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Missouri city to seek grants for rail siding

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Construction of a new railroad siding in the west industrial park in Washington, Mo., could begin late next spring or early summer if the city receives final approval of state and federal grant funds it's seeking, the Missourian reports. The city has received the preliminary nod for more than $2 million in state economic development grants to finance the "team track" rail siding at the end of West Main Street, according to Dick Oldenburg, economic development director.

City council members unanimously
approved two resolutions authorizing Mayor Dick Stratman to pursue Community
Development Block Grants, including $1.3 million in federal economic stimulus
funds. The council action came following separate public hearings on the CDBG
grants.

Oldenburg said the reason
for the special meeting was to meet a Dec. 31 deadline to apply for a CDBG
grant offered through the federal economic stimulus program.

Missouri received a
"significant" amount of stimulus funds – about $6.5 million – for
public job creation projects, Oldenburg explained. Washington was one of five
communities "picked" for the grants, he said, and is in line to
receive $1.3 million for the team track project.

The city also is applying
for a "regular" CDBG grant for $750,000 to apply toward the project
estimated to cost $3.5 million.

The project, under study
since 2002, would provide a secure facility where local industries and
businesses could load and unload products and materials onto railroad cars and
trucks. It also would allow for the elimination of the rail siding along Front
Street, between Cedar and Stafford streets.

CG Power Systems, formerly
Pauwels Transformers, needs the rail siding to be able to ship extra large
transformers it will be manufacturing at the new plant in the Heidmann
Industrial Park. Other plants also have expressed interest in utilizing the
siding to reduce transportation costs. Canam Steel also is interested in
utilizing the rail siding to ship a "new line" of bridge steel, which
will be tied to stimulus fund projects, Oldenburg said.

Oldenburg said the city
plans to utilize $500,000 in tax credits awarded to CG Power Systems toward the
team track, and also apply for a $250,000 grant through the federal Economic Development
Administration. The city would be required to fund the balance of $700,000.

But the city hopes to apply
funds already expended on buying land and allocated to build a new Westlink
Industrial Drive bridge over St. John’s Creek toward its match. The new bridge
is needed to support the weight of the new substation transformers built by CG
Power Systems, which will weigh between 250,000 and 300,000 pounds each,
Oldenburg said.

City Administrator Jim
Briggs said the city already has between $500,000 and $600,000 invested toward
the project, including engineering and design work.

CG Power Systems recently
was awarded $1 million in tax credits, which can be sold, through the Missouri
Build Program, Oldenburg said. Half of those credits will be applied toward
infrastructure costs on the plant the company is building and half toward the
team track, he explained. To be eligible for the tax credits, CG Power Systems
has to spend at least $15 million on its new plant and create at least 100 jobs
for moderate- to low-income employees. "They’re spending $20 million and
plan to employ 146 people," Oldenburg said.

With its new line, Canam
anticipates hiring 100 new employees, Oldenburg told the council. He said the
city would explore the possibility of leveraging those new jobs to get up to
$1.2 million in federal EDA funds.

In addition to those two
"big" users, Oldenburg said he has another prospect, a glass-crushing
company that’s interested in shipping out its product by rail

The city’s 353
Redevelopment Corporation purchased adjacent property at a cost of $325,000 for
use as fill material for the team track. When that excavation and grading work
is completed, it will leave a lot for a future industrial building, it was
noted.

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