View the October 16 seminar recording
Jennifer Symoun
Good afternoon or good morning to those of you to the West. Welcome to the Talking Freight Seminar Series. My name is Jennifer Symoun and I will moderate today's seminar. Today's topic is AASHTO Freight Rail Study Support Services – Understanding and Addressing Freight Rail Needs.
Before I go any further, I do want to let those of you who are calling into the teleconference for the audio know that you need to mute your computer speakers or else you will be hearing your audio over the computer as well.
Today's seminar will last 90 minutes, with 60 minutes allocated for the speakers, and the final 30 minutes for audience Question and Answer. If during the presentations you think of a question, you can type it into the chat area. Please make sure you send your question to "Everyone" and indicate which presenter your question is for. Presenters will be unable to answer your questions during their presentations, but I will start off the question and answer session with the questions typed into the chat box. We will also take questions over the phone if time allows and I will provide instructions on how to do so once we get to that point.
The PowerPoint presentations used during the seminar are available for download from the file download box in the lower right corner of your screen. The presentations will also be available online within the next few weeks, along with a recording and a transcript. I will send a link to the recording in the next day or so and will also notify all attendees once all materials are posted online.
Talking Freight seminars are eligible for 1.5 certification maintenance credits for AICP members. In order to obtain credit for today's seminar, you must have logged in with your first and last name or if you are attending with a group of people you must type your first and last name into the chat box.
PDH certificates are also available for Talking Freight seminars. To receive 1.5 PDH credits, you will need to fill out a form. Please see the link in the chat box. Certificates will be emailed one week after the seminar. A seminar agenda has been included in the file download box for those who need to submit an agenda to their licensing agency.
Finally, I encourage everyone to please also download the evaluation form from the file share box and submit this form to me after you have filled it out.
Today we'll have two presentations, given by:
Our first presentation will be given by Matt Dietrich, the Executive Director of the Ohio Rail Development Commission, serving in that role since 2007. With expertise in transportation planning, economic development, grade crossing safety and public-private partnerships, Matt oversees the daily operations of the Rail Commission and has been involved in several multi-state projects including the Norfolk Southern Heartland Corridor project and the CSX National Gateway project. Prior to joining the Rail Commission, Matt held positions at the Ohio Department of Development and metropolitan planning organizations. Matt is involved in national organizations serving on panels for the Transportation Research Board, National Cooperative Highway Research Program and is currently the Vice Chair of the American Association of State Highway and Transportation Officials Council on Rail.
Matt Dietrich
Thank you, Jennifer. My name is Matt Dietrich and I was asked today to talk about an overview of the Rail Resource Center through AASHTO. So, because each state DOT is a little different, I want to take time to talk about how we interact with folks, but really to go over the Rail Resource Center. As many of you know, each DOT CEO gets several invoices annually and one of those is for participation in the Rail Resource Center. As the name implies, it provides AASHTO with the resources to pursue research and other lines of inquiry regarding rail transportation issues. Rather than give you an overview of all the good stuff that the Rail Resource Center could do, what I wanted to do was provide you a better idea of what we've done by giving a presentation on a recently completed study using the Rail Resource Center.
Again, as I said, because each state interacts differently with freight railroads, I thought I would give you a brief description of my agency for context. The Ohio Rail Development Commission was established in state statute in the early 1990s. It took all the nonregulatory rail functions and put them under the authority of the Rail Commission. We were established as an independent commission system within the DOT, and the commission itself includes cabinet members from transportation and development, referred to as Directors in Ohio rather than Secretaries. And the remaining board is appointed by the governor, Senate President, and Speaker of the House. In general, the rail commission's work focuses on 3 areas: railroad coordination for highway projects, a loan and grant program for companies wanting to use rail, and we administer the 130 grants for the state. And finally, while this isn't a specific program under the commission, we work with a lot of companies, communities, and economic development officials as well as railroads directly on any issues involving rail throughout the state. So, with that as a little bit of background I wanted to go into what we have actually done with the rail commission for the AASHTO report.
So, here is a little background on the study I am about to discuss. Back in 2002, AASHTO produced the first Freight-Rail Bottom Line Report. Its objective was to evaluate the capacity of the nation's Freight Rail Transportation System to keep pace with economic growth projected for 2020. It was the observation that all the metrics showed that the projected increases in freight in general were very big, and there was a question about whether freight railroads had the capacity to absorb that increase. Furthermore, was there a public role in not only helping the rail keep its market share, but also try to capture more of it? The study was performed by Cambridge Systematics. It did a really good job of outlining the history of the industry and how market and regulatory forces created the industry as we know it today. There were multiple findings in the report, but two that were most relevant for this discussion and future work were that relatively small public investments in the rail system can be leveraged into relatively large public benefits for highways, highway users, and freight shippers. The other was that market forces will continue to pressure the rail industry to streamline and downsize to maximize revenues and minimize capital costs. So basically, this report with its companion Bottom Line Reports produced by AASHTO in other areas, form the basis of a lot of the policies and programs advocated by AASHTO and the transportation bills that followed.
