Rail Authority forges ahead in wake of grant rejection
by Clay Chandler
Published: August 26,2012
Lawmakers changed the law last session. Previously, only publicly owned short line railroads were eligible for money from the fund.
The Authority’s first application for a $250,000 planning and design grant from the fund was rejected.
The new law was designed to make it easier for RAEM to procure money to in its effort to reopen a 50-mile stretch of railroad from Waynesboro to Lucedale that would be the last link to an uninterrupted railroad along Mississippi’s eastern border. The line was abandoned in 1983. Rail traffic is currently diverted to Mobile, Ala., at Waynesboro. Continuous rail service in East Mississippi would mean easier and more efficient transport of forest products to the Port of Pascagoula, officials say. The Mississippi Department of Transportation administers the Multi-Modal Fund.
Authority director Geoffrey Clark said the Authority needs about $3 million to complete prep work on the rail before construction can start. When RAEM was formed in 2009, the six member counties committed $650,000 to get the project off the ground. The Authority was in line for a $1-million appropriation as part of a U.S. Senate transportation bill in 2010, but that fell through after the congressional earmark moratorium.
Since then, RAEM has been awarded a $25,000 Pat Harrison Waterway grant and a $50,000 USDA Rural Development grant. It has also applied for a $1 million TIGER 3 grant from the Federal Railroad Administration. Efforts to persuade legislators to pass bond measures for the project have failed the past two sessions.
Clark said there’s reason for optimism, though, pointing to the Authority having about $1 million of that $3 million total on hand.
“And there could be some other funding through the federal department of transportation that we could apply for through the state,” Clark said, referring to the U.S. Department of Transportation’s recent release of $473 million in unspent earmarks accumulated from 2003-2006.
“We’ve already started the environmental process, and we’re looking at the route selection now. That ($3 million cost) projected cost was based on a broad analysis. We’re now getting down to serious details, like how many water crossings we’ll have to deal with, because things like that are pretty expensive.”
A preliminary market analysis done by Mississippi State and University of Southern Mississippi found that there is sufficient demand for the rail, and that it can cover its operating costs. Existing businesses will benefit, the analysis said. Wood chips and pellets used for power generation in Europe would be the principal driver of the rail traffic, the report said. The line would carry about 15,000 rail cars annually for the purpose of transporting forest products. The report said the East Mississippi woodbasket carries “enormous volume” with demand growing with the specter of biomass companies locating in the region.
The line’s secondary market would include access to stone and aggregates for regional construction projects. Grain, chemicals and metals for metal fabrication could drive another 1,000 cars annually, the analysis found. The analysis was paid for by a grant from the U.S. Economic Development Administration.
The next application period for the state’s Multi-Modal Fund, Clark said, is next spring. Until then, the Authority is in negotiations with rail companies Clark hopes could serve as the line’s “anchor tenants.” Clark said he thinks a deal could be struck with one or more of those companies by year’s end.
“If that happens, we’d have a pretty firm idea of how much traffic the line would have committed to it, which would be good information to have as we move through the process of applying for different grants. Overall, I’m really pleased with the progress we’ve made this year.”
To sign up for Mississippi Business Daily Updates, click here.
Top Posts & Pages
- Report: Mississippi only state to see drop in home prices
- Palmertree blocked from using public funds for legal defense
- Two companies fined for violations of 'No-Call' law
- District at Eastover takes shape with financing in place, tenant signings under way
- States settle with manufacturers in DRAM price-fixing case
- Chris McDaniel gets a thank you note from Travis Childers
- John Ferrucci'a perfect voice is perfect for the Silver Slipper Casino
- City suing Hercules for pollution at shuttered plant site
- Pickering collects more money from failed beef plant project
- The First acquiring Alabama bank in cash/stock deal