Chicago drowning in trains

[MP173]

The AAR meeting would have been an interesting one, but not worth a month's salary.

Moreover, I do understand rates of return and the rails inability to achieve their cost of capital. Therefore, the absolute best method of purchase of a railroad, or it's stock is to purchase below it's value. Thus, when CN is giving up tracks (and LAND) in a very hot real estate market and not receiving ownership in something in return...I have to wonder.

So, lets see, their benefit is they will be able to move their trains quicker, yet in the meanwhile they will continue to consume themselves. That logic is flawed. As an owner of the company, it concerns me. Regarding partial ownership of the IHB, I am sure their Canadian neighbor didnt want ANY part of that deal.

Since I am an outsider, I have no idea what goes on in the industry, nor the operations in the city. I dont know how much it costs to operate either on a company's own line or over the IHB or any other line. But, if the CN is giving up book value and is receiving a double turnout in return while in the meanwhile their competitor is receiving considerable improvements to their property (IHB) I would question whether or not the project doesnt need revisiting.

Of course, CN may be trading it's real estate for lower payments into the $212 million cost. I dont know. Nor will I ever know. My options are to cash out and pay capital gains if I dont trust ownership.

Regarding the flyover that benefits NS only, is that a true statement, or a generality? The two flyovers I recall would benefit more than just NS.

This should be a great project for the system and particularly when the six class ones become four or less.

ed

[gabe]

QUOTE: [Gabe,

I'm not saying the city can't contract. Of course it can contract. I'm not even saying it shouldn't assist CREAT. There can be local benifits from reduced congestion and the city can contract for the "mutual benifit" of its citizens. (Although in Chicago, the city contracts tend to be less than "mutually benificial" from time to time.)

I'm saying that the Federal Government shouldn't (not couldn't) put money into the project. If there are national benifits those benifits can be captured and changed to the entitities benifiting, the private railroads and the shippers. Those are the ones who should pay.

Greyhounds,

I see two problems with your argument that CREAT should solely be a contract between the City of Chicago and the federal government.

(1) The tax structure—and current structure of government itself—would make such a contract impossible. The federal government taxes Chicago citizens at a considerably higher rate than city and Illinois taxes. If Chicago were to undergo such a project by itself, Chicago’s taxes would not only have to be considerably raised, but—in effect—Chicago would be hit up twice. It would have to pay federal taxes that are designed to go to such projects and its own tax increases in order to pay for the project.

I realize this is something you would probably like to change as well. However, this structure of government and taxation has been established since the second Roosevelt administration. It would take several years to redirect tax revenues—in the mean time we have to make sure the trains keep running.

(2) CREAT does not just benefit the citizens of Chicago and railroads; it benefits the whole nation. Increasing efficiency in the Chicago hub area will allow railroads to offer more competitive rates and take trucks off the road all over the nation. If X trucks per year from New Jersey to Seattle are taken off the road doesn't the entirety of the—federal—interstate highway system and every state between New Jersey and Washington benefit? If there are benefits beyond State lines, why shouldn’t the federal government be allowed to enter into such a contract?

Thank you for responding,

Gabe

[Anonymous]

Very Interesting thread. Some thoughts.

Chicago proper has long required grade seperations for all railroads, so blocked crossings is not a benefit to the city. The same is not true of the suburbs, however they don't have the political clout the city does and regional co-operation isn't the greatest.

The state has recently trippled tolls for trucks on the tollways which will affect some rail to rail via road transfers.

I'm not familiar with all of the inner yards, but many have no room for expansion. Both Clyde and Proviso are pretty much a mess now. The BNSF tanscon yards along I-55(Corwith or Corinth??) are also a mess. I saw one double-stack parked over Harlem ave. waiting to get in for 3 days last weekend.

Regarding the J, maybe some of the planning people should take a drive along the Kane/Kendall county corridor(Elgin to Joliet). In addition to the new Inermodal facilities that far out, trucking companies are building massive terminals out there. There's also a couple of massive delievery facilities for unloading auto-racks and storing cars for dealers. Things aren't so built-up that adding capacity to the J would be that difficult. 10 years from now, I don't know. Maybe they're holding out for a better offer???

Since there's far fewer railroads coming into the region, I'm surprised they haven't rationalized interchange more than they have???

[Anonymous]

1. The Chicago, IDOT, Metra, and Class I planning people are aware of what's going on. Have been for decades. If you browse through all the reports you can find in Google (there are hundreds upon hundreds of reports, meeting notes, data sets, etc.), look at the dates these documents were issued. I have reports on my desk on Chicago dating to 1917 (!!!!) that have been ignored by the elected representatives of the voters ever since. The planners are not vested with dictatorial powers. The voters often don't want to listen, or don't want to pay, or prefer to wait for miracles to happen. The politicians can't act on their own, independent of the voters wishes -- and I'm thankful they don't, that's called totalitarianism.
2. Most of the planning and railroad types realize that a massive build-up of freight traffic on the J probably isn't going to happen now. The voters who live next to it would consider that a dimunition of their property values, and something that a reasonable person wouldn't have predicted when they bought the property, and the law is on their side. It's a lost cause.
3. If Chicago had three or four billion dollars in spare cash, it could pull all the yards out of the city and put them on the J, build up the J, and buy all the houses next to it for a few blocks on either side. Is that a reasonable use of that much money, out of anyone's pocket? Probably not. Most solutions in the real world are far from "ideal," but they are usually practical.
4. The suburbs intentionally did not institute grade-separation ordinances back when they had the chance. They wanted the railroad in order to enhance their property values and to create economic activity, and since they couldn't agree to coordinate with each other, none was about to independently pass an ordinance, because that would have encouraged railroads to go around it. What they could have done was agree to be incorporated into Chicago, but they wanted to have their cake and eat it, too -- piggyback on Chicago's economic engine while not paying any of the costs. In other words, the suburban forefathers sold future generations down the river for short-term economic gain.

