Port Bienville Railroad - Mississippisp.mdot.ms.gov/Environmental/Environmental Projects/Port...

Port Bienville Railroad

Purpose and Need

1 Project No. FRA-0023-00(003)/105494 101000-102000

1.0 Introduction The Mississippi Department of Transportation (MDOT), the Federal Railroad

Administration (FRA) and the Hancock County Port and Harbor Commission (HCPHC)

are preparing an Environmental Impact Statement (EIS) to evaluate a proposed new

freight rail line that would provide a direct connection between the Port Bienville

Railroad (PBRR) and the Norfolk Southern (NS) rail line near Interstate 59 (I-59), north

of NASA’s John C. Stennis Space Center (SSC). This connection would provide a second

Class 1 rail connection to Port Bienville and the Industrial Park.

1.1 Project Location and Study Area Description The project is located in the southwestern portion of the state of Mississippi and

encompasses a portion of Hancock and Pearl River Counties. The study area is generally

bound by (the communities of) Nicholson and Kiln to the north, Port Bienville to the

south, the Pearl River to the west, and Stennis International Airport and SR 603/42 to

the east, representing a study area of approximately 180 square miles (see Figure 1).

The study area is bisected by Interstate 10 (I-10), while I-59 passes through a small

portion of the study area on the north. Other major features within the study area

include wetlands, wetland mitigation banks, forests, open pit sand mines, SSC, and a

125,000-acre acoustical buffer zone surrounding the SSC. This acoustical buffer makes

up the majority of the study area and restricts development of this large area of land

outside SSC. The two major facilities and key economic factors within the study area are

Port Bienville Industrial Park and NASA’s SSC.

Port Bienville Industrial Park – Port Bienville is a shallow draft (12 ft.) barge port in

southwest Mississippi, located off the Intracoastal Waterway near mile marker 24 on

Mullatto Bayou in Hancock County. It is one of four ports serving Mississippi’s gulf coast.

The Port Bienville property encompasses approximately 3,600 acres, including the Port

Bienville airport facility, industrial park, and the port. Approximately 800 people are

employed at the companies located in the Port Bienville Industrial Park.1 The barge port

has 6 employees and the Port Bienville Railroad employs 8 people. 2 Seven companies

are engaged in manufacturing and research and development involving plastics,

1 2012 interviews with Port Bienville Industrial Park businesses and information from Hancock Port and Harbor Commission. 2 Employment figures provided by Beau Gex, Government and Industrial Relations Manager, Hancock County Port and Harbor Commission on November 23, 2015.

Port Bienville Railroad Environmental Impact Statement Purpose and Need

2 Project No. FRA-0023-00(003)/105494 101000-102000

chemicals, and metals. Both raw materials including coal, sheet steel, and chemicals and finished

materials such as polymers and plastics pellets, steel pipe, beams, and specialty fabricated metals

are shipped via the port.3 Three businesses at the park provide logistics services including

shipping and warehousing, and one is part of a large nationwide firm that leases and repairs rail

cars.

Several park businesses are currently major rail users, relying on rail for both incoming raw

materials and outbound shipments. Companies also use a combination of the modes available

within the park: truck, rail, and barge. Several businesses receive products that come by container

ship, often to the Port of New Orleans, and then the product travels to or from Port Bienville by

rail, barge, or truck to the Port of New Orleans. A number of companies in the industrial park

currently export finished goods to international customers in Mexico, Brazil, Peru, Panama, and

Canada.

John C. Stennis Space Center – For more than four decades, SSC in Hancock County has served as

NASA’s primary rocket propulsion testing ground. Today, SSC has evolved into a multidisciplinary

facility that includes NASA research facilities and other resident agencies engaged in space and

environmental programs and national defense, including the U.S. Navy’s oceanographic research

community. It provides propulsion test services to NASA and the Department of Defense and the

private sector. Stennis is home to NASA’s Rocket Propulsion Test Program, which manages all of

the agency’s propulsion test facilities. Approximately 5,000 people work at the SSC.

Facilities, a 7.5-mile canal waterway system, and the 125,000-acre acoustical buffer zone that

surrounds SSC enables testing of large-scale rocket engines and components. Development

within the acoustical buffer zone is governed by development restrictions purchased by the

Federal Government. Some of the land within the buffer zone was purchased by the government,

but the majority of this property remains in private ownership subject to the development

restrictions that do not allow any inhabitable buildings within the buffer area.

3 From interviews with firms at Stennis and Port Bienville Business Parks and Port Bienville Rail Road in September and October 2012.