So, fast forward to now. A lot has changed in the rail industry and freight flows in general. So, the AASHTO Rail Council decided the report needed to be updated. For example, the short line rail industry has undergone a great deal of consolidation under holding companies since 2002. Also, the Council wanted more research into what kinds of projects the public sector should be getting involved with. For example, the first report focused on the need for more capacity. Following that logic, a legitimate question brought about by the research was, why weren't states helping large class one railroads with tie projects since class one mainlines were the ones that had the most railroad volumes? I know it was overly simplistic to say, but the study appealed to me personally because it was an opportunity to have the research to support many of the policy positions that states have been taking in their project selection processes because of our own experiences. So, as a practitioner my goal for this update was twofold. It was to have a document that could validate existing practices, as well as research to direct future program management. So, using the Rail Resource Center, we issued an RFP and selected WSP for the work. Specifically, Alex King with WSP was the project manager and I think he did an outstanding job. We had a relatively large working group from multiple states with a lot of different perspectives, but Alex managed to produce a report that considered all of the varied viewpoints and out it, more importantly, into an understandable format for moving forward.
So, going back to the report, it went back to the original study from 2002 and validated the findings of the first. It was also able to focus deeper into how the public sector should participate with privately owned railroads. Like the first study in the slide you see, the update looked at the role of freight rail in the country overall, and also its role in goods movement. So as this map shows, there is still a lot moving by rail in the country, and for specific industries shown in the bottom corner (coal, cereals, grains, metallic ores, fertilizers, basic chemicals) that are very heavily dependent on that rail movement. It also validated the overall projections we have heard back then and continue to hear, freight traffic is going to grow, we know it's going to grow. For those of us in the public sector it's really important for rail to at least maintain its market share, because if it doesn't maintain its market share that means more trucks on the road with the associated safety, capacity, maintenance, and environmental issues. Again, some of this stuff is from the FHWA FAF 4. For those of us in transportation this is not groundbreaking or cutting-edge research, we have seen this before. But it puts it in the context of rail transportation. And then I really like this graphic because it really updated and kind of delineated some of those benefits. Especially in the mobile shipment as you can see. And it starts attaching numbers to what it would mean if we could shift some of those truck ton miles to rail, and also gives us some equivalencies. And, to be overly simplistic, I viewed this part of the report as enforcing why the public sector should invest in private freight rail.
For the group I think those of us practitioners, one of the hardest things to do for us, at least for me, is to come up with ways to display and disseminate the information that we have. In 2002, if you go online and Google the report, you can see by the cover it is one of those thick bound reports that we had that were pretty standard practice. We knew that wasn't going to work, so one of the deliverables we asked for was this PowerPoint presentation and the slides in it, as well as an 11 x 17 infographic. So, if there is anything you like here, please contact me and I will make sure you get a copy of this, or Jennifer can. Because I've used this stuff, I've pulled pieces out of it, and I cannot tell you how much easier it has been to have these conversations with policymakers when you have this in such a concise and consolidated form.
So, here's where we started to deviate a bit from the old. The original study identified these three categories, and WSP built on them and went into a bit more detailed work. So now we start to get the picture of how the various commodity industry groups use rail, and which projects are most associated with each type. Again, these are not mutually exclusive, but this is a good way to explain how companies access rail. So, if you think about it in very simplified terms, Manifest Rail is from model train set – boxcar, tank car, flatcar, whatever. Unit train, all one type of commodity; very familiar for those of us in the Midwest for grain. And then Intermodal. And then it goes to the next category of the most common users. So, you see with Manifest, which you would typically think of with rail users, building supply, unit Trains, coal and energy products. And Intermodal where you get into more of a retail customer. Finally, it added the types of projects. Again, these are not mutually exclusive but to give those an idea of what are the critical infrastructure needs to support each type of real transportation. The other distinction that this went into detail about was different types of railroads and how they have different needs. The first report provided a history of the rail industry and how it got to be what we know it as today. But to build on that it really went into more distinctions about the various needs of the private sector partners. Essentially, not all railroads have the same needs. You can see from the average revenue per route mile where the Class 1's versus the short line industry is, for those of us who have programs at the state level a lot of our work is done on the short line network. Again, I kind of always go back to the who, what, and why. So, I look at this slide as the who. Who the public sector should be partnering with.
Building on that work this slide provides a good overview of the types of rail projects. It takes the synthesis of the work beforehand. So, you can look at the capacity projects, industry spurs, great crossings, transload opportunities, light density line rehabilitation. And when we are looking at this, we are focusing on that 16% where the railroads are expanding, trying to grow their infrastructure. By growing, maybe not specific new tracks, but improving track speeds, increasing that. That is where identifying the who, what, where, when, how, this is the what. What should the public sector should be focusing on?
