The Los Angeles Board of Harbor Commissioners has approved the development of an Intermodal Container Transfer Facility on a 155-acre port-owned site, paving the way for Burlington Northern Santa Fe Corp. to establish a dockside facility.
In releasing a request for proposals for design of the facility earlier this month, the board paved the way for BNSF to gain a foothold near its main competitor, Union Pacific Corp.
Burlington Northern has served the ports of Los Angeles and Long Beach since 1887 from a 120-acre facility in Commerce originally designed for cattle hauling. That rail yard has the capacity to handle 1.5 million "container lifts" annually. The rail line expects to move 1.3 million containers this year, up 100,000 from the year earlier.
"In order to accommodate the forecasted growth, it's crucial that a new near-dock facility is built," said Lena Kent, a spokeswoman for BNSF, which asked both ports to develop a facility in October 2003. "They haven't selected a user yet but we feel we're the best match for that facility."
Burlington Northern and Union Pacific are the dominant rail operators in the market.
Construction of the container yards, gate complexes, security measures and the laying of railroad tracks is expected to cost $130 million and be complete in 2 & #733; years, port officials said.
Harbor commissioners, who approved the development plan Nov. 10, are expected to grant a lease on the site to an operator during the first quarter 2005, after financing of the project is ironed out.
Although BNSF has no lock on the facility, port officials implied the company has the inside track.
"Our rail policy does encourage competitive issues," said Dave Mathewson, the port's environmental planning and development director. "So one could infer that we would be looking at competing operators so that one (company) wouldn't necessarily have a monopoly on all the rail."
Union Pacific spokesman John Bromley did not say whether the company would seek a lease on the new facility. "There's been a lot of talk about (the project)," he said. "It's pretty sensitive." Union Pacific pays the port $4 million to $5 million per year, depending on cargo volumes, for its facility.
The new site is four miles north of the L.A. and Long Beach ports, along Alameda Street between Sepulveda Boulevard and the Pacific Coast Highway. It will have a capacity to make 600,000 lifts per year.
Union Pacific's 250-acre facility, which it has been leasing from the L.A. port for two decades, is about the same distance from the port on the other side of Sepulveda, south of the San Diego (405) Freeway. It can make 700,000 lifts annually.
BNSF wants to use the new facility for imports the bulk of the cargo it hauls on the West Coast and keep its existing Commerce facility to move goods manufactured in the L.A. Basin.
As with the Union Pacific's operation, BNSF would be able to bring cargo directly from the port by rail to the new facility, at which point containers transfer onto train cars. The average BNSF train carries 280 double-stacked containers.
Volume of that magnitude could eliminate an estimated 1 million truck trips per year off the 20-mile stretch of the Long Beach Freeway, according to Kent. She said the facility could generate as many as 1,000 jobs.
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