1. KEVIN B. PAGE VIRGINIA DEPARTMENT OF RAIL AND PUBLIC TRANSPORTATION VIRGINIAS RAILROADS A STAKEHOLDER IN TRANSPORTATION DEVELOPMENT

2. Todays Rail Presentation VA Railroad Overview Intermodal Partnership –TRUCK/HIGHWAY –CONTAINER/PORTS VAs response to assist rail transportation through state funded rail industrial development programs

3. Railroads Timeline 1960S Began downturn of railroad dominance in ground transportation 1970S Scrapping the old system 1980S Deregulation 1990S Market recovery

4. External Circumstances National Interstate System Truck Competition Air Travel Automobile Federal regulations limiting railroads from competition and rationalization of unprofitable lines

5. Year 2000 Two Main Line Railroads Ten Shortline Railroads 3,188 Route Miles of Track

6. Rail Adjusts to Market Need Traffic flow change –NAFTA –Import/Export to China, Far East Truck/Rail found its niche –CDL and Drug Testing –Higher speed intermodal trains Railroads step into the Just In Time (JIT) inventory management Industries convert to inventory on wheels

7. Intermodal Partnership Bridging Relationships Between Truck and Rail

8. CONCRETE AND STEEL, A GEOGRAPHIC RELATIONSHIP

9. INTERMODAL CORRIDORS TO VIRGINIA PORTS

10. Intermodal Rail Corridors

11. VA/Railroads Stake in Enhancing its Rail Network Fostering industrial growth by promoting and investing in a balanced transportation system for Virginia Getting Ag goods to Market –Where rail fits in –Need rail? How do I get it? –Managing Rail Service After Implementation

12. Where Rail Fits in Rail typically enjoys: – high tonnage moves – the bigger the better –JIT moves – Assembly plant parts and supplies –Moves over 600 miles are truck competitive The longer the haul the better the rate

13. Where Ag Products Fit in Rail typically enjoys: – high tonnage moves – the bigger the better –Rate breaks begin at or about 15 car cuts –Unit trains preferred for dedicated move and less handling at terminals –Sidings at industry plant site to accommodate the business generated

14. Challenges of Ag Rail Service Rail service typically needs: – Siding capacities to accommodate the business generated –Run around track at or near terminal –Ability to weigh cars loaded out –Unit train moves – 15 car cuts or better –Need cars? Yours or theirs Lower volume business appreciated but at a higher price of doing business –Shortline railroads can offer better service at the terminal

15. Rail Preservation SHORT LINE PRESERVATION A WINDOW OF OPPORTUNITY FOR INDUSTRIAL DEVELOPMENT

16. Rail Preservation BeforeAfter Providing improvements to rail lines and interchanges to handle heavier loads and improve track safety

17. Need Rail? How Do I Get It? Not all sites on rail can be served: – Curved track deters switches to plants –Availability of switching services –Grades and other geographical obstacles All railroads have an Industrial Development Representative to assist in making these determinations

18. Cost of New or Enhanced Rail Service What Industry Pays For –Main Line Switch –Improvements on site Track and loading/unloading facilities –Improvements off site Runaround track or yard capacities DRPTs Rail Industrial Access Program can assist in capital costs of rail service on site

19. RIA Program Purpose Virginias pro business environment Additional incentive program –Compliments other economic development initiatives –RIA is a unique program not available in most other states

20. Rail Industrial Access Up to $450,000 available per jurisdiction per year Grantee eligibility –Business, commercial or industrial enterprise –Municipal or county governments –Local departments of economic development –Railroads

21. Managing Rail Service After Implementation Anticipation of delivery and coordination on site are the biggest components of successful rail services – Coordinate placement of cars with ability to unload or load them –Cars sitting around cost you money –Skimping on rail siding capacity in site design will cost you in the end Plan big Implement in phases as you grow the business