One way the rail is different from other transportation modes is that there are no formula funds for railroads. So, it's up to us on the public side to figure out the appropriate funding streams and that is why in some ways rail projects are more like traditional economic development projects in states. They are usually on a transaction level, there is a grant for a specific project with specific benefits with private entities who are responding to market conditions at a particular point in time. So, we have a lot of these different resources, but on the public side it is up to us to figure out based on project needs and benefits and metrics which funding sources, which blend of funding sources, are the ones that would best fit what we are trying to accomplish in terms of project need.
Finally, I have used this slide a lot. This tells a good story in terms of where we should be spending our funds. As you can see, on the right-hand side you had public benefits, the private financial returns, and that is something we struggle with as practitioners on a project basis all the time. We don't want to do projects that are going to happen anyway. So, this gives us a little bit of context. If you look at the upper left-hand side of the slide, it's the high public benefits low financial returns, or high risk. To overly simplify it, we talk about this as the "but for" projects. But for the public investment this project would not happen, because market forces are such that this would not happen. On the upper right-hand side, you have high public benefits and high financial returns. So, yes it can be privately? funded, but we can reduce risk, accelerate public benefits, or we can secure public benefits through metrics and claw backs. So, we kind of refer to this as bigger, better, faster. The project could happen, but it's going to happen bigger better faster with public assistance, getting those public benefits, then it would without us. Then you can see below you can see low public benefits, low financial returns, project really isn't justified for either one of us, but you could argue that some of the preservation projects might fall under there. And then kind of the low public benefit and high financial concerns. And that's really the distinction when I talked earlier about the Class 1 mainline improvements where there really isn't a public role.
That's the presentation in a nutshell, and it is just one example on how we are able to use the Rail Resource Center to answer some needs we had as AASHTO members. At the last Council on Rail Transportation meeting, we had a lively conversation among state DOTs about other topics that we could look at for the Rail Research Center. And they included a best practices or even a study to try to simplify the benefit-cost analysis calculations for federal grants. I know many of you, if you work in rail and are in the state DOT, you may be taking a break from your CRISI applications which are due this Friday to listen to this presentation. So, I am sure a study about BCA calculations would be timely for all of us right now. We could all use something that would simplify that. Additionally, because of the SHRP 2 effort, talking about highway roadway project coordination, is officially coming to an end, there are a host of great highway coordination topics that were brought up that would be worth further study. If you have any thoughts or ideas on any of those or additional topics, please let your state Council on Rail representative know. We are going through the list right now and trying to figure out what is the next big thing for the Rail Resource Center to focus our efforts on. Again, I will take questions at the end and appreciate your time. Thank you very much. Have a great rest of your afternoon.
Jennifer Symoun
Thank you. I want to encourage everyone to continue typing questions for Matt and we will get to them at the end. Our next presentation will be given jointly by Amanda Martin and Laura Hutzell of the Iowa Department of Transportation, Rail Transportation Bureau.
Amanda Martin has worked with the Iowa Department of Transportation for more than 21 years. She has obtained a substantial amount of multi-modal transportation planning experience while working at the Iowa DOT and is currently the freight and passenger policy coordinator for the Rail Transportation Bureau. Amanda works extensively on Iowa's passenger rail effort but also works on many freight rail activities for the bureau.
Laura Hutzell has worked for the Iowa DOT for eight years and has spent the past six years working in the Rail Bureau as the Program Manager for the Railroad Revolving Loan and Grant Program at the Iowa DOT.
Amanda Martin
Thank, you Jennifer. I'm going to be tag teaming on this presentation with Laura, as you had probably guessed. I'm going to go first and then she is going to go at the last. But I think the information we both have to share will hopefully be of interest to you guys. So, as we were putting this together, we were trying to think what would be good information to provide to this audience? We decided to put slides at the front that provided you with setting the stage and background information about Iowa railroads and what is going on in Iowa.
So, the first railroad operated over 160 years ago, give or take, and a lot of states have similar stories; there were a lot of miles initially, so by 1890 we had a lot of miles of track in the network. And so, the first 50 years of our statehood we became a major crossroads of transportation. Rail mileage did peak around 1914 with over 10,000 miles, so pretty much every county (we have 99 counties) was served. What I've read historically is that every town was within about 13 miles of a railroad, so everybody had access. Obviously, there were a lot of changes in the early 1900s, including the automobile creation and it becoming a more affordable way of travel. As that evolved, by the 60s hundreds of rail miles were starting to be abandoned. After that wave of rail bankruptcies and abandonment of the rail and then regulatory changes, it changed the dynamic of rail in Iowa as it probably did around the country. Today our network has decreased significantly, but still there are a lot of miles in the state of Iowa. There is a lot of work to be done and a lot of transporting that is done as you will see in future slides that I will present. Currently we have 5 class I and 12 operating short line and/or regional railroads in the state. Here is a graphic for you to look at with more clarity on our website, but this is what we have going on as far as the railroads and some passenger rail that overlays on the California Zephyr Line that goes through southern Iowa, as well as Southwest Chief on the southeast corner of Iowa. We have lots of rail maps on our website in addition to that service map, so feel free to check those out. We are proud of the maps that we have, we get a lot of compliments on those.
