Monday, March 29, 2004

Roanoke could become crosstie for rail routes

Preliminary plans being kicked around by Norfolk Southern might make Roanoke a major rail hub again.

   Roanoke may have a future in railroading after all.

   Norfolk Southern Corp. has a new idea, one that could make the Star City once again the crossroads of two major rail corridors.

   Robert Martinez, Norfolk Southern vice president for business development, says the railroad wants to upgrade its tracks southwest of Roanoke in the Interstate 81 corridor. That alone would be a change from the railroad's focus for the past 15 years.

   If the tracks were upgraded, NS could capture more of the business of shipping container freight from the Southeast to the Northeast and possibly slow the growth of truck traffic.

   The railroad also wants to improve its east-west corridor through Roanoke. That would give the port of Norfolk a faster connection to Columbus, Ohio, with Midwest markets and transcontinental rail lines.

   Two key elements for Roanoke are its location in both corridors and Norfolk Southern's vision of moving more container freight.

   It is the most significant new business idea NS has offered for Roanoke since 1982, when the Norfolk and Western Railway merged with Southern Railway to form NS. A few years after that, thousands of NS jobs began leaving Roanoke.

   Infrastructure is the obstacle to the vision. Public funding may be the answer, and that's the new element in the NS business approach.

   Container freight is merchandise in truck-size boxes that can be moved by ship, rail or tractor-trailer. The containers are usually carried by at least two of those modes on a single journey, which is called intermodal shipping.

   Trains with containers stacked two high have been moving through Roanoke for about 20 years, but NS hasn't been able to increase business as quickly as it would like.

   Tracks south of Roanoke can't handle enough trains at speeds needed to compete with trucks. West of Roanoke to Columbus, tunnels and highway overpasses aren't tall enough for double-stacked freight containers.

   Martinez hopes the public funding can come to the railroad through the same program that is being used to widen I-81 to eight lanes.

   The funding concept for I-81 is based on a 1995 Virginia law called the Public-Private Transportation Act. In its simplest form, the act enables private money to be lent for transportation projects. Revenues earned from roads repay the investors.

   People in Western Virginia know that funding concept as tolls. Tolls have been the hot-button element in I-81 discussions since January 2002, when a builders' consortium called Star Solutions offered to widen I-81 and collect fees from users.

   Martinez hopes an NS track upgrade can ride piggyback on the highway widening because several local governments want the rail lines to be upgraded along with I-81, according to information gathered by the Virginia Department of Transportation.

   Martinez said the railroad took note of media reports about the local governments' wishes and about community activists who argued for more rail instead of more highway.

   Highway tolls wouldn't be used to pay for rail improvements, Martinez said. Instead, rail shippers would pay a surcharge on freight movements, thereby reimbursing private investors who would buy bonds that would provide upfront financing for construction.

   In the early 1990s, Martinez served as Virginia's secretary of transportation under Gov. George Allen. Martinez said his major accomplishment in that role was writing the Public-Private Transportation Act.

   The act doesn't contain a provision for one of the major conflicts that's sure to arise with the NS proposal.

   Any freight that moves through the corridor from Knoxville, Tenn., to Harrisburg, Pa., without paying a toll on I-81 cuts down on revenue the highway would generate.

   The Star Solutions consortium has made its concern clear. It wants a contract with Virginia that eliminates competition in the I-81 corridor as much as possible. Wall Street investors will demand that protection, Star Solutions says.

   Martinez says Virginia state officials can decide that issue when they weigh the value of rail in the I-81 corridor, he said. Transportation officials should decide how much it's worth, in terms of public welfare, to divert 518,000 trucks per year off I-81 and haul their loads by train, Martinez said.

   Once Virginia decides what it's worth, the state could offer NS a contract under the Public-Private Transportation Act allowing bonds to be sold to generate track-improvement funds.

   At that point, NS would decide whether the improvements would generate enough profits for stockholders, and whether improvements in the I-81 corridor would be made more cost-effective than upgrades it could do itself at other places on the railroad.

   Martinez said the track upgrades NS proposes could allow 12 more trains a day to pass through Roanoke on the north-south corridor.

   The railroad has reduced its presence in Roanoke from 5,000 employees in 1987 to about 1,800. The major share of NS' north-south shipping now follows its Piedmont corridor from Atlanta through Greensboro, N.C., and Lynchburg to Harrisburg.

   NS says the Piedmont corridor is its fastest north-south route. Its track in the I-81 corridor is slow, has too many curves and too few sidings where oncoming trains can pass each other.

   A study by NS in 1999 showed $2.3 billion would be needed to upgrade and double-track the line paralleling I-81 from Knoxville to Harrisburg. Martinez said NS has done a new study of the route and the price has come down considerably. The Virginia portion of the infrastructure upgrade would be $306 million, Martinez said.

   Part of the line south of Roanoke would gain separate tracks for northbound and southbound trains, Martinez said. Most of the route, however, would remain a single track. It would have more sidings and longer ones, up to 11,000 feet to handle longer trains.

   Curves would be improved to allow faster train speeds, and signals would be upgraded to shorten the trains' wait on sidings, Martinez said.

   But that level of improvement isn't enough to satisfy Michael Testerman, a leader among the community activists who favor rail and oppose the eight-lane concept on I-81.

   Testerman said he didn't know the details of Martinez's proposal, but "of this I am certain: Norfolk Southern is not proposing rail upgrades that will substantially divert enough trucks from I-81 to minimize widening plans or to lower environmental impacts. We'd be lucky to see 1 million truck diversions between Chattanooga and Harrisburg under the NS upgrade scenario.

   "Technologically, rail can divert 3 million to 8 million trucks annually between Knoxville and Harrisburg if the investment is made in the infrastructure - about $3.6 billion in Virginia's segment" of the corridor, Testerman said. His cost figure was based on building double track along the entire route.

   State Sen. John Edwards, D-Roanoke and a leading advocate for more use of rails, said he hadn't heard the details of Martinez's proposal, but he liked it anyway.

   Edwards proposed legislation this year to create a rail development authority for Virginia that could guide the development of concepts such as the NS proposal, but it was killed.

   He said he plans to bring up the legislation again next year, but in the meantime he's had conversations with Gov. Mark Warner's staff about issuing an executive order to create a rail commission that would study and refine the plan for rail improvements.

   "Roanoke was once a railroad town, and it could become a railroad town again," Edwards said.

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