 187 Fairfield ³ ± In

179 ³ ± 142 ³ ± 1A Franklin 2 01 Corridor 26 ³ ± 01 Benton Thorndike Bucksport POWER 4 Operation Mexico ³ ± 41 ³ ± 202 WALDO 5 ³ ± SOFTW Oakland 01 Brooks Orland Rail Chesterville Prospect SOFTW Rumford Dixfield Waterville Ellsworth Track POWER Freedom Hancock Milbridge Jonesport Vienna Winslow CO. Removed PARI P&PM Belgrade Albion Sullivan Steuben 108 ³ ± 27 Swanvil le 172 1 Jay Lakes ³ ± SOFTW BML ³ ± 01

15 ³ ± 012 HARDW Mt. Newry East 1 1 Chisholm Vernon Vassal boro Stockton Springs 01 01 Surry Gouldsboro 220 ³ ± Sorrento

Livermore Falls China 175 ³ ± Belgrade Penobscot Vassal boro 184 5 Morrill Searsport ³ ± ³ ± 3 Canton CMQR ³ ± POWER 172 ³ ± Trenton OXFORD KENNEBEC 1 140 01 ³ ± 17 ³ ± Sidney 108 ³ ± PARI 195

SLR ³ ±

SLR 3 ³ ± 186 Belfast ³ ± 2 Bethel Blue Hill Bar Prospect Gilead 01 Locke Li vermore Kents H ill S. China Palermo 102 ³ ±

CO. CO. 202 3 ³ ± Harbor Hbr. Mills PARI Winter Readfi eld 01 Li berty Castine SOFTW Bryant 219 Hbr. Pond ³ ± Somesville

4 ³ ± Searsmont 220 ³ ± SOFTW

133 ³ ± Wayne 41 Northport

³ ± 3 95 202 ³ ± 219 ³ ± Manchester ¦§¨ 3 ³ ± 01 172 W. Paris ³ ± 5 Augusta 198 ³ ± ³ ± PARI 202 Windsor 15 SOFTW Winthrop 01 Li ncolnvil le Islesboro ³ ± Sedgwick 26 Buckfield Leeds Weeks Mills Cen. ³ ±

35 ³ ± CHIP 17 Northeast H br. Hallowell ³ ± Washington Li ncolnvil le 175 Tremont 102 ³ ± Southwest Turner Hope ³ ± Farmingdale Harbor Monmouth 011 Randolph 17 ³ ± Bass Harbor S. Paris W. Gardiner Deer

126 32 ³ ± ³ ± Isle Center Norway Hebron N. Whitefield KNOX Lovell Gardiner Union Camden 15 ³ ± Pittston Jefferson Waterford Greene 126 220 ³ ± 4 Li t³ ± chfield95 CO.W. Rockport Rockport ³ ± ¦§¨ Atlantic 35 ³ ± 9 ³ ± Whitefield SOFTW 26 ³ ± SLR 202 117 ANDROSCOGGIN Operation ³ ± 01 LINCOLN Stonington Oxford 17 Harrison CO. ³ ± Sabattus Warren 5 ³ ± Mechanic 213 North H aven ³ ± 32 Frenchboro Falls Auburn PARI Alna CO. ³ ± SOFTW In 011 CMQR Rockland Poland Minot Lewiston Waldoboro Otisfield Richmond Isle A u Haut

35 ³ ± 95 Commercial Seaport Not ¦§¨ 9 Bridgton ³ ± ¦§¨295 Thomaston Vinalhaven In

302 27 ³ ± Fryeburg 01 Not S. Thomaston OperationLisbon Newcastle Damariscotta 220 ³ ± Casco Danville Lisbon Falls 1 St. George

113 ³ ± 160 Wiscasset 01 ³ ± Bowdoinham 73 ³ ± NMW Not 5 ³ ± 01302 Checkpoint In Denmark Naples Durham SAGADAHOCPARI Operation SOFTW New Gloucester Friendship re t seculo G weN 32 Brownfield CUMBERLAND CO. Bristol ³ ± Tenants Harbor

35 4 ³ ± ³ ± 129 117 ³ ± ³ ± 131 ³ ± 9 ³ ± Topsham CMQR 231 ³ ± STATE 5 202 1 State Checkpoint ³ ± CO. 01 W01oolwich Port

107 ³ ± Raymond 27 ³ ± PARIPARI SLRSLR Cooks 130 Clyde

113 ³ ± ³ ± Pownal Gray Cor. Bath Hiram Brunswick Boothbay 127 E. Sebago 26 ³ ± ³ ± 24 ³ ± Freeport Phippsburg Active Railroads SOFTW N. Windham 123 PARI ³ ± Boothbay Kezar Falls N. H arpswel l 209 ³ ±

25 ³ ± Steep Falls 302 Porter Cornish 01 Harbor Not 35 In ³ ± Cumb. 5 Yarmouth Georgetown ³ ± §¨95 Cen. Highway Priority Corridors

11 ³ ± ¦ Operation Cundys

160 ³ ± Harbor 202 ³ ± Standish 01S. Windham 9 Li mington SLR Priority 1 Corridors PARI Falmouth

25 ³ ±

Li merick 117 ³ ± Gorham Priority 2 Corridors 35 ³ ± 22 295 ³ ± 4 ¦§¨ 11 ³ ± Portland ³ ± Newfield Westbrook

5 ³ ± 202 Priority 3 Corridors Bar Mill s01 POWER S. Portland 4 Holl is Cen. ³ ± YORKWaterboro P&PM 11 Cen. Cape Elizabeth Priority 4 Corridors ³ ± Scarborough CO. ¦§¨95 1

109 5 ³ ± 01 ³ ± Shapleigh 4 Waterboro Acton ³ ± Prouts Saco¦§¨195 Neck 01202 Old Orchard Beach 111 PARI Springvale ³ ± Biddeford Alfred Wood Product Facilities Operating Rail Companies Sanford Biddeford Pool ¦§¨95 011

11 ³ ±

99 ³ ± SOFTW Kennebunk SOFTW Softwood Sawmill BML Belfast & Moosehead Lake Railway

9 ³ ± 01202 109 4 ³ ± ³ ± Kennebunkport HARDW Hardwood Sawmill CMQR Central Maine and Québec Railway S. Lebanon 9 ³ ± Wells Priority 1, 2 and 3 Corridors NHN N. Berwick PARI POWER Biomass Power Generator DSRX Company 9 ³ ± 98 ³ ± with a Customer Service Level 011 CHIP Chip Mill EMRY Eastern Maine Railway

Berwick 4 ³ ± S. Berwick Ogunquit score of “D” PELLET Pellet Mill MNR Company 91 Priority 1, 2 and 3 Corridors ³ ± Cape Neddick ¦§¨95 P&PM Pulp and Paper Mill NBSR Southern Railway 1A with a Customer Service Level

101 ³ ± 01 236 York Village ³ ± score of “F” MFG Manufactured Wood Mill NHN New Hampshire Northcoast Corp. South Eliot 103 011 ³ ± Kittery Kittery Pt. PARI SLR St. Lawrence & Atlantic Railroad Co.

0 5 10 20 30 40 50 Miles

Revised January 2018

DISCLAIMER – The Maine Department of Transportation provides this publication for information only. It is subject to revision and may be incomplete depending upon changing conditions. Reliance upon this information is at the user’s own risk. The Department assumes no liability if injuries or damages result from this information. Jan. 2018 ForestProducts_HCP_Jan2018.ai