How Iowa ranks. This is information we gathered as part of the state sale plan update. So, not sure how many other states have this information, but we are lucky to be able to provide this to folks that read that document and today as part of this presentation as well. So, ranked 11th as far as miles; tons originated, twelfth; carloads originated, fifteenth; tons carried, seventh; carloads carried, seventh. Food products, obviously Iowa produces a lot of ag products and food products as a result of those ag products. So, based on the information from our state rail plan we were ranked first. Chemicals ranked fourth. There are obviously a lot of chemicals associated with the production of food and manufacturing. And as far as farm products, seventh.
Economic benefit. This is where it starts to really show this sort of impact that railroads have in Iowa and on our economy. So directly employed railroads 3500; rail-related employment then jumps to 219,000. It represents 10.8% or 2 million jobs statewide. And this equals $13.8 billion earned, which is 13.6% of total labor income. If you look at the value-added associated with that, it's about $24.2 billion or 14.7% of gross state product.
We help the railroads with a lot of different things. We have inspectors, we have funding programs, I work with passenger rail, we work with AASHTO and other organizations on committees and so on and so forth. When folks have issues, they call in; it can be citizens or folks wanting to work with railroads, etc. Something we became aware of is that we needed to provide this specific tool to help folks understand rail in Iowa and how to utilize it. So, our Economic Development Authority and our agency collaborated in 2014 to create this initial toolkit, which was then updated on a few occasions, and now we have the most current one on our website. We have handed out toolkits to a lot of folks. Over 2,000 hard copies have been distributed, but that does not take into consideration how many folks have looked at it electronically. But if you want a hard copy of it, feel free to let us know, because we can send you a hard copy. The information included was to help the folks in Iowa and businesses in and around Iowa to be able to understand how utilizing railroads for shipping and transporting goods could be easy, and how they can understand it. And I encourage you to go out and look at this; I'm sure several have already seen it. But chapters are assembled to provide current information about the benefits and try to provide basic explanations, because rail can be complicated to the average person, and if you don't work in it you probably don't understand as much about it. So, we tried to make the document one of the types of resources that average folks could pick up, read, understand, and be able to utilize. Now I'm going to shift the presentation over to Laura.
Laura Hutzell
My name is Laura Hutzell, as Jennifer said. My role at Iowa DOT is the program manager for the Railroad Revolving Loan and Grant Program, and I also help co-manage another funding source or grant program known as the Linking Iowa's Freight Transportation System program at the DOT. So, I'm here to talk to you about both.
I will start with the Railroad Revolving Loan and Grant Program that we call the RRLG Program, for short. The program, in a nutshell, is a dedicated funding source to rail in the state of Iowa. We provide grants and loans to industries, private companies, as well as railroads for rail related projects within the state. Just to get started, a little bit about the how the program itself got started. It was created by legislation in 2005 with the purpose to provide loans and grants for railroad related improvement projects to help benefit the state of Iowa. The program is funded by loan repayments and appropriations; we get an appropriation each year by the Iowa state legislature. The program is available to cities, counties, economic development organizations, and other nonprofit organizations through a competitive application program. A little bit more about the funding source. Each year, usually during the spring, the state legislature appropriates a certain amount of money for the RRLG program. This is money that the Iowa DOT essentially fights for each year. We submit a governor's budget with a request for the program. It's not always the amount we want, but we are lucky in that since I've been in the role of the program manager, we have had a dedicated appropriation each year. Generally, we see an appropriation about $1-3 million, depending on the year and what else is going on in the legislature. In addition to that, because it is a revolving loan program, we are consistently lending out money and it's being repaid. So, there is a steady stream of funding coming in each year for the program. So, we add that to the appropriation as well as any previous money in previous years that had been either returned or projects never came to fruition, so we add that to the total. So, for the last 5 years we have seen anywhere from $1.3 million to $4.6 million in 2017. And we just awarded our FY 2020 round and handed out approximately $3.9 million.
