Intermodal Connectors: A Method For Improving Transportation Efficiency?

Intermodal Connectors: A Method For Improving Transportation Efficiency?

Order Code RL31887
Report for Congress
Received through the CRS Web
Intermodal Connectors:
A Method for Improving
Transportation Efficiency?
May 7, 2003
John F. Frittelli
Transportation Analyst
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

Intermodal Connectors: A Method for Improving
Transportation Efficiency?
Summary
As Congress considers reauthorization of the nation’s surface transportation
legislation, the Transportation Equity Act for the 21st Century (TEA-21, P.L. 105-
178), which expires in September 2003, one issue policymakers are examining is the
flow of commerce to and from U.S. cargo hubs. Recent Department of
Transportation (DOT) studies have found persistent traffic bottlenecks and
inadequate access to freight transfer facilities. The pavement of access roads, in
many cases, is in poor condition and the roads have deficient geometrics (limited
turning radii at intersections, low clearances, inadequate shoulder width, etc.) for the
heavy truck traffic they serve.
The access roads to these terminals are referred to as “intermodal connectors.”
Intermodal connectors that are in poor condition may reduce service reliability and
predictability. If connectors are a weak link in the transportation system, they may
raise shipping costs, reducing the productivity and competitiveness of U.S.
businesses. Poor intermodal connectors can also result in long lines of idling trucks,
reducing air quality and increasing energy consumption. Some have argued that
intermodal connectors are “low hanging fruit,” in the sense that relatively modest
investment in these route segments could yield substantial returns in freight
movement speed and reliability.
As trade volumes have increased and growing congestion is occurring on the
nation’s highway system, the issue of intermodal connectors can be viewed as a
microcosm of broader issues regarding the federal government’s role in the nation’s
intermodal transportation system. A basic premise of TEA-21 is that metropolitan
planning organizations (MPOs) are an important element in the identification and
prioritization of transportation projects needed in urbanized areas. However, some
would argue that this planning arrangement is more suitable to solving commuter
concerns than it is in addressing interstate and international commerce concerns.
At issue for Congress is how to plan for and develop an intermodal freight
network that is largely national, and even international in scope, with a planning
process that is largely local in scope. There may be legislative or other alternatives
that could lead to an increased focus by decision makers to ensure intermodal
priority. These include addressing freight data needs, evaluating multijurisdictional
planning activities, developing partnerships with the railroads to better plan terminal
location, or even restructuring the federal transportation decision-making process.
Congress may also examine whether existing funding programs are appropriate to
addressing the infrastructure needs of intermodal connectors. Congress may consider
directing funds for this purpose, expanding the eligibility of existing programs to
include freight projects such as intermodal connectors, or other approaches. This
report will be updated as developments warrant.

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
What Are Intermodal Connectors? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Significance of Intermodal Connectors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Transportation Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
International Commerce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Military Mobilization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Peaking Behavior . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Findings of DOT Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
The FHWA Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
The MARAD Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Strategies for Improving Mobility To and From Cargo Hubs . . . . . . . . . . . . . . . . 6
Redesigning Terminal Infrastructure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Improving Port Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Implementing ITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Issues for Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Intermodal Planning Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Freight Information Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Freight Corridor Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Terminal Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Federal Intermodal Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Intermodal Funding Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
List of Tables
Table 1. Intermodal Freight Terminals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Table 2. Poor/Very Poor Pavement Ratings by Terminal Type . . . . . . . . . . . . . . 5
Table 3. Percentage of Ports Indicating Below Acceptable
Flow Conditions on Key Elements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Intermodal Connectors: A Method for
Improving Transportation Efficiency?
Introduction
As Congress considers reauthorization of the nation’s surface transportation
legislation, the Transportation Equity Act for the 21st Century (TEA-21, P.L. 105-
178), which expires in September 2003, one issue policymakers are examining is the
flow of commerce to and from cargo hubs. Recent Department of Transportation
(DOT) studies have found traffic bottlenecks and inadequate access to some freight
transfer facilities. The pavement of access roads, in some cases, is in poor condition
and the roads have deficient geometrics (limited turning radii at intersections, low
clearances, inadequate shoulder width, etc.) for the heavy truck traffic they serve.
Poor intermodal connectors can also result in long lines of idling trucks, reducing air
quality and increasing energy consumption.