3 Project No. FRA-0023-00(003)/105494 101000-102000


4 Project No. FRA-0023-00(003)/105494 101000-102000

2.0 Purpose and Need for the Project

2.1 Purpose The purpose of the project is to construct a new railroad line to support the needs of the Port

Bienville Industrial Park, and its tenants and other industries in the area. A new dual Class I

railroad connection to serve the Port Bienville Industrial Park and surrounding area would:

• Improve rail transport time and reliability; • Foster greater economic opportunities and attract new industries to Hancock and Pearl

River Counties; Creating flexibility in rail transportation options during storms and other emergencies.

2.2 Need Mississippi’s waterborne transportation is a critical component to the state’s economy, as

identified through MDOT’s long-range planning in the 2035 MULTIPLAN. Port Bienville is a

shallow draft barge port and is one of four ports serving Mississippi’s gulf coast. The Port

Bienville Industrial Park and PBRR provide intermodal connections to support surface

transportation freight movement. CSX Transportation (CSX) and NS both provide Class I rail

service to markets east of the Mississippi River. PBRR provides shippers an existing connection to

CSX on the shortline railroad south of the industrial park; however, there is no existing

connection to NS which is located just north of the study area. A north/south connection between

CSX and NS would provide more options to shippers and make dual Class I rail services possible.

Access to dual Class I rail service is a critical factor for economic competitiveness for existing

businesses, and it is a significant factor for many companies considering sites for new or

expanded business operations. In a future hazard event or disaster, this rail connection would

provide transportation and economic resilience by enabling existing rail carriers to position

equipment and material out of harm’s way and allowing businesses in the industrial park to

strategically deploy equipment and materials, enabling operations to restart more quickly after

an event.

Dual class I rail service would lower rail transportation costs, reduce rail delivery times to a

number of strategic markets, improve reliability for existing and potential businesses in Hancock

and Pearl River counties, and provide significant improvement in rail transportation resilience for

this coastal region. For those who ship or receive heavy or oversized materials, or who receive or

ship large quantities, freight rail can be much more cost effective than other modes, including

trucking. A study of U.S. chemical producers (a significant industrial sector in the Port Bienville

Industrial Park) found that when they compared rail shipping rates for their captive4 and non-

4 Captive rail facilities are those with access to only one Class I rail service provider.


5 Project No. FRA-0023-00(003)/105494 101000-102000

captive facilities and considered comparable volumes, distances, and services, average rail rates

for captive production facilities were 30 percent higher.5

Businesses must also consider timeliness of deliveries and reliability, as their customers value

transit time and predictability of shipments. At present, rail freight bound for Port Bienville must

travel to the Gentilly Yard in New Orleans, and then be back-hauled to Port Bienville. This

additional time and distance increases the cost of rail transport. Gentilly Yard is also often

congested. It is not unusual for cars to take at least 7 days to move from Gentilly Yard back to Port

Bienville, and transit times as long as 28 days were reported by Port Bienville Industrial Park rail

users. This is more than an inconvenience; one Port Bienville Industrial Park business had to hire

hundreds of trucks to offload a rail shipment in order to avoid a customer penalty for late

delivery, and another faces a plant shutdown when raw materials are held up.6 Dual Class I rail

service would result in competitive pricing, and would also offer options to improve reliability.

The connection to CSX is along the coast and serves as a primary east/west rail connection; there

is currently no north/south rail connection at the Port Bienville Industrial Park site. Traversing

the Gulf Coast, this rail line is in the storm surge zone and has experienced significant service

disruptions in the past due to natural disasters, limiting intermodal connections into and out of

the Port and resulting in rail closures in the wake of these events. The proposed rail line would

provide a north/south rail connection and provide an option to move rail equipment, industrial

equipment, materials, and other critical components out of harm’s way in advance of a disaster or

hazard, improving transportation and economic resilience for the entire region.

In addition, the Port of Gulfport is a deep water port recently designated as a Strategic Seaport by

MARAD that serves container ships and barges.7 Mississippi State Port Authority has initiated a

restoration and expansion project for the port and is investing over $570 million in

improvements; additional improvements are planned to enhance rail access in the future. With

the expansion of the Panama Canal expected in 2016, it is anticipated that the capacity at the Port

of Gulfport will more than double, impacting the amount of cargo and related logistics for

shipments to Mississippi along the gulf coast.8 If barges can be diverted from Gulfport to Port

Bienville, it may allow Gulfport to accommodate more container ships.

