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Boonville port has become focal point of talk about proposed Jefferson City port

Boonville port has become focal point of talk about proposed Jefferson City port

August 19th, 2018 by Philip Joens in Local News

The riverside of the Howard-Cooper County Port is visible from across the Missouri River in Boonville on Monday, August 6, 2018. The port is located across the river from the active train tracks, so any items that need to be transferred from train to ship or vice-versa must cross the river by truck.

Photo by Stephanie Sidoti /News Tribune.

BOONVILLE, Mo. — On the banks of the Missouri River near Boonville, the Port of Howard/Cooper County looks like a place passed by time.

Less than a third of an acre in size, two rusting grain storage bins sit next to an aging dock. The last outbound barge traffic left the port in November 2016. Before then, it had been eight years.

"Our infrastructure crumbled there," said Bill Burnett, a member of the Howard/Cooper County Port Authority Board of Commissioners.

Just down the river, another town has a dream of using the Missouri River as an economic engine for growth. Advocates of a proposed Jefferson City port — Heartland Port Authority of Central Missouri — say it could create jobs and drive business for decades to come.

Heartland Port proponents downplay concerns about Boonville's port because they think Jefferson City will build a bigger and better port — while opponents of the proposed Jefferson City port say the Boonville port stands as a rusting reminder of the failures that can happen when economic development officials make big promises and fail to deliver.

River town

As with most modern ports statewide on the Missouri and Mississippi rivers, the Port of Howard/Cooper County traces its roots to the early 1970s. It opened around 1975 and served six to eight companies that operated boats and barges at the port for years, Burnett said.

To his knowledge, Burnett said, the port was always profitable during the first two decades of its existence, although that predated his time on the port authority's board.

Ken Farris, a certified public accountant in Boonville, is the only employee of the Howard/Cooper County Port Authority in a part-time role. Farris, the port authority's long-time treasurer and secretary, said it was a "so-so" venture from the beginning.

Neither he nor Burnett would provide specifics as to the performance of the port in its early years.

In the late 1990s and early 2000s, barge traffic on the Missouri River ground to a halt due to a combination of drought, economic recessions and low commodity prices.

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At the time, the U.S. Army Corps of Engineers, which manages the Missouri River channel, began limiting water releases from upstream dams to protect species of fish. That marked the beginning of the downturn for the Boonville port, Burnett said.

"We always had good community support," he said. "The death knell on the Missouri River was they wouldn't allow enough water releases."

At 9 feet deep and 300 feet wide, the Missouri River's 760-mile navigation channel from Sioux City, Iowa, to St. Louis can be much trickier to navigate than the Mississippi River, according to Burnett, in part because the Missouri moves around more in its channel.

Unlike the Mississippi, navigable sections of the Missouri do not have locks to help boats get upstream. This makes moving upstream more economically inefficient, he said.

"The same horsepower boat that handles 15 barges on the Mississippi would handle six to nine on the Missouri," Burnett said.

Farris said a partnership between the port authority and its private operator of the time, Interstate Marine Terminals, was never great.

Interstate neglected to keep up on maintenance, letting the dock and other equipment at the port fall into disrepair, Farris said. For 20 years, the sides stood at an impasse as conditions at the port deteriorated and traffic dwindled.

"It was not a good marriage to start with," Farris said.

Officials with Interstate Marine Terminals did not return calls for comment.

From 2013-17, the Howard/Cooper County Port Authority never recorded more than a few thousand dollars in revenue. Most of the money came from renting its grain storage bins, Farris said. During that time, port authority revenues peaked at $2,785.43 in 2017, according to documents provided by Farris.

For about eight years between 2008 and October 2016, the port saw no outbound traffic, according to a February report by Atlanta consultant Cambridge Systematics for the Missouri Department of Transportation.

In November 2016, regional farm cooperative MFA Incorporated loaded four barges with soybeans from trucks. Burnett described the process as cumbersome. A portable loading facility would be brought to the site, barges would be brought in and a tugboat would stand by.

"That's not ideal," Burnett said. "The larger towboats you see coming up the river can't afford to stop and do tug service."

As Laura Wax, executive director of the Boonville Area Chamber of Commerce, grew up in Boonville in the 1980s and 1990s, the port always seemed busy. Since she started her job in November 2014, she said, the port hasn't impacted the city's economy much.

The Boonville chamber does not market the port to businesses because it is not a member of the Boonville Area Chamber of Commerce. Wax said she hopes the port will rebound one day because it could help the community.

