Developers of the Heartland Gateway Intermodal facility at Prichard promised a lot as they took the project from concept to completion. The 100-acre site that was supposed to open southern West Virginia, southern Ohio and eastern Kentucky to the world market didn't quite accomplish that.
Last week, the state of West Virginia chose essentially to give up on the project, with an eye toward privatizing the facility. The West Virginia Port Authority board passed a resolution to allow the negotiation of a short-term lease of the inland port in Prichard to a private company. After the short-term lease is over, the goal would be to auction off the facility.
"This facility has been losing money every year," West Virginia Department of Transportation Secretary Byrd White told the board.
He then made clear the extent of the problem: "In fiscal year 2019 the facility had $17,370 in income, but had $522,000 in expenses." he said.
The Port Authority, which is now under the WVDOT, had only 579 lifts of containers off railcars to trucks at $30 a lift in fiscal year 2019, White said.
The state's decision to no longer support the facility was clear months ago. In the state's fiscal year 2020 budget, the West Virginia Legislature defunded the Port Authority, White said. He said the facility has been borrowing money from the WVDOT to keep it open.
The facility provides businesses with a truck-to-rail transfer option along the Heartland Corridor, a 530-mile stretch of railway from the Port of Virginia in Hampton Roads through West Virginia to Chicago.
The history of the intermodal facility began around 2005 as railroads were adapting their operations to accommodate the increased amount of container shipping in international commerce. They wanted trains that could carry containers that could be stacked one on top of the other. This required increasing headroom on bridges and in tunnels to allow the higher loads to pass.
Norfolk Southern planned and built several of these double-stack corridors, including the Heartland Corridor, a 530-mile route from the Port of Virginia in Hampton Roads through West Virginia to Chicago. West Virginia wanted a piece of the action. The result was the facility at Prichard, just off U.S. 52 about 10 miles south of Interstate 64.
Norfolk Southern donated 76 acres of the 100-acre site and provided $1 million in development costs. West Virginia provided $18 million, and a federal grant provided $12 million.
It opened for business in late 2015, and it has struggled to come close to matching the original goal for it.
Maybe the intermodal market was stacked against the Heartland Intermodal Gateway from the start. With intermodal shipping being the big thing in international commerce now, every major metro area has one of some sort. This being a relatively sparsely populated market with few major international manufacturers and even fewer regional distribution facilities, there was a scarcity of customers.
Let's hope that the state is successful in finding an operator of the Heartland Intermodal Gateway in the short term and finds a buyer at auction that can salvage the facility for a useful purpose, whether it's as a transfer station or some other use. Perhaps a private operator could bring skills and contacts the state does not have, but there is no guarantee it could turn the operation around.
There are few if any guarantees in business.