CSX unveils $575 million wish list

Rail improvements tied to proposed marine terminal

State money at stake

Projects could lure cargo lines to relocate here from New York

Shipping

April 10, 1999|By Robert Little | Robert Little,SUN STAFF

Officials for the East Coast's largest railroad have outlined a package of "significant capital investments" that they say are needed for Baltimore to accommodate the giant marine terminal state officials hope to build in Dundalk.

To handle the cargo that shipping companies Sea-Land Service Inc. and Maersk Inc. might bring to Baltimore, the CSX railroad needs improvements costing as much as $575 million, company officials say.

Projects include new tracks to Philadelphia and Washington and a new rail yard in northern New Jersey. Bridges and tunnels as far away as West Virginia and Ohio need to be enlarged, railroad officials said.

Maryland has offered to build a 330-acre marine terminal to lure the shipping lines to Baltimore. Maryland Port Authority officials refuse to reveal what they have promised Sea-Land and Maersk or the cost to taxpayers, but they acknowledge that they would have to spend at least $200 million. Most observers expect the cost to be much higher.

CSX officials say their list of railroad projects is neither a request nor a demand for government assistance. But it came in response to a letter from Gov. Parris N. Glendening last week offering state money for "reasonable" projects that could help Baltimore win Maersk's and Sea-Land's business.

In a letter to state Transportation Secretary John Porcari, CSX Vice President J. Randall Evans outlined several improvements that the railroad says it needs to handle the increase in cargo that Maersk and Sea-Land would bring to Baltimore.

All the projects are designed to increase the number and size of trains that can travel from the port of Baltimore to common cargo destinations like New York and Chicago. They include:

Additional tracks and other rail improvements in and around the public marine terminals in Dundalk. Estimated cost: $20 million to $30 million.

New tracks between Baltimore and Philadelphia, and increased clearance from Philadelphia to New Jersey. Estimated cost: $120 million to $135 million.

A new rail yard in northern New Jersey for transferring cargo onto trucks or other rail lines. Estimated cost: $60 million to $80 million, depending on real estate costs.

Improved clearance from Baltimore to Chicago to accommodate trains hauling containers stacked two high. This would include increasing the height of the Howard Street tunnel beneath the city, and improving tunnels and bridges in Western Maryland, West Virginia, Pennsylvania and Ohio. Estimated cost: $120 million to $130 million.

A third track between Baltimore and Washington to keep freight trains from interfering with MARC commuter trains. Estimated cost: $200 million.

Glendening and others have said they would consider investments in the state's railroads only if they see clear evidence that those investments would improve Baltimore's chances of wooing the two shipping companies.

State officials would not comment yesterday on whether CSX's projects met Glendening's standard of "reasonable." Said Porcari: "It's a starting point to try to define what projects are reasonable."

Because Richmond, Va.-based CSX Corp. owns Sea-Land, it could block Sea-Land's plans with Maersk to relocate to Baltimore. But CSX officials have said that Sea-Land will decide independently whether to move to a new marine terminal. Evans said in his letter that CSX was not suggesting that all its improvement projects must be financed for Baltimore to win Sea-Land's business.

Sea-Land and Maersk, two of the world's largest container shipping companies, are awaiting a final proposal from the Port Authority of New York and New Jersey before deciding whether to stay in Elizabeth, N.J., or move to Baltimore. While Maryland has offered to build the companies a new terminal and promised deep discounts in labor rates and pilot fees, New York has been unable to make an offer because of a quarrel between the governors of New York and New Jersey.

The shipping lines have given the bi-state port until Tuesday to put an offer on the table. Longshoremen in New York and New Jersey are planning to picket the World Trade Center in Manhattan on Monday, a plea to the governors to keep the shipping lines in New Jersey and preserve as many as 3,500 waterfront jobs.

While the Baltimore port is believed to be offering lease and labor rates below the norm for East Coast ports, the shipping lines are expected to stay in New Jersey if the New York-New Jersey port authority comes close to matching Baltimore's bid. As much as half the cargo that Maersk and Sea-Land ship through the East Coast originates from or is bound for the New York area.

That makes the railroads key components in Baltimore's effort to lure the shipping business. Maersk and Sea-Land have asked for access to two major railroads and need reliable, overnight rail service to New York for Baltimore to be a viable port.

One of the city's railroads, Norfolk Southern Corp., has expressed few complaints. The Norfolk, Va.-based railroad has agreed to give up its exclusive rights to the Dundalk Marine Terminal and share the business with CSX.

State officials are helping Norfolk Southern negotiate with Amtrak for space on the crowded northeast tracks between Washington and New York, but the railroad has made few other requests.

CSX, however, has argued that its tracks in Baltimore are inadequate to handle the increased business. The new terminal would move as many as 750,000 cargo containers a year, more than tripling the amount of container cargo that the port of Baltimore handles today.

Pub Date: 4/10/99

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