Atlantic Gateway Dis Trip Ark Plan Final Report 200803

Atlantic Gateway Distripark Plan Final Report

Prepared For

Halifax Regional Municipality and

Partners

Prepared By

MariNova Consulting Ltd. UMA Engineering CPCS Transcom Dillon Consulting Colliers International

March 2008

Atlantic Gateway Distripark Plan

Table of Contents Executive Summary................................................................................................. i 1.0 Introduction.....................................................................................................1 !"!

#$%&'() )*&+( ,%)- )-./0 """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 1 !"!"! 234- +%5%+*-0 4(6*)(/ """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7 !"!"1 8%+9 3: '43;-$""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7 !"!"7 <$*55*&' ,*&()"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" = !"!"= 234- -(4>*&%,) """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" = !"!"? #@ A%*,"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" = !"!"B C553)*-*3& -3 A3+90 8%9( )*-( """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ? !"!"D E4%&),3%/""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?

2.0

Literature Review and Case Studies .............................................................7

3.0

The Atlantic Gateway Distripark Concept...................................................15

1"! 1"1 1"7 1"= 1"? 7"!

4.0

="7 ="=

="?

A%*, &(-;349""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 1J E$( /*)-4*5%49 -(4>*&%,""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 1! ="1"! A%*, %++()) """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 11 ="1"1 A3%/ &(-;349 """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 17 ="1"7 E(4>*&%, A3%/ %++())""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 1B E(4>*&%, +%5*-%, +3)-)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 1H A%*, )$.--,( 35(4%-*3&)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 1N ="="! 2.453)(""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7J ="="1 A(O.*4(>(&-)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7J ="="7 PQ*)-*&' -4%*& )(46*+("""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7! ="="= <$.--,( -4%*& +3)-)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 77 C-$(4 #@ +3&)*/(4%-*3&)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7= ="?"! PO.*5>(&- """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7B

Terminal Operations and Management.......................................................38 ?"! ?"1 ?"7 ?"=

?"? ?"B ?"D ?"H

6.0

E$( +3&+(5-""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" !B

Functional Site Plan......................................................................................20 ="! ="1

5.0

F.+9,%&/"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D G%&+3.6(4""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" H G*4'*&*% I&,%&/ 234- """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" !J <0/&(0K F.)-4%,*% """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" !! L3-$(&M.4'K <;(/(& """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" !1

A3,( 3: FLR"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7H <-4.+-.4("""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7H 2(4:34>%&+( )-%&/%4/)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7N 243+()) """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7N ?"="! E4%&),3%/ *>534-)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7N ?"="1 E4%&),3%/ (Q534-)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" 7N ?"="7 P>5-0 (Q+$%&'("""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =J G3,.>() """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =! S%&&*&'""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =! 8%M3.4 *>5,*+%-*3&) """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =! S%49(-*&' -$( FLR"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =1

Social, Environmental and Cost/Benefit Impact.........................................44 B"!

B"1

2,%&&*&' *)).()""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" == B"!"! #.44(&- S2< %&/ T3&*&' """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" == B"!"1 A('*3&%, 5,%&&*&' )-4%-('0"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" == B"!"7 I>5,*+%-*3&) :34 54353)(/ .)("""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" == P&6*43&>(&-%, %))())>(&-""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =?

March 2008

Atlantic Gateway Distripark Plan

B"7

B"=

7.0

Financial Projections of Revenue and Expense.........................................62 D"! D"1 D"7 D"= D"? D"B

8.0

B"1"! <3+*%, :(%-.4()""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =? B"1"1 P&6*43&>(&-%, :(%-.4()"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =? B"1"7 R3;&)-4(%> :(%-.4() """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =B B"1"= U(-,%&/)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =B B"1"? U%-(4+3.4)( +43))*&')"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =D B"1"B U*,/,*:( %&/ )5(+*() 3: +3&+(4& """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =D B"1"D P,(6%-(/ >(-%,)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =N B"1"H F+*/ '(&(4%-*&' M(/43+9"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =N B"1"N F4+$%(3,3'*+%, 4()3.4+() """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =N #3)-VM(&(:*- %&%,0)*) """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" =N B"7"! F)).>5-*3&)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?J B"7"1 #%,+.,%-*3& 3: -4.+9 /*)-%&+( ()-*>%-() """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?! B"7"7 A()-4*+-(/ 6)" .&4()-4*+-(/ 9> """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?7 B"7"= #%,+.,%-*3& 3: 4%*, /*)-%&+( ()-*>%-()"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?= B"7"? E4.+9 63,.>( %&/ /*)-4*M.-*3& 3: -4.+9 -4%::*+""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?= B"7"B E4.+9 /*)-%&+( )%6*&')"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?? S3/(, 4().,-)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?B B"="! I>5%+- 3: -4.+9 /*)-%&+( W -4.+9(4)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?H B"="1 I>5%+- 3: 43%/ ;(%4 %&/ -(%4""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?H B"="7 #3&'()-*3& """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?H B"="= X%&/,*&') W +3)-VY)%6*&')Z """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?N B"="? @(- LXL (>*))*3&) W *&+4(%)(VY4(/.+-*3&Z """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" ?N B"="B [4*/'( 35(4%-*3& W *&+4(%)(VY4(/.+-*3&Z """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B! B"="D @(- +$%&'( *& 5435(4-0 6%,.()""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B! C+(%& -(4>*&%, %+-*6*-0 """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B7 @(; /*)-4*5%49 %+-*6*-0"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B7 P>5-0 +3&-%*&(4 0%4/ %+-*6*-0 """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B7 E4.+9 ;%*- -*>("""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B7 #3)- -(4>*&%, 35(4%-*3&) """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B= <.>>%40 3: &(- :*&%&+*%, *>5%+- """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" B=

The Value Proposition ..................................................................................68 H"! H"1 H"7 H"= H"? H"B H"D

X%,*:%Q 234- F.-$34*-0""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" BH X%,*:%Q A('*3&%, S.&*+*5%,*-0 """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" BH R3;&-3;& X%,*:%Q"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" BH #@ """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" BH R*)-4*5%49 %&/ -4%&),3%/ """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" BN <$.--,( -4%*& """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DJ E(4>*&%,)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DJ H"D"! A(/.+(/ (>5-0 $%&/,*&' %- -$( -(4>*&%,""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DJ H"D"1 #3&6(4)*3& 3: ,3%/) :43> -4.+9 -3 4%*,"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D! H"D"7 E4.+9 '%-()"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D! H"D"= R;(,, -*>() """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D! H"D"? P>5-0 )-34%'( """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D! H"D"B A(6(&.( """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D! H"H <$*55*&' ,*&()"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D! H"H"! E4%&),3%/ +%4'3""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D1 H"H"1 X%&/,*&' %&/ )-34%'( 4%-() """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D1 H"H"7 P>5-0 +3&-%*&(4)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D1 H"H"= PQ534- +3&)3,*/%-*3& """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D7 H"H"? #3&)3,*/%-*3& 3: (Q534-"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D7 H"H"B C-$(4 )(46*+() Y+3&-%*&(4 ,(%)*&' %&/ 4(5%*4Z"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D7 H"N E4.+9(4) """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D7 H"!J <$*55(4)"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D= H"!J"! E4%&),3%/""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D=

March 2008

Atlantic Gateway Distripark Plan

H"!J"1 F++()) -3 +%4'3""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D= H"!J"7 <+$(/.,*&'""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D= H"!J"= #3>>3&\.)(4 (>5-0 0%4/ """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D? H"!J"? #3&)3,*/%-*3& 3: (Q534- +%4'3"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D? H"!! S.&*+*5%, '43.5""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" D?

9.0

Synergies.......................................................................................................76 N"! N"1 N"7 N"= N"?

N"B N"D N"H

E4%&),3%/V/*)-4*M.-*3&"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DB XAS M.)*&()) 5%49) )-4%-('0 """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DB [.4&)*/( (Q54());%0 """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DD XAS M0 /()*'&"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DD L4((& *&*-*%-*6()""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DH N"?"! XAS]) +,*>%-( +$%&'( *&*-*%-*6()""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DH N"?"1 XAS]) +,(%& %*4 *&*-*%-*6() """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DN N"?"7 X2F (>*))*3&) M%)(,*&( %&/ 4(/.+-*3&)""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DN 2436*&+*%, '4((& *&*-*%-*6()""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DN N"B"! P&6*43&>(&-%, -(+$&3,3'0 543'4%>""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" DN N"B"1 P+3-4.)- >.&*+*5%, 543'4%>""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" HJ ^(/(4%, L4((& *&*-*%-*6() """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" HJ N"D"! P+3E4%&)534- )-4%-('0 %&/ -$( (+3^4(*'$- 543'4%>"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" HJ F-,%&-*+ L%-(;%0 """"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" H1

10.0 The Business Case and Implementation ....................................................84 !J"! !J"1 !J"7 !J"=

2%4-&(4)$*5) """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" H= E$( /(%, """""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" H= I>5,(>(&-%-*3&"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" H? #3&+,.)*3&""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" HB

** ** **

March 2008

Atlantic Gateway Distripark Plan

i

Executive Summary The original objective of this study was to follow up on the previous study (Halifax Inland Terminal and Trucking Options Study) that suggested that, under certain circumstances (mainly the need for port capacity), an inland terminal and container shuttle to a site at Rocky Lake was a compelling project from a number of perspectives. A number of events that negatively impact on the economic viability of the original project have occurred since that report was prepared in 2005. The estimated capacity of the port was revised from 800,000 to 900,000 TEUs per year to 1.4M to 2M TEUs per year; this coupled with the lack of growth in the last two years pushes the point at which an inland terminal concept could be viable too far out into the future to be relevant. The more positive change from a port perspective is that transload activity has started and is growing in Halifax. A new concept was therefore required to reduce/remove truck traffic from city streets. As its title implies, this study now focuses on the opportunity to leverage this transload activity to reduce truck traffic without increasing the overall cost of transportation. It actually reduces the cost of transload container delivery chain through the Port of Halifax. The new concept is a commercially driven Distripark adjacent to the proposed Phase 13 Transportation Node in Burnside Industrial Park that is a combination transload service, empty yard container terminal and possibly a Long Combination Vehicle (LCV) yard at some point in the future. A daily shuttle would move transload containers between the container terminals and the proposed facility and empties would be received, stored and delivered from the Atlantic Gateway Distripark (AGD). Full import containers destined to locations other than Burnside would continue to be delivered by truck from the terminals as would the full export containers.

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Atlantic Gateway Distripark Plan

ii

Schemes to improve the cost of handling containers to/from their origin/destination are not new in the industry but are growing in popularity as governments attempt to find sustainable solutions to remove trucks from roads and reduce costs of cargo distribution. Variations of this concept have been studied and are being implemented in Auckland, Sydney, Gothenburg, Virginia, Vancouver and other cities. Each was developed to deal with the specific needs of the situation. Based on a number of assumptions that are detailed in the report, the volumes that would be attracted to the new terminal would result in 23,183 truck moves shifted to rail within the city and a further 43,322 empty container truck moves shifted from the container terminals to the AGD in 2009. This represents approximately 40% of the international container truck traffic that would flow through the city otherwise. Use of the AGD facility would be primarily justified by transload cargo that could benefit from going directly to rail, and transported more economically between the AGD and the terminals more economically using a rail shuttle. The empties generated by the transload activity would provide the base volume for the AGD’s secondary role as an empty yard. This empty yard activity contributes to the removal of truck traffic from city streets and adds volume necessary to lower handling costs at the AGD. The direct transportation costs benefits are summarised in the table below, based on the projected 2009 volume levels:

<,'&=)'"0 F"' ()*&%+, GH/,',I Total Savings -#)%,./)0 1)%0.&%+ <=>'? <@AB)%+" -/').

23456788 259C6;35 296;D867E9

!"# $%&' ()*&%+, 293:;9 294:CD

$%&', 2(4 -4%&),3%/ +3&-%*&(4 -$43.'$ -$( FLR 2(4 (>5-0 >36( )$*:-(/ -3 -$( FLR

While not included in the economic analysis, the transfer of CN’s Halifax Intermodal Terminal (HIT) activities would increase the volume of traffic through the AGD and significantly enhance its economics as the savings per HIT container would exceed $20.00 per unit. Even without the HIT volumes, the operating benefits of the AGD are positive in 2009 (net savings of $1.1M) and improve as volumes grow, mainly because the cost of the rail shuttle is nearly fixed. The projected cost savings in 2028 is between $5.9M and $6.2M. It should be noted that, just as in the previous report, the economics are calculated on the basis of holistic costs and assume the incremental savings and costs are realized. The actual rates the various stakeholders may charge for additional services or be willing to give back through rate reductions for savings incurred may vary significantly. This difference between costs and rate constitutes one of the main challenges of creating a deal that would permit all stakeholders to benefit. In addition to the direct transportation operating cost savings and the reduction of the number of trucks from city streets, the AGD will also:

March 2008

Atlantic Gateway Distripark Plan

! ! !

iii

reduce GHG (Green House Gas) emissions by reducing truck mileage or concerting such mileage to more fuel efficient rail transport; reduce the wear and tear on city streets; and reduce the wear and tear on bridges.

The following table shows a summary of the quantifiable operational benefits of the AGD.

($000s)

NPV Of Costs/Savings at 20 Years ($000s) Using 5% Discount

$(115)

$(1,921)

$538

$8,968

$40

$962

$1,100

$26,443

0

0

$732

$13,778

$2,294

$48,229

$(1,201)

$(14,963)

$1,094

$33,266

Costs/Savings at Year 1

Ocean Terminal Activity Full Containers (ship-to-truck or truck-to-ship) Empty containers (to/from terminals) Distripark Activity Transload containers Transload empties MT Yard Activity MT yards Truck Wait Time Truck waiting time cost Total savings Less Annual Shuttle Cost NET Handlings Savings/(Costs)

The economics are sensitive to a number of variables as described in the assumptions, not the least of which is: !

the volume of transload cargo through the AGD (particularly since the rail shuttle costs are mostly fixed);

!

the ability of the container terminals to go directly to/from rail rather than ground containers (captive railcars have been assumed in the cost of the shuttle);

!

the volume of empty exchanges at the AGD; and

!

the volume of transload exports (consolidation of high volume export commodities).

The transload traffic is expected to grow at a faster pace than the organic growth of the local market. As such, the percentage of container truck traffic that could be removed from city streets is projected to grow from 40.5 % in 2009 to 49.1% by 2028. The truck avoidance potential is summarized in the following figure:

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Atlantic Gateway Distripark Plan

iv

Growth in Truck Moves & Projected Share Removed From City Streets 500,000

60.0%

450,000 50.0%

400,000 350,000

40.0%

300,000 250,000

30.0%

200,000

20.0%

150,000 100,000

10.0%

50,000 0

0.0% 1

2

3

4

5

6

7

8

9

10 11 12 13 14 15 16 17 18 19 20

Total Trucks Involved in Terminal Moves Total Trucks Removed or Shortened Percent of Intermodal Trucks Removed or Shortened

The AGD, at an estimated infrastructure capital cost of $14.5M compares favourably to the Rail Cut alternative in terms of truck avoidance potential. However, a direct comparison between the “Rail Cut” options in the earlier study and the Distripark is difficult because the cut could be used by other than container trucks and it would be used one way for all traffic in the South end of Halifax, while the AGD would affect only intermodal traffic from the port as a whole. The AGD at $14.5M promises a 40.5 % reduction of intermodal truck traffic, growing to 48.6% over time, while the use of the Cut would reduce south end truck traffic by an estimated 55% but cost some $40M. At least at the beginning, the capital cost of the facility cannot be fully paid for by the AGD operator and government and other stakeholder funds will be required. It is recommended that the facility be operated by a private sector operator under a long term concession agreement that would be awarded to the qualified operator willing to pay the most towards the capital cost of the infrastructure. The concessionaire would be required to provide handling equipment and take the commercial risk of the business. In summary, the AGD: !

has the potential to reduce the impact of growing truck traffic on city streets;

!

can be commercially viable from an operating perspective;

!

is located in an industrial area that does not appear to have any significant negative environmental or neighbourhood impacts;

!

is consistent with the Port’s strategy to attract transload facilities to Halifax;

!

is compatible with the long term plans of the Burnside Industrial Park;

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Atlantic Gateway Distripark Plan

v

!

is a sustainable solution to the desire of HRM and many other stakeholders to reduce the numbers of trucks on Halifax Peninsula; and

!

uses the rail cut for a rail shuttle.

The next steps, if the project is deemed acceptable to government, are to develop a consensus among the main stakeholders, structure a deal for the financing of the infrastructure between the government and the shuttle operator (railway), and concession the AGD to a qualified operator.

March 2008

1

Atlantic Gateway Distripark Plan

1.0

Introduction

This report is a follow up to a previous study undertaken by the same team of consultants in 2005. Its main purpose was to examine “options” available to the Halifax Regional Municipality in removing trucks traveling to and from Ocean Terminals and Halterm through downtown city streets. The previous study suggested an inland terminal and container shuttle to a site at Rocky Lake was a compelling project with a number of potential winners and few losers, providing the timing was correct. It would reduce peninsular truck traffic and save wear and tear on local roads while reducing air pollution in the downtown core. It was predicated on moving the vast majority of local cargo to port terminals via a rail shuttle and considered a more viable and “greener” alternative to using the CN Rail Cut as a truck route. The financial drivers were based on the avoidance of future cost of capital of alternative options of expanding Halifax port terminals and were timed to be put into place when additional port capacity would be required. Figure 1 – Original Concept, Rocky Lake Inland Terminal

The inland terminal would have increased the capacity of the Halterm and CeresGlobal terminals significantly, and postponed the need to construct a third container terminal, with the timing dependent upon the port’s overall growth.

March 2008

2

Atlantic Gateway Distripark Plan

The previous study suggested the $60M cost of the project could be shared amongst a number of parties who stand to benefit, including Halifax Port Authority, Halifax Regional Municipality, CN, the Province of Nova Scotia, the Municipal Group and a terminal operating company. At the time the previous study was completed, it was apparent that there was not sufficient congestion at either container terminal or in downtown Halifax to justify the inland terminal on pure operating savings. Moreover, whatever port congestion there was in Halifax was related more to moving cargo inland to Quebec, Ontario and the US Midwest, not cargo trucked to local or regional destinations. It was recommended that the Halifax Port Authority and partners adopt a plan to have an inland terminal built by the time the port is handling 900,000 TEUs per annum, which was the port’s estimated capacity at the time. It was also recommended that negotiations begin regarding the Rocky Lake site and that some combination of HRM, HPA and CN reach agreement to acquire this property in a prepared state from the existing quarry owner the Municipal Group. The previous study also recommended that when the existing terminals were within one to two years of reaching capacity, an operating company should be established and that a management strategy be implemented to work with stakeholders (terminals, shipping lines, shippers, and truckers, labour) to ensure a smooth transition to the new entity. The present study was commissioned following the recommendations in the Halifax Inland Terminal and Trucking Options Study to go forward with a plan to be ready when the facility is needed. However, a number of significant changes have occurred since the previous study was completed and the Request for Proposal issued for this study. 1.1 Changes since last study While it is beyond the scope of this project to extensively revise the original trucking study released in January 2006, it is nevertheless useful to quickly review the changes that have occurred since the first study. The original study concluded that there was “not now sufficient congestion at either terminal or in downtown Halifax to justify the NIT (New Inland Terminal)”. It also concluded that the NIT’s justification was contingent on the avoidance (deferral) of the capital cost of developing a NOT (New Ocean Terminal) i.e. a third major container terminal in the Port of Halifax. The NIT was considered “the lowest cost option to increasing port capacity when it becomes required.” It also concluded that “the actual cost to operate the terminal would depend on negotiations amongst the interested parties and how much each was willing to contribute towards achieving a positive outcome. Finally, it recommended that the land should be acquired and reserved for an inland terminal and that “when existing terminals are within one to two years of reaching capacity, an operating company should be formed”. In the past year and a half, a number of events or changes have occurred which could impact on the economic viability of the original project. The following are some of the most relevant changes.