Compounding the problem, a DOT funded study projects that freight volume
will increase significantly by the year 2020.1 Thus, the issue of intermodal
connectors epitomizes larger issues regarding the appropriate federal role in planning
and funding the nation’s intermodal transportation system. Policy issues and key
questions include: Do existing institutional arrangements encourage an intermodal
approach in transportation planning? Are existing funding programs capable of
effectively addressing intermodal freight projects? Is the system planned and
operated as a comprehensive intermodal system, or is emphasis and focus on
individual modes and elements?
Background
What Are Intermodal Connectors?
Intermodal freight can be defined as the shipment of goods involving two or
more modes of transportation (sea, air, rail, road) from origin to destination under a
single contract of carriage (bill of lading).2 To facilitate transferability among modes,
intermodal cargo is typically shipped in standard size containers. Intermodalism can
improve the overall efficiency of our transportation system as it uses the best
1 U.S. DOT, Press Release FHWA 41-02, Oct. 3, 2002. For further information on DOT’s
freight forecast, see [http://www.ops.fhwa.dot.gov/freight].
2 For a discussion of the definition of “intermodalism,” see Joseph Szyliowicz,
Intermodalism: The Challenge and the Promise, National Center for Intermodal
Transportation, n.d. [http://www.ie.msstate.edu/ncit/].

CRS-2
combination of modes, allowing each mode to be used for the portion of the trip for
which it is best suited. Trucks begin and end almost all intermodal moves, whether
by rail, ship, or plane, because they perform the “door” movement, moving the cargo
from the seaport, airport, or rail terminal to the shipper’s warehouse, or vice versa.
The access roads, and in some cases, rail lines to these terminals are referred to as
“intermodal connectors.” The connectors tie the intermodal transportation system
together. Intermodal connectors are typically short segments of road or railtrack,
generally less than two miles in length. Access roads are usually local, county, or
city streets. Many of the connectors, especially roads leading to seaports, are in
older, industrialized areas and have a preponderance of at-grade rail crossings.3 The
freight community refers to these access routes as their “front door” because they are
the pivotal link in the intermodal transportation system.

Significance of Intermodal Connectors
Transportation Efficiency. Intermodal connectors that are in poor condition
may reduce service reliability and predictability, two of the most important qualities
shippers seek in their supply chains. One industry representative has described the
nation’s intermodal system as a network of conduits and pipes that is only as efficient
as its “weakest link.”4 If intermodal connectors are a weak link in the nation’s
transportation system, they may raise shipping costs, limiting the productivity and
competitiveness of U.S. businesses. Poor intermodal connectors can also result in
long lines of idling trucks, reducing air quality and increasing energy consumption.
Recent trends in business logistics demand higher levels of service from
intermodal carriers. Retailers and manufacturers have been substituting more
frequent shipments for large and costly inventories and outsourcing production to
overseas plants with cheaper labor. In a “just-in-time” delivery environment,
manufacturers essentially use their carriers as rolling warehouses. A truck may
deliver parts from overseas within hours or even minutes before they are used in a
manufacturer’s assembly line.
The growth of intermodal container shipping was largely spurred by
deregulation of the trucking and railroad industries in 1980. Deregulation fostered
new arrangements between these competing modes. Trucks and trains compete
fiercely for intermodal traffic, but in some cases trucking companies are partnering
with the railroads to move their less time-sensitive line-haul shipments. Rail
intermodal can represent a cost savings for the trucking industry. For the rail
industry, intermodal is a growing source of revenue. Intermodal, both domestic and
international, represents 20% of rail’s revenue base, second only to coal which
generates 23%. Intermodal rail traffic has grown from 3.1 million trailers and
3 Harry Caldwell, Freight Policy Team at FHWA, as quoted in “Giving Freight a Voice,” by
S. Lawrence Paulson, Public Roads, March/April 2001.
4 Joni Casey, Pres. of Intermodal Association of North America (IANA), as quoted in “An
industry still in need of integration,” Purchasing, May 18, 2000.

CRS-3
containers in 1980 to more than 9.0 million in 2000.5 Advances in information
technology, such as Electronic Data Interchange (EDI), have also spurred
intermodal’s growth by facilitating the exchange of shipment information between
modes at transfer points. According to many industry observers, the U.S. intermodal
network is now operating close to its physical capacity.

