Monday, May 4, 2009

Martin says Queensgate Terminals will be 'something that Cincinnati people are proud of'

Specialized soybean producer Bluegrass Farms of Ohio, Inc. is working with short-line railroad operator Rail America to build a $26 million, 31-acre container-to-barge port called Queensgate Terminals along the Ohio River in Lower Price Hill.

On the site, containers of grain traveling by rail from the company's Jeffersonville facility would be transferred to barges for shipment to deep water ports, and empty containers would be accepted for a return trip.

David Martin, president of Bluegrass Farms, says that they've made great strides to design a clean, neighborhood-friendly operation – changes to the development plan have more than doubled the price from a one-time estimate of $12.5 million.

A hike-bike trail has been incorporated into the plans, as well as solar panels and wind turbines and living roofs for the facility's buildings.

Quiet, German-made electric cranes will be doing the work, meaning that emissions will be zero, and loaded containers will not be stored on-site, Martin says.

"We want to be good neighbors, so the community takes ownership over it," he says.

Tom Tsuchiya has been commissioned to design timeline sculptures showcasing the importance of commerce in Cincinnati's history.

"People are going to use this as a landmark, because it's such an important project," Martin says. "Quite frankly, it will be one of the top three sites for people to come and see when they're in Cincinnati. It's going to be something that Cincinnati people are proud of."

State is on board

Last month, Bluegrass Farms was awarded a $7.5 million Logistics and Distribution Stimulus loan from the Ohio Department of Development to support development of the 1,000-acre Central Ohio Logistics Center, a $10 million intermodal facility in Jeffersonville that is expected to create 24 jobs during construction and five permanent positions after the project's completion.

The center is part of the Ohio Valley Trade Corridor, a plan for a statewide system of intermodal centers that will take advantage of Ohio's centralized position within one truck day of 60 percent of the U.S. and Canadian marketplace.

"There's a new emphasis in our transportation to try to combat the kind of congestion we're going to have in 2020," he says. "You can have three-lane highways turned into 16-lane highways, and that's not going to solve what's ahead of us. We have a disaster on the horizon. And so, by doing this, like they do in Europe, this is going to grow and become a vital part of our economic infrastructure and will put Ohio at a very low-cost fulcrum of transportation that can be leveraged to have all kinds of economic activity come as a result."

Ohio Governor Ted Strickland has proclaimed himself an "enthusiastic supporter" of Queensgate Terminals, an integral part of the plan that will ship containers to and receive containers from the Jeffersonville facility.

Locally, the Western Economic Council and Hamilton County Commissioners have offered written support for the project, and the Ohio-Kentucky-Indiana Regional Council of Governments has provided verbal support.

"Cincinnati can play a vital part in that by providing this artery of water into that equation," Martin says. "It's a fraction of the cost of trucks, it's a fraction of the cost of rail, and it's a fraction of the cost of airplane."

By lowering transportation costs for surrounding businesses, Martin sees it as a win for everyone involved.

"It's good for the City, it's good for the region, it's good for the state," he says. "And we're willing to give a very large portion of the tariff money to all of the Western Hills communities."

Grain exports a growing business

Martin believes that every product has a suitable mode of transportation, and that the kick-start to container-to-barge facilities is specialized grains.

Not only can bulk materials be shipped by container to ports such as New Orleans, Houston, and Mobile's Choctaw Point Terminal, but two new container-to-barge terminals – the State of Louisiana's MegaPort and Lykes Brothers' Sea Point – are being built specifically to handle such cargo for export.

Queensgate Terminals, located on a navigable inland waterway, is an integral part of tying into those facilities.

"When we started exporting ten years ago, there were 16,000 containers filled with grain every year that left," Martin says. "Last year, there were 600,000. So if we're going to talk about ideal candidates to put on barges that are in containers, it's ideally suited for our business. And that's why we've pursued this to such a great extent."

The Jeffersonville center will be a public facility open to all grain companies as well as individual farmers.

"The companies that aren't exporting now, perhaps we can make their products competitive so that maybe they, with the weaker dollar and lower costs of transportation, can make it something that they can look into," he says. "And we can help them with that."

His company has learned the hard way and is ready and willing to help Ohio companies learn how to export.