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3

Atlantic Gateway Distripark Plan

1.1.1

Port capacity revised

Following a (yet unpublished) study commissioned by the Port Authority, the capacity of the existing container terminals is now considered to be in the range of 1.4M TEUs to 2M TEUs, compared to the previously used practical capacity estimate of 800,000 to 900,000 TEUs. This puts the need for additional capacity much further into the future since, based on the most recent capacity estimate, the existing container volume is only 25-40% of the port’s capacity versus 60-65% of capacity previously. 1.1.2

Lack of growth

While container volumes declined slightly (3%) in 2004, the container cargo through the Port of Halifax had generally been growing for the past decade albeit at a lower pace than the market; and as of 2005, it was expected to continue this growth pattern. However, the growth in containers moved through the port declined in 2006, to 530,000 TEUs and was expected to be down another 6-8% in 2007 to about 490,000 TEUs. Figure 2 – Port of Halifax TEUs, 2004-2007 2004 525,553

Actuals 2005 550,214

2006 530,722

Projected 2007 490,000

Based on 10 year trend and incorporating the change in estimated capacity, the requirement for a third major container terminal is pushed beyond the foreseeable future. In 2005, assuming the container volume continued on its previous 10 year trend, would have resulted in the volumes reaching the low end of the stated capacity by roughly 2022 while today, (early 2008), the same exercise would indicate that the additional capacity would not be necessary for the next century. The situational differences can be visualized on the two following graphs: 10 Year Trend in 2005

10 Year Trend in 2007

Th 800 ou sa nd 750 s

Th 1400 ou sa 1300 nd s 1200

700

1100

650

1000 600 TE Us

TE Us

550

900 800

500 700 450

600

400

500

350

400 300

300 1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

1998

1999

2000

2001

2002

2003

2004

While these projections are by no means an indication of the realistic growth prospects of the port, the impact of the combined changes (in growth and estimated port capacity) can be clearly seen.

March 2008

2005

2006

2007

4

Atlantic Gateway Distripark Plan

1.1.3

Shipping lines

Shipping lines using the Port of Halifax were concerned their costs could increase. They pointed to the lack of growth in the port to explain the need to improve the cost of doing business in Halifax and see any potential for extra costs as a threat to the port. In the short term they are concerned they will be left to pay the extra costs of any double handling. They also view trucking directly from the container terminals as a flexible and smooth process, compared to having the railway supply rail cars on a shuttle train, and railing the containers inland before being available for delivery, or having ships wait for containers to be shuttled into the terminal for loading. The fact CN had at that time changed its operating policy from having sufficient empty cars available at the port terminals for ship arrivals, to one of just supplying one days worth of loaded cars for unloading at the port, was an issue. CN was concerned about railcar asset utilization and not wanting to keep empty cars available and sitting idle waiting for ships to arrive. Ultimately, any extra handling costs would be passed onto the shipper and the competitive position of local importers and exporters could be negatively impacted. 1.1.4

Port terminals

Both terminals have underutilized assets, and theoretical capacity gains of the proposed Rocky Lake inland terminal are of no value at the present time. The terminals have expanded with more cranes, more tracks, more land and higher stacking of containers. They do not want to relinquish any opportunity to generate revenue and are concerned that any increase in the cost of moving containers through the port would have catastrophic consequences with respect to the port’s viability. They also foresee more containers going to ground and competition between the shuttle and the trains for railcars, negatively affecting non-local traffic. 1.1.5

CN Rail

CN indicated that the inland terminal concept was too futuristic. The company is very focused on operating a railroad, meeting short term goals and maximizing yield from its train operations. They do not feel the need for an inland terminal has been established. In the meantime, the company has stated publicly on several occasions that it is considering building its own transload facility at a site not yet released. In terms of its port operations, CN has reduced the amount of switching at the two container terminals, and continues to seek ways of minimizing their operating costs and maximizing their trainload yield. CN has a significant investment in this key corridor and is looking for ways to bring more traffic in order to maximize their revenue. CN sees Halifax as a gateway where port costs need to be reduced if increases in rail traffic are to be realized. Traffic from Halifax to the US. Midwest has been particularly hard hit and one main reason is the strong Canadian dollar. It has also stated publicly that it is generally concerned about the lack of growth at the Port of Halifax and the port’s ability to fill existing capacity.

March 2008

5

Atlantic Gateway Distripark Plan

1.1.6

Opposition to Rocky Lake site

After this study was awarded, residents in the area around Rocky Lake and Waverly organized themselves to oppose the location of an inland terminal in their neighbourhood. Public meetings were scheduled to be held to discuss the project and its potential impact. Even though these meetings were not held with the consulting team, feedback received both directly and indirectly, indicated there was substantial and mounting opposition to locating the terminal on Rocky Lake Road 1.1.7

Transload

On a more positive note, transload facilities which were still in the planning stages in 2005 are now a reality, with the opening of Consolidated Fastfrate’s facility in Burnside Industrial Park. The industry is growing at a much faster rate than the local market or the inland (rail) market. There is an opportunity for this cargo to be delivered at lower overall cost if such facilities are located in close proximity to the port to reduce trucking distances. A study, “Building the Transload Sector in Halifax” was completed in 2007, looking at the ways in which a Distripark would assist port growth, to determine the value of such a concept and identify the transportation characteristics necessary to make it work. 1 This study pointed to the need of having transload facilities located close to the port in an integrated fashion to reduce handling costs. However the reality is that there is insufficient property at either port terminal to realistically provide this benefit. Furthermore, transportation facilities do not typically locate on prime real estate in the city core. Trucking and railway yards continually retreat to the outskirts of cities because their types of business cannot afford to be located on expensive real estate. The exception of course is the ports, which are generally tied to and surrounded by the cities they serve. However, the very dock areas they occupy have, in many cases become the very centres of urban redevelopment and “liveable cities” strategies. Waterfront property is viewed as prime and condominiums are replacing dock warehouses everywhere in the developing world, and Halifax is no exception. This makes it difficult and very expensive for ports such as Halifax to acquire additional waterfront real estate. The Transload Study concluded there would be benefits to the development of a Distripark. However, based on the widespread locations of the various transload activities involved in the delivery chain, and in particular the amount of traffic to and from the Burnside area, the related transportation costs and/or real estate costs would make the goal of taking cost out of the delivery chain very difficult to do on a significant scale. Based on all of the forgoing, the authors looked at whether there was a way in which the benefits of providing a real Distripark Terminal, including the goal of an overall reduction in the cost of the delivery chain, along with reducing truck traffic in the city, could be achieved.

1

MariNova Consulting Ltd., “Building the Container Transload Sector in Halifax,” Greater Halifax Partnership,

2007.

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Atlantic Gateway Distripark Plan

6

Since there was no portside property available, could an inland terminal be designed to be an integral part of a transload facility, and still reduce overall costs?

March 2008

7

Atlantic Gateway Distripark Plan

2.0

Literature Review and Case Studies

There is a rich and growing body of literature and studies relating to a number of related concepts – inland terminals, inland ports, logistics parks, distriparks, and dry ports. While not required in the Request for Proposals or project scope, it is useful to review these, as well as some case studies, because Halifax is not the only community seeking such options. The previous study examined three case studies in Auckland, Vancouver and New Orleans. The New Orleans terminal was badly impacted by Hurricane Katrina and remains closed, and there have been a number of interesting developments impacting the other two examples. We have also found a number of other studies of similar concepts in Virginia, Sydney (Australia), and Gothenburg, which are summarized herein. 2.1 Auckland In 2005, Auckland was developing plans for five inland terminals outside the city. The initiative began as a capacity issue for the port, as it was (and is) running out of space on the waterfront. The Auckland region has a population of about 1.15 M and the port handled 773,160 TEUs in FY 2006-07. The port is presently about two to three years away from running out of capacity, which is when their inland terminals will really be needed. To some extent, Auckland’s inland terminal initiative was also a competitive response to the port of Tauranga, located 200 miles away, which has its own intermodal terminal, Metroport, located within Auckland’s city limits. Given its distance from the port, Tauranga’s Metroport would be more akin to a North American intermodal port, such as those in Montreal or Toronto, although on a smaller scale. A major difference is the fact that Tauranga subsidizes the service as a means to increase its share of the Auckland market. The results have been impressive, with the port increasing its volumes 500% since establishing Metroport, and the intermodal facility itself handling 138,000 out of the port’s total of 466,000 TEUs in FY 2006-07. In Auckland, one small terminal is operating in East Tamaki, primarily serving a large manufacturer of white goods, Fisher and Paykel. This one hectare facility is 18 kms from the port, and is only served by truck, primarily in off-peak periods, from 1700-0300. A new facility is under development in Wiri, about 25 kms from the port. This facility will be 10 ha in size and is expected to be served by rail shuttle within the next 12 months, assuming operating details can be worked out with the railway. It is expected that a distripark will emerge “naturally” and there is another 5 ha available for this purpose.2

2

Interview with Grange Pole, Manager Inland Ports, Ports of Auckland, 22 January 2008.

March 2008

8

Atlantic Gateway Distripark Plan

Figure 3 – Auckland Inland Ports

<3.4+(_ 234-) 3: F.+9,%&/

One of the big challenges is in getting shippers to use the terminal. One incentive that has been tried is increasing the demurrage charged at the port and reducing it at the inland terminal. At the port it is $75.00 per day after four days; at the inland terminal it is $20.00 per day after six days. In marketing the facility, the port concentrates on the shipper rather than the shipping line, because the shipper gets better access to cargo and containers. The terminals in Auckland, including the two main container terminals and the inland terminals, are operated by the port, through various subsidiaries and its wholly-owned stevedoring company. The port itself is owned by the Regional Council. 2.2 Vancouver The 2005 MariNova study examined a facility called Coast 2000, which was built as a socalled inland terminal by the Vancouver Port Authority and a local real estate developer, Modalink. The VPA subsequently sold its 50% share to Western Stevedoring in 2004. In actuality, this facility is really a transload facility, but it does facilitate a more efficient movement of containers in the Vancouver region by balancing out import and export moves and reducing the number of empty container moves.

March 2008

9

Atlantic Gateway Distripark Plan

In 2006, the BC Ministry of Transportation completed an inland terminal study.3 It identified five key success factors: 1. 2. 3. 4. 5.

an adequate catchment area; availability of suitable land; reliable and competitive rail service; good access to a highway network; and phased development to limit initial capital investment.

According to their research, most European and North American inland terminals are predicated on import traffic, the fastest growing part of the market. Congestion at on-dock rail terminals in the Lower Mainland is viewed as the major challenge to system efficiency as is the imbalance in the supply of empty containers returning from the east to on-dock facilities, to be loaded with local exports at transload facilities. The development of a facility to ‘rationalize” the handling of empty containers was seen as the best opportunity for the use of an inland terminal in the Lower Mainland. The prime obstacle identified to obtaining rail service for an inland terminal was the potential impact on mainline rail operations. Two options were considered, an empty container terminal in the Lower mainland and an export transload-oriented terminal. Three size options ranging from 50-225 acres were considered, with costs ranging from $38M to $148M, exclusive of land costs. The smallest terminal would have capacity to handle 150,000 TEUs per annum. A site was picked at Matsqui Junction, about 45 miles from existing transload warehouses. The location of the terminal made it uncompetitive with the existing system because of increased trucking costs. However, it was determined that having a cluster of import distribution facilities located at the same location would vastly reduce the costs of drayage. Combining an inland terminal with an integrated logistics park was also considered but a large land assembly in the Lower mainland was thought to be very difficult and expensive, and it would be difficult to relocate several new facilities recently constructed. One conclusion was “more rapid expansion of container-handling facilities adjacent to the on-dock container terminals, may offer better efficiency and increased levels of service if it can be accomplished”. Moreover, the authors considered the co-location of an inland terminal with an integrated logistics park to be a “best practice”.

3

BC Ministry of Transportation, “Inland Container Terminal Analysis, Final Report,” IBI Group, 12 December

2006.

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Atlantic Gateway Distripark Plan

10

Figure 4 – Transload Facilities in Lower Mainland BC

<3.4+(_ `I&,%&/ #3&-%*&(4 E(4>*&%, F&%,0)*)K ^*&%, A(534-aK I[I L43.5

2.3 Virginia Inland Port In 1984, the Virginia Port Authority began to examine ways to increase its market share. Their inspiration came from a facility owned by the port of Rotterdam, near the German border, about 120 miles from the port at Venlo in the Netherlands.4 Along with the Norfolk Southern railway, they determined that an inland terminal could be a means to extend the port’s hinterland into Ohio, Pennsylvania, Maryland, West Virginia, New York and Virginia itself. Most of this hinterland was being served by the Port of Baltimore. A site was selected in the Shenandoah Valley near Front Royal. It had access to two interstate highways and 1,400 ft. of rail trackage alongside. The initial concept was to run three trains per week, moving a total of 20,000 TEUs per annum. Initially, marketing was focused on cargo being trucked or moved by barge to Baltimore. By 1996, the facility had grown to 40 acres with over 17,000 feet of rail track and was handling about 100,000 containers per annum, all of which was considered new business for the VPA. VIP provides all the services that a port terminal does including at least 6 trains per week, warehousing, customs, very flexible operating hours, a chassis pool, and reefer plugs.

4

J. Robert Bray, “Virginia Inland Port: The Case for Moving a Marine Terminal to an Inland Location,” prepared for AAPA Port Authorities Professional Port Manager Program, September 1996.

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11

Effectively, the port was moved 220 miles inland. Once operational, the VPA joined with Washington Dulles International Airport to attract warehouse/distribution facilities to the corridor connecting the two facilities. There are now over 80 distribution centres operating in Virginia, with over 30M sq. ft. of warehouse space, averaging 375,000 sq. ft. 2.4 Sydney, Australia Sydney is the largest container port in Australia, handling about 1.6M TEUs in 2006. A number of years ago, Sydney Ports Corporation decided to move its entire container handling facilities to nearby Botany Bay, about 12 kms south of the central business district. A new AU $1B expansion has been underway since 2006. Coincidentally, the port is also embarking on the development of an Intermodal Logistics Centre (ILC) at Enfield, about 25 kms from the city centre and 18 kms from Port Botany.5 The project will cost AU $165M, but we have not been able to determine who will pay for it nor the operator. At the present time, about 20% of containers are moved in and out of the port by rail. With the development of the ILC and intermodal shuttle service, it is expected to increase to 40%. To be successful it was determined that a potential site had to have: ! ! ! ! ! ! !

close proximity to the area it serves; connected to a rail line; within easy access of trucking routes; located in an industrial area; large enough to allow other freight-related activities to take place; a large market nearby; and environmentally and socially sustainable.

It is expected that each train will carry between 60-80 TEUs. The Enfield ILC will be built on a 60 ha site, with a 12 ha intermodal facility. Total capacity is expected to be 150,000 TEUs, with potential to grow to 300,000 with further expansion, and there will be enough space provided for six warehouses of 650,000 sq. ft. It is expected that the ILC will resulting a competitive alternative to moving containers by truck and that “delivering containers closer to their origin and destination improves delivery cycle times and reduces trucking costs. Empty container storage on site can further reduce costs and unnecessary truck movements, compared to current practice, where empty containers are generally trucked back to the Port Botany area.

5

Intermodal Logistics Centre at Enfield, Project Overview, Sydney Ports Corporation, January 2006; See also “Developing Freight Hubs: A Guide to Sustainable Intermodal Terminals for Regional Communities, Department of Transport and regional Services, Government of Australia.

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Atlantic Gateway Distripark Plan

Figure 5 – Enfield Intermodal Logistics Centre, Port Botany

<3.4+(_ <0/&(0 234-) #34534%-*3&

2.5 Gothenburg, Sweden There have been numerous initiatives in Europe, but especially the Baltic and North Sea regions, which have been promoting the concept of “dry ports”, inland freight terminals or inland ports, along with transport logistics centres, and rail service. SustAccess, which promotes Sustainable Accessibility between Hinterlands and Gateways around the North Sea, views them as critical infrastructure in the development of gateways, which themselves are viewed as “promoting sustainable and efficient transport and logistics”.6 A dry port is defined as “an inland intermodal terminal directly connected to a seaport, with high capacity traffic modes, where customers can leave/collect their goods in intermodal loading units, as if directly at the seaport”.7 It also provides a “set of efficient services such as

6

“Feasibility Study on the Network Operation of Hinterland Hubs (Dry Port Concept) to Improve and Modernize Ports’ Connections to the Hinterland and Improve Networking”, Intergrating Logistics Centre Networks in the Baltic Sea Region, FDT Association of Danish Transport Centres, January 2007; SustAccess, “Improving Connection between Gateways and the Hinterland”, Region Vastra Gotaland, November 2005; Andrius Jarzemskis, Aidas Vasillis Vasilliauskas, “Research on Dry Port Concept as Intermodal Node” Transport Research Institute, Transport - 2007, Vol. XXII, No. 3, 207-213. 7

V. Roso , J. Woxenius., G. Olandersson, “Organization of Swedish dry port terminals”, A Report in the EU INTERREG North Sea Programme, Chalmers University of Technology, Gothenburg, 2006.

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Atlantic Gateway Distripark Plan

transhipment, storage, depot, maintenance of containers, customs clearance, and tracing and tracking”.8 A fully functional dry port is believed to increase the energy efficiency and the environmental performance and relieve road congestion of port cities.9 Removing seaport functions from the port area also frees up valuable space on waterfront lands. There are three types of dry ports: “distant” dry ports, “mid-range” dry ports and “close” dry ports. In the North American context, a distant dry port would be akin to CN’s intermodal terminals in Montreal, Toronto and Chicago. A mid-range dry port would be similar to the Virginia Inland Port described above or the proposed Inland Port at Moncton, and is generally a distance away that could also be served by truck. As described above, VIP is about 330 kms away from the port. The best example thus far of a “close” dry port in North America is the Alameda Corridor serving Los Angeles/Long Beach. The close dry port concept is the most relevant to this study. In many ports, “the main problems seaports are facing are lack of space or inappropriate inland access”.10 Ports can therefore increase their capacity by establishing a close dry port in their immediate hinterland or at the outer fringes of the city. With increased terminal capacity comes the ability for increased productivity since larger vessels may then call at the port. The close dry port also “consolidates road transport to and from shippers outside the city area offering a rail shuttle to the port relieving city streets and the port gates”.11 Gothenburg, the second largest city (regional population 510,000) in Sweden and largest port in the Baltic, is connected to its hinterland through a network of rail shuttles as well as close, mid-range and distant dry ports. In 2006, the port handled 820,000 TEUs of containers and another 1M short sea roll on-roll off units. Gothenburg has 22 rail shuttles to various inland destinations including one operated by Green Cargo AB to a dry port 10 kms from the port. This shuttle operates 6 times per week. Gothenburg also has an intermodal freight centre (IFC) or cargo village at Gullbergsvass, 8

V. Roso, “Evaluation of the dry port concept from an environmental perspective: a note”, Transportation Research, An International Journal, Part D 12 (2007), 523-527. 9

“Sustainable technology options and policy instruments: Report no. 3 Appendix, European Panel on Sustainable Development, 2006-05-16. 10

Ibid., p. 8.

11

Ibid., p. 9.

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Atlantic Gateway Distripark Plan

which is connected to the Green Cargo dry port. Despite good inland rail connections, however, only 30% of Gothenburg’s container cargo arrives by rail.12 The Green Cargo terminal at Gullbergsvass handled 15,000 TEUs in 2007. Thus far in the gestation of dry ports in Sweden, at least, they have not been linked to the development of distriparks, cargo villages or intermodal logistics centres.

12

V. Roso, “The Dry Port Concept: Applications in Sweden”, Chalmers University of Technology, Division of Logistics and Transportation, 2005.