More than two thirds of Hancock County is within the acoustical buffer boundary of SSC, thereby

limiting the development opportunities in the area. However, there are several major economic

generators currently served by existing rail and additional businesses that may be served by

providing rail access to SSC and other planned industrial development nodes. The need for dual

Class I rail service to improve freight mobility was made clear when business owners and

5 Veris Consulting for the American Chemistry Council. 2012. “Analysis of Freight Rail Rates for Chemical Shippers.” 6 Port Bienville Rail Economic Feasibility Study: Economic Benefits and Opportunities Analysis, Mississippi Department of Transportation, 2012 7 Mississippi State Port Authority press release, Nov. 15, 2015 8 Mississippi State Port Authority, Port of the Future, FAQs and Facts


6 Project No. FRA-0023-00(003)/105494 101000-102000

managers at Port Bienville Industrial Park and Stennis Airpark were interviewed in 2012. Several

Port Bienville Industrial Park tenant owners and managers noted their plans for expansion would

hinge on the availability of dual Class I rail. Owners and managers at Stennis said they knew of

other firms that were interested in locating there if rail access were available. The Mississippi

Development Authority also shared that two prospects projected to create a total of 450 jobs and

invest $650 million in plants and equipment were considering locating in Hancock County, but

would not consider a site there unless dual Class I rail service would be available within a specific

time frame.9

Transportation Dependence and Hancock County’s Economy

Freight transportation represents a key competitiveness factor for Hancock County. Businesses

today compete on the basis of product quality, timeliness and cost. The transportation networks

that serve their facilities must provide reliable connections to customers and access to a

multitude of markets, ensure timely deliveries of goods and services, and provide access for

employees and customers. Some business sectors use transportation facilities and services more

extensively than others. An industry sector’s dependence on transportation can be measured by

examining the amount a business sector spends on transportation as a share of the total output of

the sector. Transportation Satellite Accounts provide national data about the amount spent on

transportation per dollar of output for various sectors.

Sixty-four percent of the businesses in the Port Bienville Industrial Park are engaged in

manufacturing and a number of agencies and contractors at SSC are also engaged in ongoing

manufacturing, re-fabrication, or research and development activities that involve moving heavy,

over-sized equipment and engines.

An industry sector’s dependence on transportation can be measured by examining the amount a

business sector spends on transportation as a share of the total output of the sector. 10 Key

industrial sectors were evaluated to better understand the role freight and goods movement play

in Hancock County and how multimodal transportation contributes to the economic vitality for

this area. The evaluation was based on the non-governmental employment concentrations in the

county that make up these key industrial sectors. Sixty-three percent of the non-governmental

employment is concentrated in five industrial sectors: construction, manufacturing, wholesale

and retail trade, professional and technical services and Arts, entertainment and recreation.11

Figure 2 shows the breakdown of these employment sectors in Hancock County.

9 Port Bienville Rail Economic Feasibility Study: Economic Benefits and Opportunities Analysis, Mississippi Department of Transportation, 2012 10 “Transportation Satellite Accounts: A Look at Transportation’s Role in the Economy, “ U.S. DOT Research 11 Bureau of Labor Statistics


7 Project No. FRA-0023-00(003)/105494 101000-102000

Figure 2 – Employment by Sector in Hancock County

Source: U.S. Census, Bureau of Labor Statistics

The following primary industry sectors in Hancock County and their corresponding industrial

classification codes were identified for each key sector to allow a comparison of the applicable

transportation costs per dollar of product output calculated from the Transportation Satellite

Accounts research.

Table 1 - Industrial Sectors for Hancock County

Hancock County Industrial Sectors North American Industrial Classification Sector Aerospace and Aviation Manufacturing

Cargo-Oriented Development Transportation and Warehousing

Polymers and Advanced Composite

Materials Manufacturing

Geospatial Technology Professional and Technical/Manufacturing

Manufacturing Manufacturing

Retail and Wholesale Trade Retail and Wholesale Trade

Figure 3 shows the transportation cost per dollar of product output for several important existing

industry sectors in Hancock County.

Construction

Manufacturing

Wholesale and Retail Trade

Professional and technicalservices

Arts, entertainment,recreation

18%

17%

9.6%

11%

8.2%


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Figure 3 - Transportation Cost as a Share of Sector Output (Transport Cost per $ of Product Value)

Source: Transportation Satellite Accounts Database, Bureau of Transportation Statistics, Research and Innovation Technology

Administration

The transportation satellite account data indicates that Hancock County industries most

dependent on freight rail services include aerospace and aviation businesses; polymers,

chemicals, and plastics; manufacturing; cargo-oriented development; and wholesale & retail

trade, as shown in Table 2.

