Times Watchdog Report: Another passenger train idea for Tennessee Valley

Speeding trainView full size(Stock image)

DECATUR, Alabama – The allure of riding the rails on a passenger train has been around probably as long as trains have existed. And the flirtation with bringing passenger trains through the Huntsville area has continued over the years.

The late Ed Mitchell for decades pushed a high-speed, magnetic levitation train that would follow the Memphis-to-Atlanta superhighway route that passed through Huntsville.

Just a few years ago, Madison businessman Doug Gooch proposed a light-rail system transporting commuters between Cummings Research Park/Bridge Street Town Centre and Redstone Arsenal.

But the high-concept rail systems proposed by Mitchell and Gooch have never come to fruition, primarily because of the high costs.

Now, a Virginia group has the idea of a railway demonstration project to haul freight and passengers between Memphis and Harrisburg, Pa., on a route that includes Huntsville, Chattanooga and Knoxville.

But the cost of the 965-mile-long rail system is a healthy $12.6 billion.

Pete Lotts, director of RAIL Solution, outlined the demonstration project called “the Steel Interstate” to about 30 elected and economic development officials Wednesday afternoon at Calhoun Community College.

RAIL Solution is a nonprofit group based in Salem, Va., that was formed to reduce heavy tractor-trailer truck traffic on Interstate 81 between Knoxville and Harrisburg.

The proposed demonstration project originally ended on the south end at Knoxville, but the group last year extended the plans to reach Memphis, Lotts said.

Improving the existing railroad tracks and building new tracks represents about $6.5 billion of the cost. Building an electrical system to power the trains would cost about $2.7 billion. Other major costs, Lotts said, include $750 million for separated crossing grades for two tracks and $660 million to buy right of way.

“We’ve got to create the atmosphere for this to happen in a public/private partnership,” Lotts said.

Lotts said guaranteed loans from the federal government would pay about half of the project’s cost, and private capital by issuing bonds would pay another 30 percent of the cost.

Norfolk Southern, which does not support the project, is counted on by the group to pay 8 percent, or about $1 billion, with state and local governments and direct private investment paying the remainder of the cost.

The recently adopted federal transportation bill could provide the $5 million to $10 million needed for a feasibility study, Lotts said.

Lotts said local officials can adopt resolutions supporting the project and talk to other officials and the public about it.

RAIL Solution envisions eight passenger trains running the route daily, Lotts said.

“We’re not talking about high-speed rail,” he said.

The passenger trains would travel between 90 mph and 120 mph, he said. They would be geared to short or medium distance trips such as from Huntsville to either Memphis or Atlanta.

Lotts said the system would be better for the environment by reducing fuel consumption, more economical, and safer for passengers and freight movers.

If the demonstration project is successful, it could lead to a new rail freight system across the entire country, Lotts said.

 

 

Article source: http://blog.al.com/breaking/2012/07/times_watchdog_report_another.html

Parking agreements now in place for $85M Councill Courts redevelopment

Councill Courts wide angle.JPGThe corner of Gallatin Street and St. Clair Avenue, as seen from Huntsville Hospital’s main parking deck. (The Huntsville Times/Bob Gathany)

HUNTSVILLE, Alabama — The Huntsville City Council approved a series of contracts Thursday night related to an $85 million-plus redevelopment of the former Councill Courts public housing site.

Pearce Construction was hired to build a $9.8 million parking garage at the renamed Twickenham Square, which promises about 240 loft-style apartments, a Homewood Suites hotel, Publix supermarket, large office tower plus additional retail and restaurant space.

The four-story, 941-space city garage could begin rising in September near the corner of Gallatin Street and St. Clair Avenue.

General Services Director Jeff Easter said the city will give Pearce the green light to start work as soon as the private developers involved in Twickenham Square – Triad Properties, Bristol Development Group and PGM Properties – buy the land from the Huntsville Housing Authority.

Gerry Shannon, a Triad executive, said that is scheduled to happen Aug. 9.

