Tuesday, May 9, 2017

My Letter to the STB Concerning Great Lakes Basin Transportation llc

I oppose this proposed project.   First, there is not a report or long term plan from and regional planning board that says this railroad is needed.   The 2012 Illinois State Rail Plan fails to foresee a possible need for a bypass around Chicago. The Chicago Region Environment and Transportation Efficiency Program (CREATE) also does not see a need for a bypass of the Chicago market.   To put it simply, this proposed project has not been on any planning group's radar.

GLBT has also failed to provide basic economic data to prove the proposed railroads viability.  GLBT has not provided proof that any of the 6 Class 1 railroads will use this bypass with a letter of intent. GLBT has failed to show proof that this project will be more economical than the existing interchange rails in Chicagoland.

It is foreseeable in times of high rail demand, like what we have seen in 2014, the rail lines would use an alternate around Chicagoland.  However,  it is equally foreseeable in times of normal rail demand or during a rail depression, like we are in know,  a GLBT bypass would be useless and sit idle. 

Out simply, we do not need an 8 billion dollar rail line that is only used as an overflow pressure relief valve and sits idle 95% of the time.

GLBT has also failed to show it will do no harm to the existing interchange railroads.   If GLBT is about to offer track usage at a competitive rate, the harm done to the existing interchange railroads can be create an imbalance in the Chicagoland market.   The Chicago rail market works because both interchange railroads are profitable and solvent.   If the GLBT harms one or the other interchange rails, it can throw the entire Continental United States rail market into turmoil.  At best, the creation of GLBT would be a transfer of wealth from one railroad to another in a captive market.

GLBT has also failed to show the incentive the 6 Class 1 railroads will have to use a Chicagoland bypass.   With the 6 railroads as investors in the 2 Chicagoland interchange railroads, the 6 CEO's will realize diverting trains from the interchanges to GLBT will create a loss and hardship on their investments in the interchange railroads.   Put simply, there is no incentive for the 6 to use GLBT.
GLBT Application fails to acknowledge changes in the rail transportation market but only assumes the recent high demand market will continue to develop.   We are now in a rail recession.  The demand of unit trains of frac sand has subsided.   The demand for coal in eastern states is gone.   The demand for oil by rail is reduced with new pipelines coming online. The intermodal rail market is evolving with the advancements of the Panama Canal and container ships are being sent to east coast ports rather than being railed across America from the west coast.   Put simply, the previous high demands on railroads was a result of a perfect storm of several industries converging on rail but have since moved to other forms of transportation.

Rail infrastructure is America's buffer. Rail is used to absorb the excess transportation demands when other infrastructures, like truck, barge, pipelines, or transmission are unable to keep up with peak demand.   Frank Patton GLBT fails to understand this basic economic concept.

Beyond Frank Patton, Great Lakes Basin Transportation llc refuses to make public the investor's names of this project.   We, as a society, have no way of properly vetting the financial capabilities of this project's construction or have the capital to operate a railroad.  We have seen firsthand the problems of a cash poor railroad with the Rock Island.   We, as a society, have no need or desire to repeat those mistakes.

Only a moron would ask the Surface Transportation Board for approval, financial,  and eminent domain power to build a 15,000 acre industrial park and call it a "railyard".

Only an idiot would ask the Surface Transportation Board for approval and eminent domain for an easement wide enough to allow selling future easements off as pipeline or transmission easements.   Those matters are handled by the Federal Energy Regulatory Commission (FERC).

Only an imbecile would tell the Surface Transportation Board the project would cost 8 billion dollars, then one year later state he misspoke and explain that price included a toll road.

It’s frightening to think Frank Patton doesn’t even have a good idea what this proposed project will cost.   He most likely will be seeking federally guaranteed loans to build this proposed project.   We, as a society, cannot invest 2.8 billion into a project only to learn at a later date, and when the project is partially finished that the project is underfunded.

We, as a society, need to support infrastructure development when it is needed.   This proposed project is not needed, but is also being proposed by people with no experience in the rail industry. 

It is my hope the Surface Transportation Board denies this project as soon as possible so we can move forward as a nation. Many farmers and landowners are delaying financial decisions because of this proposed project.   Just the knowledge of a potential railroad through a farm decreases the farms value.   We cannot afford to have another Tongue River, where a proposed project hangs in limbo for 35 years before being denied. 

Could this project move rail more efficiently than the existing Chicagoland interchanges? Yes, potential this is true, but the costs and risks do not warrant STB approval. We don't build a canal through Iowa so Nebraska corn can be transported by barge.  Such an infrastructure project would be cost prohibitive and not justifiable. So if the case with the proposed Great Lakes Basin Transportation llc. It is not viable.

Put simply, GLBT fails to reach the criteria of a project worthy of the Surface Transportation Board's blessing.

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