Table 2 - Transportation Dependence Rating of Hancock County’s Top Industries

Industry Sector: Highways Freight Rail Waterways/Ports Air Transportation cost

per dollar of output

Aerospace & Aviation High High High High 9%

Cargo-Oriented

Development High High High Medium 9%

Polymers &

Composite Materials High High Medium Low 9%

Geospatial Technology High Medium Low High 6.5%

Manufacturing High High High Medium 9%

Retail and

Wholesale Trade High High Medium Low 6.5%

The transportation dependence of an industrial sector is just part of the overall business-

transportation connection. As competition world-wide becomes more intense, businesses are

exporting a diverse range of products to customers in more countries than ever before. Export

Nation, a recent study from the Brookings Institute, found that:

$0.00 $0.02 $0.04 $0.06 $0.08 $0.10 $0.12 $0.14 $0.16

Agriculture & Forestry

Transportation Equipment and Parts

Transportation and Warehousing

Wholesale & Retail Trade

Professional & Business Services

Manufacturing

Natural Resources & Mining


9 Project No. FRA-0023-00(003)/105494 101000-102000

In 2008, over 11.8 million jobs in the United States were supported by the chain of export

production including inputs and transportation.12

Export intensive industries pay higher wages, and pay 1 to 2 percent higher wages even

for workers without high school degrees.

Export sectors generate multiplier impacts much greater than sectors that only produce

for domestic markets. Gains from trade result in additional demand for products and

services from outside the economic impact area.

High-value-added products are more time sensitive and often higher in value.

Reliability and speed to market were determined to be critical factors of competitiveness for 85

percent of the businesses in the Port Bienville Industrial Park. Dual Class 1 rail service would

improve delivery time to customers and reduce potential delays to certain key markets, and has

the potential to reduce transportation costs by up to 30 percent. Improvements in transportation

costs and services would substantially affect a company’s profitability. Lower transportation

costs and more reliable freight rail service would help reduce the cost of materials, and thus

overall production costs. Reliable delivery of materials would enhance productivity, reduce

distribution costs to the consumer, and may also improve their competitiveness.

Industrial and Business Site Evaluation Factors

Understanding the corporate site location process and the critical factors that businesses evaluate

when making their decision about locating or expanding a facility is important to the evaluation

of the potential economic development benefits and opportunities resulting from dual Class 1 rail

services in Hancock County. The economic prosperity of Hancock County and south Mississippi

depends upon the businesses and industries within the region, and the ability to meet their

unique requirements for workforce, land, transportation, utilities, and other services. Industrial

site evaluation factors have evolved to reflect the changing demands of businesses and the global

marketplace in which they compete. A number of factors influence a business’s decision to locate

or expand facilities in one location over another.

An ongoing corporate site location study has been conducted by Area Development, a leading

executive magazine covering corporate site selection and relocation.13 These studies are

conducted to identify the most important factors affecting the location decisions of businesses,

and to track these factors over time to assess evolving trends and conditions driving business

location decisions. The study covers a broad range of industry sectors including transportation

12 John Tschetter, “Exports Support American Jobs,” U.S. Department of Commerce, International Trade Administration, 2010 13 Area Development. Corporate Executive Survey Results, 2012.


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equipment, medical and scientific instruments, warehouse and distribution, and equipment and

components.

Eleven of the 26 site selection factors related to the movement and accessibility of goods and

people were ranked most important by businesses when considering a new or expanded facility

location. In the aforementioned 2012 Area Development survey of corporate executives, the

transportation and freight factors considered most important include:

Highway accessibility

Availability (accessibility) of skilled labor

Proximity (accessibility) to major markets

Inbound/outbound shipping costs

Proximity (accessibility) to suppliers

Availability (accessibility) of unskilled labor

Accessibility to major airports

Raw material availability (accessibility)

Proximity (accessibility) to technical college/training

Railroad services

Waterway or ocean port accessibility

These transportation factors, along with other competitive conditions including the availability of

land and buildings, occupancy and construction costs, corporate tax rates, incentives, and labor

costs, influence the site decisions that businesses make when locating, expanding, or

consolidating operations. While freight rail transportation alone will not foster economic growth,

improved freight services and connectivity, multi-modal transportation services, and competitive

costs can significantly differentiate the region’s economic environment, providing opportunities

to attract and retain businesses and jobs for Hancock County and the region in the future.

For some major industrial projects, access to two Class 1 railroads is essential. Many companies

depend upon reliable transportation services to meet their customer’s delivery and production

schedules, and on competitive transportation rates to keep their customers’ business. These

businesses would benefit from the transportation savings and improved transportation services

that historically are realized with access to two railroads. The resulting economic benefits are

needed to foster greater economic opportunities for Hancock County.

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