"We're experts of logistics at Bluegrass Farms," Martin says. "We take our products to the front door of our customers overseas. We take it, literally, from our door. We handle the product, all the way to the deep water port of the end destination, and then, in a lot of cases, we arrange transportation to take it from the port to the front door of the company that we're serving."

Most suitable location

Queensgate Terminals owns the former Amtrak station, and the surrounding length of land along the river is perfectly suited for its planned operation.

"We came to this site because it's the only spot where this works," Martin says. "This was the old Storrs railroad yard. And thus, the railroad configuration both to and from provides the site with staging areas that can accommodate a train that's a mile long. You just can't bring a mile-long train into any neck of the woods. And yet, this site is perfect for that."

Access to Rail America's short-line railroad means that transportation to the Jeffersonville hub can operate quicker, more efficiently, and more economically than available in other parts of the state.

Even if it were an option to move the terminal elsewhere, it would take years to get to the point where they are now, Martin says.

"What you have here is not a footprint that you can just take and go somewhere else," he says. "We have the natural things that are here because of the history of the railroad in Cincinnati that allows this to happen in this spot."

Not only has a federal deadline of 2012 been established for building container-on-barge facilities, but Martin also says that they need to move as quickly as possible to get a lease with the City to have the project considered "shovel ready", and therefore eligible for federal economic stimulus funds.

"We have to plant the flag," he says. "The funding's there for us to get. We have the federal support, we have the state support. We've been working on this project for eight years. Eight long years. And all of the stars are lined up to get all of this funding right now. If we don't move right now, Indiana's working hard to do this exact same thing."

Martin says that Lawrenceburg is one of the Indiana cities trying to take advantage of the Ohio River to get a container-to-barge operation going in its state.

He fears that the local fear mongering and stall tactics will cause Ohio – and Cincinnati – to lose out on tax revenue and well-paying jobs.

"It's hard to believe that the structure of this weak-mayor system that we have in Cincinnati is creating such an environment that it is, that it's so difficult for businesses to come in and do what they do," he says. "Something needs to change down here. If it's not going to get done here, we're going to lose it and it's going to go somewhere else."

Lease and liability

The 31-acre property has been targeted by the Cincinnati Department of Community Development for a container-to-barge operation for nearly ten years, and Queensgate Terminals was brought on to develop it in 2004.

Access to the site was later cut off by the planned Waldvogel Viaduct reconstruction, leading to a court case in which the Ohio Supreme Court ruled in favor of Queensgate Terminals, forcing the City to purchase the property for $5 million and to negotiate a lease with the port operator.

Lease negotiations broke down nearly two years ago due to public pressure, but, late last month, council passed a motion allowing for those talks to resume.

"We've won unanimously in every court that we went to," Martin says. "We've never had one vote against us by any judge. We went through the whole entire court system, and the City attorney is saying that there's little liability. I think he'd better go back and read all the decisions. It was a blatant, heavy-handed abuse of the City."

Martin refers to an opinion by city solicitor John Curp, who disagrees that the City may be on the hook for several million dollars if it fails to negotiate the lease.

"It's unbelievable," he says. "It's an unbelievable situation. It was a private piece of property. And if they think that there's no liability on their part, that's just amazing to me."

Queensgate Terminals is now filing a new lawsuit to go after lost revenues, which Martin says will be dropped if a lease is signed.

"Do the people of Cincinnati really want that?" he says. "I would think not. We're willing to walk away from all of that. We don't want that. We don't want money."

'East Side's going to wish they had this'

Martin is loathe to call neighborhood opposition a "controversy", saying that he believes it's only a small, narrowly-focused group of people who want a public park at the expense of the taxpayers of Cincinnati.

"Controversy, to me, is defined as a problem between equal numbers of people," he says. "I think here you have a handful of people that are making the appearance that there are a lot of people in opposition. I think that when it comes right down to it, they don't have the number of people behind them. I just think that they like to write a lot of letters, and give a lot of contributions."

Martin says that the land has been industrial for its entire history, and its location presents several problems for recreational development – a position echoed by city manager Milton Dohoney Jr.

