Thursday, February 18, 2010

Why didn't stimulus money stop at BNSF Edgerton IM Project?

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Competition for the $1.5 billion in TIGER grants awarded Wednesday was grrrrrreat. But the results weren't so great for Kansas, which got skunked, according to a column by Rob Roberts in the Kansas City Business Journal.

U.S. Secretary of Transportation Ray LaHood was in Kansas City to announce the 51 TIGER (Transportation Investment Generating Economic Recovery) awards. Considering there were more than 1,400 applicants seeking more than $60 billion, LaHood said, Kansas City was extremely fortunate to have landed a $50-million grant for its 150-block Green Impact Zone and related transit improvements.

Across the state line in Edgerton, however, it was a different story. The Kansas Department of Transportation's request for a $50-million TIGER grant to jumpstart a $750-million intermodal complex in Edgerton did not make the cut.

In early 2009, BNSF said that its portion of the Edgerton complex - a $250 million rail-truck intermodal hub - would be deferred until freight markets recover sufficiently to justify the construction. But after the TIGER grant program was announced later in the year, the railroad said it would break ground in 2010 if Uncle Sam picked up $50 million of the tab.

Subsequently, Warren Buffett's Berkshire Hathaway Inc. offered to buy BNSF for $34 billion. And six days before the TIGER grants were to be announced, BNSF's shareholders approved the buyout.

Not the best timing if you were betting on a gravy train to Edgerton.

In the wake of the bank bailouts, $50-million handouts for billionaires aren't in vogue. But, of course, no one is saying whether that or Kansas' status as a red state had anything to do with its TIGER skunking.

Instead - perhaps because a new $600-million round of TIGER grants may be coming - officials like BNSF public affairs director Steve Forsberg are being cordial.

"BNSF greatly appreciates the consideration given to the public benefits that will be provided by this project and for the strong leadership demonstrated by all of the public officials, business and community leaders in the state of Kansas and the Kansas City region who supported the state's application (for the BNSF TIGER grant)," Forsberg said in a written statement after the TIGER awards were announced.

Still, it has to rankle some local folks that a $105-million TIGER grant was awarded for a project in Norfolk Southern's Crescent Corridor. It will help finance construction of two new intermodal facilities in Memphis, Tenn., and Birmingham, Ala.

Kansas City-area sources who stand to benefit from the growth of local intermodal capacity also may be scratching their heads about the $100-million TIGER grant landed by Chicago. It will finance several so-called CREATE projects designed to reduce rail congestion. That's good news for shippers and customers throughout the country whose goods pass through the Chicago rail yards. But it's not so good for those touting Kansas City over Chicago as a distribution site for rail shippers.

Those folks like to point out that, from the West Coast ports, it takes three days to get freight to Chicago and another three days to get it through Chicago.

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