OS

[Anonymous]

I'm not familiar with the entire length of the J, but between Elgin and Joliet there aren't a lot of houses next to it. The trucking terminals and light industry is much more predominant. There's also a big political issue out there right now regarding the construction of a high voltage transmission line Com-Ed wants to build, I believe along the ROW.

I realize changes won't happen overnight and the planning people just advise. I also don't think it has to be an all or nothing solution where the inner yards would be eliminated. Clyde has become so overloaded with Intermodal, the Q is doing a lot more flat switching of general freight at Eola(out near the J) so it's already happening. Most of the local freight work along the racetrack now originates from Eola, rather than Clyde.

[Anonymous]

QUOTE: Originally posted by O.S.

I wish I were as confident of the EJ&E's becoming a true belt line as you are, Dave. I'm just not seeing what you're seeing. The fundamental problem is that most of the yards are deep inside the EJ&E belt, will not and cannot move outside the belt for good economic reason, and once the traffic is beyond the belt, backtracking isn't going to happen -- not so much because of the added circuit length, but because it would require doubling of capacity on the main lines between the yards and the belt. In the meetings I attend in Chicago, the EJ&E is rarely even mentioned, and the CREATE project essentially doesn't include it. I agree that traffic will grow on the EJ&E, but not by leaps and bounds. There just aren't that many trains that arrive in Chicago that actually go through Chicago, untouched.

OS

I'm not involved in the kind of stuff you are, so I don't know what the real plans are. I just think the ultimate resolution will be moving a lot of the traffic to the fringe areas, so it doesn't have to enter the city proper in the first place. This is what's happening in a lot of cities, not only with rail traffic, but truck as well. Logistics in Joliet is a good example of that. It may seem crazy to think it could happen on a large scale for now, but they said the same thing about the Alameda Corridor project out here in the Port of Los Angeles. It's simply unbelievable how much money has been spent to make the expansions that were needed, but they did do it. Also, if you look at how much RR traffic actually interchanged inside the city limits of L.A. even just 30 years ago, as compared to now... It's a tiny fraction. So I think it's possible.

This is just pie in the sky, but I personally think the EJ&E should have built their own new classification yard on the West end, and also something like Logistics. Other small roads have benefited from the gamble of having a 'build it and they will come' attitude. I think that could have worked on some level for the EJ&E... But as was stated by someone before. USX is in the steel biz, not the rail biz.

Dave
-DPD Productions - Home of the TrainTenna RR Monitoring Antenna-
http://eje.railfan.net/dpdp/

[MP173]

All of the $$$ in the world may not help move the trains if the terminals cannot handle inbound moves.

Intermodal yards in the city are very small and cramped. I know there is a move out to Joliet and Rochelle for the new yards, but if an inbound train cannot be yarded, it sits. That in turn takes away a section of a mainline or a siding.

ed

[greyhounds]

QUOTE: Originally posted by gabe

(2) CREAT does not just benefit the citizens of Chicago and railroads; it benefits the whole nation. Increasing efficiency in the Chicago hub area will allow railroads to offer more competitive rates and take trucks off the road all over the nation. If X trucks per year from New Jersey to Seattle are taken off the road doesn't the entirety of the—federal—interstate highway system and every state between New Jersey and Washington benefit? If there are benefits beyond State lines, why shouldn’t the federal government be allowed to enter into such a contract?

Thank you for responding,

Gabe

No, it won't benifit the whole nation. It would benifit some people in the nation and harm other people in the nation. If you're a waitress at a truck stop in North Dakota, and the number of trucks using I-94 goes down, you're not going to benifit. You're going to see your income degraded. There is absolutely no way for the Federal Govt. to sort this out so they should stay out of it and let that waitress earn her living.

The people who will benifit will be the shippers and rail carriers. These benifits are "divisible" in that they can be paid for by the entities that actually receive the benifits. Benifits for some things, such as national defense, are "indivisible" in that niether one of us can buy the amount of national defense we want. It has to be done collectively.

That's not the case with rail freight. A shipper making the decision to use rail freight can decide just how much he wants to buy at just what price. He gets the benifits and he pays the costs.

You may regard shifting freight from truck to rail as a "good thing" ,but there are a whole lot of good folks who would be hurt by such a shift. You're seeking to impose your values in an arbitrary manner that will harm many people.

The Federal Govt. shouldn't do this - mainly because they can't begin to understand the costs/benifits of their actions in allocating economic activity.

"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.

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