(Reuters circulated the following article by Nick Carey on October 19.)
CHICAGO — U.S. railroad Norfolk Southern Corp. is considering building a major rail yard by an Indiana town 75 miles from Chicago to bring consumer goods to the Midwest, local officials said on Wednesday.
“They’re looking at a site west of LaPorte and are negotiating with property owners to buy land,” said Leigh Morris, mayor of LaPorte.
Morris said Norfolk Southern was looking to build an intermodal transfer yard on a 2,000 acre site near the town of 22,000 people.
“An investment like this would be positive for us in many, many ways,” Morris said.
He added that two other railroads, CSX Corp.
Intermodal shipping uses standardized containers that can be transferred between different modes of transport – ship, truck or train – and growth is driven by soaring U.S. imports from developing nations such as China.
When asked about the possibility of a LaPorte yard, Norfolk Southern spokesman Rudy Husband said the company “does not comment on rumor or speculation.” A Canadian National spokesman also declined to comment for the same reason.
CSX spokesman Garrick Francis said the railroad has been “talking to communities in both Ohio and Indiana” about an intermodal yard, but has “not reached any decision on a location.”
Any decision on allowing the construction of a rail yard would fall to the LaPorte County Commission, Morris said.
Commission president Marlow Harmon said he could not comment because he has signed a confidentiality agreement on the project.
“I know (Norfolk Southern) has been looking into doing this, but I can’t say any more than that,” Harmon said.
Mayor Morris said the plot of land Norfolk Southern is looking at would give the railroad easy access to three Interstate highways – 80, 94 and 90.
CSX and Canadian National have looked at LaPorte county for the same reason, he said.
Morris said the yard would mimic railroad Burlington Northern Santa Fe Corp.’s
BNSF officials said the facility in Elwood, Illinois, has hired 900 people since opening in 2002. There are also several distribution centers just outside the facility that employ hundreds of others. Retailer Wal-Mart Stores Inc.
This year the facility will handle 800,000 containers.
Transportation analyst Stephen Brown of Fitch Ratings said that building yards outside Chicago would be a logical choice, given the congestion railroads face around the city.
“I wouldn’t be surprised if railroads were looking at sites like this (LaPorte),” he said. “Intermodal requires moving goods fast from A to B.”
“So the railroads need to be close to existing arteries to deliver goods fast,” Brown added, “but far enough away so that they can bypass congestion.”