Freight Leaders Anticipate Next Level of Intermodalism

LI> Bob Martin, vice president of operations at the Memphis-Shelby County Airport Authority.

LI> Eugene S. Bryan, manager of transportation planning for the Memphis and Shelby County Division of Planning and Development.

What is the public attitude toward freight transportation?

Martin: It is considered the lifeblood of the community and is very well received.

ryan: We have a pretty well-defined industrial growth area and have reduced, to the degree possible, conflict between residential and our major growth areas.

Richardson: The citizenry of Memphis has a real awareness that distribution is our future and our bread and butter.

Rowland: Memphis is unique in that we have a large number of train systems coming into Memphis. We have two from the west, two from the east and one going north and south. As part of the Super Terminal project, we’re looking at increasing the number of trains coming here. But at the same time, we’re looking at decreasing the amount of time people spend at crossings in the city by increasing single-line capabilities and moving the trains through town quicker.

What is the origin of the Super Terminal?

Richardson: About two years ago, we were looking at the amount of container freight coming into Memphis. It is between 600,000 and 700,000 containers on an annual basis. Two railroads — Union Pacific Southern Pacific and Burlington Northern Santa Fe — accounted for 70% of that number. Both railroads said they were stuck in yards surrounded by urban areas. They told us we can’t expand to handle the growth in containers, which was clipping along at about 10% in the U.S.

UP was in worse shape than BNSF, and they were looking at Arkansas, which is on the other side of the (Mississippi) River, but has available space. At that time, the port association said we need to address that problem, given that we understand that if you take freight trains away from large metropolitan areas, it can be very detrimental. A lot of people don’t understand how much freight comes into metropolitan areas by train. It’s a very important asset to a city.

Where does the project stand now?

Richardson: We’re seeking letters of intent from railroads so we can go out and get a private financing package to help build it. We’re also working to bring in the public financing aspects for off-site rail infrastructure and road improvements.

Will the federal government support this kind of project?

Richardson: My director, Don McCrory, is in Washington now to talk with the Federal Railway Administration about a new loan program for intermodal facilities. It just came out as part of the new TEA-21 bill. There’s a program that is tailor-made for this type of facility.

Why did you say it’s detrimental to the city to have intermodal freight outside of the city?

Richardson: It’s detrimental to the city in that business, by necessity, is going to do such things that keep their costs down. When the UPSP moved across the river from Memphis, depending on the size and frequency of shipments, their shipping charges went up as much as $50 to $500 per container. That’s a significant change in shipping costs.

The fact that UPSP moved out, did that damage prospects for this project?

Richardson: No, it didn’t. There are still certain aspects of it that UPSP can probably capitalize on in the future. They have freight that must be switched from one system to another.

et me say one other thing about this project. This is not a Memphis project. The scope is way too large. It’s going to reach all the way to Europe and Asia, because this is going to open up a clog in the transportation system. It’s not going to cure it, but it’s going to help.

What is being done to help balance the flow of freight into Memphis?

Bryan: We are working with local companies to explore the potential for international export. Obviously, the bigger companies are already into it, and we’re relying on their expertise to teach and train some of our smaller manufacturing companies to go in that direction.

We actually have a pretty decent manufacturing base here. One area that is taking off is food products. Cargill just did a major expansion over the past 24 months. Protein Technologies increased their capacity by one-third. And we’ve had two facilities in the inner urban area that have come forward with significant proposals for upgrading equipment and increasing capacity. A lot of this is processing of grain into other food products.

Martin: We wanted to take transportation to another level, and we’re beginning to see it here at the airport. In October 2000, we will open up what we refer to as the World Runway. It will be an 11,100-foot runway. And what that brings to the community is nonstop service, whether it be passenger or freight service, to Asia or anywhere in the world. When we open that up, we will begin to see additional international distribution.

Bryan: Five years ago, when people talked about distribution in this town, they were talking about absolutely low-end jobs because of the labor-intensive nature of the work. The companies that we have attracted here over the past four or five years have been highly automated warehouses with pay scales 50% above what they were.

Companies thought, when they expanded their warehouses, that they weren’t going to be able to train people in this new technology. But through incentives offered locally and through the state, these companies found that 98% were able to get certified and pass the test and get the significant increase in pay. So that has had a phenomenal impact on the local economy.

Is labor a constraint on growth right now?

Richardson: Speaking for our association, there’s a good and a bad thing about labor in Memphis. The bad thing is you have difficulties at the lower levels and at some of the medium levels as far as just the physical number of people available. The good news is that other large cities in the Southeast that we compete against have the same problem.

We have a lot of trucking out on President’s Island. And it is very difficult to find qualified truck drivers right now. You are processing the same drivers over and over again. There’s been an emphasis by the Chamber of Commerce and some of the local city fathers to start looking at the labor issues in the state of Tennessee and to get more into training and vocational schooling.

Bryan: We have a significant number of people that drive here from Jackson. It’s an hour trip to East Memphis from Jackson. We consider that part of our economic region and we don’t perceive that as a particular problem.

Martin: We’ve not found anyone hesitant about coming to the airport with any type of development because of labor. That’s not ever been an issue. That’s not to say it might not be in the future.

Richardson: Let me qualify what I said about labor. The difficulty that we see is that you have so many good jobs and higher paying jobs at the warehousing-distribution level that it’s difficult to find people that will do the heavy manual labor, like being out on a dock in 100-degree weather when you can be in Pfizer’s warehouse in the air conditioning for the same money. So it’s the quality of the work that draws the labor pool up toward the middle and upper class, which is good for everybody.

What is the top transportation priority?

Bryan: We don’t have them prioritized. We just have 20 that we feel need to be addressed.

e have Interstate 69. That’s viewed as critical. Right now, to get to parts of the upper Midwest, you’ve got to go to Nashville, which is a three-hour trip, and then go north. This will cut a significant number of hours off the trip by being able to get to Indianapolis directly from Memphis, as well as having additional routes across the river to the south that gets us into Texas.

That will help unclog freight in the Houston area. It can be brought north and distributed from here.

I don’t see any transportation companies represented on the Metropolitan Planning Organization. Do they have a voice in what goes on?

Bryan: At this point in time, they don’t have a formal voice. The state asked us to do a survey of trucking companies and rail yards to address their concerns about access. What we’re doing now is preparing a list of those people that showed a significant interest in having a greater say and putting together a committee. Then they will get a higher level of voice in the community.