Summary of Recommendation:
The Commonwealth should increase its investment in rail freight projects to reduce the rapidly increasing volume of through trucks on the Interstates and on primary roads in the major urban areas. The recently adopted program for rail enhancements – both passenger and freight rail - should be steadily increased over the next six years, starting with 2007 at $150 million. The majority of funds should be focused on joint freight-passenger improvement in the I-95 corridor and Shenandoah lines.

Background:
Virginia’s location and topography mean that the Commonwealth is a funnel for freight traffic along the eastern seaboard. An analysis of the US DOT 2002 Commodity Flow Survey shows that 57% of the big rig trucks passing through Virginia do not have an origin or a destination in the Commonwealth. By comparison through truck traffic in North Carolina is only 26%.

International trade is fueling freight demand and US DOT expects freight transport to double between 2002 and 2004. The situation will only intensify. The Port of Virginia is enjoying substantial growth from Asia and India trade and more is anticipated. But the transportation system is not prepared to absorb all this new traffic, especially in congested Hampton Roads and Northern Virginia.

Private railroads serving Virginia have more capacity to accommodate this demand in terms of right of way, but are hampered by decades of disinvestment. The result is that capacity potential is limited by terminal bottlenecks, antiquated signals, and reduced trackage in those rights of way. For example, most rail lines in the state are single track even when the right of way will accommodate 2 to even 4 tracks.

To recapture and expand this capacity the state needs to partner with the private railroads to expand north-south capacity along I-81, Route 29, and I-95, and east-west capacity from the Port of Virginia. A US DOT 2003 study estimated that benefits to shippers, highway users, and avoided highway costs would be five times the cost of upgrading rail freight lines. Most of the funds invested in Virginia will benefit long-standing and popular passenger rail services, such as Richmond to DC and Bristol to Richmond.

Better yet, the private carriers will bear between 20 to 60 % of the costs depending on the split between private and public benefits. Partnerships with rail freight companies should be the highest priority for PPTAs. If Norfolk Southern plans to spend $1.1 billion for capital improvements this year, we should provide the incentives to secure a larger part of that investment for Virginia. Ditto, CSX. Reducing truck traffic equates to substantial investment in highway capacity and avoided maintenance costs for the state that can not be ignored.

Plans have advanced for most of the key rail investments. Many projects can be quickly started in the I-95 corridor, Piedmont, I-64 and 460 corridors. Some initial improvements also are known for the Shenandoah line (I-81), but more substantial planning is needed for longer term fixes. Public funds are needed to match the private investment and public leadership to ensure delivery.

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