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Atlantic Gateway Distripark Plan

3.0

The Atlantic Gateway Distripark Concept

The study team proposes a new and much less expensive concept for a combination transload-and rail driven Distripark and empty container terminal that takes advantage of existing rail infrastructure to link the Distripark and the port and build on the port’s recent success in attracting transload and distribution business to the Halifax gateway. Figure 6 below provides an overview of the Halifax area under discussion, showing North Burnside with the proposed Burnside Expressway and Distripark site. Figure 6 – North Burnside with Burnside Expressway

Our new concept is a hybrid combining the “close” dry port and the Distripark in one location 18 kms from the port, at the north end of Burnside Industrial Park, adjacent to the proposed Phase 13 Transportation Node in Burnside Industrial Park. The new concept is not a rail spur, but a Distripark Terminal. Initially, it is envisioned that CN will operate one rail shuttle per day with dedicated equipment in each direction, taking containers to and from both container terminals. The concept uses the rail cut for rail traffic. This report assumes using traditional diesel-electric locomotives presently assigned to service in Halifax, to avoid additional costs. However, CN or other stakeholders may want to consider the use of environmentally-friendly hybrid locomotives specifically for this service, which may prove advantageous with respect to applying for federal infrastructure money. The concept is commercially-driven and provides a competitive alternative to trucking. It will provide a less expensive delivery chain for transload containers than the current system of trucking from Halterm and Ceres port terminals. There is no diversion or building of new rail routes required, and it links up with the proposed Burnside Expressway and other synergies. The basic concept is illustrated below:

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Atlantic Gateway Distripark Plan

Figure 7 – Distripark Terminal Concept Burnside Industrial Area

Present Situation Port Terminals Port Labour Empties

Across City Dray

Atlantic Gateway Terminal Concept Port Terminals

Atlantic Gateway Distripark

Burnside Industrial Area Distripark

Gateway Labour Yard Shunt

Empties

Yard Shunt

3.1 The concept Under the present situation, import cargo that arrives at the port to be transloaded locally is picked up by truck and driven to a transload facility. The empty container is generally returned to the port by truck. The same container is later picked up by truck to be positioned to a shipper for loading of export cargo. Finally the loaded export container is then trucked to the port for vessel loading. Thus the container may make as many as four trips in the process. This situation is a result of different processes for import versus export cargo, as well as having a wide dispersion of facilities which can add cost to the system. The first priority for a successful Distripark is to design a facility which maximizes the number of processes which can be centralized into one location. These processes include the unloading of containers, inspection, empty storage, repair, reloading of the container, all without using normal gate restrictions, public roads or highways with their accompanying licensed chassis and licensed truck drivers. The design needs to provide lower cost yard jockeys to be respond to the need of containers using shunt trucks and yard chassis within the park, avoiding road tractors and road chassis. More importantly, it must be designed to provide competing transload operators, various forwarders and transportation companies to have access to this integrated facility, while still maintaining their independent public road access. Finally, the facility, while it cannot be on the port, needs to be directly tied to the Port of Halifax in the most economical manner. The best way to achieve this is finding a site that can feature a direct and dedicated rail shuttle service, close to existing industrial users while also having great public road access. This concept proposes using a shuttle train which not only can move containers more cheaply on an operating cost basis, even when adding an additional lift in the process, but is also a competitive service in addition to trucks, and not a “forced” fit for all port traffic. This last point is the most important one of the concept. Trucks are faster, more versatile and for some moves – of more value than a rail shuttle. Thus, this concept promotes a competitive chain of delivery that can deliver a more cost effective product for those products that are the best fit March 2008

Atlantic Gateway Distripark Plan

17

for this type of service. This way the shuttle becomes a competitive transport mode and remains a commercially driven product. This in turn means that the better “value” for a given movement will determine its routing. The Distripark Terminal is designed as an integrated facility as shown in Figure 8. Figure 8 – Atlantic Gateway Distripark Terminal Concept

The concept shows nine (9) transload sites varying in size from 14-30 acres located to one side of the container facility. Each of the nine facilities has normal public road access to their premises identified by the orange coloured road way above. Each operator has their own facility designed to their own specifications, based on their particular business. (The blue line above indicates private roads connecting each site in the terminal. The red line indicates public roads to and from Phase 13.) Most importantly, each facility has access to a “back door” through their own back gate which allows for the seamless movement of containers between the transload operator and the terminal facility shown in blue, without access to public roads and related costs. The gate mechanism at “C” location is simple and is set between the terminal and each of the transload facility operators. Traffic can also move between transload facilities as well, for maximum flexibility. For movement between the transload facilities and the terminal, jockeys report with key input and cards as well as being recorded on camera, Security for movements entering each of the transload operators properties are determined by each operator.

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The terminal facility includes a rail unload/load area for the shuttle train. In addition it has container empty storage areas as well as yard chassis for direct loading of containers to be moved around the Distripark. Finally, it has a main public road gate that is open 24 hours for ease of access. Trucks using public roads can travel either directly to the main divided highway or to the already established adjacent Burnside industrial area. The train shuttle runs with dedicated car sets, and a regularly scheduled run, just like a commuter train. Dedicated car sets ensure consistent capacity and availability as well as allowing for a reservation system to be put into place as necessary. The regularity of schedule, such as would be the case with a commuter train, provides for operating reliability. Everyone knows when this train operates. The container facility would also include container repair, empty inspection, cleaning and services. Figure 9 shows the movement of a typical Import loaded container that would be transloaded at the Distripark. The yard shunt reduces road miles, dray labour, wait time and can be done at any time night or day. Figure 9 Atlantic Gateway Terminal Concept Transload Imports Port Terminals

Atlantic Gateway Distripark Gateway Terminal Labour Yard Shunt

Burnside Industrial Area Distripark

Transload Facilities

Figure 10 below shows the reverse operation. Here a typical export load that has been loaded at the transload Distripark, is placed on the rail shuttle and sent to the Port. It should be noted that export loads can often ordered at the last minute in large quantities, which can provide problems in terms of having sufficient tractors available to haul the quantities in time to meet the vessel sailing. The rail shuttle provides the alternative and opportunity to handle such volumes more efficiently to the port.

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Atlantic Gateway Distripark Plan

Figure 10 Atlantic Gateway Terminal Concept Transload Exports Port Terminals

Atlantic Gateway Distripark

Burnside Industrial Area Distripark

Gateway Terminal Labour Yard Shunt

Transload Facilities

Finally, Figure 11 shows the use of the container terminal as a storage depot for empty containers. These can be used for serving road chassis bringing empties in or taking them out to remote facilities, as well as serving any other requirements (cleaning, repair) for those empties being moved within the facility. Figure 11

Atlantic Gateway Terminal Concept Atlantic Gateway Distripark

Burnside Industrial Area Distripark

Gateway Terminal Labour Road Transport

Yard Shunt Transload Facilities

These three processes (i.e. import loaded transload containers, export loaded transload containers and empty exchange service) provide the opportunity for significant cost savings in the transload supply chain.

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4.0

Functional Site Plan

4.1 Rail network Halifax serves as the eastern terminus for CN train operations. The Bedford Subdivision covers the local route between Truro and Halifax. Heading east toward Halifax the Dartmouth Subdivision branches off at Windsor Junction (mi. 15.8) thereby providing a connection between the CN mainline and Dartmouth, as shown in Figure 12. Figure 12 – Rail Network

Continuing into Halifax on the Bedford Subdivision from Windsor Junction, over 95% of the freight rail traffic is comprised of containers bound for the port terminals of either CeresGlobal or Halterm. Originally this section was a two track mainline between Halifax and Windsor Junction. Frequent trains plus slower speeds owing to the heavy 1.5% ruling grade between Bedford (mi. 9.5), (elevation 5 M) up to the Rocky Lake Quarry (mi. 12.7) (elevation 60 M), provided the impetus for double tracking this section. In 2004 a hurricane washed out a section of one of the 2 tracks near Bedford, which resulted in CN removing the second main track from mileage 7.0 to Windsor Junction. There is still the ability for trains to

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pass in the section since the Halifax Transfer Track (formerly the second main track), runs as an additional track between mileage 4.5 and mileage 7.0 through Rockingham yard. The mainline officially ends at the east end of Rockingham yard at Fairview Junction (mi 5.0). Here the Deepwater Branch diverges at Fairview Junction from the mainline, connecting the CN domestic intermodal terminal (HIT). The former double track mainline continues as a single yard track through the cut toward Halifax passing the Chester Spur (mi 4.5), and is designated the HOT-Rock Connecting track. CN removed one of the two main tracks several years ago in the cut, leaving only a second yard service track between mileage 2.5 and mileage 1.4. From mileage 1.4 two tracks branch into the HOT terminal yard. The VIA station is located at mileage 0.0 Bedford Subdivision. The CN Dartmouth Subdivision descends eastward from Windsor Junction, passing under Highway 102, passing by the community of Waverly, dropping down toward Lake William and then climbs toward the Burnside Industrial area. It finally descends into the Bedford Basin and downtown Dartmouth. The Dartmouth Rail yard is located in prime downtown real estate at the waterfront and is used as a support track for various industries but primarily as a holding area for empty auto rack railcars waiting to load imported automobiles at the CN Autoport facility east of town. 4.2 The distripark terminal The site location is adjacent to Phase 13 of the Burnside Industrial Park. Figure 13 – Distripark Terminal

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Atlantic Gateway Distripark Plan

The area to the east of the site is designated to be used as a Transportation Node. The 64 acre terminal site is entirely on Municipal Group land, lying just east of the CN Dartmouth Subdivision as shown below. Thirty-two of these acres will provide the initial terminal area. The terminal will lie at an approximate elevation of 40 metres above sea-level. This is approximately the same elevation as the CN Dartmouth subdivision where the proposed Burnside Expressway will pass overhead at the south end of the proposed terminal. The terminal property abuts Phase 13 of the Burnside Industrial Park to the east, which is the latest proposed development for the Burnside Industrial Park. This results in local truck access which can be provided through Phase 13 if it is modified for this purpose. One benefit of this plan is that the Distripark itself can be accommodated with little variation to Phase 13. This is shown in Figure 14. Figure 14 – Distripark Terminal Conceptual Layout

Conceptual layout showing 9 properties with both direct “back door” terminal access plus public road front door access. Termina

1

3 5

4

6 9

4.2.1

2

7 8

Rail access

As seen in Figure 14 above, the terminal will be double ended, with two pad tracks of 3200 ft in length plus a service track for operational purposes. Since all tracks will be double ended, maximum flexibility for shuttle train access will be provided. There may be a need to provide an easement wider than the existing 100 ft railway right of way, through “Ungranted Lands” to the north of the terminal in order to allow rail access based on railway gradients. The following is a cross-section showing a typical layout of the proposed container Terminal.

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Atlantic Gateway Distripark Plan

Figure 15

4.2.2

Road network

This section describes transportation impacts of the proposed Inland Terminal and Distripark to the overall transportation road network. Also, it provides an overall description of the proposed location, access concept, and results of the initial feasibility assessment of the proposed access/connectivity solution. As described above the proposed location for the Distripark is adjacent to the north-west side of the Phase 13 development lands of the Burnside Industrial Park along CN Dartmouth Subdivision track. This location was selected from several alternatives as described earlier in the report. The proposed location offers several significant benefits, from the access/connectivity perspective, resulting from the proximity to the existing and future major highways (the proposed extension of Highway 107) and interchanges (the Highway 107/118 interchange and the proposed Highway 107/Akerley Boulevard interchange), and the Burnside Drive extension. Probably the most significant benefit of the proposed Distripark development for the overall transportation/road network is to curb the growth of truck traffic related to the Halifax container terminal operations from Downtown Halifax and the MacKay Bridge. The number of trucks using both terminals was 72,250 in 2006 (according to the 2006 Trucking Report). Approximately 700 truck trips related to the container operations at both terminals are accounted for daily in Halifax. Table 1summarizes existing annual truck volumes generated by the Halifax port terminals and their distribution. Figure 16 illustrates the existing situation. Table 1: Annual Truck Volumes Generated by the Halifax Port Terminals, 2005 (pre-transload) Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Total Trucks

Halterm

4,550

853

284

15,750

3,500

1,313

26,250

Ceres

7,973

1,495

498

27,600

6,133

2,300

46,000

Richmond/HIT

10,400

1,950

650

N/A

N/A

N/A

13,000

Total

22,923

4,298

1,433

43,350

9,633

3,613

85,250

% of Total

27%

5%

2%

51%

11%

4%

Annual Truck Volumes

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Atlantic Gateway Distripark Plan

Figure 16

All truck traffic generated by the proposed new Distripark facility (the Terminal and Distripark subdivision) will access a highway network adjacent to the proposed site, and will be distributed through this network to their destinations throughout the Region, Province and outside without affecting Downtown streets. Table 2 below presents anticipated initial volumes and distribution of truck traffic from the proposed Terminal/Distripark, while Figure 17 depicts the related future truck traffic operations and illustrates the relief from truck traffic provided to the Downtown area by the proposed solution. Table 2: Year 1 Annual Truck Volumes Generated by Ocean Terminals Number of truck moves to/from AGD WEST via 107 connector Number of truck moves to/from AGD EAST via 107 connector Total

8,190 53,236 61,426

13% 87% 100%

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Atlantic Gateway Distripark Plan

Figure 17

The truck traffic issue in Downtown Halifax will aggravate in the future as significant growth in port terminal operations, particularly relating to Transload is anticipated. The projected growth of ports operations (and related growth of truck traffic) provides additional justification for the proposed Distripark project. Table 3 presents projected growth of truck traffic (projected truck traffic annually and average daily) related to the operations of the proposed facilities. Table 3: Projected Truck Traffic Generation (Terminal/Distripark) Year Total Annual No. of Trucks Average Daily No. of Trucks

2009

2013

2018

2023

2028

61427

74301

94253

119561

151666

246

297

377

478

607

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Atlantic Gateway Distripark Plan

Figure 18

This truck traffic will be using in the future Highway 107 Extension/Burnside Expressway – a new connector between Highway 102 and Highway 118 (not built yet). NS TIR is currently completing the feasibility study and preliminary design of the Highway 107 Extension. As part of the project, an extension of Burnside Drive is also proposed. This new road will be connected with Highway 107 through a partial interchange. A full interchange is proposed at the proposed crossing of the extension of Akerley Boulevard to the Phase 13 subdivision proposed by the Halifax Regional Municipality as an expansion of the existing Burnside Industrial Park. Figure 18 presents the future connections of the proposed site and the adjacent Phase 13 development to the provincial (highway), regional and local road network. 4.2.3

Terminal Road access

To facilitate the connections as described above a preliminary access network concept was developed and is presented in Figure 19.

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Atlantic Gateway Distripark Plan

Figure 19

We propose to expand the partial interchange between the Burnside Drive Extension and Highway 107 (the NS TIR project) to a full interchange and provide exclusive access for truck traffic to/from the Terminal and Distripark. This interchange will also provide direct connectivity to the Burnside Industrial Park through the proposed Burnside Drive extension. The proposed Long Combination Vehicle (LCV) assembly facility would benefit from a direct highway access through the interchange. An expansion of the originally planned Phase 13 internal road network is proposed to provide public gateways to the Distripark. This network culminates at the proposed Highway 107/Akerley Boulevard interchange (the NS TIR Highway 107 extension project) and, in addition to providing access to the Highway 107, connects the proposed site and the whole Phase 13 area to the rest of the Burnside Industrial Park (via existing Akerley Boulevard). There will be also internal private roads connecting Distripark lots and the Terminal. During the course of this Study we attempted to assess the feasibility of the proposed road network concept and coordinate our solutions with the Phase 13 plans and the Highway 107 Extension project (based on available information). It has to be noted that the NS TIR’s Highway 107 Extension project is in a preliminary stage of development. Further close coordination with the Regional/Local Municipalities and NS TIR will be required during subsequent planning and design stages of the Distripark project.

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Atlantic Gateway Distripark Plan

4.3 Terminal capital costs It should be noted that we assume the Distripark development will be undertaken by a developer in conjunction with the city and other stakeholders. As in Figure 9 above, land for the Distripark will have to be acquired from three different owners, Chappell, Webby and Shortt. So the Distripark area is not included in our cost assumptions. The terminal proper will require property from Municipal Group as well as at least easement rights to a portion of the ungranted lands for the rail access at the north end of the intermodal terminal. The cost of these is also not included in our calculations. Opinion of Probable Terminal Costs 1. "Average Probable Costs" shown in Table 4 are based on a multifunctional intermodal terminal design that typically includes the following items: ! ! ! ! ! ! ! ! ! ! ! ! !

pad, support, and lead tracks including crossovers, ladders, and connections; asphalt/concrete/granular pad area designed for loaded container stacking up to four high; entrance/exit gate including queue lanes, kiosks, islands, truck & employee parking; building for operations/administrative staff; ground-air system for charging trains; site security incl. chain link fence, gates, and CCTV system; IT systems conduits for typical communication and inventory systems requirements; drainage system including: ditches, storm sewers, and retention ponds; internal access roads, at-grade railway crossings, and connection to external roads; yard lighting sufficient for night operations; culverts and bridges for minor road and water crossings; typical site preparation measures incl. clearing, building demolition, etc.; and typical environmental features such as oil/water separators, erosion control, etc. Table 4 DISTRIPARK TERMINAL ($M)

CONTINGENCIES TOTAL

2.2 2.3 4.2 0.7 0.3 0.3 0.6 0.2 0.2 0.4 11.4 2.1 13.5

LOCAL ROAD ACCESS GRAND TOTAL

1.0 14.5

GRADING TRACK PAVING GATE STRUCTURES BUILDINGS ELECTRICAL ENVIRON'L SIGNALS & COM ENGINEERING

SUB TOTAL

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Atlantic Gateway Distripark Plan

2. Excludes: ! ! ! ! ! ! !

costs for bulk rock excavation; costs for all major environmental mitigation, remediation, design, etc.; cost of any major utilities crossing the site; construction cost of bringing site services to the site, other than road access; all costs for other road changes and improvements outside of the terminal; costs for noise or light abatement; and costs for land acquisition.

Notes: Probable costs are based on year 2006 average construction costs. No field information is available for preparing this estimate (i.e. geotechnical, survey, hydrologic, etc.) Finally the option of turning the planned Burnside Expressway (107) interchange at Burnside Drive into a full interchange for access at the south end of the facility will cost approximately $6M. The primary reason for this interchange is not truck traffic to the terminal, but to provide for an LCV assembly point. 4.4 Rail shuttle operations The Burnside site, while being the furthest alternative site from the port terminals by an additional 8 rail miles, nevertheless has the best features to become an integrated Distripark Terminal. The rail route the new location is traced as the yellow line shown on the tracks in Figure 20 below. Figure 20

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4.4.1

30

Purpose

The Rail shuttle has two basic operational requirements: 1. Carry local export transload containers from the Distripark which have been loaded with export to the two port terminals by rail. 2. Conveyance of locally destined import containers from the two port terminals to NIT by rail where those containers are to be de-stuffed as well as containers whose final destination is more closely served by the new Distripark terminal. Unlike the Rocky Lake proposal, the shuttle train is designed to run with essentially a fixed consist, without additional switching on a commercial basis carrying transload traffic to and from the Distripark as required, eliminating a substantial number of empty container truck moves to and from the port terminals as well as replacing some of the loaded container moves that presently move by truck. 4.4.2

Requirements

The Shuttle would operate 18.6 miles Halterm/Ceres to new Distripark location on Dartmouth subdivision via Windsor Jct. and then return over the reverse route. While this site involves more miles of travel than the Rocky Lake Site, it has the benefit of not having to remove or construct any substantial track, other than the rail access to the new terminal location. Since there is no direct wye at Windsor Junction to connect Dartmouth/Halifax rail routing directly, we assume train operation will use the wye at the junction to reverse the train movement or alternatively, runaround the train at Kinsac, which is first siding west of the junction. A new wye connection at this location could be added for roughly another $1M$2M if required for other pure operational reasons. Those reasons could be that Kinsac is already used as a set-off /lift track for other rail traffic and therefore is occupied part of the time, and there are other issues using the Windsor & Hantsport Railway shortline tracks at the wye. CN has indicated they would prefer the new wye connection to be added at Windsor Junction, but this has not been costed. The train schedule would operate to Port requirements. We assume normal operation of 5 days per week at four hours average round trip, although based on labour contracts this could work as a six-day-if-required assignment. The crew would most start at Halterm late in the evening, running to Ceres were it would lift cars for the Distripark. It would immediately return from the Distripark terminal back to the Port area in the early a.m. working one round trip per working day. This way the crew would originate and terminate at the port end. The shuttle could operate 2 round trips if necessary on a given day (i.e. 4 hours + 4 hours (with some overtime for crew if necessary) but we do not anticipate volumes would require that need on any regular basis. We assume DS rail cars are dedicated in this service to handle the import/export containers. There would be two "sets" of DS articulated well cars each with 50 platforms (ten 5-paks) (about 3000 ft each train set). A typical 125 ton articulated 5-pak railcar is shown below in Figure 21. This car is designed to carry standard ISO 40 ft and 20 ft container weights, up to a maximum of ten 40-ft containers.

