Technical Report Documentation Page 1. Report No. 2. Government Accession No. 3. Recipient’s Catalog No. FHWA/TX-03/4083-2 4. Title and Subtitle 5. Report Date October 2002 INLAND PORTS: 6. Performing Organization Code PLANNING SUCCESSFUL DEVELOPMENTS 7. Author(s) 8. Performing Organization Report No. Jolanda Prozzi, Russell Henk, John McCray, Rob Harrison 4083-2 9. Performing Organization Name and Address 10. Work Unit No. (TRAIS) Center for Transportation Research The University of Texas at Austin 11. Contract or Grant No. 3208 Red River, Suite 200 0-4083 Austin, TX 78705-2650 12. Sponsoring Agency Name and Address 13. Type of Report and Period Covered Texas Department of Transportation Research Report: Research and Technology Implementation Office September 2001 – August 2002 P.O. Box 5080 14. Sponsoring Agency Code Austin, TX 78763-5080 15. Supplementary Notes Project conducted in cooperation with the U.S. Department of Transportation, Federal Highway Administration, and the Texas Department of Transportation. 16. Abstract The consideration of multi-modal inland ports to enhance trade corridor performance and improve the efficiency of global supply chains is starting to emerge in the transportation community. Ultimately, it is believed that inland ports have the capability to create local employment, enhance corridor efficiencies and thus trade competitiveness, and reduce both public and private costs. The objective of 4083-1 was to create a classification methodology to better understand how different inland ports can support efficient supply chains and enhance corridor performance. The first year study recognized the importance of inland ports as international trade processing locations. In addition to this function, inland ports relieve congested traditional ports of entry, facilitate value-added services, and enhance local and regional development. The objectives of 4083-2 are to demonstrate the role and benefits of inland ports, provide a brief overview of the TxDOT highway planning and programming process, highlight the critical investments required and the level of TxDOT support that can expected as the inland port develop, consider the impacts of trade and trade truck flows on the locations of inland port developments, and finally, to propose an evaluation framework that allows TxDOT planners to review potential inland port investment requests from a transportation planning perspective. Given the multi- modal components of inland port developments, it is foreseen that the findings of this study can be used to inform transportation planners considering the location of multi-modal terminals on the proposed Trans Texas Corridors. 17. Key Words 18. Distribution Statement Inland ports, supply chain management, transportation No restrictions. This document is available to the planning, critical investments, evaluation public through the National Technical Information considerations Service, Springfield, Virginia 22161. 19. Security Classif. (of report) 20. Security Classif. (of this page) 21. No. of pages 22. Price Unclassified Unclassified 96 Form DOT F 1700.7 (8-72) Reproduction of completed page authorized Inland Ports: Planning Successful Developments Jolanda Prozzi Russell Henk John McCray Rob Harrison Research Report 4083-2 Research Project 0-4083 Impacts of Inland Ports on Trade Flows and Transportation in Texas Conducted for Texas Department of Transportation in cooperation with U.S. Department of Transportation Federal Highway Administration by the Center for Transportation Research Bureau of Engineering Research The University of Texas at Austin October 2002 Disclaimers The contents of this report reflect the views of the authors, who are responsible for the facts and the accuracy of the data presented herein. The contents do not necessarily reflect the official view or policies of either the U.S. Department of Transportation, Federal Highway Administration, or the Texas Department of Transportation (TxDOT). This report does not constitute a standard, specification, or regulation. There was no invention or discovery conceived or first actually reduced to practice in the course of or under this contract, including any art, method, process, machine manufacture, design or composition of matter, or any new useful improvement thereof, or any variety of plant, which is or may be patentable under the patent laws of the United States of America or any foreign country. NOT INTENDED FOR CONSTRUCTION, BIDDING, OR PERMIT PURPOSES. Robert Harrison Research Supervisor Acknowledgments The authors wish to acknowledge the involvement and direction of the Texas Department of Transportation project monitoring committee, which includes Project Director Judy Friesenhahn (Advance Project Development Engineer) and Program Coordinator Luis A. Ramirez (District Engineer – Laredo). Thanks are also due to Dr. Khali Persad who provided valuable input in drafting the level of TxDOT support that can be expected at each of the various phases of the inland port development life cycle. The research team is also grateful for the assistance provided by Patricia Hord (CTR) and Maria Saenz-Farias (CTR) who provided editing and graphical assistance in the production of this document. Research performed in cooperation with the Texas Department of Transportation and the U.S. Department of Transportation, Federal Highway Administration. Table of Contents 1. Introduction and Background................................................................................1 1.1 Project Background..................................................................................................1 1.2 Project Purpose........................................................................................................2 1.3 Organization of Report ............................................................................................3 2. The Role and Benefits of Inland Ports ..................................................................5 2.1 SOCIETAL BENEFITS..........................................................................................5 2.1.1 Economic Development............................................................................5 2.1.2 Employment Creation...............................................................................6 2.1.3 Increased Tax Revenues ...........................................................................7 2.1.4 Reduced Congestion and Environmental Pollution at Traditional Ports of Entry .........................................................................7 2.2 PRIVATE BENEFITS.............................................................................................7 2.2.1 Multi-Modal Transportation Access.........................................................8 2.2.2 Improved Supply Chain Management ......................................................9 2.3 PUBLIC AGENCY BENEFITS............................................................................11 2.3.1 Optimize Existing Port Capacity/Border Facilities.................................11 2.3.2 Leverage Private Funds...........................................................................11 2.3.3 Allow Modal Split away from Heavy Trucks.........................................12 3. TxDOT Highway Planning Process .....................................................................13 3.1 PARTICIPANTS IN THE PLANNING PROCESS .............................................13 3.2 TxDOT PROJECT DEVELOPMENT PROCESS................................................14 3.3 FUNDING CATEGORY STRUCTURE..............................................................15 3.4 CONCLUDING REMARKS.................................................................................17 4. Critical Investments and Support Required for Inland Port Development .....................................................................................................19 4.1 PHASE 1: PREPARATION .................................................................................19 4.1.1 Inland Port Developer.............................................................................19 4.1.2 TxDOT Support......................................................................................23 4.2 PHASE 2: ESTABLISHMENT............................................................................24 4.2.1 Inland Port Developer.............................................................................24 4.2.2 TxDOT Support......................................................................................25 4.3 PHASE 3: EXPANSION......................................................................................26 4.3.1 Inland Port Developer.............................................................................26 4.3.2 TxDOT Support......................................................................................28 4.4 PHASE 4: STABILIZATION ..............................................................................29 4.4.1 Inland Port Developer.............................................................................29 4.4.2 TxDOT Support......................................................................................30 4.5 PHASE 5: DECLINE/ INNOVATION ................................................................30 4.5.1 Inland Port Developer.............................................................................30 4.5.2 TxDOT Support......................................................................................31 vii 4.6 CONCLUDING REMARKS.................................................................................31