International Commerce. Intermodal shipments are especially important
to U.S. international trade. Recently, merchandise trade accounted for over 25% of
U.S. GDP.6 In 1970, it accounted for only 11%. Over the past decade, the volume
of intermodal containers moving through ports worldwide has doubled. According
to a freight study conducted by DRI-WEFA (now known as Global Insight) for the
Federal Highway Administration (FHWA), the volume of international trade is
forecast to double by 2020.7 The Port Import/Export Reporting Service (PIERS), a
maritime economic research firm that tracks the U.S. container trade, is forecasting
a 4.6% average annual growth rate in import containers and a 5% average annual
growth rate in export containers through 2010.8 In certain gateways, such as the Ports
of Los Angeles and Long Beach, the volume of trade is expected to triple. It is not
likely that many additional seaports or rail terminals will be built to handle this
increase in freight traffic. Rather, existing ports and terminals will need to become
more productive. A key element for increasing productivity will be improving the
throughput of intermodal connectors.
Military Mobilization. The performance of intermodal connectors also has
national security implications as the Department of Defense (DOD) increases its
reliance on commercial freight systems. In the late 1990s, the DOD relied on
commercial carriers for 90% of its peacetime movements and 85% of its wartime
movements.9 The military relies on commercial carriers through the Voluntary
Intermodal Sealift Agreement (VISA). Under the VISA program, private ocean
carriers can volunteer ship capacity to the military in a time-phased activation. An
important component of the VISA program is that in addition to ship capacity,
participating carriers also provide a full range of intermodal services - truck and rail
services, freight consolidation, 24-hour monitoring and tracking, and flexible routing
and scheduling options. In one scenario, where the DOD would need to respond to
two simultaneous contingencies, each the size of Desert Storm, the DOD estimates
it will require the capability of shipping 7,000 marine containers per week.10
5 Association of American Railroads, Railroad Facts, Oct. 2001, p. 26.
6 U.S. DOT, Office of Freight Management, National Freight Movements, July 24, 2001.
7 U.S. DOT, Press Release FHWA 41-02, Oct. 3, 2002. For further information on DOT’s
freight forecast, see [http://www.ops.fhwa.dot.gov/freight].
8 “Questions,” JoC Week, December 10-16, 2001, p.10.
9 Transportation Research Board, National Conference on Setting an Intermodal
Transportation Research Framework, Conference Proceedings 12, 1997 as cited in FHWA,
The Role of the National Highway System Connectors: Industry Context and Issues, Feb.
1999, p.18.
10 U.S. DOT, FHWA, The Role of the National Highway System Connectors: Industry
Context and Issues, Feb. 1999, p.18.

CRS-4
Peaking Behavior
An important aspect of freight flows on intermodal connectors is peaking
behavior. Like commuter traffic, container drayage also experiences daily rush
hours. Most warehouses prefer to receive their inbound shipments in the morning
while outbound cargo is loaded in the afternoon. Harbor truckers respond to their
customers’ needs by trying to be first at the port terminal’s gate in the morning. Rail
ramps and seaports are predominately located in large urban areas where truck and
commuter traffic often intermingle.
Surges also occur on a weekly and yearly basis. The import container business
largely follows the retail market. The peak shipping season begins in August in
anticipation of back-to-school sales and continues through the end of October in
anticipation of holiday sales. Container lines also tend to bunch their ship calls at
ports on certain days of the week in order to connect with rail timetables.

Traffic volume is further consolidated by the larger container ships being
deployed. These larger ships are calling at fewer ports because standing still in port
costs money. The result is an increase of container traffic at hub ports. The railroads
are also rationalizing their intermodal hubs. They are reducing the number of
intermodal terminals and consolidating traffic on unit trains. This also contributes
to the concentration of freight activity at key hubs.
Findings of DOT Studies
The FHWA Study
Recent national studies have highlighted the poor condition of intermodal
connectors.11 The National Highway System (NHS) Designation Act of 1995 (P.L.
104-59), required the DOT to submit a list of designated intermodal connectors.
DOT submitted its list in May 1996 after consultation with state DOTs, metropolitan
planning organizations (MPOs), and terminal operators. In TEA-21 (Section 1106),
Congress called on the FHWA to examine the condition of intermodal connectors.
The FHWA published its findings in January 2001.12 The criteria used to define an
intermodal freight connector were based on the amount of truck traffic on one or
more of the principal routes serving a facility. Comparison of truck activity between
connectors was made on a national as well as state level. Table 1 shows the
inventory of freight connectors by terminal type.
11 In addition to the two DOT studies described in this report, the Transportation Research
Board (TRB) has also studied this issue. See National Cooperative Highway Research
Program, (Project 8-39) Financing and Improving Land Access to U.S. Cargo Hubs,
[http://www4.trb.org/trb/crp.nsf/All+Projects/NCHRP+8-39].
12 U.S. Department of Transportation, NHS Intermodal Freight Connectors, A Report to
Congress, July 2000. Available at [http://ops.fhwa.dot.gov/freight/infrastr/nhs/].

