CHAPTER 6 6.8 RAIL 6.8.1. INTRODUCTION Even though rail service is important to the economy, the railroads physical size has been diminishing since the 1920’s with the abandonment of underutilized track. The construction of federally funded highway projects initiated in the 1950's and 1960's increased the use of truck transportation. Waterborne shipping transport was also improved, and in some cases created, with the use of federal funding. But, in recent years, the railroad’s share of the transportation market has been increasing and abandonments have slowed. American railroads have generally been privately owned. The one exception was Conrail for the first 11 years of its existence. Eastern railroads, until recently, have not been on the receiving side of any federal funds. Nonetheless, the railroad industry continues to play a vital role in the maintenance of a healthy economy in Ohio and nationwide. Many industries throughout the state depend on rail service that varies from the use of a short line operator with a few miles of track to the Class I railroad companies with thousands of miles of track in many states. In Ohio and across the country, more than 40% of all intercity freight is transported by rail. Deregulation allowed the rail industry to abandon lines without going through a long regulatory procedure. This permitted the railroads to become more productive and more competitive. Although this process has resulted in track abandonments and sales, and workforce reductions, service has been improved resulting in more cost effective railroads able to compete with other forms of transportation and to attract the capital necessary to fund improvements. It has also allowed the creation of numerous shortline railroads. Shortlines generally have lower labor costs and less stringent work rules, so they may serve shippers more efficiently than a larger railroad. However, because shortlines are by definition short, the long haul still belongs to the Class 1 railroads. This results in a win‐win situation where Class 1’s are relieved from ownership of marginal lines, but still get the long haul, new businesses are started and jobs are created, and most importantly, shippers still receive the benefits of having the most energy efficient/cost effective method of transportation available to them. Prior to 1980, there were three shortline railroads in the two county area and these were all subsidiaries of one or more class 1 railroads. Today there are five shortlines in the area, none owned by a Class 1. In fact four of these shortlines are owned by the Genesee & Wyoming System, a company that owns over 60 shortline railroads in the U.S. and three other countries. One area of growth for the railroads in recent years has been intermodal traffic. Intermodal traffic is where more than one type of transportation is employed for moving goods such as truck/rail, water/truck, or water/rail. Also, the cargo should stay in the same shipping container. A myriad of technological improvements have contributed to more efficiency in the rail industry. Ohio is one of the top ten states nationally in railroad track mileage and employment. The Ohio General Assembly established the Ohio Rail Development Commission (ORDC), on October 19, 1994. There are 15 ORDC Commissioners. Commissioner’s appointments include four non‐voting members from the Ohio General Assembly, seven Commissioners are appointed by the Governor, one each by the Speaker of the Ohio House and the President of the Ohio Senate. The Directors of the Ohio Department of Development (ODOD) and the Ohio Department of Transportation (ODOT) are both ex‐officio members. The primary responsibilities of the ORDC include: Preserving Ohio’s rail infrastructure through rehabilitation, acquisition and construction; Promoting Ohio’s rail freight and intermodal freight system; Developing Ohio’s intercity rail passenger system; Assisting in the development of Ohio’s commuter rail corridors; Providing grants, making loans and issuing bonds for various projects; Granting franchises for passenger rail and station operations; Initiating freight and passenger rail projects which contribute to the establishment of a balanced transportation system and the economic development of Ohio. The Commission staff functions as an integral part of ODOT to ensure the coordination of rail investments with other modes of transportation. When railroads apply to abandon an unprofitable line, a process begins to determine the feasibility of maintaining the line through cost/benefit and viability analysis. The Commission is available to assist a community with alternatives to purchase the rail line and acquire a short line company to operate and provide service on it. If the track is deteriorated, the ORDC can also provide support to rehabilitate the line. The Commission provides other service options to local entities, including the connection of facilities for freight transfer from one mode to another. Amended House Bill (HB) 163, a Legislative Mandate for a study to be performed by the ORDC, the Public