“I think this (series of council approvals) gets us to a land closing,” Shannon said Thursday afternoon. “We’ve been working on this piece of property for about two years, so I’m ecstatic.”

Of the eight contractors that submitted bids for the parking garage, Pearce was the cheapest at $7,104,770. Extras requested by the city – including a fourth level, upgraded facade and LED lighting – added another $2.6 million.

The total budget for the garage, including architectural designs and utilities, is $11.8 million.

Finance Director Randy Taylor said the city will cover about $9.2 million from its capital budget, plus current and future Alabama Trust Fund money.

Councill Courts downtown development sketchThis sketch shows the intersection of Gallatin Street and Lowe Avenue as they will appear after the development is completed. (The Huntsville Times/Submitted photo)

Developers are chipping in $500,000 toward the garage and will pay the entire cost of a smaller parking deck reserved for residents of the Flats at Twickenham Square apartments.

Huntsville Hospital, located caddy-corner from the project, will pay the city $2.1 million to lease 209 spaces on the top floor of the main parking deck.

Spokesman Burr Ingram said those spaces are needed for employee parking.

“With a growing community, you always have to provide more opportunities for parking,” Ingram said Thursday. “Additional (parking spaces) will be appreciated.”

All told Thursday, the council OK’d 12 legal agreements related to Twickenham Square, including parking leases, development agreements and a land swap with the housing authority.

In exchange for the 2.1-acre tract on which the parking garage will sit, the city will pay the housing authority $380,000 and also give it 2.7 acres along Holmes Avenue at the Searcy Homes public housing site acquired several years ago as part of a flood control project.

The housing authority intends to use its Councill Courts land sale proceeds to buy or build new public housing units throughout the city.

Meanwhile, Huntsville Hospital plans to move its clinical laboratory to the Triad-owned office tower at Twickenham Square. Shannon said the lab will cover about 1 1/2 floors in the five-story building.

A pedestrian bridge between the office tower and hospital also is on the drawing board.

“It’s been a very complicated deal with all the developers and their attorneys and their financial institutions,” Mayor Tommy Battle said Thursday. “Our team has done a great job of protecting the taxpayers and achieving the goals we were looking to achieve.

“I feel really good about it.”

Article source: http://blog.al.com/breaking/2012/07/parking_agreements_now_in_plac.html

Toyota engine plant incentives include land, grant money, utility breaks

Gov. Robert Bentley at Toyota news conference.JPGAlabama Gov. Robert Bentley was on hand in May when Toyota announced an $88 million expansion of its Huntsville engine plant. The project allow Toyota to ramp up its production of V6 engines. (The Huntsville Times/Dave Dieter)

HUNTSVILLE, Alabama — Toyota will get nearly free use of 134 acres to expand its engine plant at the city-owned North Huntsville Industrial Park.

An incentive package approved by the City Council on Thursday calls for the city’s Industrial Development Board to lease Toyota the rolling property — valued at $6.7 million — for a dollar per year.

Toyota has a 10-year option to buy the property for $2, but may prefer to lease the land for tax purposes.

In addition, the city will seek a $150,000 state site development grant and ask Huntsville Utilities to give Toyota an “investment initiative” credit worth $974,000.

Meanwhile, Madison County has promised a $250,000 economic development grant and $100,000 worth of site preparation work on Toyota’s planned V6 engine production line.

Toyota Motor Manufacturing Alabama announced plans in May to construct an additional 300,000 square feet of production space for V6 engines. The $88.3 million expansion — the company’s fourth since coming to Huntsville in 2003 — is expected to create 126 new jobs, pushing total employment to around 1,150.

Mayor Tommy Battle said he expects the new jobs to pay from $45,000 to $50,000 annually.

“Toyota has a $60 million economic impact on our community year in and year out,” Battle said Friday. “They’ve been a good corporate neighbor — the kind of company you like to keep in the area.”