A little bit about how to apply to the RRLG program. Even though we only have one appropriation per year, we do take applications at any time throughout the year and we will hold them until springtime which is when we kickoff the new funding round. Eligible applicants include both public and private entities, as well as entities interested in rail development. The RRLG program has 3 categories in which applications apply, and I'll get to those here in the next few slides. We do require an application to be submitted to us. We review those in-house. We have a team put together and review the applications over the summer months. We will do site visits if we feel it's needed. It's one thing to see an application on paper, but another to go out and meet with potential people you will be working with as well as see the site of the project. Then once we know what projects we want to recommend we go to the DOT commission. They are the governing body here who have the final approval on the projects. Once I have their approval, I start the agreement period. Depending on the agreement type, projects usually have anywhere from 18-36 months to complete.
As I've stated, there are 3 components to the RRLG program. The first component is what we call the Targeted Job Creation Component, and these are projects that specifically have jobs tied to their rail development. These are grants only and they are maxed at $12,000 per job. These jobs must meet the 100% wage rate for their county. It requires a 50% match contribution from the applicant; we will cover 50% of the total rail project cost. And then jobs are verified within 3 years of project completion. Now, because it is maxed at $12,000 per job, let's say a project only has 2 jobs which is only $24,000. So, in addition to a grant, projects are also eligible for loans and I will get into that here in just a second. But I do have an example of a project that received a grant and a loan; a company called Iowa Grain Processors in Glidon, IA. They were awarded a grant and a loan back in 2014 under the Targeted Jobs category. Iowa Corn Processors is a dry milling company. They were originally served by a single 1800 foot spur track, as you see in the last picture. However, the company came to us looking to reduce congestion on the UP Mainline and to reduce the amount of time the UP was spending on their property to load and unload cars. We awarded them a grant of $174,000 and a loan of $245,000 so they could add two additional spur tracks, which essentially doubled their shipments at the facility.
The 2nd component to the RRLG program which is the loan program; we call that the Rail Network Improvement Program. These are loans for projects that support or create new rail structures in Iowa. We have railroads that say, "we have this stretch of rail in the middle of nowhere, we need new ties, new balance, but there are no jobs associated with our project." They would qualify for loans with 0% interest for 10 years. And they may be up to 80% of the total rail project cost, meaning the applicant would be responsible for providing a 20% match. And, as I alluded to earlier, these loans essentially are being paid out and repaid, so they help sustain the program at a minimal level, even if our appropriations were to cease. Which, knock on wood, hopefully does not happen.
Another example of a Rail Network Improvement Project. This is another project from 2014. This is Heartland Co-op, who is a well-known cooperative in Iowa, and I think throughout the Midwest. This project is in Fairfield, IA, and they received a $1.45 million loan from the DOT to build a 125 car unit train loop track at their grain facility. Prior to this project they were mostly just trucking in their shipments within a 6 county region in Iowa. They chose to add a grain loadout facility to obtain pricing advantages of unit trains. They also wanted the high-capacity shipment capabilities, as well as provide local producers with additional markets for their grain. By enabling a unit train, the project benefits both the customer and the railroad. So, this is a good example of a big project we would fund with RRLG money, as well as the targeted job example I gave you, is a good example of a smaller project. We don't try to weed out projects just because of their size. We want to fund the big ones, but also want to help the small ones as well.
The 3rd component is what we call the Rail Port Planning and Development Projects. These are grants that are maxed at $100,000 and they are available for a community or a public entity or anyone, for that matter, to hire a consultant to do a planning study to help make decisions on whether or not to bring rail to their community or their county. Some examples include, they might have a business park with access to railway they are not sure how to design it. We provide grants to hire a consultant and do a study to see if a project would even be feasible for them. I don't have an example of a Planning study, because it essentially comes to us in a Word document, but we like the planning studies because we essentially catch those projects in their infancy when they come to us. And we've had many examples where they come to us as a planning study and move on throughout the process and then come to us for a grant or loan to build the project. We like seeing those types of projects come in.
So, just to sum up this program. RRLG has been around for a about 13 years now. We've done over 76 projects with total awards of $37.2 million. Of that 47.2, we've had $28 million in grants and $26.4 million in loans. I think it's a program the DOT is proud of. We like being able to help as many businesses as we can and bring those jobs to Iowa. That's all we have for the RRLG program.
The other program that I mentioned in my introduction that I co-manage with our system's planning Bureau at the DOT is what we call the Linking Iowa's Freight Transportation System, which has a lot of similarities yet a lot of differences to the RRLG program. I will talk about how this program got started. As you probably know or as a lot of DOTs probably know, we have a lot of pots of money for various modes of transportation at the DOT. We have pots of money for aviation, rail, RRLG being one of them, trails, highways, but over the last 5 or so years the DOT has really noticed an awareness with the challenges in freight transportation especially in the gaps in multimodal funding. In this I'm talking about rail to truck, truck to rail, water freight, air freight and those kinds of things. So, this program was essentially set out to fill that gap and those funding needs. In 2015, when the Fast Act was signed into law, the Fast Act contained a new formula program for projects known as the National Highway Freight Program. This program essentially expanded the eligibility of multimodal projects for federal transportation funding and 10% of the state's National Highway Freight Program apportionment could be used for freight intermodal or freight rail projects. So, in 2016 the DOT knowing that there was a gap in multimodal funding, we decided to use this 10% set aside money through the administration of a new great program, which we then called LIFTS. We approved it with our commission, and it included approximately $2.6 million during the first round of funding, which was 2 years' worth of funding. And from there on out we've had approximately $1.4 million to award.
