BUFFALO, N.Y. — CSX Transportation is planning a $6 million expansion to transform its intermodal yard off William Street in Buffalo into an “inland port” for the Port of New York & New Jersey, the Buffalo News reported.
The expanded yard would become a hub for breaking down large shipping containers into truck size shipments bound for Rochester, Syracuse, Pittsburgh, Pa., and Ontario, according to railroad officials.
The William Street yard is already the fastest growing CSX intermodal yard in the northeast, with container volume growing 21 percent in the last 12 months.
Railroad officials believe container volume at the Buffalo yard will grow from 30,000 containers this year to more than 50,000 containers within three years.
CSX would add between 20 to 40 jobs locally and believes the expanded facility would spin off hundreds of jobs in the warehousing and trucking industries.
“The important point is, there is tremendous growth potential here,” said John Casellini, resident vice president of state relations for CSX. “We’ve been saying all along that there’s an opportunity waiting to happen for Buffalo, and it’s here.”
But the Florida-based railroad is looking for $3 million in state funding to complete the project.
Casellini said profit margins are “razor thin” in the intermodal business and the railroad has to be price competitive to drive volume to Buffalo.
“If we had to do this on our own, we’d do it on our own, but not right away. We want to get this into Buffalo immediately. Because they’re going to try to do in Pittsburgh what we’re trying to do here in Buffalo,” Casellini said.
Assembly Majority Leader Paul A. Tokasz, D-Cheektowaga, has already secured $1 million in state funding for the project. CSX officials are lobbying the Senate and Gov. George E. Pataki’s office for additional state funds.
The intermodal yard expansion is possible because CSX is relocating its transflo terminal, which processes fertilizers and other bulk goods, from William Street to a former Conrail yard in the city’s Black Rock neighborhood.
The state already put up $4 million to help fund renovations at the Black Rock yard.
Moving the transflo facility opens 22 acres at the William Street yard, behind the U.S. Postal Service processing center, to expand intermodal operations.
Tokasz believes a larger intermodal yard would help Buffalo grow as an international trading center.
“Railroads played a prominent role in establishing this region as a center of commerce. Western New York is well positioned to not only regain this status, but also to flourish once again as a center of commerce and distribution of goods,” Tokasz said.
The state legislature agreed to a plan earlier this year slashing property taxes on rail assets in New York.
Buffalo is becoming increasingly popular with railroads during phasing in of the North American Free Trade Agreement. Canadian National, Canada’s largest railroad, recently expanded its lumber processing yard in Western New York.
CSX plans to use the intermodal facility for customs clearance and logistics work. Oversized containers originating overseas would be broken into smaller truck loads.
For example, toy action figures of Power Puff girls arrive in one bulk container. Those toys have to be integrated with other toys into shipments bound for large retail chain stores in New York, Pennsylvania and Canada.
“Somebody has to break the containers down and prepare them for the marketplace. That’s the kind of work that goes on in New Jersey right now that could be going on here,” Casellini said.
The number of large shipping containers unloaded in Buffalo would have to be returned to the Port of New York/New Jersey. Container space in the returning empties would be offered to U.S. and Canadian exporters at reduced rates, according to CSX.
Port Authority officials approached the railroad about establishing inland ports because traffic at the Atlantic Coast port has grown so dramatically in the last decade, CSX officials said.
Much of the New York City port traffic now comes upstate on trucks. Tokasz said many state officials like the idea of pushing the commerce to rail to reduce wear on the New York State Thruway and improve air quality.