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Atlantic Gateway Distripark Plan

Figure 21

To reduce unnecessary switching and allow railcars to always be available for unload/loading, one set of railcars would always be left at the Distripark terminal, and the other set would be split and left at the port terminals. Each set could move up to 100 – 40 containers per set of railcars each way on their round trip. The sets would be split at the port terminals based on percentage of requirement from Halterm or Ceres. Currently that would be four 5-paks or 1200 ft for Halterm Terminal and six 5-paks or 1800 ft for Ceres Terminal. To clarify this point, this means this means the shuttle train will arrive with one set of cars at the Distripark terminal, set them off, run-around the other end of the terminal, couple onto the second set of cars which have been loaded and then depart. This operation constitutes less than two hours work for the shuttle train at the Distripark terminal and allows one crew to be used from the port terminals to the Distripark terminal and back again within 8 hours. We calculate about 50 containers average per day each way to start the service. The variance on any given day would be between 30 and 80 containers per train – depending upon vessel and pricing. The advantage to this proposal is there is always the "competitive" alternative to have individual containers trucked if necessary at a higher cost, so there is operational flexibility in our approach. In addition, as the volumes by shuttle increase beyond 10 containers moved per train, the actual costs drop dramatically per container, which will in turn entice more traffic to rail. 4.4.3

Existing train service

As shown in Figure 22, the mainline is predominantly a single track mainline with sidings spaced approximately every 10 miles to allow opposing train movements to pass one another. Trains are identified by number, with odd numbered trains operating westbound and even numbered trains operating eastbound. West of Windsor Junction, trains from the Halifax as well as Dartmouth side of the basin combine to keep this section fairly busy. At least 12 trains per day plus extras move over this section. East of Windsor Junction, on the Dartmouth Subdivision general manifest trains 307 and 308 carry autos and other commodities. In addition, Gypsum unit trains make 2 round trips daily between the National Gypsum dock near Burnside and the East Milford mine. These unit trains are numbered U701, U702, U703, and U704. On the Halifax side of the basin, intermodal trains 120, 121, 148 and 149 operate. Rockingham yard serves as the main CN switching yard for Halifax. Around the clock yard assignments make up outbound trains; switch inbound trains into the two port terminals and HIT (the CN domestic intermodal terminal) as well as other local industries. Other than train 121, all freight trains arrive and depart from Rockingham yard. Train 121 originates at HOT and operates through the cut, lifting the Ceres and HIT traffic at Rockingham each evening. Inbound Train 120 arrives each morning at Rockingham and then proceeds to take its domestic containers directly into HIT for early morning availability. VIA trains 14 and 15 operate through the cut over the HOT-Rock Connecting Track into the VIA station (mi 0.0).

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Figure 22

The following table is a representation of CN train operations over the Bedford Subdivision as well as a suggested Shuttle Schedule. The Distripark is shown in red since it is in the reverse direction from Windsor Jct. The red times show other train schedule times which pass the Distripark Terminal for comparison to the shuttle. Kinsac is the fist passing siding west of Windsor Junction, assuming the shuttle train would either wye at Windsor Junction or run around the train at Kinsac.

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33

Table 5: Representative CN Rail Operations Bedford Subdivision

Since one round trip per day is scheduled for the Shuttle, there are no obvious capacity issues with either the Bedford Subdivision or the Dartmouth Subdivision. The Shuttle could operate as shown above from Halterm departing around 21:30 hours lift cars en route at Ceres Terminal and arrive at the Distripark at about 23:15 hours. Since there is an extra set of rail cars left at the Distripark Terminal, there would be no switching involved. The shuttle would simply pull through one of the 2 terminal pad tracks and cut off the cars from the Port. Then the engines would runaround the pad tracks lift the other rail cars on the other pad track, which at this point would have already been brake tested and then depart for the Port Terminals at 23:45. It would arrive at Ceres around 00:45 and at Halterm around 01:30 hours. This train operation is simple and straightforward. The dedicated cars make this a very simple operation, and risk free. There is sufficient time in the 8 hour crew day to do any switching required at either Ceres or Halterm if required. 4.4.4

Shuttle train costs

We have estimated the following shuttle operating costs. While these are really somewhat variable, for ease of argument we are assuming an amount that will cover operating costs. We have presented estimated shuttle operating costs below. While these are really somewhat variable depending upon a host of factors, for ease of argument we are assuming an amount that should cover operating costs. We have used cost rather than rate throughout the analysis to avoid getting into issues of profit levels, fairness and the allocation of fixed costs within certain organizations. The costs of the shuttle train are largely fixed costs independent of volume since we have assumed fixed consists for ease and consistency of delivery. We have avoided speculating on how rates would be set by the various stakeholders but do come to the conclusion that since there is a holistic gain, all players would benefit if the overall costs in the delivery chain are reduced making Halifax a more attractive port, especially for the transload and distribution sectors. We assume the two locomotives required for the shuttle train will come from existing locomotives that area available in Halifax already. As such they are charged for one third of the full lease costs because they are available for other duties.

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Since the cars are very low mileage on the shuttle run (less than 20 miles per day), mechanical costs are not included as they are insignificant. Since the cars will not be broken apart at the Distripark, there is no need for operating personnel to couple air lines on the cars. Any exceptions can be handled by the train crews. Overhead costs include a sum for track maintenance, and is low since the shuttle represents a relatively small amount of tonnage over the tracks used. It is important to note that these costs are well below the savings accumulated by use of the shuttle. Therefore our conclusion is that CN has ample room to cover costs and make a profitable service based on the gap between shuttle costs and operating savings from the overall Distripark Shuttle concept. Table 6 1. Annual train operating costs Fuel, wages, overhead, admin & other 2. Annual Rail Cars lease costs Rail platforms 100 @ $16 per day Daily lease per platform car incl. mtnc. $16 Daily car costs $1,600 Lease days per yr 365 3. Annual Locomotive lease costs Number of Locos 2 Capital cost 1,800,000 Total capital 3,600,000 25 year life $548 Total Annual "Operating" Costs

$550,000 $584,520

$66,667

$1, 200,667

4.5 Other CN considerations As shown in Figure 23 below, CN has the potential to combine some of its rail operations into the Distripark Terminal area. We have superimposed the aerials of both the existing CN Halifax (Domestic) Intermodal Terminal (HIT) in the Phase 2 area of the new terminal, as well as the existing CN Dartmouth Yard in downtown Dartmouth to the west side of the Dartmouth Subdivision.

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Atlantic Gateway Distripark Plan

Figure 23

In terms of HIT, this would provide significant benefit to CN since much of their ability to fill backhaul domestic containers is generated by transload freight from import containers. By using the Distripark Terminal in lieu of HIT, CN would generate savings on most domestic truck haul, terminal lift costs, and increase the likelihood of transload product. In terms of Dartmouth Yard, CN is sitting on prime waterfront real-estate (and one of the best views of downtown Halifax). The yard is used as a support yard for local switching, primarily as car storage for the CN Autoport. One study completed a number of years ago had already recommended moving this yard to a location very close to the Distripark. (The Distripark concept was independently arrived at). As can be seen below, this yard would be relatively a small addition to the overall project. CN has indicated that it is willing to examine relocating the Dartmouth yard as long as mainline access is continued through the Dartmouth area to reach Autoport. We believe that CN should consider these options carefully, especially with the additional benefits of freed up real-estate and consolidation of operating assets. It is beyond the scope of this report to discuss the detailed cost/benefits, but the advantage also extends beyond CN in the overall reduction of trucks on Halifax city streets.

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4.5.1

Equipment

The operator of the AGD will of course have the final say in the choice of equipment, organisation and process to be used. They will have to bear the consequences of these decisions and are responsible for the commercial risk of the AGD. The AGD’s operator will: ! ! ! ! !

select the quantity and type of equipment to be used at the AGD; choose between new equipment, relocating existing equipment or acquiring used equipment; determine whether to buy or lease capital equipment; choose an appropriate of operating system; and decide on the staffing levels necessary to the business.

The AGD is expected to handle some 23,183 full containers to/from rail per year or an average of 93 rail/truck or truck/rail moves per normal work day, some. Peak handlings per day are expected to reach 148 handlings per day which is only 12 handlings per hour over the 12 hours of operation. This is not the same as a 5 minute truck turnaround, as it is mostly dependant on matching the terminal’s capacity with the arrival pattern of trucks. Twelve handlings per hour are relatively low and a combination of extended hours and continuous operation will minimize truck turnaround by minimizing queuing. In theory, two top handlers or reach stackers could easily handle this volume of full containers; however some redundancy is required in the system to allow for temporary surges and the occasional equipment failure. It is also necessary to have sufficient equipment deployed to achieve the truck turnarounds that are foreseen, and time in the equipment schedule for preventive maintenance activities. The following discussion is meant only to provide an example of a capital cost of equipment for such an operation. Capital cost estimate: 3 Top Handlers @ $600,000 each: $1,800,000 Similarly, empty handlings of containers are expected to reach 58,355 containers per year or some 233 per day on average, 373 per day, peak. Three empty handlers could handle the workload (at 10 lifts per hour per machine), but some redundancy is also needed. Capital cost estimate: 4 Empty Container Handlers @ $300,000 each: $1,200,000 Operating system requirements are very much a question of philosophy, simple operating systems that simply keep track of the containers on site and their approximate position require a small investment but do not provide the same benefits as an integrated DGPS system that can plan instructions to optimize the use of handling equipment and provide a record of all moves within the terminal. A middle of the road system should be able to supply the information for billing and keep track of container movements on a real time basis. The cost of such a system can vary significantly depending on whether the system is bought for this application or the system is simply an extension of an existing (or proprietary) container control system used elsewhere.

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Capital Cost Estimate: $500,000 including base system, and on-board systems Chassis should be supplied by the transload warehouses and colour coded by transload facility operator. This will allow containers to be positioned to chassis on arrival and moved to and from the transload facilities as required. To handle these chassis and some other equipment on the terminal, four shunters are foreseen. Capital Cost Estimate: 4 shunters @$125,000 per shunter $500,000 Fuelling and general servicing of the container handling equipment is best handled by others (contractors) until the volume of work is sufficient to justify full time employment of the labour and equipment necessary to perform these tasks. A maintenance facility with at least one indoor bay for servicing the container handlers and other vehicles is required. Ideally all the office and maintenance functions could be accommodated within a single structure. While the building is part of the infrastructure, the AGD operator will be responsible to provide office equipment, shop tools and strategic spares. Capital Cost estimate: $400K including strategic spares and minimum facilities for access to equipment for preventive maintenance Total equipment capital cost estimate: $ 4,400,000

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5.0

38

Terminal Operations and Management

5.1 Role of AGD The AGD would provide two main services: an intermodal yard for transload cargo (including some export consolidation) and an empty yard operation for the empty containers to and from the areas of Burnside, the Valley and north of Halifax. Since the existing container terminals will still handle empty containers, as well as full import and export to/from truck, it is expected that the full-in full-out truck moves will increase and gravitate towards the container terminals. The MT-in MT-out moves are also expected to grow as a proportion of the total and will tend to gravitate towards the AGD. Truckers and shippers would benefit from longer hours of operation and quicker turnaround times at AGD. Moving CN’s HIT activities to AGD could be beneficial for CN, the AGD and the shippers but this is not part of the business case considered here. The existing port terminals would recoup some of the land presently used for truck traffic storage, empty container storage, container repair, etc. 5.2 Structure The AGD will require some government funding to make it viable in the short term and the ownership of the facility should rest with the funding entities although the facility could be sold to the private sector at some point in the future. The shuttle operator is a critical component of the AGD’s success and it is desirable that the shuttle operator (likely CN) also have an equity investment in the AGD to ensure that the objectives of the shuttle operator are aligned with those of the AGD and that volumes are maximized. Assuming the land, infrastructure and services are funded by some combination of the three levels of government (municipal, provincial and federal), the shuttle operator should fund, own and maintain the trackage and the captive rolling stock (locomotives and railcars). The AGD operating company should be a separate company or profit centre with its own management, billing and administrative functions. It will need to work closely with the shuttle operator; scheduling and IT systems need to properly mesh and close day-to-day communications will be essential to ensure service objectives are met. Both the shuttle operator and the AGD operator should be driven by commercial objectives and government control should be kept to an absolute minimum as long as the operating company lives up to its agreements and respects applicable laws. The recommended arrangement for the management of the facility is a long-term concession of the facility, similar to the arrangement between the HPA and the existing container terminal operators, where the concessionaire would essentially function as if it owned the facility although the land and basic infrastructure would never transfer and the concession would come up for renewal at the end of the concession period.

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The concessionaire should be chosen by competitive bids first on the basis of their technical competence and, among the bidders determined as competent, on the basis of their financial proposals. Although a concession fee should be paid to the owners of the facility on an annual basis, all commercial benefits/risks should accrue to the operator. Ultimately, the more successful the AGD operator is, the more trucks will be removed from city streets and the more valuable the concession will be on renewal. 5.3 Performance standards Truck turnaround should be measured continuously and monitored on an ongoing basis as part of the concession performance standards. It is one of the main benefits for trucks of the AGD and it should be kept under 30 minutes from the time the truck is available to enter the facility to the time the truck exits the facility. This means that during the hours of operation, 6 AM to 6 PM, trucks are services continuously without interruption for breaks, meals etc. Security standards must be maintained both as a consolidation area for export cargo and to maintain the terminal’s status as a Custom’s bonded facility. Automated scheduling should be implemented to keep the queuing of trucks to a minimum and to ensure truck turnarounds can meet expected performance levels. 5.4 Process The following descriptions depict the foreseen handling process for the three main types of handling activities. The actual handling process will be determined by the operator and may vary significantly from the descriptions herein. 5.4.1

Transload imports

Transload imports are generally railed to the AGD and handled from the railcar directly to a chassis designated for the transload facility for which the cargo is destined. This chassis should be owned by the transload facility and the AGD is deemed to have delivered the container to the transload operator once the container has been positioned onto the chassis. As the chassis belongs to the transload facility and the consignee is now the transload operator, transload operators that are directly back onto the AGD can access their freight at any time, 24 hours per day, 7 days a week. They control their own gate to the private access gate and enter the AGD through an automated gate and security system set up on the private road. The may choose to use their own shunting tractor or to contract this work out to the AGD operator. Once the container emptied, it is returned to the empty stack and stored until it is needed for export load. 5.4.2

Transload exports

Similarly, transload exports start with the positioning of the appropriate empty container on the chassis and the positioning of the container to the transload facility for loading. Once loaded, it is brought back for direct loading to rail and the cycle is repeated until the entire

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Atlantic Gateway Distripark Plan

shipment is delivered to rail. This is much more likely to occur during normal working hours due to the benefits of handling containers directly from chassis to rail. 5.4.3

Empty exchange

After the delivery of a loaded container within the local market area, the empty may be returned to the AGD, particularly if the next move for the trucker is the positioning of another (different) empty for loading export to/from an area closer to the AGD than the terminals. The empty container would be recorded by the trucker on the way into the AGD and the request for the container to be picked up made at the same time. The truck would then be given instructions to drive to the appropriate area in the yard to deliver the container and then to the area pick-up the next one. The receipt of the empty container would be registered when the container is offloaded and the container delivered to the trucker would be registered as the truck leaves the facility. The yard and the terminal would be laid out in such a way that all circulation is one way. While this may occasionally require that trucks drive further up and down the terminal, it makes traffic on the terminal much safer and allows all containers to be stacked in the right direction (doors facing the rear of the truck). Full containers would be handled by front end loaders (fronts or top handlers) or by reach stackers depending on the operator’s preference. It is estimated that approximately three such units, each capable of lifting 40-tonne containers from the second level of a double stacked railcar would be required at the expected volume levels. Empty containers would be handled by special purpose empty container handlers capable of stacking such containers 5 (or more) high. It is estimated that four such empty handlers would be required initially. Hustlers would serve to move chassis around as required as well as pick-up and deliver containers from transload facilities. The transload facility operator would have the option of using their own tractor or contracting the work to the AGD operator. The estimated number of yard hustlers required is 4, although more could be required depending on the contractual arrangements between the AGD operator and the transload operators. At the heart of the NIT operation is a state-of-the-art terminal management and inventory system with Differential Global Positioning System (DGPS). The terminal management system (integrated IT system) will plan every move based on all the information available to it. This information would typically include: ! ! ! !

container locations in 3D based on DGPS verification; equipment locations, live DGPS; number of moves required to access the container; and best container to choose in the case of an empty to be picked up or a multi-container booking.

The DGPS features on the machines allow the terminal management system to both verify that the instruction was properly executed and also keep track, in real time, of the 3D locations of any box shifted.

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5.5 Volumes Based on the assumptions made for the financial projections, some 13,633 containers would be handled from rail to transload facilities and some 9,550 containers from such facilities to rail for export. This leaves a significant number of vacant slots available on the rail shuttle for export. Empty container volumes to and from truck are made up of an estimated 26,322 empty container moves presently handled at the existing container terminals within the port, 20,000 empty containers generated by transload activities and a share of the containers presently handled at empty yards in the Halifax region (12,033). In total, the AGD is estimated to have the possibility of handling 23,183 rail-chassis handlings, 58,355 empty containers to/from truck and 43,183 moves to/from transload facilities. Figure 24 – Summary of handling volumes (moves) 1)%0.&%+, )' A/%')&%"# '"#=&%)., MK,&%",, H)'"+/#?N OA")% -#)PP&A ^b88<_ #3&-%*&(4) )$*5\-4.+9 34 -4.+9 )$*5 P>5-0 +3&-%*&(4) -3 :43> -(4>*&%,) MK,&%",, H)'"+/#?N F"Q -#)%,./)0 RA'&*&'? @PU_ E4%&),3%/ +3&-%*&(4) @PU_ E4%&),3%/ (>5-*() MK,&%",, H)'"+/#?N S- T)#0&%+ SE 0%4/) E3-%,

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5.6 Manning The AGD is foreseen to service trucks and handle containers to/from rail on weekdays, from 6 AM to 6 PM continuously and would perform the majority of positioning to-from the transload facilities between 8 AM and 5 PM. While actual manning levels will be set by the AGD operator, the manning levels below are shown consistent with equipment levels and previous assumptions. Manager/Assistant Manager: Equipment operators: Clerks: Security: Mechanics:

2 15 3 3 2

Total staff:

25

5.7 Labour implications The ILA has jurisdiction over any activities in the longshoring industry occurring within its geographical accreditation. As the work to be performed at the AGD is not work in the longshoring industry, it would fall outside the present ILA jurisdiction.