CRS-5
Table 1. Intermodal Freight Terminals
Miles of
Intermodal
Connector Type
Terminals
Connector Road
Ports (ocean and river)
253
532
Airports
99
221
Truck/Rail Terminals
203
354
Pipeline/Truck Terminals
61
115
Total Number of NHS Freight Terminals
616
1,222
Source: reproduced from NHS Intermodal Freight Connectors
As Table 1 illustrates, intermodal connectors are short segments of road,
generally less than two miles in length. The study found that the pavement condition
of these roads was either poor or very poor for 12% of the total connector mileage.
This figure compares with an 8% poor or very poor rating for all National Highway
System mileage. “Poor” pavement condition is defined as having shallow rutting or
cracks that cause a reduction in speed. “Very poor” pavement is defined as having
major problems with potholes causing substantial reductions in speed. Just over
half of connector mileage (51%) was found to be in good or very good condition
while 37% was found to be in fair condition.
As Table 2 illustrates, roads leading to rail terminals and seaports were in worse
shape than those leading to airports. This may be due to the fact that airports serve
considerable passenger travel as well as freight.
Table 2. Poor/Very Poor Pavement Ratings by Terminal Type
Terminal Type
Poor/Very Poor
Airports
7%
Truck/Pipeline
7%
Ports (ocean and river)
15%
Truck/Rail
12%
Source: reproduced from NHS Intermodal Freight Connectors.
In addition to poor pavement, the FHWA study found other deficiencies with
intermodal freight connectors. Almost half the terminals have at least two geometric
deficiencies. Geometric deficiencies can be inadequate travel width, tight turning
radii at intersections, lack of stabilized shoulders, or railroad crossing deficiencies.
The study also noted that there are currently no national, regional, or terminal based
design standards for intermodal connectors.

CRS-6
The MARAD Study
In addition to the FHWA, the Maritime Administration (MARAD) has also
examined the condition of intermodal connectors. MARAD’s study was limited to
seaport terminals but examined rail connections as well as road connections.13 The
survey found that “port access conditions are generally acceptable today but may not
sustain continued growth and international trade.” The latest survey was conducted
in 2001 and reveals the following:
Table 3. Percentage of Ports Indicating Below Acceptable
Flow Conditions on Key Elements
Key Element
Top Container Ports
Non-Container Ports
Roadways within the port
10%
3%
Local roads
25%
24%
State/Interstate roads
30%
10%
Rail line-haul moves
22%
18%
Rail moves on rights-of-way
shared with passenger rail
37%
10%
Source: Maritime Administration, Intermodal Access to US Ports -Report of Survey
Findings, August 2002.
Strategies for Improving Mobility To and From
Cargo Hubs
There are a number of strategies that state and local governments and private
industry have implemented or are developing to expedite the flow of cargo to and
from terminals.
Redesigning Terminal Infrastructure
In recent years, ports have redesigned their physical infrastructure to
accommodate the growth in container traffic. In the past 10 - 15 years, ports have
built on-dock or near dock rail yards. These facilities reduce the amount of “bridge
trucking” of containers from port to rail terminal. The downside of on-dock rail is
that it absorbs a tremendous amount of scarce surface area at the port. The Port of
New York and New Jersey has begun a plan to tranship a portion of its container
traffic by barge to less congested ports, such as the Port of Albany, New York. While
13 U.S. Department of Transportation, Maritime Administration, Intermodal Access to U.S.
Ports - Report of Survey Findings, August 2002. Available at
[http://www.marad.dot.gov/publications/01%20IAccess%20Report%20pub.doc].