Unlike the RRLG program I just talked about, which was state money, the LIFTS program utilizes federal money. Which means we don't have a lot of the same flexibility that we do with the state-funded programs. When projects use federal funding, it means there are additional requirements award recipients must meet them order to fulfill these federal requirements. This in itself presents a lot of challenges. We found it to be harder and harder each year to get a lot of interest in the program just because of the hoops and the red tape associated with federal funding. And that's not necessarily a bad thing, it is just something we ourselves have to set aside more time for it to help. We have a lot of public entities interested in this money, so it's a little more handholding on our end, which we don't mind doing but it's just something we need to be a little more aware of. We've had to become pickier on the projects that we do fund in order to get the money spent in the appropriate amount of time. We are finding out that the more straightforward a project is the easier it will be to administer. But examples of these Federal requirements are NEPA, Buy America, and Davis-Bacon, just to name a few. Like RRLG eligible applicants include any transportation providers or users, cities and counties, public and private industries, as well as any other industries interested in freight transportation. That being said, if you are a private applicant you are eligible for 50% grant funding with a 50% match. And if you are a public applicant, which includes public-private partnerships like economic development groups, you are eligible for 80% grant funding with a 20% match.
And I do have one example here. It is not a rail example, but it is an example of a project that did not necessarily have a dedicated source of funding. It's a project from the Eastern Iowa Airport in Cedar Rapids, IA. This was awarded a LIFTS grant last year around this time, back in 2018. The airport had come to us requesting $1million to relocated and expand their air cargo facility at the airport, and this included their cargo apron area. The new facility will consist of cargo sorting, warehouse space, truck docks, office and landsides truck parking, as well as maneuvering areas. Although we were not able to fulfill their full request, we did award them approximately $826,000. This is a good example of a project that we hope will move through fairly quickly. It actually already had some federal funds tied to it, so they already started the need for process. So, they were very aware of the federal requirements and what they entailed. That is all I have for you guys today on those two programs. If you have any questions, I'm happy to start answering. Jennifer, I will kick it back to you.
Jennifer Symoun
Thank you, Amanda and Laura. We do have a few questions that have been type it in for you. We still have plenty of time remaining so please everyone continue to type in questions for Amanda and Laura or Matt. But we will start with you, Amanda and Laura. What is the total amount that the RRLG has spent/loaned out since its inception? What is a typical value of a grant or loan?
Laura Hutzell
I don't have the total with me right now. We've given out in awards over $47 million. But specifically, grants and loans, the last slide in the RRLG section has those numbers there; $20.8 million in grants and $26.3 million in loans. If you want more specific numbers, I can probably get those, I just don't have them on hand right now.
Jennifer Symoun
Ok, thank you. And what was the average or typical value of a specific grant or loan?
Laura Hutzell
It totally depends on the project type. I think the largest award we have given is probably close to $2 million. That may have had an earmark, that would have been a little bit of a different year that year. But it honestly depends on the size of a project. We've given small amounts, a couple hundred thousand dollars, and we've given the bigger amounts as well. It just depends year-by-year and how much funding we have as well.
Jennifer Symoun
Another question for you. Do grants that seek less than a 50% match score better?
Laure Hutzell
Yes.
Jennifer Symoun
Have you ever enforced grant claw back if goals are not met?
Laura Hutzell
We do have a protocol, so to speak, in place. We actually have a sister program with the RRLG program that's administered in the Systems Planning Bureau and that is called the Rise Program. And we kind of adopted their claw back, so to speak. If it comes down to it, we need at least 90% of the jobs fulfilled. And if they can't make it, they would have to pay back that portion of the grant that they couldn't fulfill. I've never had it happen, but we do have something in place should that happen.
Jennifer Symoun
How is the determination made to award only partially of what is requested, for example, coming up with $800,000 rather than $1 million?
Laura Hutzell
We want to try to spread the money around as best we can. So, if we have good projects and we have a few small ones, we want to try to award those as well. So, sometimes the bigger guys have to take partial awards. But before we do that we want to say, "hey, we can't do all of it, but we want to do a portion of it." We may have them submit a little bit of a different scope depending on the project type to us to make sure that we know in writing that they can still use this money in an appropriate way.