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If the activities of HIT are shifted to the AGD, the labour affiliation at the AGD would likely be determined by the ownership of the terminal and the ownership of the operating company (concessionaire). For the purposes of this study, a heavy industrial labour rate of some $20-25 per hour, plus 30% fringes was used for labour costs at the AGD. Labour at the AGD would consist primarily of equipment operations working to a schedule designed around the work requirements of the terminal while providing 40 hours per week of scheduled work for the employees. Meal hours and break periods would be staggered to maintain continuous truck servicing throughout the day. 5.8 Marketing the AGD The onus for selling the services of the AGD will be on the AGD operator, with support provided by various stakeholders. The HPA will be a major stakeholder, and it will market the facility in much the same way as it does its container facilities. It will be part of the port’s value proposition in developing the transload sector. AGD will also be marketed by the Greater Halifax Partnership, which is leading the marketing effort directed at the transload sector. It is expected that this facility will be one of the lynch-pins and a critical piece of infrastructure required to grow the sector. Likewise, HRM Business Parks will be involved in selling land adjacent to the facility. CN can assist in marketing both the shuttle service and the facility itself, particularly if HIT is relocated to the Distripark. Other partners in the facility will also market their particular aspect of the services provided, such as empty storage, reefer repairs and maintenance and Long Combination Vehicle (LCV) assembly. Of critical importance, obviously, will be the transload operators who locate in the facility. They will market their own facility, but there is also potential to market the whole sector or whole Distripark under one brand. The ultimate customer of the AGD will be the shipper. In order of potential, they are: ! !

!

Transload import ! Major retailers Transload export ! Large volume shippers ! lumber ! newsprint ! tires ! French fries Local shippers (non-Burnside) ! New Brunswick ! NE Nova Scotia

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43

Annapolis Valley ! South Shore Truckers !

!

The overall value proposition can be summarized as follows: ! ! ! ! ! ! ! !

lower cost; better access to transload facilities; better access to cargo; better access to warehousing facilities; facilitates large movements of multiple containers; reduced wait times at terminals; better scheduling of shipments; and better asset utilization (truckers).

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6.0

Social, Environmental and Cost/Benefit Impact

6.1 Planning issues 6.1.1

Current MPS and zoning

The proposed Distripark Terminal site is in the current Dartmouth plan area and is in the General Land Use classification of Reserve. It is outside the Development Boundary (the serviceable area) for Dartmouth and is zoned H (Holding). It is adjacent to the I-2 (General Industrial) zone that contains Burnside Business Park. Permitted uses in a Holding Zone are R-1, Commercial, and Park uses (and accessory uses). This is essentially a growth restrictive zone: because the area is outside the Development Boundary, development is limited to one lot per year. 6.1.2

Regional planning strategy

Under the HRM Regional Planning Strategy (2006), the site is within the Rural Commuter designation as shown on the Generalized Future Land Use Map (Map 2, Regional Planning Strategy). It is also adjacent to one of the Business/Industrial Park sub-designations (Burnside) of the Urban Settlement designation. Regional Plan Policy S-6 states that the intent of the Rural Commuter designation is to protect the character of rural communities and conserve open space and natural resources. Growth will be focused in a series of centres; between centres (e.g., the study area) the amount and form of development will be carefully controlled. The plan identifies the Highway 107 extension to connect Akerley Boulevard with Highways 101 and 102 as a planned capital project with anticipated completion within 25 years (Chapter 4, Section 4.1.1.2). The extension, immediately to the east of the proposed Terminal site, would access to the site. 6.1.3

Implications for proposed use

Although the site is in the Rural Commuter designation, the site’s adjacency to the Business/Industrial Park sub-designation, the planned Highway 107 extension, and the existing rail line is significant. Use of the site as a Distripark terminal would be compatible with the adjacent business park land uses and be an efficient use of planned and existing transportation infrastructure. The forested area to the north of the site has historically been an unserviced, growth restricted area (in both the Dartmouth MPS and the adjacent Shubenacadie Lakes MPS) and is currently undeveloped except for a CN Rail line; Regional Plan policies are consistent with these policies. The Sovereign Resources Quarry is approximately 1500m northwest of the proposed site. Therefore, use of the site as a Distripark Terminal would be unlikely to conflict with future land uses in the surrounding area.

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6.2 Environmental assessment13 This section documents the preliminary scoping of environmental and social issues associated with the proposed location of the Burnside Distripark. Information sources include existing environmental reports, the NSDNR wildlife database, the ACCDC database, and reviews by the Nova Scotia Museum and a qualified biologist. References are cited throughout the text and are listed at the end of the report. 6.2.1

Social features

The Distripark site is located on the northwestern edge of Phase 13 of the Burnside Industrial Park. Currently, land surrounding the site is undeveloped. The nearest existing neighbour is the existing development in Burnside, approximately 1 km to the south. The Bedford Ammunition Depot occupies extensive lands approximately 1 km to the southwest. The Rocky Lake Quarry is approximately 1.4 km northwest of the site, with plans to extend southeast up to and including the site. The site is approximately 2.5 km from its nearest residential neighbours in Lake William and Portobello, 3 km from the community of Rocky Lake, 4 km from Lakeview and 4.5 km from Waverly. In addition to the distance, topography in combination with the site layout, provides screening from surrounding land uses. The site’s location is conducive to the nature of the development proposed. Phase 13 of the Burnside Industrial Park will see extension of existing light industrial and retail uses towards the site. HRM is planning for an extension of Burnside Drive/Highway 107, which proposes a route crossing immediately to the south of the site (Figure 22). 6.2.2

Environmental features

The site occurs within the Quartzite Barrens (Halifax) theme region of Nova Scotia, which is characterized by extensive barrens with a bedrock-dominated topography and repetition of ridge-swamp-swale features. Generally, wetlands are primarily raised bogs, flat fens and swamps, and tend to be biologically productive. A review of available resources indicates that there are no significant features known or expected for the site that would preclude its development for the Distripark. There are, however, a number of features that are known to occur and may occur onsite that would require appropriate mitigation to minimize impacts and obtain necessary environmental approvals. A number of sensitive features are present downstream of the site, and would require appropriate environmental protection measures to be employed during construction and possibly operation.

13

While the TOR anticipated a greater level of environmental review, that was based on the premise that the project would continue to be focused on the Rocky Lake site, which had undergone environmental screening-level review as part of the previous project. However, the project site changed twice - first to the Burnside Intermodal site and then to the Burnside Distripark site (accepted by the Steering Committee in December 2007), which ultimately became the project focus. As a result, we lost our "window" for field truthing and the budget was used in the definition and review of two other potential sites.

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Atlantic Gateway Distripark Plan

6.2.3

Downstream features

The site extends across a watershed divide (Figure 25). The majority of the site is located within the Shubenacadie River watershed, with surface drainage via Marshall Brook and discharge to Lake William, near the headwaters of the Shubenacadie system. Lake William is a nesting area for the Common Loon, ranked as a sensitive species. The headwaters of the Shubenacadie system are significant for Atlantic Salmon, Striped Bass, Atlantic Sturgeon, Landlocked Salmon and Bald Eagle (pers.comm., D. Archibald, NSDNR). The southern end of the site is located within the Wrights Brook watershed. Based on a review of available topographic mapping, it appears that this portion of the site drains directly to Wrights Brook (with discharge to Halifax Harbour at Wrights Cove). However, there is potential for this portion of the site to drain to Anderson Lake, as the influence of the existing rail line and downgradient wet areas on the direction of surface flow could not be determined with certainty from mapping. The direction of drainage should be confirmed, as Anderson Lake has been stocked with an experimental population of the endangered Atlantic Whitefish (Coregonus huntsmani), a SARA-listed species. If determined to be downgradient of the site, the presence of this species has the potential to require additional environmental review and possibly approvals, such as the requirement to apply for an Allowable Harm Permit for activity that may have an impact on the species or its habitat. 6.2.4

Wetlands

Based on available topographic and habitat mapping, the proposed location of the Distripark will require infilling part or all of two wetlands as illustrated below. Figure 25

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Atlantic Gateway Distripark Plan

The Terminal component of the site will require infilling of a wetland identified by NSDNR mapping as a 5.5 hectare shrub bog. The wetland is currently crossed by the rail line and it is expected that construction of the Terminal will require approximately half (over 2 hectares) of the wetland to be infilled. Development of the Distripark (primarily Lot 1 and possibly Lot 2) will require infilling of a smaller wetland, listed by NSDNR as a 2.7 hectare fen. The significance of habitat present in these wetlands is not known, and a wetland evaluation is required to assess the full extent of mitigation required. Infilling will require application to NSEL for a Wetland Alteration Approval. Mitigation is expected to consist of compensation for the wetland loss, which is typically accomplished through a wetland habitat enhancement project. This process is administered by NSDNR. Any disruption of 2 hectares or more of wetland also requires registration of the project as a Class I undertaking under the Nova Scotia Environmental Assessment process. The Minister determines whether further environmental review is required. 6.2.5

Watercourse crossings

Construction of additional track beyond the northern limit of the Distripark may involve at least two watercourse crossings of Marshall Brook Figure 22), parallel to the existing rail line crossings (reportedly culverts, JWA, July 2005). A previous Environmental Assessment Registration report characterizes the lower reaches of Marshall Brook (downstream of its confluence with MacGregor Brook and beginning at the two watercourses crossings required for the Distripark) as a broad meandering channel surrounded with shrubby swampy habitat, with a 40 m section of fast-flowing stream downstream of the railway crossing (JWA, July 2005). Development of the Distripark will require crossing or alteration of two branches of MacGregor Brook (Figure 22). MacGregor Brook is a tributary of Marshall Brook and is expected to dry up or have low flow during the summer months (JWA, July 2005). The brook is unlikely to support fish species, given its small size, lack of suitable habitat, and natural barriers to fish passage below its confluence with Marshall Brook (JWA, July 2005). Marshall Brook is expected to support creek chub (Semolitus atromaculatus), American eel (Anguilla rostrata) and gaspereau (Alosa pseudoharengus) (JWA, July 2005). Fish species known for Lake William include white sucker (Catostomus commersoni), white perch (Morone Americana), brook trout, smallmouth bass (Micropterus dolomieui), American eel, gaspereau, and Atlantic Salmon (Salmo salar) (JWA, July 2005). Standard mitigation measures will be required for each crossing and each will require approval from Nova Scotia Environment and Labour. 6.2.6

Wildlife and species of concern

Based on nesting records, Osprey (Pandion haliaetus) may occur in the area. There is potential for some species of concern to occur on or near the site in addition to the Atlantic Whitefish mentioned previously, based on records for the larger area. The Four-toed salamander (Hemidactylium scutatum), listed as vulnerable by the Province, has been recorded in wetlands in the larger area. The NS Museum indicates that Dragonfly and Damselfly species of concern may occur in the watersheds and ponds adjacent to the site; this

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Atlantic Gateway Distripark Plan

is supported by the data provided by ACCDC for a 5-km grid including the site. The NS Museum also lists a number of at risk plant species as potentially occurring on site. These species are listed below in Table 7. Table 7: At Risk Species With Potential to Occur On Or Near the Site Category

Species

Rating

Dragon Fly and Damselfly Mottled Darner

Aeshna clepsydra

S2

Green-Striped Darner

Aeshna verticalis

S2

Prince Baskettail

Epitheca princes

S2

Martha’s Pennant

Celithemis Martha

S2

Lyre-Tipped Spreadwing

Lestes unguiculatus

S2

Taiga Bluet

Coenagrion resolutum

S2

Mountain Sandwort

Arenaria groenlandica

Yellow

Waxy-leaved Aster

Aster undulates

Yellow

Purple-Stem Swamp Beggar-Ticks

Bidens connata

Yellow

Capitate Spikerush

Eleocharis olivacea

Yellow

Wiegand’s Wild Rye

Elymus wiegandii

Grass-Leaved Goldenrod

Euthamia caroliniana

Yellow

Black Ash

Fraxinus nigra

Yellow

Golden-Heather

Hudsonia ericoides

Yellow

Larger Canadian St. John's Wort

Hypericum maius

Red

Greene's Rush

Juncus greenei

Red

Southern Twayblade

Listeria australis

Red

Beck Water-Marigold

Megalodonta beckii

Yellow

Field Milkwort

Polygala sanguinea

Yellow

Vaccinium cespitosum

Yellow

Plant Species

Red

Herptile Species Four-toed salamander

Hemidactylium scutatum

Vulnerable, Yellow

Whip-Poor Will

Caprimulgus vociferous

S2B

Great Crested Flycatcher

Myriarchus crinitus

S2 S3B

Common Loon

Gavia immer

Yellow

Bird Species

Definitions S2 – rare S3 – uncommon Yellow – vulnerable, sensitive to human activities or natural events Red – at risk or may be at risk

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The absence or presence of these species should be determined through field assessments conducted during the appropriate field season. 6.2.7

Elevated metals

Historic gold mining activity in the Waverly area has left an environmental legacy that may need to be addressed during construction of Distripark. Mine waste was reportedly disposed of in nearby lakes and watercourses, and waste rock was used for road and railway bed construction JWA, July 2005). Elevated metals, including mercury and arsenic, may be encountered along the existing railway bed and in watercourses and wetlands to be crossed. Future fieldwork should seek to determine the presence of elevated metals in areas to be disturbed and/or affected by increased storm water runoff flows, which have the potential to re-suspend and disperse contaminated sediments. 6.2.8

Acid generating bedrock

The site is underlain by bedrock of the Goldenville Formation, which is known in some locations to contain acid-bearing pyrites responsible for acid runoff. Rock samples taken from an area along the rail line just south of the site in the mid 1990s showed quantities of the acid producing sulphide below levels necessary to produce significant acid production.14. Given potential sensitive features in downstream waters, it may be necessary to test for acidproducing bedrock in areas requiring grading or exposure of the bedrock. 6.2.9

Archaeological resources

The NS Museum reports that there are no recorded archaeological sites known for the site and that the area has low potential for historic and pre-contact archaeological sites. 6.3 Cost/benefit analysis This analysis includes an assessment of the benefits and costs associated with the project, was well as an overall assessment of the economic impacts of the development. The financial model that is used in this analysis builds from previous work in the 2006 MariNova report titled “Trucking Options Study.” With the reduction in city traffic as the main purpose behind this study, the specific options under consideration were limited to a proposed new inland terminal (Atlantic Gateway Halifax Distripark) and the use of a dedicated rail shuttle service that would move certain volumes of container traffic by rail to a proposed terminal to be located within Phase 13 of the Burnside Industrial Park. The resulting overview of benefits and costs compares “doing nothing” with the option of building a new inland terminal. Accordingly, financial considerations are expressed as a

14

UMA Engineering Ltd. “Relocation Feasibility Study: Downtown Dartmouth CN Rail Marshalling Yards,” Phase I Report, 1995.

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Atlantic Gateway Distripark Plan

‘delta’ or change moving from the ‘doing nothing scenario’ to the “inland terminal option” and the associated costs or savings attributed to that change in mode of operation. The model used to assess the financial and economic impacts associated with the proposed development includes the following elements: !

Distances Travelled – an assessment of the distances from significant commercial and or distribution areas within HRM;

!

Truck Volumes – an assessment of the volume of truck traffic in and out of the major commercial and or distribution areas within HRM;

!

Highway/Urban Distances – an assessment of truck distances that are within urban areas (reduced speed through stop-and-go-traffic) and highway distances (highway speeds); and

!

Truck Distances Saved – the ‘delta’ in truck distances that result though the location of the new inland terminal and the associated reduction and or elimination of both reduced speed and highway speed distances that need to be travelled.

The model uses the above information to identify the: ! ! ! ! ! ! ! ! ! 6.3.1

total handlings savings/cost; road maintenance savings/cost; truck operations savings/cost; net change in GHG emissions; net bridge operations/capital avoidance; net change in property values; net cost of terminal (capital); net cost of rail service (operating); and overall net cost increase (savings). Assumptions

The following major assumptions were used in the development of the financial model: Transload containers per week in year 1

400

High volume exports assumed to use facility

20%

Percentage of full container moves with empty leg

80%

Estimated percentage of empty moves that can be avoided

80%

Percentage of trucks to/from areas with benefit greater than 0

91%

Transload percentage requiring empty back to terminal

100%

Empty % market share from present empty yards

30%

Percentage of Transload from Ceres that is still trucked

50%

Handling costs at Ocean Terminals per move Percentage of containers direct to/from rail Handling costs at HIT per move

$35.00 50% $45.00

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Handling costs at AGD per move

$25.00

Handling costs at AGD Tship on site per move

$15.00

Effective turn around time at Ocean terminals

60

Effective turn around time at HIT per container

45

Effective turn around time at AGD

30

Value of truck time

$30.00

Average distance saved per shortened truck move

9.1

Average cost per km

$1.15

Cost per truck move

$60.00

Growth rate for ocean terminal volume

3.5%

Growth rate for Distripark volume

7.5%

Average annual Consumer Price Index adjustment

2.2%

Discount rate for net present value calculations

5.0%

Weighted container growth (blend rate – Distripark and Ocean Terminal growth)

4.87%

Percentage of trucks from Ceres (Original Distribution From Old Study)

64%

Percentage of trucks from Halterm (Original Distribution From Old Study)

36%

Number of terminal operation days per year (5 days * 50 weeks)

250

Average kms saved per shortened truck move

9.1

Note: The entire analysis is framed in the context of the variance from the status quo, therefore, there are no costs or benefits with the status quo. 6.3.2

Calculation of truck distance estimates

Table 8 provides the current (Status Quo) one-way distances distance from selected point-topoint locations associated with significant transportation/commercial destinations in HRM. For example, Halterm is approximately 13.3 kilometres from Burnside. Table 8: Point-to-Point km [From (Col) to (Row)]

Halterm Ceres Richmond Atlantic Gateway Halifax Distripark (AGD)

Burnside 14.5 7.3 7.7

Bayers Lake 13.3 9.1 11.1

Other HRM 4.3 4.5 2.5

Truro 60.1 51.1 53.1

Valley 24.7 19.5 21.5

South Shore 15.8 10.6 12.6

2.0

16.4

13.0

47.6

7.0

18.0

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Atlantic Gateway Distripark Plan

Locations are defined as follows: ! ! ! ! ! ! ! !

Halterm – the Halterm gate; Ceres – the gate at Ceres; Burnside – Akerley & Isnor Dr; Bayers Lake – Costco entrance; Other HRM – Macdonald Bridge access; Truro – Exit 9 on 102; Valley – Junction of 101 and 102; and South Shore – Exit 3 on 103.

Distances are calculated as the best truck route based on expected travel time. Table 9 shows the kms of the total distance that is travelled on low speed (restricted) roads. Table 9: Restricted Speed Km's

14.5 7.3 7.7

Bayers Lake 10.0 6.0 8.0

Other HRM 4.3 4.5 2.5

Truro 10.0 3.0 5.0

Valley 9.0 6.0 8.0

South Shore 9.0 6.0 8.0

2.0

13.3

13.0

2.0

2.0

13.4

Burnside Halterm Ceres Richmond Atlantic Gateway Halifax Distripark (AGD)

Table 10 shows the kms of the total distance that is traveled on highway speed roads. Table 10: Highway Kms Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Halterm

0.0

3.3

0.0

50.1

15.7

6.8

Ceres

0.0

3.1

0.0

48.1

13.5

4.6

Richmond

0.0

3.1

0.0

48.1

13.5

4.6

Atlantic Gateway Halifax Distripark (AGD)

0.0

3.1

0.0

45.6

5.0

4.6

Table 9 and Table 10 are useful in calculating time and fuel consumption/GHG. Table 11 shows the net change in distances based on the location of the proposed Atlantic Gateway Halifax Distripark in Burnside (Phase 13) and the locations effect of reducing or increasing point-to-point distances that must be travelled.