Located along Pulaski Pike nearly 10 miles northeast of downtown Huntsville, the Toyota plant currently builds four-cylinder engines for the Camry, Highlander, RAV4, Sienna and Venza vehicles, plus V6 and V8 engines for the Tundra and Tacoma pickup trucks and Sequoia SUV.

The expansion will allow the factory to produce 3.5-litre V6 engines for Highlander models assembled at a plant in Princeton, Ind.

Toyota Motor Manufacturing Alabama President Jim Bolte.JPGJim Bolte

Jim Bolte, president of Toyota Motor Manufacturing Alabama, told the City Council before Thursday’s vote that construction could start in late August or early September. The first V6 engines are expected to roll off the assembly line in the spring of 2014.

“I’m already working with our global headquarters on our next expansion,” said Bolte.

The state has agreed to provide more than $6 million in incentives for Toyota’s V6 engine expansion, including $1 million for capital costs incurred by the company in developing, constructing and equipping the facility, $400,000 for industrial access roads and $4.8 million for job training.

As part of the city’s commitment, Toyota has an option to purchase an additional 173 acres in North Huntsville Industrial Park for $10,000 an acre — a significant discount from the $50,000-an-acre market price.

Battle said the incentive package is far less than the $158.5 million that the state, City of Mobile, Mobile County Commission and Mobile Airport Authority shelled out this month to land an Airbus assembly plant.

“We’re getting a deal,” said Battle.

Toyota’s Huntsville plant produced the company’s first V8 engines made outside of Japan. It’s the only Toyota plant in the world to produce four-cylinder, V6 and V8 engines under one roof.

The expansion will bring the company’s total investment in Huntsville to more than $700 million.

Article source: http://blog.al.com/breaking/2012/07/toyota_engine_plant_incentives.html

Lawson right person in right place for this cycle of life (Ingram)

In January 2006, I came to Baldwin County to become the third president and chief executive in the 12-year history of the Baldwin County Economic Development Alliance.

The organization had five employees, plus me, and was deeply in debt due to a failed capital campaign. Lance LaCour, my predecessor, had done a great job of building the organization from the ground up. A strong board, with great leadership was in place.

ringramsig.jpgView full sizeRobert Ingram is president and CEO of the Baldwin County Economic Development Alliance.

Over just a few months, budget and personnel adjustments plus a shift in the direction of the organization –needed to allow the organization to better handle the economic realities post hurricanes Ivan and Katrina — resulted in a smaller, more focused organization.

My first hire was a young man named Lee Lawson. At an Economic Development Association of Alabama event, not long after I arrived in Alabama, Lee made the effort to find me, introduce himself, welcome me to Alabama and offer to help in any way. He was working in economic development in Jefferson County at the time.

He made a great first impression and I hired him as a project manager soon thereafter. He transitioned easily from his former position, which primarily involved industrial property development and management, into cultivating and handling prospects, doing incentive negotiation and paperwork, and everything else related to bringing deals to the table and closing them.

Not surprisingly, Lee’s work was soon recognized by others with far bigger budgets and far more resources than the Alliance had. Less than two years after he came to Baldwin County, he moved on to PowerSouth, one of our best allies and economic development partners. It was a loss for the Alliance and the county, but certainly not a sad day, as it meant we had chosen well, benefited greatly from Lee’s work, and had a new ally in a strategic recruiting position in Alabama. He was a rising young star in the profession.

On Aug. 6, Lee will officially become president and chief executive of the Alliance as I transition into a support role, while phasing in a retirement plan and moving toward more community and economic development consulting, and fewer 8 a.m. to 5 p.m. days. He will step into a strong organization with no debt and with a track record of success.

His and the Alliance’s challenges and opportunities will be different from what mine were. The Airbus announcement and the potential receipt of hundreds of millions of Recovery Act dollars, flowing to certain parts of the county, will create unbelievable opportunity. Retiring staff members plus the recent departure of Josh Thornton, a great young economic developer himself, will leave organizational gaps which must be filled quickly in order to properly seize new opportunities.