CRS-7
container barges and feeder ships are common in Asia and Europe, they are not
widely used in the United States.
Another redesign concept that some port logisticians are advocating is the
“Inland Intermodal Center.”14 The idea is to move the container sorting facility,
which requires a great amount of space, to a less congested inland area. The sorting
facility would be connected to the port by a rail shuttle. All containers unloaded from
a ship would be moved to this inland facility where local traffic moving by truck
would be separated from traffic moving further inland by rail. This concept has the
potential to reduce truck traffic near the port. However, while there may be
economic benefits from saving land on shore, these benefits would have to be
weighed against the cost of acquiring the right of way for a rail shuttle.
Operationally, there would also be the cost of adding an additional link in container
movements, namely the cost of the rail shuttle movement and the cost of an
additional container unload and load.
According to some, ports have been more aggressive than railroads in investing
in the access infrastructure to their facilities. In the executive dialogue discussion of
the FHWA study, “it was noted that railroads continue to focus on using their
existing yards, which were originally developed for box car traffic that did not
require highway connections [while] highway access is crucial to intermodal rail
service.”15 However, this is not to say that railroads are not investing in their
intermodal terminals. There are many instances where rail carriers are consolidating
their intermodal terminals and/or moving terminals outside metropolitan areas where
land area can be expanded and connections to highways improved.
Improving Port Operations
Modifying port operations can also expedite the transfer of cargo between water
and land modes. Although rail terminals operate 24 hours a day, seven days a week,
traditionally, port terminal gates are open only on weekdays from 8 a.m. to 5 p.m.
Expanding gate operations to evening hours is proposed as one solution to relieving
congestion on port access roads. Some ports have begun extending their gate
operations to off-peak hours. The question, however, is if there will be enough
shippers willing to extend the hours of their warehouse operations to generate enough
cargo to make off-peak operations cost-effective.
Cargo flow to and from ports can also be expedited by reducing the number of
days shippers are allowed to store their container shipments at the port. Large
shippers are often granted more than the typical five days of free storage at ports. To
accommodate these shippers, containers may be stacked six or seven high. This
practice slows the container pick-up process for the truckers as they wait for the
containers to be unstacked and re-stacked.
14 a.k.a. Inland Port Concept and Inland Container Transfer Facility.
15 FHWA, The Role of the National Highway System Connectors: Industry Context and
Issues, Feb. 1999, p. 28.

CRS-8
Implementing ITS
Many believe Intelligent Transportation Systems (ITS) can significantly improve
cargo flow on intermodal connectors.16 ITS is described as expanding the capacity
of existing infrastructure by substituting information (or “infostructure”) for
infrastructure. The idea is to use existing infrastructure more efficiently with the help
of information technology. Given the competing land uses surrounding seaports and
rail terminals, limiting the amount of space available for widening access roads, ITS
may be especially applicable to the problem of increasing freight mobility on
intermodal connectors.
Information exchange has been a key element in the success of intermodal
transportation. The efficient exchange of shipment data between carriers at transfer
points is as important as the hand-off of the cargo itself. The internet is evolving as
a popular tool for gathering and providing information on container shipments.
Websites such as “eModal” and “First” can increase freight mobility on access roads
to ports by sharing information with harbor truckers on congestion areas, road
closures, and container availability for pick-up.17 Providing this information to
truckers can reduce the number of “dry runs” they make to the port due to mis-
communication. One port provides real-time surveillance video of its gate on its
website so truck dispatchers can gauge the waiting time at the gate.18
An axiom in the intermodal industry is that “the commodity most frequently
shipped is air.”19 A substantial amount of truck traffic to and from intermodal
facilities is picking up and returning empty containers. The internet can be used to
directly connect an importer with an exporter in need of an empty container. A
trucker can deliver an empty container directly to the exporter after unloading its
contents at the importer’s warehouse. This eliminates the intermediary truck trip to
the container depot to drop off and pick up an empty container.20
ITS is also being deployed to track shipments on intermodal connectors. While
ports and railroads provide container tracking information, a black hole often exists
when the container moves by truck between facilities. The FHWA is conducting a
pilot program to track containers when they leave the port area21 and an ocean liner
company has recently begun offering a similar service.22 Improving in-transit
visibility on intermodal connectors is sought by all parties. Government officials
desire greater visibility for security purposes, shippers for better inventory
16 For further information on ITS, see CRS Report RL31283, Intelligent Transportation
Systems for Highways and Transit: Status, Federal Role, and Options for Reauthorization.
17 See [http://www.emodal.com] and [http://www.firstnynj.com/].
18 See [http://www.portofportland.com/tmst6/inquire.asp].
19 U.S. DOT, RSPA, Partnership to Promote Enhanced Freight Movement at Ports and
Intermodal Terminals, Feb. 2000.
20 “Gridlock on L.A. Agenda,” Traffic World, Jan. 15, 2001, p. 42.
21 See [http://www.ops.fhwa.dot.gov/freight/Info%20Highway/Freight%20Info.htm].
22 “Maersk Data offers drayage tracking,” JOC Online, May 10, 2002.

