(The following story by Pam Eggemeier appeared on The Journal-Standard website on May 7.)
FREEPORT, Ill. — Intermodal transportation seems to be on the right track in northwest Illinois and Springfield has jumped on board.
Gov. Rod Blagojevich’s office announced Wednesday that the Union Pacific Global III Intermodal Facility would receive a $100,000 planning grant from the state Department of Commerce and Economic Opportunity. The grant will be administered by the Greater Sterling Development Corporation.
Intermodal transportation is one of the nation’s fastest-growing businesses, growing annually at about a 9 percent clip. The term generally refers to the transfer of freight or people from one mode – of travel such as rail or truck – to another at a centralized facility.
The facility, located in Rochelle, is at the intersection of Interstates 88 and 39. It has the ability to handle 25 trains and 3,000 containers daily. Its central location is ideal for getting certain goods from the east and west coasts to consumers throughout the nation and it also is close enough to entice Chicago-based businesses whose city transportation channels are getting slower and slower.
The potential is great but the grant money will fund an economic impact study that will try to get a better handle on it, making sure that no stone is left unturned.
“We know that the strategic location (of the facility) gives the I-88 corridor great economic potential, but what we don’t yet know is the best way to take advantage of that potential and make sure it translates into more jobs for this region,” said State Sen. Todd Sieben, R-Geneseo. “This planning grant will enable us to do that; this was an opportunity we couldn’t afford to miss.”
The grant comes on the heels of a $1.1 million Opportunity Returns award given to the Intermodal Facility one month ago. That grant will help bring a RC2 distribution center into the Intermodal Facility. RC2 is a manufacturer of toys and collectibles. The money will be used to build a sanitary sewer extension and water main, extend 10 years of tax credits to the company, and fund some job training programs.
Wal-Mart and Rayovac have also announced their intentions to build or relocated distribution centers near the Rochelle facility.
Bob Skurla, Freeport Area Economic Development Foundation executive director, said the impact of Intermodal on Freeport could be substantial but it probably won’t be immediate.
“Rochelle eventually will hit a wall with people wanting to locate right there,” Skurla said. “Businesses within a two-hour radius would consider it as a transportation alternative and Freeport wouldn’t be considered too far. It definitely has value for us when trying to bring certain types of businesses here.”
Skurla said certain food items with a long shelf life, such as canned vegetables or ethanol byproducts, would be prime candidates for intermodal distribution.
Riverport Railroad, LLC, a tenant at the Savanna Army Depot, said they have intermodal plans of their own in the works. Food-related commodities also play a key role in that company’s plans, according to Jack Koster, Riverport president.
“We are in the center of the nation’s and maybe the world’s largest farm community,” Koster said. “We see a future in handling those commodities.”
Fertilizer is another potential high-growth area. For example, Cargill can use it as a central location in bringing phosphate from all over the country and deliver it to North and South Dakota in time for fertilizing the fields. Companies like Archer Daniels Midland could also transport byproducts like corn syrup or salad oil through Savanna.
The commodities unit trains would be part of the picture. Riverport also hopes to serve as an around-the-clock servicer of car segments for adjacent main-line railroad company, Burlington Northern-Santa Fe – one of Union Pacific’s major competitors.
“We could take up to 120-car trains, which is the maximum according to federal safety regulations,” Koster said. “If the cars break down they could stop at our tracks and we’d pull out the cars, put the train back together and get them on their way.”
The company would handle intermodal cars in limited niches but that will take a little longer to happen. The intermodal units have double-stacked containers and generally travel during the day.
The intermodal units are a key component of the foreign trade zone recently established at the depot. Koster said Riverport is investing about $5 million in track upgrades and another $6 million to $7 million related to the foreign trade zone.
“We will have capacity for four unit trains by May or June 2005, and that should be big-time business next year,” Koster said. “The intermodal and foreign trade zone should take a little longer to develop.”
Dave Ylinen, director of the Jo-Carroll Local Redevelopment Authority, said Riverport has been a tenant since March 1999, and the LRA is now finalizing a sale of property to Riverport for the Intermodal Zone.
“They’ve paid us for the sale of the railroad property and the attorneys are working to finalize the agreement,” Ylinen said.
A 95-acre parcel of land had been set aside for Riverport with the hope the railroad would set up the Intermodal Zone in the former Army railway area that is adjacent to the Burlington Northern-Santa Fe main line. The land was recently released by the government, enabling Riverport to purchase the property.