Changing political climates and possibly changing political leadership at local and national levels, plus little or no growth of many local budgets, could affect Alliance revenues. The success of the organization will ultimately depend on public and private sector leaderships’ commitment to grow and diversify Baldwin County’s economy. One man or organization cannot do it alone.

Lee’s job will certainly not be easy. It will be a balancing act from day one — creating opportunity; solving problems; managing people and budgets; and, trying to do more — with less resources than an organization such as the Alliance needs — to compete against the world. And the world, not our neighbors in the region, is who we compete against.

On Aug. 6, 2012, the circle closes, and the cycle starts again. Lee Lawson is the right person, in the right place at the right time.

Welcome him warmly, Baldwin County, then provide the Alliance adequate resources, and hop on the train for the ride of a lifetime. Our destination is a strong, vibrant, diverse economy, one that is not totally dependent on good weather or clean beaches, one that creates new jobs and new wealth in every corner of Baldwin County.

The ride will not always be smooth, but it beats the heck out of standing at the station and watching the train depart.

Article source: http://blog.al.com/press-register-business/2012/07/lawson_right_person_in_right_p.html

On Alabama and Mississippi coasts, industry and education are a two-way street

AX103_0C7D_9[1].jpegView full sizeFlight Training of Mobile Flight Instructor Bill Cobb show kids from the AIRBUS Flight School summer camp where they will be flying Friday June 29, 2012. The Airbus Corporate Foundation has awarded a second $50,000 grant to the Gulf Coast Exploreum and Science Center. The Exploreum is using the funds to expand its first year pilot youth mentoring and aeronautics program. (Press-Register/Bill Starling)

MOBILE, Alabama — Education and industry are inextricably linked, each serving as a catalyst to help the other grow. Nowhere is that more evident than on the Alabama and Mississippi coasts, where economic development officials tout their education efforts — whether it’s public or private schools, college, or vocational training — to attract industry, while businesses, in turn, work with area schools to start grooming their workforce.

Area officials said that education is a critical piece of the puzzle that industries consider when they are scouting locations.

Just how often does it come up? “One-hundred percent of the time,” said Troy Wayman, vice president of economic development for the Mobile Area Chamber of Commerce. And that’s pretty early in conversation, Wayman said.

“While incentives are important, their No. 1 issue is the long-term cost of doing business,” Wayman said. “If there isn’t the human capital there, if there isn’t a trainable or skilled workforce, there aren’t enough incentives in the world to land a major deal.”

That means, he said, that if the education in the Mobile area had been terrible, German steelmaker ThyssenKrupp and European jet manufacturer Airbus may not have decided to locate along the Gulf Coast, despite hundreds of millions of dollars in incentives.

“(Lack of quality education) could absolutely be a deal breaker,” he said.

A recent letter to the Wall Street Journal pointed to a continually improving public education system as a major factor in landing Airbus, right alongside Alabama’s status as a right-to-work state, Mobile’s top-notch port and the impressive incentives package.

“Assembling airliners assumes a highly skilled, educated workforce,” wrote John Anderson in his letter published on July 8. “This reality alone would rule out many potential sites. But in Mobile, its nonprofit Local Education Fund, Mobile Area Education Foundation, has pioneered and successfully implemented a remarkable, sustainable reformation of its 65,000-student public schools.”

Anderson, who heads a similar nonprofit in Jacksonville, Florida, said his organization hopes to emulate Mobile’s success.

His letter points out that the foundation held dozens of public meetings that led to significant performance improvement.

Perhaps most importantly, the foundation emphasizes children’s programs — such as engineering-oriented summer camps and hands-on learning — the give elementary and high school students a taste of what it’s like to work in local industries.

Ideally, that will help them set career paths early.

A Mobile Area Education Foundation program called Vital Link, funded by ATT and Compass Bank, gets kids and teachers out in the workforce to see what different jobs are like.

