Developers of the Heartland Gateway Intermodal facility at Prichard promised a lot as they took the project from concept to completion. The 100-acre site that was supposed to open southern West Virginia, southern Ohio and eastern Kentucky to the world market didn't quite accomplish that. Now the state of West Virginia has to figure out what to do with the nearly $32 million investment.
The answer could come today when the West Virginia Public Port Authority board of directors meets to consider hiring a private company to manage the facility.
"The Justice administration has been less than satisfied with the level of activity at the inland port in Prichard," David Lieving, president of the Huntington Area Development Council, told The Herald-Dispatch reporter Fred Pace last week. "The governor made that very clear to me."
Lieving said Toyota Motor Manufacturing West Virginia is the largest user of the facility. Toyota has said in the past the Prichard facility will save the company $500,000 this year in logistics costs.
About a year ago, Huntington-based DARCO International, working with XPO Logistics and Thunder Logistics, became the first local company after Toyota to use the facility for the continuous shipment of its in-bound freight containers.
At that time HADCO called the addition significant.
"These initial shipments provide a proof-of-concept for containerized exports to and from the Port of Shanghai," Lieving said. "The successful execution of these shipments can provide a model for companies throughout the region who use the facility."
Two users do not make a successful publicly owned rail-to-truck transfer operation.
The history of the intermodal facility began around 2005 as railroads were adapting their operations to accommodate the increased amount of container shipping in international commerce. They wanted trains that could carry containers that could be stacked one on top of the other. This required increasing headroom on bridges and in tunnels to allow the higher loads to pass.
Norfolk Southern planned and built several of these double-stack corridors, including the Heartland Corridor, a 530-mile route from the Port of Virginia in Hampton Roads through West Virginia to Chicago. West Virginia wanted a piece of the action. The result was the facility at Prichard, just off U.S. 52 about 10 miles south of Interstate 64.
Norfolk Southern donated 76 acres of the 100-acre site and provided $1 million in development costs. West Virginia provided $18 million, and a federal grant provided $12 million.
It opened for business in late 2015, and it has struggled to come close to matching the original goal for it.
Neal Vance, who had been the port authority's director before leaving his job last week, has said he had approached Appalachian Rail Car Services of Eleanor, W.Va., about a lease to manage the Prichard facility. Vance said the company was interested.
Maybe the intermodal market was stacked against the Heartland Intermodal Gateway from the start. With intermodal shipping being the big thing in international commerce now, every major metro area has one of some sort. This being a relatively sparsely populated market with few major international manufacturers and even fewer regional distribution facilities, there was a scarcity of customers.
But that doesn't mean the state gives up, locks the gate and scraps the track. A private operator could bring skills and contacts the state does not have, but there is no guarantee it could turn the operation around.
There are few if any guarantees in business. A lease could be the best option for bringing the Heartland Intermodal Gateway closer to the potential envisioned for it 15 years ago.