West Virginia legislators on Tuesday objected to state plans to auction off the $32 million Heartland Intermodal Gateway, in Prichard, for as little as $1 million, after the complex shut down operations this fall.
“It was probably a good idea. It just did not work at all,” Transportation Secretary Byrd White said of the complex, which opened in December 2015 with the goal of loading and unloading 15,000 rail-to-truck containers a year.
“Some months, we had less than 20 containers come through,” White told interim oversight committees on Transportation and Infrastructure. “We didn’t have 1,500 containers a year. From an economical standpoint, it just did not work.”
Currently, the complex has no activity, since Norfolk Southern Railway stopped servicing the facility on Oct. 1, he said.
Sen. Robert Plymale, D-Wayne, argued Tuesday that the complex had, and still has, great potential, and blamed the state for frittering away an economic opportunity.
“For the last five or six years, this has been so mishandled by the DOT and the Port Authority,” Plymale told White, adding, “I’ve seen a lot of bad stuff, but I’ve never seen anything so mishandled. I’m sorry you were handed this, but I still don’t think you’re handling it right.”
Plymale said the Port Authority, which manages the facility, had not met for two years, and Gov. Jim Justice had to appoint a new member this summer so that the Authority could have a quorum for a meeting in July to authorize White to attempt to lease the facility to a private operator.
The facility is part of the $290 million Heartland Corridor project, which permits double-stacked intermodal trains to operate on Norfolk Southern routes from Norfolk, Virginia, to Columbus and Chicago. That project required heightening clearances in 29 tunnels, most of which are in West Virginia.
At the time it opened, the Prichard facility was touted as a economic game-changer for the state, giving manufacturers in Southern and Western West Virginia easy, low-cost access to markets in the East and Midwest, and to international shipping ports in Norfolk.
“The Heartland Intermodal Gateway Facility will play a vital role in helping our state successfully compete for upcoming economic development projects,” then-Gov. Earl Ray Tomblin said during a tour of the site in fall 2015.
However, a series of missteps followed.
A plan to expand the access road from the facility to Interstate 64 to four lanes never happened. An aggressive marketing plan recommended by consultants never came to fruition. There were logistical issues, as well, including that the facility’s largest customer, Toyota Motor Manufacturing, used 20-foot containers to bring auto parts to its Putnam County plant, while companies shipping lumber from Prichard needed 40-foot containers.
White said the state is seeking bids from real estate auction companies to auction off the 100-acre facility. A bid opening is set for Dec. 30.
Plymale and other lawmakers asked White on Tuesday to delay any auction of the property until the Legislature has the opportunity to consider other possible options when it returns in regular session in January.
“The way it stands now, it looks like we’re going to get mere pennies on the dollar for what was invested,” said Delegate Brent Boggs, D-Braxton.
Plymale proposed giving the facility to the Wayne County Commission.
“I trust them a lot more than I trust the DOT on this,” he said.
White said, with a Dec. 30 bid opening, it would take time to negotiate a contract with the low-bidder auction house, pushing the date for an auction well past the Jan. 8 start of the 2020 regular session of the Legislature.
White said he is aware of only one interested party for the auction. He said a second potential bidder dropped out when Norfolk Southern eliminated service to the facility. White told legislators he thinks bidding will be in the $1 million to $2 million range.
He stressed that whoever wins the bid will have to operate the complex as a rail facility of some kind, a condition set when Norfolk Southern donated the site to the state in 2012.
“They have to operate it as a rail facility, or Norfolk Southern has the right to take it back,” he said. “They can’t go in there and put up an amusement park.”
White estimated that it costs about $10,000 to $15,000 a month to provide security, utilities and basic maintenance for the idled facility.