County has big hopes for rail yard

County has big hopes for rail yard

Turning CSX operation into intermodal hub would benefit warehouses in area

A group of Hendricks County and economic development officials headed to Fort Worth, Texas, this month to engage in a little gentle persuasion.

The group visited BNSF Railway Co., one of the nation’s largest railroad companies, in hopes of enticing it to use the Avon rail yard as a large intermodal rail terminal.

Having Avon as an intermodal terminal would help the area compete for rail freight headed to neighboring cities in the area and produce savings for local companies that receive shipments from overseas, particularly Asia.

“The rail yard plays a key component in what we do here,” said Cinda Kelley, executive director of the Hendricks County Economic Development Partnership. “We have the opportunity to be more focused on the yard.”

An intermodal terminal is a switching facility for large containers between rail
road cars and trucks.

While the Avon yard is involved in some intermodal transit, its main function is connectivity, building 100-car trains with con
tainers primarily from East Coast ports, such as the Port of New York/New Jersey, and moving products to other locations.

Local officials say rising costs for highway transportation and increasing demand for rail transit are helping to stoke interest in creating an intermodal hub.

Such a facility would be a
boon to the distribution companies that have built millions of square feet of space in Hendricks County in recent years.

Chicago challenge

Even so, major obstacles remain. For one, the rail yard-which is owned by Jacksonville, Fla.-based CSX Corp.-is less than 200 miles from the company’s intermodal terminal in Chicago and isn’t
on CSX’s primary intermodal rail network.

“Intermodal terminals are typically at least 250 miles apart from one another on the same rail network,” according to “A
Rail Strategy for Indiana,” a study prepared five months ago for the Central Indiana Corporate Partnership.

“Markets like Indianapolis are at a geographic disadvantage … because Indianapolis is so close to the large railroad terminal end points in Chicago.”

Yet the state does have strengths, including an
extensive existing rail network. Indiana is the country’s 12th-smallest state, but ranks ninth in total railroad miles, with 4,165. Neighboring states Illinois and Ohio, however, have even more miles, 7,196 and 5,354, respectively.

The New York Central railroad built the Avon yard in the 1950s. It is about four miles long and, at its widest point, a half-

mile across.

After a succession of ownership changes in the 1960s and ’70s, CSX acquired the yard in 1999 as part of its purchase of Consolidated Rail Corp., or Conrail. The yard employs more than 200 conductors, engineers, tower personnel and other workers, a
company spokesman said.

It runs parallel to U.S. 36, also known as Rockville Road, and effectively bisects the Avon school district, as well as the town.

Goods entering the United States by rail generally are in 40-foot containers. Larger domestic containers can be stacked on top and shipped into the interior of the country. Operators move containers from
trucks to rail, and vice versa, with each transfer called a “lift.”

Untapped potential

While the Avon yard had 28,000 to 30,000 lifts last year, “it could handle as many as 100,000 [lifts] without doing a major redesign,” said Brad Hurt, a consultant who worked on the CICP study.

A major intermodal terminal, such as the ones in Chicago and Columbus, Ohio, can handle more than 180,000 lifts a year, CSX spokesman Gary Sease said.

The CICP study suggested that Avon could be developed to serve a western railroad or link more directly to an eastern railroad’s network, such as CSX’s.

Most goods from the West Coast are sent by train to the hub in Chicago and trucked to the Indianapolis area.

That can add as much as $300 to the shipping cost of each container. But delays in Chicago coupled with increasing gas prices and the diminishing number of truck drivers make direct intermodal rail service from the West Coast more attractive.

“There are [warehouse] users locally who would be helped with a direct West Coast link,” Hurt said.

Area officials over the past two years have held discussions with CSX and other rail companies about potential uses for the Avon yard, said Kelley, the Hendricks County economic development official.

As part of that effort, area officials met with BNSF Feb. 12 and Feb. 13 to discuss establishing a direct rail link between the LA/Long Beach seaport and the Avon yard. BNSF officials could not be reached for comment.

The CICP study says such efforts have potential. It concludes, “If a connection to Indianapolis could be created from a western railroad, it is possible that Indianapolis could pull freight from intermodal connections in Cincinnati, Louisville, Chicago and Columbus.”

Such cities “are well ahead of us in terms of negotiating intermodal connec
tions,” said John Hirschman, director of development for Browning Investments, which develops industrial buildings.

“I think we will get there, but I don’t know how long it will take to get there. … An intermodal connection makes sense.”

Unfortunately, he said, top management of railroads typically are slow and deliberate in their thinking.

Helping create demand is a boom in warehouse construction in the Indianapolis area, especially in Hendricks County.

According to the CICP study, Indianapolis is home to nearly 30 million square feet of warehouse space and another 30 million is in some stage of planning or development.

In Hendricks County, the All Points Midwest business park opened last year with 650,000 square feet of space for bulk distribution and will expand to 1.2 million square feet this spring. All the space already is leased.

All Points Midwest, a 50/50 joint venture between Browning and Duke Realty Corp., sits on more than 900 acres. Over the next decade, the partners hope to develop more than 13 million square feet of space, Hirschman said.

Hendricks County officials say that to maximize the economic potential of the rail yard, and make it as accessible as possible for distribution firms, its main entrance needs to be moved. The current entrance is to the west, while all the new warehouse space is to the south and east.

They’ve talked with CSX about various options, including moving the entrance to the south side, on County Road 100 South.

“We need a new route into the rail yard. It would be positive for Avon and Plainfield,” said Kent McPhail, a board member of the Hendricks County Economic Development Partnership and head of the Plainfield Chamber of Commerce. “There definitely has to be a better entrance than what we have now.”

However, Hirschman said discussions to arrange a new entrance could take years.