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Table 11: Point to AGD Change km [From (Col) to (Row)]

Halterm

Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

(12.50)

3.10

8.70

(12.50)

(17.70)

2.20

Ceres

(5.30)

7.30

8.50

(3.50)

(12.50)

7.40

Richmond

(5.70)

5.30

10.50

(5.50)

(14.50)

5.40

--

--

--

--

--

--

Atlantic Gateway Halifax Distripark (AGD)

Locating the AGD in Burnside would remove 12.50 km from the current trip between Halterm and Burnside. Likewise, the location of the AGD would also add 5.30 km to the current trip between Bayer’s Lake and Richmond Terminal. 6.3.3

Restricted vs. unrestricted km

In this section, we present the impact of the AGD location on the utilization of restricted (city streets) and unrestricted (highway speeds) road usage. The purpose of this analysis is to inform the calculations of greenhouse gas emissions (saved or increased) in relation to highway distances (added or removed) and city/street/stop and go distances (removed or added). Table 12 presents an analysis of the distances in terms of those that are AGD reduced/increased distances that are on urban roads (reduced speeds and or stop-and-go traffic). Table 12: Restricted Speed Km's Difference from AGD

Halterm

Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

(12.50)

3.30

8.70

(8.00)

(7.00)

4.40

Ceres

(5.30)

7.30

8.50

(1.00)

(4.00)

7.40

Richmond

(5.70)

5.30

10.50

(3.00)

(6.00)

5.40

--

--

--

--

--

--

Atlantic Gateway Distripark (AGD)

The location of the AGD at Burnside would remove 12.50 km of city truck distance and have no effect on reducing or adding highway distance (Table 13) for Halterm traffic. The AGD location would also have the effect of reducing 8.0 km of city distances for cargo originating at Halterm. Table 13 presents those AGD reduced/increase distances that is traveled on highway speed roads.

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Table 13: Highway Kms Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Halterm

0.0

3.3

0.0

50.1

15.7

6.8

Ceres

0.0

3.1

0.0

48.1

13.5

4.6

Richmond

0.0

3.1

0.0

48.1

13.5

4.6

Atlantic Gateway Halifax Distripark (AGD)

0.0

3.1

0.0

45.6

5.0

4.6

6.3.4

Calculation of rail distance estimates

Table 14 provides the new rail distance from selected point to the new Distripark (AGD) as one way distances. Table 14: Rail shuttle km point to AGD Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Halterm

18.60

18.60

18.60

18.60

18.60

18.60

Ceres

14.10

14.10

14.10

14.10

14.10

14.10

-

-

-

-

-

-

Atlantic Gateway Halifax Distripark (AGD)

As shown, distances are expressed in km of rail from the three terminals to proposed AGD (one way distances). All tables above are used to calculate the impact of the new location on rail shuttle services, truck operations, handlings and the impact of the change on GHG emissions. 6.3.5

Truck volume and distribution of truck traffic

Table 15 is based on the previous study (the 2006 Inland Terminal and Trucking Options Report) and highlights the expected annual truck traffic to the selected transportation nodes. Table 15: Annual Truck Volumes Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Total Truck

Halterm

4,550

853

284

15,750

3500

1,313

26,250

Ceres

7,973

1,495

498

27,600

6,133

2,300

46,000

Richmond/HIT

10,400

1,950

650

n/a

n/a

n/a

13,000

NIT (formerly Quarry)

22,923

4,298

1,433

43,350

9,633

3,613

85,250

Total

45,847

8,596

2,865

86,700

19,267

7,225

170,500

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Atlantic Gateway Distripark Plan

Table 16 shows the percentage distribution of truck traffic from the ocean terminals from the previous study. The same proportion was used for the calculations in this report except that the transload volumes were added. Table 16: Percentage of Trucks from Source (Original Distribution from Old Study)

Halterm Ceres Richmond

Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Total Truck

6%

1%

0%

22%

5%

2%

36%

11%

2%

1%

38%

8%

3%

64%

n/a

n/a

n/a

n/a

n/a

n/a

Total

100%

Table 17 provides the number of trucked container moves that would be saved in year 1 of the operation of the proposed AGD. Table 17: Number of Trucked Containers Saved Per Year T/Load

Burnside

Halterm

14,533

Ceres

19,100

Bayers Lake

Other HRM

South Shore

Total Truck

Truro

Valley

2,492

8,625

1,917

27,566

4,366

15,114

3,359

41,939

Total

69,506

This assumes that 100% of an estimated 20,000 containers for transload would be shipped to the Distripark by either rail (13,633) or by truck (6,357) and that all empties would be stored at the Distripark. This assumes little commercial reason for Bayers Lake and “Other HRM” to use the facility. Port traffic that is destined for “Other HRM” and Bayer’s Lake will not benefit by using the new Distripark. For example, cargo arriving at Halterm and destined for Bayer’s Lake will leave Halterm and go to Bayer’s Lake directly, without passing through the Distripark. (It is assumed there will not be any regulation compelling shippers to use the shuttle, hence the commercial decision would likely see the direct shipment of cargo to Bayer’s Lake. 6.3.6

Truck distance savings

The resulting truck distance savings are summarized in the following tables. Table 18 shows that the new terminal will remove nearly 575,000 truck kilometres in year 1 from city streets.

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Table 18: Percentage of Trucks from Source (Original Distribution from Old Study) Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Total

Halterm

(213)

--

--

(108)

(34)

--

(355)

Ceres

(124)

--

--

(53)

(42)

--

(219)

--

--

--

--

--

--

--

(337)

--

--

(161)

(76)

--

(574)

Richmond Total

The average truck move is shortened by 9.1 kilometres. Urban truck km travelled is reduced by 448,000 (Table 19) while highway truck kilometres are reduced by 126,000 km in year 1 (Table 20). Table 19: Reduced Speed Truck Kilometers Difference (thousand) Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Total

Halterm

(213)

--

--

(69)

(13)

--

(295)

Ceres

(124)

--

--

(15)

(13)

--

(153)

--

--

--

--

--

--

--

(337)

--

--

(84)

(27)

--

(448)

Richmond Total

Table 20: Highway Truck Kilometres Difference Reduced (thousand) Burnside

Bayers Lake

Other HRM

Truro

Valley

South Shore

Total

Halterm

--

--

--

(39)

(21)

--

(59)

Ceres

--

--

--

(38)

(29)

--

(66)

Richmond

--

--

--

--

--

--

--

Total

--

--

--

(77)

(49)

--

(126)

6.4 Model results Figure 26 shows the model predicted growth of annual truck moves and the project share of truck traffic that may be removed from city streets as a result of truckers not having to enter into the City to pick-up and drop off containers. The total year truck avoidance potential represents 40.5% of all truck traffic currently associated with ocean terminal activities, Distripark activities and empty yard storage – roughly 300 trucks per day. By the 20th year of the projection, the Distripark will be diverting up to 49% of this traffic – 606 trucks per day.

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Figure 26 – Growth in Truck Moves

Growth in Truck Moves & Projected Share Removed From City Streets 500,000 450,000 400,000 350,000 300,000 250,000 200,000

20 09 20 10 20 11 20 12 20 13 20 14 20 15 20 16 20 17 20 18 20 19 20 20 20 21 20 22 20 23 20 24 20 25 20 26 20 27 20 28

150,000 100,000 50,000 0

Total Trucks Removed or Shortened

Total Trucks Involved in Terminal Moves

Figure 27 shows the total trucks, trucks removed or shortened and the percent of total trucks that are removed or shortened as a result of the AGD. Figure 27 – Percent of Intermodal Trucks Removed or Shortened

Growth in Truck Moves & Projected Share Removed From City Streets 500,000

60.0%

450,000 50.0%

400,000 350,000

40.0%

300,000 250,000

30.0%

200,000 20.0%

150,000 100,000

10.0%

50,000 0

0.0% 1

2

3

4

5

6

7

8

9

10 11 12 13 14 15 16 17 18 19 20

Total Trucks Involved in Terminal Moves Total Trucks Removed or Shortened Percent of Intermodal Trucks Removed or Shortened

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6.4.1

Impact of truck distance – truckers

Because of the reduction in trucks km, benefits to truckers accrue following construction and at the point the facility becomes operational. The benefits of the mileage reduction are summarized in Table 21. Looking at average operating costs per truck KM for: Table 21: Savings to Truckers (thousand)

Year 1 Year 10 Year 20

Truck Operating Savings

Truck Operating Savings – NPV

$(677) $(1,263) $(2,526)

$(725) $(7,080) $(15,775)

Truckers will save approximately $700,000 in operating costs during the first year that the facility is built. Over the course of the 20 year projection, the truckers will save the total net present value of just under $16M. 6.4.2

Impact of road wear and tear Table 22: Theoretical Savings on Road Wear and Tear

Per Year Savings (2009 Dollars) Cumulative NPV

Year 1

Year 10

Year 20

Km of City Streets Freed Km of Highway Freed

$(24,237) $(22,858)

$(24,237) $(22,858)

$(25,418) $(23,971)

Total Freed

$(47,095)

$(47,095)

$(49,389)

Km of City Streets Freed Km of Highway Freed Total Freed

$(24,237) $(22,858) $(47,095)

$(229,566) $(216,502) $(446,068)

$(456,349) $(430,378) $(886,728)

The reduction in road surface wear and tear through truck traffic reduction provides a theoretical cost avoidance of 47,000 per year. The NPV of the reduced/increased wear and tear over the 10 year projection is just under $900K. 6.4.3

Congestion

The reduction in truck traffic will increase road capacity based on a car equivalent of 2.5 cars/ truck. Based on this, the new Distripark would have the Year 1 effect of removing 130,000 trucks and allowing for added automobile capacity of 325,122 cars.

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Figure 28 – Congestion and Car Equivalents Freed Total Trucks Removed per day and Car Equivalent 600 500 400 300 200 100 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Total Trucks Removed or Shortened

6.4.4

Car Equivalent Space Avaliable

Handlings – cost/(savings)

Total savings within the Distripark are estimated at $1.1M in year 1, growing to $6.2M by year 20 with a net present value of savings of $33M for the 20 year period. Figure 29 shows the per container savings over time, as the projected volume of throughput/moves increases. Figure 29 – Net Annual Savings AGHD Annual Net Handling Savings $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Net Annual Handling Savings

6.4.5

Net GHG emissions – increase/(reduction)

Impacts on Greenhouse Gas (GHG) emissions for the proposed rail system from Burnside to Halterm and Ceres are estimated. The reduction in truck kilometres traveled will result in an emissions savings while the locomotive used to move the freight will add emissions from the diesel engine exhaust.

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Atlantic Gateway Distripark Plan

The air emission impact assessment was based on the following data and assumptions: !

the use of rail transport will reduce the truck kilometres traveled by 337,000 kms annually;

!

the truck kilometres savings are associated with reduced speed kilometres (assumed to be 20 mph on average);

!

the annual rail traffic is 250 trips per year (one direction);

!

the average train speeds are 15 mph (25 kph);

!

each train has two locomotive engines attached;

!

the locomotives are diesel-electric hybrid (model GP38) rated at 2000 Hp; and

!

the locomotive engine emissions and fuel consumption are based on an average notch setting of 2.

The primary contaminants associated with tailpipe emissions that contribute to GHG emissions and global warming are carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O). These compounds along with water vapour and ozone are naturally occurring greenhouse gases and these compounds are continuously emitted to and removed from the atmosphere by natural processes. For this impact assessment, only these compounds that are produced as a result of fuel combustion are considered. Appendix I of Canada’s Greenhouse Gas Inventory 1990 -1999 provides emission factors for GHG emissions from mobile combustion sources. These emission factors are provided in units of grams of pollutant per litre of fuel burned for a range of on-road vehicle types from light duty gas automobiles to heavy duty diesel vehicles. This foundation paper also provides emission factors for off-road vehicles, including diesel rail transportation, which were used for this assessment. To apply the emission factors to the truck-kilometres saved and rail-kilometres added, an estimate of fuel economy is required. From a report entitled “Energy Savings through Increased Fuel Economy for Heavy-Duty Trucks”, American Council for an Energy-Efficient Economy, February 11, 2004, a fleet-wide fuel economy for tractor-trailers of 5.3 miles per US gallon was obtained. For the increase in rail transportation, a report entitled “Influence of Duty Cycles and Fleet Profile on Emissions from Locomotives in Canada”, Robert Dunn, Consultant in Railway Fuels, Lubricants and Emissions, June 2002, provided fuel consumption for various locomotives and duty cycles and for each locomotive throttle position. Dillon used fuel consumption data for a SD-40 train (3000 Hp) at throttle position 2 and traveled at an average speed of 15 mph (25 kph) over the entire trip. The corresponding fuel consumption is 154 lbs/hr. However, fuel consumption data was provided for these 2000 hp locomotives at idle and full throttle positions. This data showed a fuel consumption of approximately one-half of the SD-40 fuel consumption data. As a result, a factor of 0.5 was applied to the SD-40 fuel consumption data for notch 2. The total number of locomotive trips per day (each direction) was (250/365) = 1.37. The oneway travel distance from Burnside to Halterm is 18.6 km and from Burnside to Ceres is 14.1 km which on an annual basis equates to approximately 3.6 hours per day of rail travel.

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The following table summarizes the annual GHG emissions associated with each transportation option. The total GHG emissions, expressed as CO2-equivalents, are obtained using the 100-year global warming potentials (GWPs) for CO 2, CH4 and N2O of 1, 21 and 310, respectively. The calculation for CO2-equivalents is: Tonnes CO2 Eq. = (Tonnes CO2 x 1) + (Tonnes CH4 x 21) + (Tonnes N2O x 310) Results are provided for the savings in truck travel and increased use of rail travel as well as the net impact. Bracketed values represent a net savings in GHG emissions. Figure 30 – Summary of Net Annual GHG Emissions Option Burnside to Halterm Reduced Truck Travel Increase Rail Travel Net Emissions Burnside to Ceres Reduced Truck Travel Increase Rail Travel Net Emissions

ER (CO2 ) (tonnes/yr)

ER (CH4 ) (tonnes/yr)

ER (N2 O) (tonnes/yr)

ER (CO2 Eq.) (tonnes/yr)

(393) 84 (309)

(0.02) 0.00 (0.02)

(0.01) 0.03 0.02

(397) 95 (302)

(229) 64 (165)

(0.01) 0.00 (0.01)

(0.01) 0.03 0.02

(231) 72 (159)

With respect to other air contaminants associated with diesel engine emissions, the use of rail travel instead of truck travel was estimated to result in a small increase in oxide of nitrogen emissions of 0.9 tonnes/yr but a saving in carbon monoxide and hydrocarbon emissions of 2.2 tonnes/yr and 0.3 tonnes/yr, respectively, for the combined travel routes. These emission calculations were also based on the SD-40 locomotive emission factors with a 50% reduction factor applied for the use of diesel-electric hybrid locomotives. 6.4.6

Bridge operation – increase/(reduction)

Interviews with the Halifax Dartmouth Bridge Commission reflected interest in the potential reduction in truck traffic and the potential impact of this reduction in extending the replacement cycles for the wearing surface and the substructure. Class 4 truck traffic represents about 3% of all crossings (two-way) – about 60,000 crossings per year. A reduction in truck volume would negatively impact bridge revenues but this has the potential to be more than offset by an extension of the lifecycle of bridge infrastructure (and the added benefit of decreased congestion. At the time of this writing, these aspects of the potential net savings are still being explored. We estimate removal of between 40% and 50% of all class 4 from the Bridge, although the majority of these trucks are expected to be empty containers. 6.4.7

Net change in property values

Changes in property values are expected in the area of Lower Water Street and Hollis Street as a result of reduced truck traffic. Improved vales are expected as a result of actual escalation in property values and shorter listing times. However, because of difficulties in assessing the actual value of these impacts, the benefits are not included in the financial analysis. March 2008

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7.0

Financial Projections of Revenue and Expense

System wide, current terminal operations are estimated to cost $9.1M per year (Year 1). The effect of the AGD is to reduce this cost by: !

reducing more costly truck transportation in favour of lower cost shuttle movement of containers;

!

reducing truck wait times, and therefore increasing efficiency of trucking operations, and reducing trucking distances; and

!

shifting handling from the higher labour/operating cost associated with the ocean terminals (estimated at $35 per move) to the lower operating cost associated AGD (estimated at $25 per move).

The following presents the system wide summary of the costs and benefits in relation to the stakeholders to whom the benefits/costs accrue. There are three “business categories” assessed in the financial model of the proposed Distripark. These business categories include: !

Ocean Traffic, which is made up of: ! Full containers from ship to truck or truck to ship ! Empty containers to from terminals

!

New Transload Activity – two way moves associated with transload activity

!

Empty Yard storage activity - assumed as a share of exiting MT yard storage that will be captured by the new AGHD

A fourth area of activity that will be presented relates to Truck Wait Times. The total number of moves across these business categories is estimated at 183,823 container moves for year 1 operations of the new AGD. The 183,823 container moves are comprised of: !

Ocean Traffic Volumes which includes: ! 95,500 in baseline (year 1) annual container volume (fulls) ! 36,290 in empty moves (38% of fulls)

!

Transload Activity which includes: ! 20,000 in full New transload activity and a balanced volume (20,000) in empty transload moves (Year 1)

!

Empty yarding, which is comprised of: ! 12,033 in empty yard storage based on an assumption that 30% of the market share will be captured from existing empty yards (Year 1)

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The new AGD is expected to impact the system by: !

changing the way in which containers are handled at the ocean terminals;

!

changing the way in which containers are transported to and from the ocean terminals and to and from the new AGHD; and

!

adding new moves associated with the new Distripark.

7.1 Ocean terminal activity The net impact on Ocean Handling Terminal Costs is a savings of $422,698. This is driven by: !

9,550 (10%) of fulls are converted to rail and incur additional handling charges and truck distance is shortened – the 9,550 moves add cost to the system of $115,000 in handling (do to an assumed 10% of ocean traffic converted to the shuttle and therefore additional handling operation at the terminal); and

!

36,290 empties are handled by truck (9,968 moves) or are saved (26,322 container moves are avoided by leaving empties at the AGD, 9,968 are returned to the terminal) for a decrease in operating costs of $537,907.

The net savings of $422,698 arises because the majority of the empty moves are saved (these containers do not need to go back to the ocean terminal). 7.2 New distripark activity The Net Impact on Transload Activity results in a net savings of $1.14M as a result of: !

13,633 containers are moved by shuttle to the AGD, while 6,367 (the balance) are shipped from the terminal by truck, shorting trucking distance, and therefore operating cost by $142,000; and

!

20,000 in balancing empty moves are saved (these do not need to be returned to the terminal), resulting in the avoidance of $1.2M in trucking costs.

The net savings of $1.4M savings arises because trucks distances are shortened and/or eliminated. 7.3 Empty container yard activity Existing Empty container yards are expected to be unaffected by the Distripark in terms of system-wide financial gains or losses. 7.4 Truck wait time A final source for savings in the movement of container volumes is in the area of truck wait time. By assuming that the effective turn around time at Ocean terminals is 60 minutes and the effective turnaround at the AGHD is half of this, the cost of truck wait time will be reduced by $731,754 based on an assumed value of truck time of $30.00 per hour.

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7.5 Cost terminal operations As described earlier, the costs associated with the rail operations are largely fixed and increase little with increasing volumes. Because of this, the per-unit cost of shuttle operations falls as volume increases. Table 23 below provides a summary of the operating costs associated with the AGD, based on 71 containers per day. These costs compare favourably to handling costs at ocean terminals in Halifax and HIT. Table 23: Terminal Operating Costs Terminal Costs Terminal Lift cost Containers lifted Daily Lift costs Operating days per year Total Annual operating Costs

Costs $25.00 71 $1,775 250 $443,750

The $14.5M terminal will cost (at 71 containers per day) just under $450,000 per year to operate.15 7.6 Summary of net financial impact The total savings from Handling is expected in the range of $2.3M in year 1 and $7.1M by year 20. The shuttle cost will add an average of $1.2M per year, leaving a net handling savings of just over $1.1M in year 1 and $5.9M by year 20 (with a NPV of $33.3M). Figure 31 summarizes the business categories and the detail driving the net savings.

15

Capital costs of the terminal construction are viewed in this analysis as a sunk cost – equivalent to a normal city development process and would be covered by the city in the same way that industrial lands would ordinarily be developed (e.g. city would develop and sell/lease land). Terminal Equipment is priced in section 4.1 at $4.4M and is included in the $25.00 per lift charge used to estimate the system wide savings/costs. This factor includes everything expect the cost of land and the cost of developing the terminal itself. The optional connector for the Distripark entrance is estimated at $6M and is related to the optional LCV development. This cost is not included in our analysis of net costs and savings resulting from the AGD.

