(The following story by Jane Roberts appeared on The Commercial Appeal website on Febraury 27.)
MEMPHIS, Tenn. — After a lengthy site search in the tristate area, Burlington Northern-Santa Fe Railway Co. is now considering staying in Memphis and merging its rail yard in Marion, Ark., here, too.
On Thursday, the railroad presented a payment-in-lieu-of-taxes application to the Memphis and Shelby County Industrial Development Revenue Board evaluation committee, which will recommend a nine-year tax freeze that could be extended to 13 years.
“At the moment, the proposal is still very much in the air,” said Brian Pecon, Memphis and Shelby County Economic Development director. “They are in the process of reviewing their options.”
BNSF, which operates a 57-acre yard at U.S. 78 and Shelby Drive, would not say how many jobs it intends to create or how many acres it would buy.
Burlington Northern-Santa Fe Railway Co. hopes to merge its Memphis and Marion, Ark., rail yards here, expanding into industrial property beyond its 57 acres at U.S. 78 and Shelby Drive.
Thursday, the railroad presented a PILOT application to the IDB evaluation committee, which will recommend a nine-year tax freeze that could be extended to 13 years, said Brian Pecon, Memphis and Shelby County Economic Development director.
“At the moment, the proposal is still very much in the air,” Pecon said.
“They are in the process of reviewing their options.”
BNSF would not say how many jobs it intends to create or how many acres it would buy.
BNSF has made no secret that it has been looking at expansion sites for years and has made formal proposals on several of them.
“We’re serious about all of them,” said BNSF spokesman Joe Faust. “But we have certain incentives we’re asking of the city and county.
“We think we know where we want to go, but is it feasible is still the question,” he said.
The logical place is a 125-acre vacant lot along BNSF’s mainline route heading out of town. It is within a quarter-mile of its yard and adjacent to 5900 E. Holmes, a warehouse owned by Belz Enterprises.
BNSF needs to expand its Tennessee Yard to add capacity for intermodal operations, the fastest-growing segment of the transportation industry.
Memphis is ground zero for intermodal traffic because it is centrally located for distribution nationwide.
BNSF currently transfers about 200,000 containers a year here. In several years, it would like to have capacity for 1 million lifts, Faust said.
The railroad has had an 18-acre intermodal yard in Marion since the mid-1980s. In 2003, it transferred 94,000 containers to trucks there, many of them heading to Memphis warehouses.
Kay Brockwell, director of economic development in Marion, saysexpects the yard employs 30-35 people and brings 34 trains through town a day.
“It’s a case of them having outgrown their facilities here and in Memphis,” she said. “We’ve known for years that they’re looking at making a change.”
If BNSF leaves Marion, there’s little chance Union Pacific, which has a large yard there, could use the facilities, she said.
“In Crittenden County, Burlington Northern runs north and south. UP runs east and west through the county,” Brockwell said.
The plans dash hopes that BNSF would join the Super Terminal, which is expected to be running by year end at the Frank C. Pidgeon Industrial Park.
Canadian National and CSX railroads are its only tenants.
“Strategically, long-range, I think it’s a mistake not to go there,” said local logistics expert Robert Milner.
He doubts BNSF could buy enough land around Shelby Drive to make the expansion economically viable.
“I think they would need another 200 acres to get five years of expansion,” he said.
Bayard Snowden, of real estate firm Colliers Wilkinson & Snowden, doesn’t see how BNSF could leave Southeast Memphis, where it serves some 70 million square feet of warehouse space.
“You couldn’t create a better logistics center for a railroad than the Tennessee Yard,” he said.
“I certainly think the IDB and the State of Tennessee are well-served to bend over backward to help the BNSF improve its situation in Memphis,” he said. “They need to grow.”