CRS-9
management, ocean carriers for better asset utilization, and local transportation
planners for better information on freight flows in their jurisdictions.
Issues for Congress
With significant increases in intermodal freight traffic projected over the next
two decades, the adequacy of intermodal connectors raises the broader issue of the
appropriate role for the federal government in planning and funding the nation’s
intermodal transportation system. Policy questions include: Do existing institutional
arrangements encourage an intermodal approach to transportation planning? Is the
system planned and operated as a comprehensive intermodal system, or is emphasis
and focus on individual modes and elements? Are existing funding programs capable
of addressing intermodal freight projects and are intermodal connectors the weak link
in achieving a more efficient intermodal system?
Intermodal Planning Issues
At issue for Congress is how to plan for and develop an intermodal network,
that is largely national and even international in scope, with a transportation planning
process that is largely local in scope. As noted earlier, the FHWA intermodal
connector report contends that intermodal connectors have not received the policy
attention they deserve. The report described intermodal freight connectors as
‘orphans’ in the traditional planning process of state DOTs and metropolitan
planning organizations (MPOs). TEA-21, and its precursor ISTEA, (P.L. 102-240)
gave states and MPOs primary responsibility for allocating funds for transportation
projects. ISTEA and TEA-21 did not specify a category of funds for intermodal
freight projects, rather it suggested and encouraged local decision makers to consider
an intermodal approach when deciding on projects for funding.
MPOs may often be the appropriate body for determining funding for
intermodal connectors because these routes largely lie in urban areas. However,
some policy analysts suggest that this planning arrangement may be more logical for
solving commuter concerns than it is in addressing interstate and international
commerce concerns.23 Freight stakeholders contend that because MPOs are largely
staffed by elected officials, they give priority to commuter projects. While commuter
trips likely begin and end within their geographic jurisdiction, freight trips
(particularly intermodal) are more likely to extend beyond their jurisdiction.
Some MPOs may perceive that while the cost of a freight project is born locally,
the benefits of the project may flow to shippers located outside their region.24 This
may be especially true where the preponderance of freight traffic is passing through
the terminal area from one region of the country to another rather than serving as a
23 Jeremy F. Plant, “Railroad Policy and Intermodalism, Policy Choices after Deregulation,”
Review of Policy Research, June 22, 2002.
24 Freight Financing Options for National Freight Productivity, FHWA, Office of Freight
Management and Operations, April 2001, p.7.

CRS-10
terminus for local manufacturers or retailers located in their jurisdiction. There may
also be concern by local officials that improvements in intermodal capacity are
primarily terminal-oriented improvements that worsen existing conditions off-
terminal, such as increasing pollution, truck traffic, and noise. In some instances,
local officials may be reluctant to make significant landside investments in improved
intermodal connectors when there are equally pressing infrastructure needs
elsewhere. On the other hand, competition among local and regional economic
development agencies to attract business to their area may encourage investments in
freight facilities. Many MPOs may view intermodal terminals as engines of
economic growth.
Freight Information Needs. A 1995 survey by the Freight Stakeholders
National Network found that 90% of MPOs responding reported that they lacked
sufficient data to conduct adequate freight planning.25 Lack of information on
intermodal shipments has been mentioned as an existing gap in available freight data.
Better information on freight flows at the local level, such as shipment origin and
destination, type and value of cargo, seasonality and peaking behavior, and time
delays, could assist localities in making sound transportation investment decisions.
It could also assist them in evaluating the potential economic benefit of investing in
freight projects.

