Rail resolution a win-win

City of North Charleston and Commerce agree to terms that set South Carolina on right track for post-Panamax economic competitiveness

CHARLESTON, SC – December 4, 2012 –  A settlement among the SouthCarolina Department of Commerce, its Division of Public Railways and the City of North Charleston was approved today by the North CharlestonCity Council. This is a first step towards ending all pending litigation among the parties, as well as the State Ports Authority, creating awin-win for the state and the city.

Commerce Secretary Bobby Hitt and North Charleston Mayor Keith Summeynegotiated a deal that enables South Carolina to offer equal dual railaccess to the Port of Charleston through an intermodal rail yard thatwill be located strategically on the former Charleston Naval Base whileprotecting the neighboring communities.

Together with funds appropriated to advance harbor deepening, thesettlement signals to the global business community that South Carolinawill be ready to accommodate the rapid growth in commerce that will move through the Port after the Panama Canal is widened in 2014. As a keypartner in the deal that will facilitate the efficient andcost-effective movement of cargo through the Charleston region andstatewide, the City of North Charleston will also benefit from newinvestment and job creation.

“With today’s vote by North Charleston City Council, everyone in SouthCarolina wins,” said South Carolina Governor Nikki Haley. “First, let me thank Mayor Summey and Secretary Bobby Hitt, who have done a tremendous service to our state by bringing us to this point. South Carolina as awhole is now positioned to even further benefit from our world-classport and the expansion of the Panama Canal – it truly is a great day inSouth Carolina.

The settlement demonstrates that the state and the City of NorthCharleston have put past differences aside and are ready to worktogether to redevelop the former Charleston Naval Base in a way thatgives the Charleston region and the state a path forward..

Key elements of the settlement include:

• An exchange of property between North Charleston and Public Railways that divides property at the former naval base so that North Charleston controls the property closest to the waterfront that is best suited for residential and recreational development, while Public Railways retains property required to implement the rail yard and associated rail lines, as well as other property best suited for industrial and economicdevelopment.
• Payments to North Charleston by Public Railways fromprivately-generated revenues available for capital projects, including$8 million paid in $2 million installments over four years andassumption of the Tax Increment Financing (TIF) bond debt associatedwith the former Noisette acreage acquired by Public Railways.
• A comprehensive surface transportation study to identify impacts ofrail and highway traffic related to state port and rail operationsthroughout North Charleston. Public Railways, the State Ports Authority, the South Carolina Department of Transportation and North Charlestonwill equally fund the study that will identify the infrastructurerequired to mitigate these impacts.
• Administrative support by the City of North Charleston for rezoning, permitting, and other issues needed to implement the rail yard, resolve existing rail and other related issues, and attract new investment andjobs to the former Charleston Naval Base.

Senator Hugh Leatherman, chairman of the Senate Finance Committee,said, The agreement reached to move forward on the dual-access rail was a long time coming, but a great day for all areas of South Carolina.  Because of these state-of-the-art rail facilities, I expect our ports to be busier, I-26 less congested and our businesses to enjoy anotherefficient and viable option to move their goods throughout our state,country and world.  By this agreement, the people of South Carolina andthe residents of North Charleston are the winners!  I commend MayorSummey, Secretary of Commerce Bobby Hitt, Former Secretary of CommerceJoe Taylor and Councilman Ron Brinson, who worked so diligently to makethis day a reality.

With this agreement, South Carolina can build an intermodal containertransfer facility that allows equal access to both Class I railcarriers. One intermodal train equals 280 trucks. Aneffectively-implemented dual access rail solution will keep thoseadditional trucks off the roads and will minimize negative impacts tothe environment and the region as a whole.

“I’ve said before that I knew this issue could be resolved and thatwe’re getting closer,” said Secretary of Commerce Bobby Hitt. “And nowwe’re here. This is a win for both South Carolina and the City of NorthCharleston. This agreement puts us at the top of the game for competingglobally for post-Panamax business. Like water poured on a rock, whenthe commerce comes, it has to have somewhere to go. The solution we have reached with the City of North Charleston will result in a highervolume and more efficient distribution channel for companies in SouthCarolina and all over the world.  Importantly, we found ways toaccomplish this while minimizing impact to North Charleston residents.  Special thanks are due to Buck Limehouse who served as mediator in theprocess.”

“Today is an important moment for the City of North Charleston,” saidMayor Keith Summey.  “We now have a great opportunity to resolve many of the lingering surface transportation issues that have plagued thegreater North Charleston region for many, many years. The joint studycommissioned by the state parties and the City will seek a solution tomany of our area’s transportation problems and lessen port trafficimpacts on the North Charleston community.  Anyone driving along NorthCharleston’s major thoroughfares has at some point been stuck ingridlock traffic or stopped by a train, unfortunately all too often.This fight has been over rail, but I believe that the City has reallyobjected to the human impact of rail more than to rail itself.  Withthis settlement, I believe that North Charleston will emerge as a better community, and that all of the citizens of the State of South Carolinawill realize that it was this community that made the tough decisionsfor their economic growth.”

Starting with the surface transportation study, the settlement outlinessteps that will be taken to mitigate the adverse impacts of theincreased rail and traffic to the North Charleston region, including the establishment of quiet zones and other related measures. This effortwill include rail and highway traffic simulations to determine theimpacts followed by public hearings to assess how best to address theimpacts in a manner that incorporates the concerns of the local citizens who are most affected by them.

Public Railways President Jeff McWhorter is ready to get started. “Thishas been a long process and we are looking forward to working witheveryone concerned to better prepare our state and the City of NorthCharleston for the opportunities coming our way,” McWhorter said. “Weexpect to begin the permitting process for the intermodal facility after the first of the year and will take steps to get the surfacetransportation study underway as soon as possible.” He added, “Our planallows for efficient rail service that will reduce truck traffic andhighway congestion starting with the direct involvement of PublicRailways in helping to ease some of the traffic tie-ups that areexperienced today at North Rhett. We will work closely with MayorSummey, his staff and nearby communities to mitigate the impact of railas it relates to our facility on the former Charleston Naval Base.”

As chairman of the Review and Oversight Commission for the SouthCarolina State Ports Authority, Senator Larry Grooms said, “I was keenly aware of the importance of the dual rail issue for the maritimecommunity and congratulate the parties on the settlement announcement.Bill Stern, chairman of the South Carolina State Ports Authority, alsooffered his congratulations on behalf of the State Ports Authority andsaid, The construction of a dual rail served intermodal containertransfer facility at the former Charleston Naval Base will enhance railcompetitiveness for the Charleston region. We are pleased that this will resolve the City’s claims against the Ports Authority, ending thepending litigation.