Rival proponents of an intermodal facility in Oregon’s Willamette Valley must divulge the status of key business negotiations to qualify for a $25 million government grant.
Oregon lawmakers allocated the money in 2017 for a facility where containers of farm goods would be transferred from trucks to trains, bypassing Portland highway congestion on the way to marine ports around Seattle.
Two competing locations, in Brooks and Millersburg, have sought to secure the funding, but state transportation officials have expressed qualms about the underlying economic feasibility of both proposals.
An independent analysis of the sites determined neither is far enough from the Puget Sound for rail shipping to effectively compete with trucking on cost, at least without subsidies.
The report also found that projections of cargo volume at both facilities were overly optimistic and that the ability to reuse empty containers from import shipments would be minimal.
Last month, the Oregon Transportation Commission conferred on the two proposals and decided more information was needed before it could commit public money to the facility.
During the commission’s March 21 meeting, an Oregon Department of Transportation official laid out the additional questions that project proponents would be expected to answer.
“This is a significant expenditure of public funds. I want to make sure we get it right,” said Martin Callery, commission member and former chief commercial officer for the Port of Coos Bay.
Significantly, proponents of both sites must disclose the “current status of negotiations with ocean carriers,” whose vessels would transport export containers to Asian markets.
Ocean carriers are seen as key to either project’s success because they’re most likely to subsidize an intermodal facility by absorbing the cost of repositioning empty containers to the Willamette Valley, according to the third-party review.
An existing truck-to-rail container facility in Portland is currently supported this way to substitute for vessel service, so ODOT is asking the Millersburg and Brooks project proponents if ocean carriers would be willing extend similar terms to their sites.
The competing sponsors are also being asked to provide memos outlining their agreements with railroads to provide service between the Willamette Valley and the Puget Sound.
“We wanted to lock in some of those outstanding issues,” said Erik Havig, ODOT’s planning section manager.
Proponents of a separate intermodal facility proposed for Nyssa, which would allow for rail shipping of onions from the Treasure Valley, will also be expected to turn over information about rail shipping but they face fewer questions than their Willamette Valley counterparts.
All three project sponsors will also be required to demonstrate they’re in negotiations with contractors that will operate the intermodal facilities and provide a timeline for reaching contract agreements.
The three project sponsors are expected to provide answers to ODOT’s questions in time for the commission’s May 16 meeting, when a final decision could be made.
Even if a project is approved for funding, the $25 million will likely be dispensed in “specific stages” as it progresses rather than all at once, said Havig.