It appears that MPOs could benefit from better information on how local freight
moves are connected to regional, national, and international markets. The FHWA’s
Office of Freight Management and Operations is developing a cost-benefit model for
goods movement that is intended to assist state DOTs and MPOs in this regard.26
This office, along with the Bureau of Transportation Statistics (BTS), also recently
released a report on freight flows in each state that is intended to assist them in
freight planning.27 An issue of likely interest to Congress is assessing whether
current freight information sources are adequate in addressing local needs and, if not,
whether the federal government, or state, and local governments should be
responsible for collecting and providing this information in a useful format.28 Freight
movement is largely controlled by the private sector, so much of the information that
would be useful for freight planning may not be readily available. One of the barriers
government agencies must overcome when enlisting assistance from the private
sector is the private sector’s fear of providing information that it considers
25 GAO, Intermodal Freight Transportation, Projects and Planning Issues, July 1996,
(NSIAD-96-159). The Freight Stakeholders National Network is a consortium of eight trade
associations: the Air Freight Assoc., the American Assoc. of Port Authorities, the American
Trucking Assoc., the Assoc. of American Railroads, the Intermodal Assoc. of North
America, the National Assoc. of Manufacturers, the National Industrial Transportation
League, and the National Private Truck Council.
26 For further information, see [http://ops.fhwa.dot.gov/freight/benefit-cost.html].
27 “State Freight Profiles,” uses data from the “Freight Analysis Framework,” available at
[http://www.ops.fhwa.dot.gov/freight/state_profiles.htm].
28 For further information on this topic, see Data Needs in the Changing World of Logistics
and Freight Transportation, Conf er ence Synt hesi s, January 2002,
[http://www.dot.state.ny.us/ttss/conference/index.html].

CRS-11
proprietary. Companies may fear that providing information to the government will
allow access to that information for their competitors.
In addition to providing more useful freight information, policymakers may also
consider resource issues for adding freight expertise to local planning staffs. Some
MPOs already have “freight advisory committees” that consist of freight specialists.
Freight Corridor Planning. A common theme found in the literature on
intermodal planning is for policymakers to focus on the trip or transportation corridor
rather than focusing on the mode of travel. To incorporate a corridor perspective into
the planning process, some state officials have created multi-state organizations so
that states could work as a team on end-to-end investments in corridors that cross
state lines.29 Two examples are the “I-95 Corridor Coalition” which includes the
DOTs from five mid-Atlantic states and the “I-35 Trade Corridor”composed of seven
states in the Midwest. In the reauthorization debate, Congress may consider
formalizing multijurisdictional arrangements or allowing existing arrangements to
continue or to expand.
Terminal Planning. The issue of improving access to intermodal terminals
raises the related issue of planning for the best location of the terminals themselves.
Many large cities have multiple rail terminals. For example, in the greater Chicago
area there are 26 intermodal terminals; in the metropolitan New York area there are
11; and in Detroit there are seven. These terminals largely developed as a result of
historical forces in which multiple Class I railroads (many of whom have now
consolidated) independently planned for additional space and facilities to meet
growing demand for intermodal traffic. In some cities, the uncoordinated manner in
which some of these facilities developed has generated fragmented freight activity.
For example, repositioning freight containers between multiple facilities generates
unnecessary truck trips which increases costs for shippers and creates more
congestion on local highways.30

With the projected increase in intermodal traffic over the next two decades,
many experts assert that we can no longer afford to truck containers across cities to
make rail connections. These experts suggest that the solution is to build rail
terminals in which two or more railroads jointly use a single facility. A multiuser
facility could concentrate intermodal activity at a single location, thereby reducing
the amount of truck traffic between rail terminals. In addition to improving goods
movement, they suggest it could have a positive effect on community mobility,
economic development, and other quality of life issues. Terminal location and access
may therefore involve larger public interests. State and local officials could partner
with the railroads in developing common user facilities. A partnership approach
offers the potential for a more orderly and coordinated terminal development
strategy.
29 Transportation Research Board, Global Intermodal Freight, State of Readiness for the 21st
Century, Conference Proceedings 25, February 23-26, 2000, p. 103.
30 “Freight Transportation Research Needs Statements,” Transportation Research Circular,
No. E-C048, Dec. 2000.