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Figure 31 – Summary of Handling Savings/(Costs) Detailed Plot of Net Handleing Savings/Costs $1.200 $1.000

Millions

$0.800 $0.600 $0.400 $0.200 $0.000 ($0.200)

Containers shiptruck or truck ship

Empty containers to from terminals

Transload containers

Transload empties

MT yards

Truck waiting time cost

The handling costs and savings are provided in detail in the following table. Table 24: Summary of System-wide Costs and Benefits (thousands)

Direct Financial Savings Operator Savings

Costs/Savings at Year 1 ($000s)

NPV Of Costs/ Savings at 20 Years ($000s)

$(115)

$(1,921)

$538

$8,968

$40

$962

$1,100

$26,443

Shippers, truckers, rail operator

0

0

Shippers, truckers, rail operator, AGD operator

$732

$13,778

Truckers, Shippers/customers

Potential Beneficiaries

Ocean Terminal Activity Full Containers (ship-totruck or truck-to-ship) Empty containers (to/from terminals)

Shippers, truckers, rail operator

Distripark Activity Transload containers Transload empties MT Yard Activity MT yards Truck Wait Time Truck waiting time cost Total Savings Less Annual Shuttle Cost Net Handlings Savings/(Costs)

$2,294

$48,229

$(1,201)

$(14,963)

Rail Operator

$1,094

$33,266

All of the above

The net savings as a result of the AGDH is estimated at $1.1M per year, including all handling, rail, trucking and terminal operation costs.

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Table 25: Other System Savings (thousands) Indirect Financial Savings Operator Savings Reduction in Road wear and tear 16 GHG Emissions

Costs/Savings at Year 1 ($000s)

NPV Of Costs/ Savings at 20 Years ($000s)

$47.10 $8.4

$446.07 $144

Potential Beneficiaries HRM/HRM Taxpayers Everyone

Figure 32 expresses the savings per railed container. Year 1 savings per railed container are $40/container and by Year 20, $55.00 per container. Figure 32 – Savings Per Railed Container Operating Savings Per Railed Container $60

$50

$40

$30

$20

$10

$0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Figure 33 shows the total savings, comprised of total transload savings and total savings from empty exchanges.

16

The per tonne value of GHG emissions was based on a range of $9.00 to $10.00 from the previous study (2006 Inland Terminal Study). We have seen estimates as high as $95.00 per tonne of carbon alone.

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Figure 33 – Savings over Time By Source of Savings Savings Over Time, by Source of Savings $7,000,000 $6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000 $0 2009

2010

2011

2012

2013

2014

2015

2016

Total Transload Savings

2017

2018

2019

2020

2021

Total Empty Exchange Savings

2022

2023

2024

2025

2026

2027

2028

Total Savings

Overall, the AGD would costs $14.5M to build, $440,000 per year to operate and would generate a net savings to the system of $1.1M through all sources (that could be estimated) – road cost reductions, net handling cost reductions, net reduction in truck operations, net reduction in road maintenance and net reduction in GHG emissions. The 20-year NPV of this savings is on the order of $33.3M, at a discount rate of 5%.

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8.0

The Value Proposition

The new concept has many benefits to a number of critical stakeholders. 8.1 Halifax Port Authority This new concept provides an opportunity for the port to promote transload activity, and thus cater to the sector of its market which is expected to grow substantially. The main concern of the Halifax Port Authority is that a project such as NIT at Rocky Lake could lessen its competitive position by adding costs. The concept of AGD is that the cargo would choose the least cost option of existing routings or the AGD. As mentioned above, it is an investment opportunity for the port, similar to the Vancouver Port Authority’s investment in Coast 2000. The Distripark terminal also removes trucks from the downtown and emerging Seaport cultural and tourist district, as well as Lower Water St. 8.2 Halifax Regional Municipality The benefits to HRM in general are in several areas: ! ! ! !

removal of some truck traffic from downtown; decrease in wear on the road infrastructure; increase in property values and desirability of downtown; and reduction of GHG emissions and noise pollution in downtown area.

8.3 Downtown Halifax Benefits to downtown Halifax relate to the removal of some truck traffic from Hollis and Water Streets and the corresponding enhancement of the urban aesthetic. Removal of truck traffic and the decrease in noise and air pollution at street level is compatible with the increasing demand for residential and office space downtown, and the desire by residents and businesses in HRM for a revitalized core. Less truck traffic would obviously create more pedestrian-friendly streets, and would enhance HRM’s ability to achieve goals under “HRM by Design”. 8.4 CN Halifax is a key terminal for CN, being the eastern terminus for CN as well as the closest North American mainline rail-served Port to Europe and India. CN is one part of this delivery chain. This natural advantage for container traffic has played well for CN in the past and CN is looking to maximize its traffic in this area where there is no real rail competition. However for international container traffic this very advantage in time is also a cost and distance disadvantage on the land portion of the container delivery chain. The Port of Halifax is much

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further than New York and other US Eastern seaboard ports to the US Midwest and even Toronto. As with all railways, CN requires significant traffic volumes to offset high fixed overhead and track infrastructure costs. CN Halifax has been negatively impacted by a Canadian dollar now on par with the US dollar, coupled with the ability of Eastern US ports to handle more container traffic. This in turn has lead to a decline in vessel callings at Halifax in recent years, and its related rail traffic to Montreal/Toronto, Chicago and beyond. Lower traffic levels through Halifax puts more pressure to reduce rail service offerings in order to maintain sufficient operating levels. CN is well aware of this problem. The best rail service offerings are influenced by volumes and as such CN is looking for ways to significantly increase traffic through the Atlantic Gateway. Since the matching of volumes arriving by vessel and train size is a considerable problem operationally as well as from a logistics perspective, the larger the number of vessel calls at a given port, the better the traffic will flow to and from rail. For example trains operate daily in order to maximize car utilization. Shipping lines do the same with their vessels. However semi-weekly or weekly vessel calls, with large container volumes that exceed 500 containers, are not a good match for a daily train service. In this case containers are transferred and piled on the ground, either waiting for trains or for vessels, resulting in delays, and extra handling costs. The service common denominator between ship and train is best reached when ships have daily callings and daily train service expands to fill this need. If vessels call on Halifax twice a week with 3 days worth of import container train volume, import traffic can be delayed at the port for up to 3 days at the port. Unlike Halifax export traffic which is of less value and can arrive at the Port on the days before the vessel calls, the Halifax import traffic, on the other hand represents the most value, and drives the Halifax time-value advantage. Therefore, the cost of the delivery chain increases as vessel callings lessen, and nether the shipping lines or railway are in position to minimize overall costs if they make up for the imbalance with extra vessels or extra rail cars. 8.5 Distripark and transload CN sees opportunities for their domestic traffic related to the international container business. Halifax and Atlantic Canada tend to be net importers of domestic goods from Central Canada. Unlike trucks that can operate trips in a triangular basis and reduce their overall empty miles (i.e. Central Canada – Maritimes – US Northeast – Central Canada), CN runs an East/West operation and is disadvantaged in finding goods to fill the return domestic trips from the Halifax area to Central Canada. However, the advantage of domestic containers is that they are able to carry significantly more goods per container than the usual marine ISO containers. This ratio can be as much as 2.5 TEUs for every 53 ft container depending upon the product being moved. This is not only a cost advantage for moving goods per container, but it also represents a quick turnaround for the international container at Halifax. A significant amount of the domestic CN Halifax containers already involve transloading either international containers or local trucks with loaded with product from the region. CN is interested in any plans which would reduce the cost of transloading and or moving product through the delivery chain. They have announced March 2008

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they are looking into the construction of a new transload facility on CN property near their HIT domestic terminal. Their main cost advantage would come in having such a transload facility near to HIT. We have proposed to CN they investigate the synergies of relocation of the HIT facility to the proposed Distripark, precisely to take advantage of the proposed transload infrastructure, which is discussed in detail in Chapter 4. We also suggested they look at the new terminal and possible synergies with the Dartmouth rail yard which is currently located in downtown Dartmouth. At this time CN have not taken a position on this proposal and are investigating the merits of same. 8.6 Shuttle train The transhipping of containers and in particular the loading of the empty international containers at Halifax with export product is also an opportunity for additional rail revenues. As explained in Chapter 4, the reduction of truck miles in and round Halifax and associated cost avoidance, road wear and tear, environmental emissions point to a better way to move containers on a commercial basis between the proposed Distripark and the Port Terminals. In particular, reloaded export containers can tend to move in large numbers and finding enough drivers at times to meet vessels sailings can be difficult. It is recognized that this type of rail shuttle operation is an unusual train operation for CN, which derives most of its revenues from providing long haul rail service. Nevertheless, CN has agreed to review the proposal and provide a response once the study is completed. 8.7 Terminals The inland port concept as originally proposed could only benefit the container terminal operators by increasing their effective capacity and thus postponing the need to construct a third container terminal in the Port of Halifax. The value of this could only be realized if and when the additional capacity were required, since only then could the additional handling costs be offset by the capital avoidance of building a third terminal. The AGD will allow transload cargo to be handled more efficiently and reduce the number of intermodal trucks on city streets. It promises an overall cost savings rather than an additional expense in the long term and the benefits increase with volume. It would compete with alternate methods of local cargo transportation and thus only be chosen when the benefits outweigh the drawbacks. Transload cargo has been the fastest growing segment of container traffic in the port and is expected to drive growth for the foreseeable future. 8.7.1

Reduced empty handling at the terminal

The location of the AGD and its extended hours of operation will favour the storage and distribution of empty containers from that location rather than from the existing container terminals. Much of the existing empty handling at the terminals could be eliminated.

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8.7.2

Conversion of loads from truck to rail

The transload import cargo (full containers) would be able to leave the terminal (in bulk) by rail. Some of these containers could be handled directly from ship to rail thus avoiding an extra handling. Others, that would need to be grounded, would benefit from the ability to be loaded out in bulk (first come first serve) to rail rather than individually to truck as is the case presently. Similarly, the export cargo could be grouped (segregated) by ship to minimize the handling requirements on arrival. 8.7.3

Truck gates

As the number of trucks handled at the existing terminals is reduced, the queues should also reduce and consequently the waiting time. In particular, the longer haul truckers arriving in Halifax overnight would have an advantage in exchanging containers at the AGD. 8.7.4

Dwell times

Most of the transload containers would be moved to the ADHD on arrival as long they were cleared to leave the container terminal. This will liberate some storage space and should result in less digging for containers delivered to truck from the terminals. 8.7.5

Empty storage

The AGD should attract much of the empty handling and storage activities, thus liberating valuable space on the terminals. 8.7.6

Revenue

While the storage and handling of empties uses up some capacity on the terminals, it is also a source of revenue which is not necessarily offset by a savings unless the capacity it liberates is required. 8.8 Shipping lines Shipping Lines are the primary contractors for transportation of ocean containers; most other service providers are sub-contractors to the shipping lines. They control most, if not all of the routing of a container from origin to destination and generally own or lease the containers. As the general contractor for the transportation of the container between the shipper and the consignee, they must pay the costs of transportation and handling activities out of the revenue they generate from the container shipment. Any extra expense associated with the movement of the cargo is generally borne by the shipping line; likewise, any savings can improve their efficiency and the contribution per container.

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8.8.1

Transload cargo

Transload activity is a relatively new phenomenon for Halifax; the Port of Halifax has promoted this concept for a few years and private sector transload operators have recently invested in facilities. By 2009, the transload volume is estimated to reach 400 full containers per week, or approximately 40,000 TEUs, since most of the containers would be 40 fts. This is close to 15% of the total TEUs through the port. These containers become part of the local market and make it more interesting for shipping lines to call Halifax. As long as the use of rail to move the containers to the AGD is market driven and optional to the shipping line or whoever controls this segment of the transportation train, the shipping lines could benefit from the AGD in regards to the transload cargo. Additionally, the cost of moving the empties generated from the import transload back to the existing terminals can, in large part, be avoided. 8.8.2

Handling and storage rates

As the primary customers of the container terminals, the shipping lines enjoy favourable handling and storage rates at the container terminals. Stevedoring rates tend to be based on throughput (from the ship to the truck or rail and vice versa) and can even include the handling of the empty containers associated with shipboard moves. Even throughput rates are based on an expected mix of business and handling process and the rate is reflective of the entire costs divided by the number of shipboard moves rather than of the cost of the individual moves. The rate is simplified by using an average rate rather than creating a plethora of individual rates. Similarly, a certain amount of “free” storage is provided at the terminals for full and empty containers. The amount of free storage allowance and the cost for storage beyond the free period/amount is negotiated along with the throughput rates and is generally based on the shipping line’s needs and past history of volumes, mix of business etc. The shipping lines could benefit from certain services offered by the AGD, but would need to change the structure of their rates to fully benefit from its use. Under the present rate structure, the shipping line could be required to pay the additional costs without realising all of the offsetting savings. 8.8.3

Empty containers

The shipping lines could benefit from the extended hours for trucks to pick-up and drop off containers although the single rate structure for truck hauls within the Halifax area works against this to some degree. The empties generated from the import transload can certainly be despatched from the AGD and empty exchanges lines would have to pay for could occur at the AGD. In order to maximize these empty to empty exchanges, the full to full export-import exchanges will have to be maximized at the existing terminals, since full empty and emptyfull exchanges will likely continue to be handled at the existing container terminals.

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More empty-empty exchanges handled at the AGD will result in fewer trucks at the container terminals, less queuing and presumably better turnarounds. 8.8.4

Export consolidation

The AGD will act as a common-user empty yard, not affiliated with a specific trucking company or service provider. In this regard, it will compete with the existing empty container yards in the greater Halifax area, although there could be the possibility of those operators investing or participating in the operation of this terminal. It is also foreseen that the AGD would act as a container repair facility and possibly as a container leasing depot. As an empty yard, the AGD would shorten the haulage distance for containers originating from or destined to the following general areas: ! ! ! 8.8.5

Burnside Industrial Park; Valley destinations; and destinations in the direction of Truro and beyond. Consolidation of export

Shipping lines could benefit from the consolidation of certain high volume commodities such as pulp and paper, so that a lager booking could serve as top-up cargo made once space is deemed available. To some degree, this occurs now but the AGD would facilitate this by reducing the lead time between the booking and the containers arriving at the terminal for loading. 8.8.6

Other services (container leasing and repair)

The local market served by the port of Halifax has traditionally been an export market although the increase in transload cargo will contribute to balance loads or even reverse the situation over time. A leasing company that would use the AGD as a base would have their containers available where they are likely to be needed for exports, sometimes at the last minute. Similarly a well organised container repair facility could complement the AGD’s other activities and the shipping lines would have another supplier to choose from for these repairs. 8.9 Truckers The proposed development offers a number of positive benefits to truckers through the reduction of distance traveled and access to a more efficient and more accessible intermodal terminal. The benefits to truckers accrue through the following: !

Shorter distance traveled – truckers whose pick-ups would normally be at the ocean terminals have the option to pick these up at the inland terminal and therefore avoid travel to the ocean terminals. This results in: ! less fuel consumption; ! less wear and tear on trucks and tires; ! less operator/labour time; ! shorter turn around for a pick-up; and

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!

other benefits include the effects of truck trip redistribution on the generation of greenhouse gases through the reduction of vehicles idling as a result.

!

a reduction in traffic conflicts through reduced traffic congestions leading to lower emission from both trucks and automobiles; and

!

lower emissions as a result of more efficient short-haul transport.

We spoke with some truckers who were (anecdotally) interested in the possibilities presented by an inland terminal located in Burnside with rail access. Truckers saw the potential benefits for distripark and transload activities and the synergies that are possible with exiting services within Burnside. They also acknowledged that the decision to move forward with this option would be driven by the shippers. 8.10 Shippers Shippers are the ultimate customers of the transportation cycle as a whole. Ultimately, they bear the total cost of moving cargo from origin to destination. Since the use of the AGD is optional and market driven in competition with existing practices, the AGD will only be considered when the overall benefits outweigh the costs of its use in the transportation cycle. 8.10.1 Transload

Transload activity is estimated to attain 400 full containers per week by 2009 and it is expected to grow at an accelerated rate of approximately 2 times the growth rate of the local market for the foreseeable future. A major component of the AGD’s concept is that transload facilities would be located on the perimeter of the AGD such that the AGD would be in their back yard. At present, transload containers are trucked to the transload facility and the container is returned to the container terminal as an empty in almost all cases. The use of the AGD would allow the empties associated with the transload cargo to remain on site and thus save the additional trucking cost. 8.10.2 Access to cargo

For those containers moved by rail to the ADHD, the cargo would be available to the transload facilities on a continuous basis and under their control without having to use public roads. The AGD would, in practice, serve as the transload facility’s cargo storage area. Because there is no gate move associated with the unloading of the containers, containers could be yard-shunted to and from the perimeter facilities as required by the operator of the transload facility. 8.10.3 Scheduling

The extended hours of operation of the Distripark facility would allow more flexible scheduling of container pick-up and delivery and the continuous operation of the truck operation at the AGD would minimize queuing times. Distripark transload operators could tailor their hours as their customers demand. The effective (including queuing) wait times at the AGD would be significantly reduced as would be the variability of the truck turnaround times.

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8.10.4 Common-user empty yard

The AGD will act as a common-user empty yard, not affiliated with a specific trucking company or service provider. In this regard, it will compete with the existing empty container yards in the greater Halifax area. It is also foreseen that the AGD would act as a container repair facility and possibly as a container leasing depot. As an empty yard, the AGD would shorten the haulage distance for containers originating from or destined to the following general areas: ! ! !

Burnside Industrial Park; Valley destinations; and Destinations in the direction of Truro and beyond.

8.10.5 Consolidation of export cargo

Certain high volume commodities such as pulp and paper could benefit from storing their production destined for export closer to the port. As an example, an exported booking 50 containers at a time could haul their cargo to a consolidation facility using larger domestic sized equipment and have the export cargo stored and available for loading into containers in a timely fashion, compared to the time required to organize and schedule the number of trucks that would be required to haul the containers to the plant and back to the container terminal to meet the ship. Such high volume export bookings are sometimes only accepted by the shipping lines near the date of the ship arrival once space on the ship is confirmed; and it is not always possible to find the number of trucks necessary within the time constraints. 8.11 Municipal group It is proposed that the terminal be sited on a 67 acre parcel of mostly owned by the Municipal Group, a major construction company. The site is at the southern extremity of the company’s land holdings, away from the main quarry operation. Waiting to quarry the land in question could be argued to not represent the “highest, best use” of the property (which is ultimately their decision to make). This project represents an opportunity for the owners of the quarry, in several respects. The owners could sell or lease the land to the terminal operator, and perhaps take an equity interest in the terminal. They would also have an opportunity to develop a logistics park on lands adjacent to the quarry. The company does have a history of making strategic investments of this type, notably their involvement in the regional landfill project, Scotia Learning PPP schools and the Harbour Solutions project.