Since the program’s inception in 1998, close to 4,000 students have participated, Mary Ann Napper, foundation partnership involvement director, said.

She said the program is beneficial to teachers, too. “I’ve heard time and again from those teachers … that it definitely changes their perspective as to how they put together their curriculum. It lets them know what businesses are looking for in students.”

On a recent weekday, Napper was headed to a meeting at B.C. Rain High School to talk about integrating aviation and aerospace into the curriculum. Located on Dauphin Island Parkway near Airbus’ home at Brookley, B.C. Rain is one of four schools within the Mobile district that are creating career academies with different areas of focus: health care at Blount, manufacturing and industry at Citronelle and teaching at Mary G. Montgomery.

Napper said the foundation is optimistic and excited about working with new industry such as Airbus as well as continuing to work with existing industry.

The role played by the Airbus engineering center that is already located at Mobile’s Brookley Aeroplex is part of an overall culture that’s exemplified by David Trent, head of the center and a Los Angeles transplant.

“I’ve found in conversations with the employees that they really like Mobile and realize there is great opportunity here, so I’ve asked them individually to get involved in different ways — to put down roots,” Trent said. “Being active in local schools, churches and other areas improves a city’s livability.”

That, in turn, attracts top industry talent and more industry.

According to a 2004 study by Milwaukee, Wisconsin-based KnowledgeWorks Foundation, education is often a factor in determining a community’s quality of life, which in turn is an important consideration when higher-skilled workers are considering where to live.

Airbus’s engineering center, along with other industries such as ST Aerospace Mobile, support engineering-related summer camps called Engaging Youth in Engineering (EYE) and educational programs at the Gulf Coast Exploreum Science Center, Trent said.

His company has also hired about a dozen graduates from the University of South Alabama’s engineering school, he said.

George Freeland, executive director of the Jackson County Economic Development Foundation, said that while facts such as graduation rates, subject proficiency and test scores are important, they take a back seat to the actual training that’s available when it comes to discussions with existing and potential employers.

Those were the focus of educational discussions at the Farnborough International Air Show in July, he said.

“We and the companies we’re working with fast forward to the delivery mechanisms, the actual training,” Freeland said. “No. 1, they want to know about the speed and efficiency of them, and No. 2, they want to know if can they customize relevant training programs.”

In south Mississippi and particularly in Jackson County, that sort of training is associated with Mississippi Gulf Coast Community College, he said.

The community college has over the years earned a reputation of being nimble and quick to adapt, he said. It has ongoing relationships with Chevron, the Gulf LNG terminal and Ingalls Shipbuilding.

Most recently, the school worked with Mississippi Power Company to implement a two-year instrumentation and equipment technical program that’s set to debut this coming year. 

Article source: http://blog.al.com/press-register-business/2012/07/on_gulf_coast_industry_and_edu.html

Unemployment rates up in Mobile and Baldwin Counties

MOBILE, Alabama — Mobile and Baldwin residents found it harder to find work in June, according to the Alabama Department of Industrial Relations.

The unemployment rate in Mobile County rose to 10 percent in June, up from 8.6 percent in May, but down from 11 percent a year earlier. June’s numbers represent more than 19,300 Mobilian’s seeking jobs

In Baldwin County, the unemployment rose to 7.7 percent from 6.7 percent in May, but dropped from 8.5 percent in June 2011. The 7.7 percent rate represents about 6,700 jobless people.

The unemployment rate can fall for two reasons — either more people get jobs, or fewer people are actively looking for work, said Keivan Deravi, an economics professor at Auburn University Montgomery.

Deravi said June is the high season in Mobile and Baldwin counties for tourism and a high number of people may have traveled to the area to find a limited number of jobs.

“Mobile County is one of the most diversified counties in the state,” he said. “There may be more people relocating there than the rest of the state. There’s a more attractive business market for people to relocate themselves to in hopes of finding a job.”