Jennifer Symoun
Alright. We'll give people some more time. It looks like there may be a few more questions coming in. I don't see anything currently, but in the meantime if anyone would like to ask a question over the phone you can press *5 and I will open up your phone line. If you want to ask a question over the phone, please press *5 or continue typing questions and we will wait a minute and see if there are additional questions.
Laura Hutzell
If anybody has any more questions on either of the programs I've presented, I forgot to put the link to our website. I can send that to Jennifer, if she maybe wants to send it out. But we have all of the guidance and guidelines for each program on our website in detail.
RRLG: https://iowadot.gov/iowarail/financial-assistance/rrlgp
LIFTS: https://iowadot.gov/iowarail/financial-assistance/lifts
Jennifer Symoun
Sure. And, if you want to type it into the chat box as well, you can do that.
I was going to thank Abby Swaine, she's put a good number of resources in there. It looks like we do have a question from the state of New Hampshire so let me open up your phone line.
Lou Barker
Lou Barker, New Hampshire Department of Transportation. On your loans and grant programs, do you give weight to the railroad's participation, sort of a match type of thing?
Laura Hutzell
Honestly, we don't necessarily care where the match comes from. A lot of the times we do get a lot of private industries come to us for funding. They want a rail spur or access to rails. A lot of times the match does not come from railroads, but in order to successfully get an award from us, we have to have what we call a service letter from the applicant. They have to submit a letter to us from the railroad so that we know the railroad is aware of the project, is on board with the project, and basically agrees with the project. So, they may not submit actual funding as a match, but they are aware of the project and they do support it.
Lou Barker
Ok, it would be from private or railroad. Our hands are tied a little bit; we deal straight with railroads. But I'm asking more specifically about the match. So, if a railroad or shipper comes in with a 50% match, are you more willing to approve that project?
Laura Hutzell
Not necessarily, no.
Lou Barker
No? Ok. Thank you.
Jennifer Symoun
Thank you for your question. We have another question that was typed in for all presenters. What are some of the differences in terms of assistance (coordination, projects funded) provided by state DOT's for improvements on large (Class I) railroads versus those on regional or short line (Class II or Class III) railroads? Matt, Laura, or Amanda, if any of you want to start off.
Laura Hutzell
I wish that they would apply for some of our programs. They don't necessarily always need the money, so we don't see a lot of them. We do see support letters come in and things like that, but we mostly just deal with the short lines. We would love for a Class I to come in, but we have not seen it yet.
Amanda Martin
I was going to quickly mention exactly what Laura said, but you also put in there coordination, so I wanted to throw this out. We do coordinate heavily with Class I's. Obviously, we have projects that interact with the Class Is as well as federal mandates that we have to adhere to related to all of the infrastructure. But one thing we do three times a year is we have a rail advisory committee. I know there are a lot of freight advisory committees out there as a result of the FAST Act, but something that we do specifically with railroads is we have a rail advisory committee. So, all of the Class Is and all the short lines, we even have short line/tourism excursion provider, that attend all these meetings. This allows those folks to be able to come in and speak with us and brainstorm with one another about all sorts of things. It can be related to things they have been dealing with, things they are looking forward to, changes to their system. They can also brainstorm legislative things as far as what they see coming forth and the short line organization vs the Class Is have their own individual presence in legislature. Obviously, they are not going to share proprietary information, but they are very open and willing to talk to one another and have coordination as it relates to things they can share. And we are at that table with them and able to hear what they are talking about and what sort of issues are coming up. And we can be flexible in the way that we work with them based on the information they are sharing and things that maybe are going to change in the future, so I wanted to throw that out there as well.
Matt Dietrich
For Ohio it varies by program. For highway coordination and for grade crossing safety (the section 130 programs), I don't want to say primarily, but a great deal of our work is done with the Class I railroads for those type of projects just because of basically geography and following the hazard index using train volumes as a determining factor, it just falls on those mainlines. For our development projects it varies. We work with private companies and our economic development folks on projects. With those projects we work closely with the Class 1 industrial development representatives, so even though we may not be giving the grant award to NS or CSX in our case, we are working with representatives to come up with designs, making sure everything is okay, that is some of the value added. You get some companies that may have, as Amanda said, rail is not necessarily the most intuitive is the best way to put it in, so getting companies to get what they need, the right engineering, to get the end product they are hoping for. The rehabs are primarily on short lines. But I will say on some of the larger projects, like the INFRA grants and the TIGER grants, those have been partnerships, at least in Ohio, with the Class I railroads. Where it's large mainline improvements for either intermodal or capacity projects serving a region. We have an INFRA grant right now that we worked with and sponsored with Norfolk Southern to improve a major line in the Appalachian portion of Ohio. So, it really varies by program for us.
Jennifer Symoun
Alright, thank you. Laura, can you expand a bit on the type of studies paid for by your programs? Do counties and other government agencies approach you about support?