Utilities Commission of Ohio (PUCO) and the Ohio Emergency Management Agency (OEMA), was signed by Governor Bob Taft on March 31, 1999. HB 163 recognized problems related to Conrail acquisitions and required the ORDC/PUCO/OEMA to investigate the following; Grade separations and improvements needed to alleviate safety problems and congestion in the state; How to develop a priority system to determine the order in which those grade separations and improvements could be completed; Potential funding sources for the grade separation and improvement projects; Statutory and regulatory changes that may be necessary to maintain public health and safety with regard to predicted increases in rail transportation of hazardous materials in the state. Study findings for HB 163 recommended that between $200 million and $225 million be made available for a railroad grade separation program to address worst‐case situations in the state. Additional information on this program can be found on ODOT’s web page www.dot.state.oh.us. 6.8.2. OVERVIEW OF THE OHIO RAIL SYSTEM Ohio’s location, midway between the major East Coast ports and the mid‐continent gateways of Chicago and St. Louis, and strong industrial/agricultural base combine to make Ohio an important national transportation area. The State’s rail freight system is heavily utilized and has experienced a steady increase in volume since the 1990’s. Mining, agriculture, vehicle and equipment manufacturing, and heavy manufacturing industries in Ohio comprise an important part of the State’s economic base and they depend heavily on rail freight services. Coal is the largest commodity by volume that is shipped by rail. Other major commodities include metallic ore, grain and other farm products, primary metal products such as steel, food products, chemicals, plastics, automobiles and parts, non‐metallic minerals, lumber, waste and scrap. Generally, major manufacturing industries in Ohio receive raw materials and ship finished and semi finished products. Railroads account for approximately 30+ percent of the total value, 25+ percent of the total tonnage and 50+ percent of the total ton miles of commodities shipped from Ohio. On the average, 40 percent of shipments from Ohio to the neighboring states of Pennsylvania, New York, West Virginia, Kentucky, Indiana and Michigan were made by rail. The future demand for rail services does in fact appear encouraging. Employment in industries that are also major users of rail transportation is anticipated to amount to 20 percent of the State’s workers. Coal, metallic ore, non‐metallic minerals and petroleum products are heavily rail dependent and account for more than 75 percent of rail tonnage in Ohio. Most of the railroad shipments with origins in Ohio are intra‐state movements and movements between Ohio and its adjacent states of Kentucky, Michigan, West Virginia and Pennsylvania. Most shipments that terminate in Ohio also have origins from these states and Ohio. Shipments from Ohio to southern states account for approximately 30 percent of Ohio rail shipments. Also, a large percentage of the freight, especially intermodal freight, on the rail lines in Ohio is passing through on its way from the East Coast ports to the Midwest gateways of Chicago and St. Louis and vice versa. Economical rail transportation has been essential to Ohio’s and the Mahoning Valley’s economic development and should continue to stimulate economic growth in the future. 6.8.3. PASSENGER RAIL SERVICE As of 2005, the B&O station in Youngstown ceased to offer passenger rail. The last remaining line at that point was Amtrak’s “Three Rivers” that ran daily between New York and Chicagoa. The primary reason Amtrak stopped service to Youngstown was because of low ridership; however it continued its service through Alliance, where ridership was not much greater. Unfortunately, the only train that comes into Alliance does so at around 1:30 AM west bound, 3 AM east bound. The late night Youngstown “fly through” service (3,600 annual passengers) that was provided did nothing to compete for the transportation business of the Mahoning Valley intercity traveler. From a transportation planning perspective, Eastgate is more optimistic about the Ohio Hub Rail Passenger Service being proposed by the Ohio Rail Development Commission (ORDC). The Ohio Department of Transportation and ORDC jointly initiated a feasibility study of a regional rail system consisting of four corridors with a central hub in Cleveland: 1. Cleveland‐Columbus‐Dayton‐Cincinnati (3C) 2. Cleveland‐Pittsburgh (Keystone) 3. Cleveland‐Toledo‐Detroit 4. Cleveland‐Erie‐Buffalo‐Niagara Falls‐Toronto. The Cleveland Hub would increase the efficiency of the overall transportation system by improving railroad infrastructure. The system would complement air and automobile travel by providing modern rail passenger service that offers convenient travel times, frequent and reliable services and comfortable, modern passenger amenities. The Cleveland Hub intends to reduce travel times by increasing maximum train speeds from 79‐mph to 110‐mph.