CRS-12
Shared intermodal rail facilities may be too massive and expensive to be
financed and built by the railroads themselves. This raises the question of whether
public funds should be provided to help finance their construction. Congress may
evaluate whether this is an issue to be resolved between local government officials
and the railroads or if, given the volume of freight moving through these hubs, it is
a matter of national significance.
Federal Intermodal Planning. Many observers believe that a major
obstacle to achieving the goal of a national intermodal transportation network as
envisioned in ISTEA is that the modes are separately managed and funded. Because
each mode tends “to jealously guard their independent source of infrastructure
financing,” the infrastructure linking the modes may fall through the cracks of
existing modal funding categories.31 Intermodal supporters argue the focus should
be on improving the connectivity and interoperability among modes. In 1966, one
of the principal reasons for creating the DOT was to facilitate a unified approach to
transportation planning. In 1991, ISTEA created the Office of Intermodalism and
the Intermodal Transportation Advisory Board to further facilitate intermodal
connections. DOT’s recent initiative called “OneDOT” is an attempt to integrate the
ten agencies in the department into an unified unit.
Congress may wish to assess whether institutional arrangements for
transportation policymaking are keeping pace with changing economic
circumstances. A recent Transportation Research Board (TRB) conference on
intermodal planning concluded that, “because the old modal boundaries are becoming
increasingly blurred at critical nodes and along key corridors, a compartmentalized
approach presents clear challenges to DOT in advancing these important types of
investments.”32 As in past reauthorization discussions, policymakers may renew
debate on whether to restructure federal transportation institutions. For example, one
proposal is to divide DOT and congressional transportation subcommittees along two
divisions - passenger and freight - rather than along modal divisions. This view
holds that these are more appropriate distinctions than modal distinctions in pursuing
greater mobility through an integrated transportation system.33
Defenders of the current system argue that initiatives to restructure DOT have
already been attempted but failed in the past, partly due to industry opposition. They
point to the Unified Transportation Infrastructure Improvement Program (UTIIP) in
1995 as one example. Some argue that while intermodal’s market share is
increasing, it still represents only a minority of total freight movement in the United
States. Carriers themselves tend to give greater priority to their mode specific needs
than to intermodal needs.
31 Paul Dempsey, “The Law of Intermodal Transportation: What It Was, What It Is, What
It Should Be,” Transportation Law Journal, Summer 2000.
32 TRB, Planes, Trains, and Automobiles: Multimodal Reauthorization Opportunities,
Scottsdale, AZ, Aug. 21, 2000.
33 Paul Dempsey, “The Law of Intermodal Transportation: What It Was, What It Is, What
It Should Be,” Transportation Law Journal, Summer 2000.

CRS-13
Intermodal Funding Issues
Intermodal connectors have been described as “low hanging fruit,” a metaphor
used to express the notion that relatively modest investment in these route segments
could yield substantial returns in freight movement speed and reliability.34 U.S.
DOT’s 2002 Conditions and Performance Report estimates that addressing the
backlog of deficiencies on intermodal connectors would cost approximately $2.6
billion while improving service to cope with expected increases in freight volumes
would cost about $4.3 billion. At issue for Congress is assessing whether existing
funding programs are adequate in financing the infrastructure needs of intermodal
connectors and if not, evaluating alternative proposals.
Some advocate creating a specific funding category for intermodal connectors
in the Surface Transportation Program (STP) in TEA-21 (section 1108). Setting aside
funds specifically for intermodal connectors might help ensure that they are given
greater priority in the state and local transportation planning process. The downside
is that setting aside funds for a specific purpose could reduce local transportation
planners’ ability to direct funds to where they may be needed most. In some cases,
a set-aside program could result in allocating funds to a marginally important freight
project while other, more pressing non-freight needs go unmet.35 Additionally, local
governments may be unwilling to provide a match for projects unless the perceived
public benefits are clear.
Another proposal Congress may debate is creating an intermodal trust fund. As
suggested by one policymaker, this fund could be financed through a user fee charged
per container shipment.36 Others have proposed pooling resources by taking a
portion from existing transportation trust funds. The funds could be used to finance
projects that improve the intermodal network. Establishing a dedicated pool of funds
for freight projects could overcome the hurdle that freight projects face in competing
with passenger projects for funding. However, it may be difficult to collect and
distribute the funds in an equitable manner that does not result in one port or cargo
hub subsidizing another port or cargo hub.
Policymakers could consider expanding the requirements of existing funding
programs to specify that freight projects such as intermodal connectors be included.
For instance, the language in the “Corridors and Borders” (CORBOR) program in
TEA-21 (section 1118 and 1119) could specify that improving access roads to ports
is eligible for funding. CORBOR provides funds for the development and
construction of projects that serve border regions. Similarly, policymakers could
consider expanding the Railroad Rehabilitation and Improvement Financing (RRIF)
credit program in TEA-21 (section 7203) to include access roads to intermodal rail
yards. The RRIF program provides low-interest loans and loan guarantees for new
34 American Assoc. of State Highway and Transportation Officials, Transportation Invest
in America, Freight Intermodal Linkages, 2002.
35 FHWA, Office of Freight Management and Operations, Freight Financing Options for
National Freight Productivity, April 2001.
36 “Intermodal Bottleneck Ahead,” Journal of Commerce, March 31- April 6, 2003.

CRS-14
railroad facilities or improvements to existing facilities such as terminals, track,
bridges, rail buildings, and shops.