Laura Hutzell
Yeah, we've had in the past I would say in the past however many years I've been at the DOT, six years in the Rail Bureau, we've probably had between eight and ten studies come in and they have been scattered across the state. We've had a couple coming for transload facilities. There is one in central Iowa, one up in northwest Iowa, as well as a large-scale railyard. We've had one come in there in the Sioux City area. And what was the last part of that question?
Jennifer Symoun
Do counties and other government agencies approach you about support?
Laura Hutzell
Yeah, I would say so. We work pretty closely, or we try to work closely with the Iowa Economic Development Authority as well. They have what is called a Site Certification Program. So, if there's a big development going on and it's using rail, it may not be a study we've funded, but we do work with them to look at any new rail that's coming into the state. We do require letters of support for projects for cities and counties as well as it could be the Board of Supervisors and any supporting industries. The planning studies are open to anyone. We've had councils of governments apply to us on behalf of the city. We've had cities themselves, counties, and private industries apply as well. So, I'm not sure that answers your questions or not.
Jennifer Symoun
If you do have additional questions, feel free to type them in. Matt, a question for you. What are the biggest differences found in terms of freight rail operations between the 2018 Bottom Line Report and the previous Bottom Line Report that was completed possibly in the early 2000's? How have the freight rail improvement needs changed?
Matt Dietrich
Overall, we focus less on freight operations because as I've said in the presentation, a lot of that was validated about the need for capacity, so we spent some time with that. One of the things the Freight Rail Network is very sensitive to is market conditions and really ebbs and flows with market conditions. I think the big difference, and Amanda was on the study so she can jump in here when we're discussing kind of scoping this out, one of the concerns was the need to be more sophisticated. If you go back to the early 2000's, for the big projects, there were earmarks around. So, there was very few of the large grant projects. So, it was really trying to come up with what was that relationship and where should the public sector be? I don't know if it's necessarily responding to operation changes, but more us getting more sophisticated and trying to understand what the relationship between freight railroads and the public sector should be and where our role was. As I say that, I realize there is one instance where there has been a lot of changes and that was really with the short line industry and the development of the holding companies. And I think that has been a challenge of how to deal with that. If you go back to the slide on public benefits and private financial returns, you take these big holding companies, and some of them have a great deal of resources, but it doesn't mean that is available to the line in your state that needs improvement. So, I think that has changed quite a bit. But overall there have been changes with market, but really it was trying to get a better understanding and a more granular understanding of where the public can be most value added in this public private partnership relationship. I hope that answers your question, Chip.
Jennifer Symoun
Another question just came in. What are the eligible project types under the LIFTS program?
Laura Hutzell
Let me go back; go to the slide with the applicant eligibility, I guess you can start there.
The program gets tricky because it is administered under the Federal Highway Administration and they have specific requirements in terms of the types of projects that can or cannot be funded. It's kind of an ongoing thing with FHWA; we are in contact with them quite a bit each year when we go through the application phase. I can tell you the types of projects we have been previously awarded. Those have been deemed eligible by FHWA. We've had a propane project come in in the southern part of Iowa. We've had the airport project in Cedar Rapids come in. We had a rail haul bridge in Northeast Iowa; that was a bridge that even though it was rail related it was essentially a bridge to divert traffic so they could put rail underneath. That could not be funded with RRLG funds, so they went ahead and worked with the LIFTS program to get funding through that. We have funded a study that incorporated barge terminals on the Mississippi River. If you go through the LIFTS website there should be a list on there of previously awarded projects. We tend to put all of our presentations that we do for the commission when they approve the projects on the website. So, I can definitely get you more information and if you are looking for a specific type of project you are welcome to email me and ask me specific questions. It's hard to say exactly what would or would not be eligible because of the different regulations that FHWA puts us through.
Jennifer Symoun
Alright, thank you. I don't see any other questions. Again, if someone wants to ask a question over the phone it is*5. We will wait another minute to see if there are other questions before we possibly end a bit early. Let's see if any other questions come in. I don't see anything else being typed in so I'm going to close out so if anyone thinks of other questions please feel free to type them in. I do want to thank all three of our presenters for their presentations today and thank you for everyone in attendance. Thank you all for attending today's seminar. I will send out a link to the recording of today's webinar within the next day. The November Talking Freight seminar is not yet available for registration, but once it is, I will send notice through the Freight Planning LISTSERV. The Freight Planning LISTSERV is the primary means of sharing information about upcoming seminars. I also encourage you to join the LISTSERV if you have not already done so.
Just one more question came in. Laura and Amanda, were there any projects with benefits to passenger rail that came from LIFTS or RRLGP?
Laura Hutzell
Unfortunately, passenger rail is ineligible for RRLG. So, long answer short, no.
Jennifer Symoun
Okay think you. We are going to go ahead and end for the day so with that, thank you everybody and have a good rest of the day.