"For one it's landlocked," he says. "It's completely surrounded by railroads, it's unsafe, and for anybody to get to it they'll have to cross a four-lane superhighway of River Road, once it gets built. And if they think they're going to put in a tunnel, or they think they're going to put in a bridge...sounds good, but it's not likely to happen."

Since first proposed, the project has been redesigned to accommodate residents' concerns, Martin says.

The redesign has more than doubled the cost of the project.

"We did all kinds of things to accommodate them, like the bike paths and the greenery," Martin says. "They wanted it to be green-friendly. They wanted it quieter. They wanted the crane height lowered. And now they still don't like it. So, would they be happy with a $60 million facility? I don't think so."

Martin says he's "stunned" by the hurdles being thrown up for such a clean project, given the site's current use.

"For the last 20 years it's been a concrete recycling facility, busting up concrete in between two rollers, sounding like dynamite going off, and dust blowing all over the neighborhood," he says. "And they're telling us that we're going to bring a facility that's got noise pollution? I beg to differ."

Instead, he says, what they'll bring will be a plus for the neighborhoods of Lower Price Hill, East Price Hill, Sedamsville, and beyond.

"It's a project that's good for the West Side," he says. "The East Side's going to wish that they had this."

Taking issue with claims

Martin also says that he's getting sick of naysayers who are trying to discredit what studies have shown, but have nothing of substance to back up what they're saying – such as assertions that the terminal will handle toxic and nuclear waste.

"If they can provide proof of everything that they're saying, I'll listen to them," he says.

He particularly takes issue with the criticisms levied by Dr. Howard Stafford, a former geography professor who disagrees with a study called Market Demand for and Impacts of Queengate Terminals, released in February by the University of Cincinnati Economics Center for Education and Research.

"The UC economic group has been around for 30 years," Martin says. "And businesses depend on them for their unbiased opinions. If this professor is going to criticize the works of these fine people, I challenge him to come up with his own study and base it in facts to back it up. And he's not doing it, because if he could, he would."

Others have criticized Queengate Terminals' lack of transparency.

In the May 2009 edition of the Lower Price Hill community newsletter, community council president Dr. Jack Degano says that Queengate Terminals has not been open with its plans, and has even shut community members out of closed-door meetings.

But Martin says his company's hands have been tied since negotiations with the City broke down nearly two years ago.

"We've tried very hard to make the public aware," he says. "However, we had our hands tied by not being able to negotiate with the City until last Wednesday. So to sit there and say that we haven't done anything when it was those people that wrote the letters to tell the City to quit negotiating...I think you're talking out of both sides of your mouth. How can we talk to the community when the community says, 'We don't want to talk to you'?"

Instead, Martin says that he's been limited to meetings meant to gather support from businesses, residents and other neighborhood stakeholders.

"We've tried behind the scenes to meet with as many people as we can," he says. "We've gained support in every community we've gone to and at every event that we've gone to except for the one in Lower Price Hill. We'd be more than happy to extend that to any community that would like to hear what we have to say. We're not afraid of anything. We have nothing to hide. We have gone about this whole process both open-heartedly and with our eyes open and asking for criticism so that we can improve this project to appease as many people as we possibly can."

Could open within a year

Ideally, Martin would like to see the site transferred to the Port of Greater Cincinnati Development Authority.

Queensgate Terminals would serve as a contract operator.

"Then we'll relieve the City of all responsibility," he says. "They won't have to worry about this lawsuit, and then we'll work with the Port Authority on all of the details of how we're going to operate this thing."

Martin says that they had all of the environmental assessments, remediation work, permits and drawings completed in 2004.

Because of that, he believes that they can have the operation up and running in some capacity within a year.

But for every day that goes by, Queensgate Terminals gets another day behind.

"We have not been able to go any more, in any direction, since then," Martin says. "So, if we get the green light to go, we're going to run as fast as we can to pick up those pieces that were dropped in 2004 and get this thing up and going as quickly as possible. That promise we can make."

Previous reading on BC:
River West Working Group latest to oppose Queensgate Terminals (4/16/09)
Professor calls newest Queensgate Terminals report 'flawed' (3/18/09)
River West Working Group: Queensgate Terminals report 'unacceptable' (4/7/08)
Dohoney reports on Queensgate site options (12/26/07)
No contact between City, Queensgate since June (12/19/07)