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9.0

Synergies

9.1 Transload/distribution In 2004, the Greater Halifax Partnership and partners undertook a study of potential distribution centre (DC) activity that could take place from Halifax as a way to attract additional container cargo traffic to the Port of Halifax. The major piece of learning from the study was that distribution centre activity was unlikely to take place in the short to medium term, but that a hybrid of distribution centres, container transload activity, held some potential. In the past two years, an agreement was signed between CRSA and Armour Transportation Group to move 4,000 TEUs through Halifax which would be distributed from a facility in the Burnside Industrial Park. Another company, Consolidated Fastfrate opened a new 90,000 SF transload facility in Burnside in September 2007. There are several more major retailers interested in moving additional volumes through Halifax if there was improved transportation distribution infrastructure available. The transload sector is important for both inbound cargo to feed national supply chains in central Canada and to provide containers for regional exporters. The contents of three (3) 40 ft. ocean containers are destuffed at a transload facility and restuffed into two (2) 53 ft domestic containers or highway trailers. At present, the 53 ft unit would likely return to central Canada empty and the 40 ft unit would likely return to Atlantic Canada empty. Transloading balances out two empty loads with two full loads. The retailer pays for two units to move inland instead of three. The local shipper in Atlantic Canada obtains access to much needed container equipment much sooner than otherwise. The retailer has the option of shipping its 53 ft unit to a distribution centre in central Canada or directly to a store, as well as eventually performing some value added services. The Greater Halifax Partnership has established a Transload Transaction Team comprising itself, Halifax Port Authority, Halifax Gateway Council, Halifax Stanfield International Airport Authority, HRM Business Parks and Nova Scotia Business Inc. it is a major priority, as is the opening up of new property within Burnside Industrial Park. The Distripark with private access to large warehouses and transload facilities would substantially enhance this effort. 9.2 HRM business parks strategy A 2005 strategic plan for Burnside Business Park identified the opportunity to create a precinct within the park targeted at the warehouse/distribution sector. The 2007 “Building the Container Transload Sector” study refined this concept and proposed a new developed area of Burnside (Phase 13) that could be developed to assist the Halifax Port Authority with its transload development strategy. Relocating the proposed Inland Terminal from Rocky Lake to Phase 13 will increase the infrastructure available for the Transload Park and the critical mass needed to establish the Inland Terminal.

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9.3 Burnside expressway Phase 13 of Burnside Industrial Park would entail completion of an important link in the provincial 100 series highway network, a section of Highway 107 linking the Atlantic Gateway – Halifax Logistics Park with the Burnside Industrial Park, the Port of Halifax, Highway 102 to the Halifax Stanfield International Airport as well as to the main highway to New Brunswick and central Canada. Pending the outcome of a feasibility study currently underway, the Expressway could also connect the proposed Logistics Park to the AGD. Currently the four-lane Bedford Bypass/Magazine Hill is the only direct link between Bedford/Sackville and Dartmouth/Burnside. A major segment of this link also forms a main thoroughfare through Burnside, Atlantic Canada’s largest business park. Currently there are about 30,000 vehicles per day (vpd) using the Bedford Bypass. Significant traffic congestion is a regular occurrence, especially during the morning and afternoon peak hours. The proposed Burnside Expressway will improve safety, reduce traffic congestion and vehicle emissions, decrease travel time for passengers and cargo and support economic development objectives of the Halifax Gateway. Completion of this link will provide badly needed additional capacity (lanes) which will alleviate traffic congestion and improve cargo flows to and from regional Gateway-related infrastructure nearby. 9.4 HRM by design The HRM by Design project (due for completion in March, 2008) will produce a plan for the revitalization of HRM’s regional core, which includes peninsular Halifax and the area within the circumferential highway in Dartmouth. A recent summary of key ideas from the draft plan shows a focus on intensifying development in the downtown core; incorporating more residential development into the downtown; increasing office space downtown; and creating streets that support an enhanced pedestrian experience. The removal of truck traffic in downtown Halifax and the removal of the marshalling yards from Dartmouth would support key elements of the HRM by Design approach. For example, urban aesthetics would be enhanced, downtown neighbourhoods could be more viable, and intensification and repopulation of the regional core would be possible. While some may view the emerging plan as somewhat unrealistic, there is a popular vision of downtown Halifax that does not include trucks traveling along the waterfront. This idea was around the same time as the RFP for this project was issued, so many people may view it as entirely consistent with a “new downtown”.

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Figure 34

9.5 Green initiatives 9.5.1

HRM’s climate change initiatives

Development of the Distripark is directly linked to HRM’s multiple initiatives related to mitigating climate change and improving air quality, including sustainable land use planning through HRM’s Regional Planning process. Specifically, HRM has developed the Climate SMART project, to mitigate and adapt to impacts from a changing climate. The project has numerous components, including GHG reduction plans. HRM’s Corporate Local Action Plan to Reduce Greenhouse Gas Emissions (Dillon, 2005) set as a target the reduction of GHG emissions from municipal operations by 20% from 2002 levels by 2012. HRM is now incorporating measures to reduce GHGs from its buildings and vehicle fleets. While HRM has and is continuing to make significant strides in reducing GHGs from its corporate operations, progress in reducing GHGs generated by the community is more difficult. HRM commissioned the Community Local Action Plan to Reduce Greenhouse Gas Emissions (Dillon, 2006), a plan for challenging and supporting the HRM community to reduce GHGs generated by residents, commuters, businesses and industry by 20% below 2002 levels by 2012. While the Community Plan identifies opportunities for GHG reduction by HRM businesses and community members and sets out measures the municipality will employ to support and encourage community efforts, progress in achieving the target requires significant community effort and commitment. The Distripark, which will result in a significant decrease in truck traffic in the core and consequently notable reductions in GHGs, will represent a major contributor to the community GHG reduction target.

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9.5.2

79

HRM’s clean air initiatives

Recognizing the importance of preserving air quality and recognizing that the Municipality does not have a delegated mandate to manage air quality (the responsibility of the federal and provincial governments), HRM is investigating an Air Quality By-Law to address local air quality issues. As a first step, the Municipality has commissioned a comprehensive Clean Air Strategy for the region, and is investigating the strategic options for HRM to ensure clean air for residents. The Framework for a Clean Air Strategy identifies the main issues that affect the air quality and its management, and identifies opportunities for HRM to influence stakeholders, residents, formal processes, and attitudes in order to sustain air quality. The Framework identifies Shipping and Marine Emissions as an air quality issue, noting that although Halifax Harbour is the focus of many activities in HRM, the Municipality has no jurisdiction over shipping and marine emissions. The report recommends that through an integrated airshed management approach, HRM can partner with the Port of Halifax to identify and implement emission reduction measures for ocean-going vessel, ferries, harbour vessels and port operations. The Distripark will represent a significant achievement in the Clean Air Strategy, through improvement of air quality in HRM, particularly in the Core. 9.5.3

HPA emissions baseline and reductions

The Halifax Port Authority (HPA) commissioned a GHG emissions baseline report (Dillon, 2008) in response to environmental and regulatory developments and trends in HRM and elsewhere. The report reviews potential emissions reduction measures to be considered by HPA and presents a framework for implementing emissions reduction. While the inventory focuses on non-ship related emission sources, truck and train transport are considered effectively outside the control of HPA and are, therefore, not included in the overall inventory. Notwithstanding, development of Distripark will align with HPA’s efforts to reduce GHG emissions associated with port-related activities. 9.6 Provincial green initiatives Nova Scotia’s Environmental Goals and Sustainable Prosperity Act includes commitments to cut greenhouse gases to 10% below 1990 levels by the year 2020, and large reductions in other air pollutants by 2010. To help achieve that goal, a $42.5M Ecotrust for Clean Air and Climate Change was established in 2007 with federal funding to support projects that reduce GHG emissions and other air pollution. Nova Scotia’s Ecotrust will support various initiatives, ranging from tidal power to natural gas conversion at Capital Health to research into carbon sequestration. While Provincial initiatives regarding GHG emission reduction are obviously focused on greener power, the program is just beginning and plans to provide support for additional clean air and climate change initiatives. Nova Scotia’s new legislation and Eco Trust demonstrate the Province’s interest in and support for programs that address the climate change issue. 9.6.1

Environmental technology program

Under Nova Scotia’s Ecotrust, the Environmental Technology Program (ETP) will support the development, demonstration, adoption and commercialization of environmental technologies and innovations that reduce GHGs and air pollutant emissions while advancing sustainable prosperity in Nova Scotia. The program has committed to investing $9.5M into March 2008

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projects initiated by Nova Scotia businesses, institutions and organizations. The Environmental Technology Program will be in place until March 31, 2010. 9.6.2

Ecotrust municipal program

The Ecotrust Municipal Program is to support municipally run projects that target reductions in greenhouse gas and other air pollutants. The program will provide support to municipalities in reducing emissions from internal municipal operations and to projects resulting from partnerships between municipalities and the private sector and NGOs. Preference will be given to capital projects rather than strategies, although these will be funded as part of a capital project. Based on available information on this program, there may be potential for some funding support for the Distripark Project, should HRM be a project partner. 9.7 Federal Green initiatives The Government of Canada estimates that the commercial highway freight sector is responsible for close to 10 percent of Canada's greenhouse gas emissions. In December 2007, Canada’s new government announced its commitment to reduce greenhouse gas emissions by 20% from current levels by 2020, through new clean energy and cleaner transportation initiatives (address by Hon. John Baird, Minister of the Environment, at the United Nations Climate Change Conference, Nusa Dua, Bali, Indonesia). There is significant public interest in and support for emissions reduction in Canada. In a recent survey of one thousand Canadians commissioned by the Chamber of Marine Commerce, 90% support the government offering incentives to encourage companies to use more environmentally friendly methods, like marine transportation, to transport their goods. In terms of specific rewards, 69% of Canadians recommend the government offer tax incentives and 63% want the government to reduce or eliminate government fees that companies now pay to use the greener marine transportation. While federal initiatives for freight transportation to date have focused primarily on the reduction of GHGs through new technologies to reduce emissions from vehicles and equipment, rather than through encouraging one mode of transportation over another, the Federal Government’s commitment to and support for reduction of greenhouse gas emissions from freight transportation is apparent in its initiatives and programs. The use of hybrid locomotives in a rail shuttle to and from the Distripark might qualify for these programs. 9.7.1

EcoTransport strategy and the ecoFreight program

In 2007 Canada launched the ecoTransport Strategy. To date strategy initiatives include the ecoMobility program, the ecoTechnology for Vehicles Program, the ecoENERGY for Personal Vehicles Program, and the ecoFreight Program. With an investment of up to $61M, the ecoFreight Program is focused on reducing the environmental and health effects of freight transportation through technology, and is being delivered by Transport Canada and Natural Resources Canada. The initiative is to reduce fuel use and emissions through six initiatives:

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!

National Harmonization Initiative for the Trucking Industry – identifying regulatory

barriers and solutions in collaboration with provinces and territories, so that the Canadian trucking industry can embrace emissions-reducing technologies. !

ecoENERGY for Fleets – reducing fuel use and emissions in commercial and

institutional fleets via training, sharing of best practices, anti-idling campaigns, technical analysis to look for potential improvements and other technology opportunities. FleetSmart is a component of this program, offering free practical advice on how energy-efficient vehicles and business practices can reduce fleet operating costs, improve productivity and increase competitiveness. Along with the latest developments in fleet and fuel management, the initiative includes improving education and awareness by fleet vehicle owners and managers of efficiency benefits of new and developing technologies. On the education side of the initiative, it's expected that more than 200,000 professional drivers – of heavy trucks, buses, construction and other vehicles – will receive training in energy efficient vehicle operating techniques over the next four years. !

Freight Technology Demonstration Fund – establishing cost-shared demonstrations

to test and measure new and underused freight transportation technologies in realworld conditions. Provides the freight transportation industry with cost shared funding for real world testing of freight transportation technologies that have the potential to reduce the emissions of air pollutants and GHGs. Examples of eligible projects under the program include: installation of aerodynamic devices to reduce drag on moving trailers; Implementation of fleet management best practices; and integration of technologies to reduce fuel consumption. Freight carriers, technology providers, eligible facility operators, freight forwarders, shippers, educational and academic institutions, industry associations, and not-for-profit organizations are eligible for funding. !

Freight Technology Incentives Program – providing cost-shared funding to

companies and non-profit organizations in freight transportation to help them to purchase and install proven emission-reducing technologies. Provides cost-shared funding to support the purchase and installation of proven technologies throughout the freight transportation system that can reduce the emissions of air pollutant and GHG emissions. Examples of eligible projects under the program include: purchase of diesel anti-idling equipments in rail yards, ports, airports and trucking stations; purchase of hybrid switching locomotives; and purchase of electronic speed control systems. Private enterprises that operate freight transportation in Canada using any of the four modes (air, marine, rail, and road) are eligible. Examples include air carriers, railways, trucking companies, marine carriers, and eligible port and airport facilities. !

ecoFREIGHT Partnerships – building and maintaining partnerships within the

transportation sector to reduce emissions from freight transportation through fast and flexible voluntary actions that can support the regulatory framework. !

Marine Shore Power – demonstrating the use of shore-based power for marine

vessels in Canadian ports to reduce air pollution from idling ship engines in some of Canada's largest urban centres. !

The ecoFreight Program builds on the major-infrastructure investments that the

Government of Canada announced in the 2006 federal budget, as well as the best

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elements of past freight technology initiatives that are consistent with the Government's objectives and approach. It also complements other measures, like regulating emissions from rail and marine transportation and fuel consumption of new light duty vehicles, announced in the fall. !

The freight transportation component of Canada’s 2000 Action Plan on Climate Change was represented by the Commercial Transportation Energy Efficiency and Fuels Initiative, a four-year, $32.2M program intended to complement existing energy-efficiency efforts under Transport Canada's Freight Efficiency and Technology Initiative (FETI). The initiative, which was concluded in 2006, represented a variety of measures designed to reduce the growth of GHGs emitted by the freight transportation sector. Past initiatives with relevance to this project include: !

The Freight Efficiency Program – delivered until 2005 and administered by

Transport Canada, the initiative focused on reducing GHG emissions by Canada’s freight-transportation sector by providing financial incentives for the purchase and installation of energy efficiency enhancing equipment in the air, marine and rail modes; and education and awareness programs for shippers and freight forwarders. !

The Freight Incentives Program – provided financial support for the purchase

and installation of GHG-reduction technology and equipment. Funding under the program was available to companies in the rail, marine and aviation freight transportation sectors. !

Marine Shore Power Pilots – funded the installation of marine shore power at

suitable locations across Canada for up to three pilot projects. !

Awareness Programs for Shippers and Freight Forwarders – aimed at the

purchasers of transportation services, this initiative increased awareness of the environmental, economic and other benefits of different transportation choices related to freight transportation decisions. The program also attempted to identify barriers to the adoption of environmentally friendly alternative methods of shipping, and to develop recommendations to overcome them. 9.8 Atlantic Gateway The Atlantic Gateway initiative of the federal government has been unfolding within the past two to three years. In September 2007 ACOA released the Atlantic Gateway Business Case. A month later, the federal government signed a Memorandum of Understanding with the four Atlantic Provinces to develop the Atlantic Gateway. The federal government has also been developing a national policy framework for Strategic Gateways and Trade Corridors, which looks at potential Gateway investment through five “lenses”. To paraphrase: ! ! ! ! !

investments have to fit an international commerce strategy; volumes and values have to be of national significance; they have to fit the parameters of future patterns of global trade and transportation, meet the potential scope of capacity and policy measures; and there also has to be a federal role and the potential to develop effective partnerships.

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This project would fit most of these criteria and greatly assist in growing the transload sector, as described in the Atlantic Gateway Business Base.17 It would have a particularly positive impact on national supply chains the impact of which has been especially well described by Pat Sinnot, Vice President, as well as Atlantic region exporters who would have access to containers that are transloaded. As of January 2008, the terms and conditions for accessing the $2.1B Gateways and Border Crossings Fund were still being developed.

17

InterVISTAS Consulting et al., Atlantic Gateway Business Case, Atlantic Canada Opportunities Agency, September 2007.

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10.0 The Business Case and Implementation 10.1 Partnerships This section addresses the question asked in the Request for Proposals: What partnerships are required to be formed? This is a multi-faceted project with many potential players involved. Funding for the construction of the terminal’s infrastructure should be provided by the Halifax Regional Municipality, HRM Business Parks, the federal government and the provincial government. CN should fund and remain the owner of the tracks (estimated at $2.6 M). The deal between CN and various levels of government is the first that needs to be struck. Without a committed shuttle service, the AGD would simply be a government-subsidized container yard competing with the existing privately owned yards. The terminal would be built by the partners listed above and equipped by the terminal operator. The terminal operator would be chosen through a competitive bidding process for a long term concession agreement. 10.2 The deal Capital Investment (apart from the land ownership) could be divided as follows: Government:

$11.9M 40% federal 40% provincial 20% municipal

CN:

$2.6M (assumes rolling stock acquired under operating lease rather than capitalized)

AGD Operator:

$4.4M

Total:

$18.9M

Different sections of the terminal could be built by different partners. The federal government and HPA could fund the basic terminal (as was done for Coast 2000 in Vancouver), while the provincial government and HRM could pay for the highway and road infrastructure. The land owner could provide the land in return for an equity position. Alternatively, the entire project could be built by a logistics park developer such as ProLogis, AMB properties, Hillwood Holdings, or CentrePoint, in partnership with CN. The second “deal” that is required is a rate structure. The business plan of the AGD operator will rely in large part on the shuttle’s competitiveness and the rate structure will need to be known for the concessionaire to develop their business plan and projections. The relocation of HIT’s activities to the AGD would also provide a solid revenue base for the concessionaire. The difficulty with this “deal” is that the concessionaire will not have been chosen when this “deal” is required. This “deal” is required before an RFP can be issued to

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allow the bidders to build their business plan. The “rate” deal will need to be struck with a surrogate for the eventual concessionaire. Since the AGD will be commercially driven and each shipper would remain free to choose their preferred routing, the commercial stakeholders should view the AGD as providing an alternative to the existing distribution system with little or no risk of increasing costs. There should nevertheless be a concerted effort to use the AGD as much as possible in order to reduce trucking through the city and minimize the environmental impact of distribution to the local market, all without adding costs. Shipping lines, terminals, trucking companies and the Bridge Commission should be encouraged to structure their rates so as to maximize the use of the shuttle and the AGD. 10.3 Implementation The project would benefit from broad Stakeholder buy-in, in particular amongst the following groups: ! ! ! ! ! ! ! ! !

HRM; HPA; container terminals; CN; shippers; transload operators; Bridge Commission; Burnside Industrial Park; and shipping lines.

During the course of the project, and at the urging of the Steering Committee, the consultants have met or spoke with several of these groups, including the container terminals, truckers, a transload operator and the land owner. The first round of meetings resulted in the development of a completely new concept, that which is presented here, instead of the original concept of the inland terminal at Rocky Lake. After developing the new concept for a Distripark, the consultants met with HPA, GHP, the Province of Nova Scotia and CN. It is now recommended that the new concept be presented to all stakeholders in one large meeting, to gauge the level of support and obtain further feedback. Assuming the project obtains broad levels of support from stakeholders, it needs a champion to move it forward. The best organizations to undertake the project would be the Halifax Port Authority, Greater Halifax Partnership, the Halifax Gateway Council, or some combination thereof. Because it is a port-driven Distripark, their support is crucial. The project needs partners who are aligned and onside. Most critical are: ! ! ! ! !

HPA; HRM; Nova Scotia government (TIR, Economic Development, NSBI); Federal government (Transport Canada and ACOA); CN;

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! !

terminal operators; and transload operators.

Once the stakeholders are aligned, investment capital should be sought from both government and the private sector. A presentation package needs to be developed and the proponents should market it to appropriate investors. If it is built on a BOT basis, then this will involve a slightly different process involving a call for Expressions of Interest and then a Proposal Call. If the stakeholders decide to proceed with the project, negotiations should proceed for the purchase or lease of land, or to ascertain whether the landowner is interested in taking an equity interest in the project. 10.4 Conclusion This project is an environmentally-friendly and sustainable alternative to using the rail cut as a truckway. It reduces GHG emissions as well as wear and tea on both city streets and the MacKay Bridge. It reduces overall supply chain cost and makes Halifax more attractive to the fastest growing segment of its business: transload and distribution activity. It also anticipates future issues with the growth of truck traffic associated with ambitions to develop the Atlantic Gateway. In summary, the AGD: !

has the potential to reduce the impact of growing truck traffic on city streets;

!

can be commercially viable from an operating perspective;

!

is located in an industrial area that does not appear to have any significant negative environmental or neighbourhood impacts;

!

is consistent with the Port’s strategy to attract transload facilities to Halifax;

!

is compatible with the long term plans of the Burnside Industrial Park;

!

is a sustainable solution to the desire of HRM and many other stakeholders to reduce the numbers of trucks on Halifax Peninsula;

!

uses the rail cut for a rail shuttle; and

!

is a “green” and sustainable alternative to trucking.

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