A High-Cost, High Risk Project
Common sense is not so common.
BST Associates and the Burger Rail Group presented their draft study to the Humboldt Bay Harbor, Recreation and Conservation District entitled, “Humboldt Bay Rail Concept Level Construction Cost and Revenue Analysis” on July 17, 2013.
You may remember that the Harbor District had offered their own lower-cost study to rail advocates pushing for the new development and construction of a 135-mile east-west rail line stretching from Humboldt Bay to Gerber, south of Red Bluff.
The Harbor District was kicked to the curb in favor of a more expensive and presumably more favorable feasibility study done by proponents pushing for the new rail line– such as the City of Eureka and the newly-formed UpState RailConnect Committee– who rushed throughout the state getting everyone and their agencies on the same page for the purposes of feasibility, support, and public investment in what would likely be a wholly private enterprise.
The short end of the rail analysis stick is that building the east-west rail is a costly proposal encompassing high degree of risk for a number of reasons.
How much would it cost? Between $1.1 to $1.2 billion depending on the route chosen, the experts say. To note, costs for environmental mitigation were not included in the study.
Some of the brief summary details of the BST/Burger Rail Group report:
Investment vs. Unknown Cargo
Rail service to Humboldt County will require a major investment, through either a new East-West rail alignment or through reconstruction of the former North-South line.
In order for this investment to be financially feasible, the rail line will need to move very large volumes of cargo.
A rail line to Humboldt County would face strong competition from existing ports, primarily those on the U.S. West Coast.
Humboldt County would face several competitive disadvantages relative to these other ports, including that rail traffic would need to generate sufficient net revenue to finance the construction of a rail line, and
the lack of a rail distance advantage.
… The difficulty will lie in convincing the shipping lines that the Port of Humboldt Bay offers sufficient competitive advantages over Prince Rupert, Vancouver, Seattle, Tacoma, Portland and Oakland for it to fully support the project before construction commences.
New Cargo Terminal Necessary
In addition to the lack of rail infrastructure, waterborne exports of large volumes of bulk commodities would likely require substantial investments in new cargo terminals. Also, the Humboldt navigation channel is not at deep as that at most of the competing ports, which would also require a substantial investment.
… Humboldt Bay would likely need a deeper navigation channel to handle the numbers and sizes of ships needed to handle the estimated volume of cargo. Such a deepening project would likely be costly.
The End Result:
In conclusion, development of rail service to Humboldt County is likely to be both high cost and high risk.
So tell us something we don’t already know.
We shouldn’t need yet another study telling us what this one does and what common sense already indicates; unless, of course, one believes that pigs can fly and aliens exist.
You can claim anything is real if the only basis for believing in it is that nobody’s proved it doesn’t exist.
You can read the comprehensive details of the full study here.
Mike Dronker’s Lost Coast Outpost article and readers comments can be found here.
…And then there’s also the freaky side-turn railroading of events that the North Coast Journal’s Ryan Burns superlatively pointed out in ‘Run Out on a Rail’.