Statewide, the seasonally adjusted unemployment rate rose to 7.8 percent, from 7.4 percent in May and 9.3 percent in June 2011. The jobless rate represented 168,775 people seeking work in Alabama.

Industrial Relations Director Tom Surtees said the unemployment rate increased in the state because more people were seeking work as the summer break began in June.

“Just as with last month, we are experiencing an expected, seasonal increase in the labor force,” he said in a statement. “People looking for summer work as well as teachers and education employees who are not working over the summer are entering the job market.”

Article source: http://blog.al.com/press-register-business/2012/07/unemployment_rates_up_in_mobil.html

Southside apartment complex sold for $2.1 million

BIRMINGHAM, Alabama — Highland Ridge Apartments, a 66-unit complex near UAB on Birmingham’s Southside, has been sold for $2.1 million.

Birmingham-based Highland Ridge I bought the property from Cedar Tree Properties LLC, also based in Birmingham. David Oakley, senior investment advisor of Phoenix-based Hendricks Partners Alabama office represented both parties.

The buyer has renamed the property Element 26 and has begun renovations expected to total $800,000, Hendricks Partners said in a prepared statement. Upgrades will include new appliances, counter tops, flooring, hardware and fixtures.

The property, built in 1970, totals 21,218 square feet.

Article source: http://blog.al.com/businessnews/2012/07/southside_apartment_complex_so.html

Alabama ranks high for average local sales tax

BIRMINGHAM, Alabama — Alabama is among the states with the highest average local sales tax, according to a report by the Tax Foundation.
Dollar coin.JPG
Only New York, Colorado and Louisiana rank higher than Alabama’s local average sales tax rate of 4.37 percent. The state has a maximum local sales tax rate of 8 percent — the nation’s steepest. However its state sales tax rate is just 4 percent. The combined state and local average sales tax rate is 8.37 percent.

“Retail sales taxes are one of the more transparent ways to collect tax revenue,” according to the report. “While graduated income tax rates and brackets are complex and confusing to many taxpayers, the sales tax is easier to understand: people can reach into their pocket and see the rate printed on a receipt.”

The Tax Foundation’s report gives a population-weighted average of local sales taxes in each state, “an attempt to give a sense of the statutory local rate for each state.”

Read the full report.

Article source: http://blog.al.com/businessnews/2012/07/alabama_ranks_high_for_average.html

Local merchants say sales tax holiday is boost for business

Lili Pad.JPGSusan Day, one of the owners of The Lili Pad and Gigi’s children’s clothing shops in Cahaba Heights, says Alabama’s sales tax holiday is a boost for local merchants.BIRMINGHAM, Alabama — Alabama’s back-to-school sales tax holiday weekend, which kicks off Friday, is a major benefit for local merchants, say two Cahaba Heights shop owners.

Katherine McRee and Susan Day,
owners of the children’s clothing shops, The Lili Pad and Gigi’s,
say
their sales increased about 40 percent in August 2006, when the state’s first
sales tax holiday weekend was held, compared to August 2005.
And sales have continued to grow.


Over the years, they have added their own incentives for shoppers,
including opening on Sunday, a day the stores are normally closed.


And, since the stores are located in Jefferson County, which does not
participate in the holiday, they pay the county sales tax so customers
can shop tax-free.

The sisters’ comments came in the wake of a new report from The Tax Foundation, a Washington-based think tank, which said such events impose signifi­cant costs on businesses and consumers without cre­ating major benefits.

The group says the holidays are poor substitutes for comprehensive tax reform.

McRee and Day
say they believe the discounts prompt shoppers to buy more than they
would have on a typical day, and the sales tax holiday weekend has
become bigger than Christmas or Easter.

“It gives us a major boost going into fall, and it is our busiest weekend of the year, period,” McRee said.

The Alabama Retail Association is also defending the sales tax holiday.

The group says it is a way to draw consumers into stores, where they also spend money on products that aren’t exempt.

