(The following story by Grace Hobson appeared on The Kansas City Star website on February 12, 2009.)
KANSAS CITY, Mo. — The proposed BNSF Railway intermodal hub in Gardner — part of a $750 million project — will be delayed because of the faltering economy, rail officials said Thursday.
At one point BNSF had hoped to break ground on its rail hub in 2007, but getting a required federal environmental permit has taken years longer than officials anticipated. More recently, the company hoped to finish construction within 18 months of acquiring the permit, which could come this spring.
Now the 18-month schedule has been scuttled in favor of an open-ended timeline that will depend on the economy, said railway spokesman Steve Forsberg.
In a letter to Gardner Mayor Carol Lehman dated Thursday, the company sought to assure the city that it is committed to the project.
“This is evidenced by our major investment in land, state-of-the-art electric cranes, and project-related development expenditures,” wrote J. Vann Cunningham, BNSF assistant vice president of economic development.
The railroad has spent millions to acquire about 1,000 acres for the project, including 492 acres for the rail hub and about 500 acres for warehouse distribution in a logistics park, Forsberg said.
The Allen Group, which is developing the logistics park, learned of the delay Thursday.
“We’re disappointed with BNSF’s decision to extend its construction schedule, but it’s understandable given the state of the economy,” said William Crandall, president of the Allen Group’s Kansas City operations.
The company will spend the next few weeks figuring out what the delay means for the logistics park, Crandall said. The proposed park has not lined up any tenants, he said.
By late last year, freight volume on trains around the country was down by double digits.
BNSF reported in its fourth-quarter earnings statement that it was parking 35,000 rail cars and 700 trains because of a decline in demand. Normally, BNSF runs more than 200,000 cars and more than 6,000 trains on its network, Forsberg said.
“That’s a pretty significant downturn,” Forsberg said.
Gardner City Administrator Stewart Fairburn said the city is confident the project will go forward despite the delay.
“It’s not a question of ‘if,’ just a question of exactly when the project will be done,” Fairburn said.
The original timeline was too aggressive given the company’s need for the federal permit, a much longer process than BNSF realized, Fairburn said.
The company has applied to get a permit to move a stream on the hub property. The Corps of Engineers and BNSF have been working on the permit process in earnest since 2007. The corps is conducting an environmental assessment of the project.
BNSF in the past month submitted thousands of pages of documents to respond to all the issues that have been raised. It hired consultants to conduct studies on the project’s environmental impact, Forsberg said.
“We’ve put in an awful lot of time and effort to gather all the information we needed to respond to all the issues, and we think we’ve done a very good job at that,” Forsberg said.