The ARA has pushed for comprehensive tax reform, including sales
tax reform, for years, said Alison Wingate, ARA vice president. And
while the sales tax holidays are not a replacement for that, they still
provide an economic boost for communities and relief for families across
the state.

“The back-to-school
sales tax holiday this weekend will provide families with a little bit
of relief from sales taxes that, in many Alabama cities, combine for
over 10 percent,” she said. “For families in Alabama, a 10 percent
savings on their back-to-school expenses is hardly a gimmick.”


In Alabama, the back-to-school sales tax holiday runs Friday through
Sunday, and items ranging from pencils and notebooks to clothing and
computer equipment is exempt from the state’s 4 percent sales tax, as
well as sales tax in participating counties and cities.


The holiday has
proved popular with Alabama businesses and consumers, as many stores
offer additional discounts and special events to coincide with the tax
savings. Total sales tax collections for the month of August have
increased most years, the ARA says.

Read The Tax Foundation report.

Read more about Alabama’s sales tax holiday.

Article source: http://blog.al.com/businessnews/2012/07/local_merchants_say_sales_tax.html

Times Watchdog Report: Another passenger train idea for Tennessee Valley

Speeding trainView full size(Stock image)

DECATUR, Alabama – The allure of riding the rails on a passenger train has been around probably as long as trains have existed. And the flirtation with bringing passenger trains through the Huntsville area has continued over the years.

The late Ed Mitchell for decades pushed a high-speed, magnetic levitation train that would follow the Memphis-to-Atlanta superhighway route that passed through Huntsville.

Just a few years ago, Madison businessman Doug Gooch proposed a light-rail system transporting commuters between Cummings Research Park/Bridge Street Town Centre and Redstone Arsenal.

But the high-concept rail systems proposed by Mitchell and Gooch have never come to fruition, primarily because of the high costs.

Now, a Virginia group has the idea of a railway demonstration project to haul freight and passengers between Memphis and Harrisburg, Pa., on a route that includes Huntsville, Chattanooga and Knoxville.

But the cost of the 965-mile-long rail system is a healthy $12.6 billion.

Pete Lotts, director of RAIL Solution, outlined the demonstration project called “the Steel Interstate” to about 30 elected and economic development officials Wednesday afternoon at Calhoun Community College.

RAIL Solution is a nonprofit group based in Salem, Va., that was formed to reduce heavy tractor-trailer truck traffic on Interstate 81 between Knoxville and Harrisburg.

The proposed demonstration project originally ended on the south end at Knoxville, but the group last year extended the plans to reach Memphis, Lotts said.

Improving the existing railroad tracks and building new tracks represents about $6.5 billion of the cost. Building an electrical system to power the trains would cost about $2.7 billion. Other major costs, Lotts said, include $750 million for separated crossing grades for two tracks and $660 million to buy right of way.

“We’ve got to create the atmosphere for this to happen in a public/private partnership,” Lotts said.

Lotts said guaranteed loans from the federal government would pay about half of the project’s cost, and private capital by issuing bonds would pay another 30 percent of the cost.

Norfolk Southern, which does not support the project, is counted on by the group to pay 8 percent, or about $1 billion, with state and local governments and direct private investment paying the remainder of the cost.

The recently adopted federal transportation bill could provide the $5 million to $10 million needed for a feasibility study, Lotts said.

Lotts said local officials can adopt resolutions supporting the project and talk to other officials and the public about it.

RAIL Solution envisions eight passenger trains running the route daily, Lotts said.

“We’re not talking about high-speed rail,” he said.

The passenger trains would travel between 90 mph and 120 mph, he said. They would be geared to short or medium distance trips such as from Huntsville to either Memphis or Atlanta.

Lotts said the system would be better for the environment by reducing fuel consumption, more economical, and safer for passengers and freight movers.

If the demonstration project is successful, it could lead to a new rail freight system across the entire country, Lotts said.

 

 

Article source: http://blog.al.com/breaking/2012/07/times_watchdog_report_another.html