"Even if it doesn't help the city directly, it would help the county," she said. "At some point, it will help everybody in the community."

As things sit, Wax said, traffic is so low at the port that it feels like a missed opportunity for the region.

"I don't know why we don't use it more given the number of crops around here," she said. "All that's got to go somewhere."

Building a successful port

In July, the Jefferson City Area Chamber of Commerce released an economic impact report it commissioned Cambridge Systematics to write, which evaluated the economic impact of a Missouri River port on Cole, Callaway, Osage and Boone counties.

The report forecast 4,385 jobs could be created through the 25-year life of the proposed Heartland Port — about 175 jobs per year. Cambridge suggested the port would create 2,605 jobs directly and 1,780 jobs indirectly. Freight-dependent jobs could benefit the most.

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The Heartland Port could create 655 new retail jobs in the Boone, Cole, Callaway and Osage counties, the report estimated. About 390 jobs could be created in the wholesale trade industry.

The report also suggested the port could help relieve pressure on Missouri's aging highway system.

In April, the American Society of Civil Engineers gave Missouri a C- on its infrastructure report card, which found 12.9 percent of the state's bridges are structurally deficient, compared to 8.9 percent nationwide. Rail lines operated by private companies seem in good shape, the report found. But rail traffic is expected to increase by 30 percent through 2031, according to the ASCE.

Proponents of the proposed Heartland Port say 77 percent of its traffic would divert traffic from the aging highway system and 23 percent would divert traffic from rail lines. The port could have a maximum potential market of 80,100 tons of goods in its first year, according to the February Cambridge report.

By its 25th year, the Heartland Port's maximum potential market is expected to increase to 115,200 tons, with 73 percent of traffic being diverted from trucks and 27 percent being diverted from rail lines, the study said.

If built, the top commodities for the Heartland Port would likely be metals, chemicals, fertilizers, animal feed and coal, according to the feasibility study. Top markets could be Minneapolis, Houston and Baton Rouge.

The Port of Kansas City, the only other existing Missouri River port besides the Port of Howard/Cooper County, handled 45,000 tons of freight in 2015 and 83,000 tons in 2017.

Wax, the Boonville chamber executive director, said: "The more you can use the river, it's just less (traffic) on the roads. The less (traffic) you have on the roads, the longer they're going to last."

Jefferson City port plan

Cambridge's feasibility report outlined two options to build a Missouri River port in Jefferson City.

The first option would build a port only in southern Jefferson City adjacent to the Missouri National Guard Ike Skelton Training Facility, near the chamber's industrial park.

A second option would build a port near OCCI Inc. in northern Jefferson City in Callaway County, as well as the southern port.

Under the two-site plan, dry bulk commodities would be handled at the south site using conveyor systems. Commodities moved by crane, like those in shipping containers, would be handled at the north site.

Building only the south site would cost at least $54.77 million, Cambridge officials said. The combined plan would cost $59.5 million.

An additional $10 million would be needed for roadway improvements, and engineering and planning services would cost $1 million more.

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Construction of south site facilities is expected to take about two years under both plans. In the dual-site plan, operations at the north site could begin about a year after construction starts.

Callaway County, Cole County and Jefferson City contributed $47,600 each to pay for the feasibility study and economic impact report. For now, the Heartland Port Authority has pinned its hopes on getting a $937,500 BUILD grant from the U.S. Department of Transportation to pay for preliminary planning work, according to documents outlining the Heartland Port Authority Approval Process.

The grants allocate a maximum of $25 million to projects that support roads, bridges, ports or other infrastructure projects. This will be the first time the Transportation Department awards BUILD grants to projects still in planning phases.

"We were lucky in a way," said Randy Allen, Jefferson City Area Chamber of Commerce president. "That's exactly what we need."

If they receive the grants, Jefferson City and Cole County would contribute an additional $75,000 each, and Callaway County would pay $37,500 toward future costs.

In July, the Cole County Commission and Jefferson City Council approved spending up to $150,000 on the next phase of the project if the grant application fails. The Callaway County Commission declined to approve spending $75,000 if the grant funding fails.

If the group gets the grants, it then can look at other costs the entities may incur later, Allen said.

"If we get that, then we can really start looking into all of these costs and what the potential for each of the partners to contribute to this port authority is," he said, adding either way, the project will move forward.

The Callaway County Commission, Cole County Commission, City of Jefferson and Jefferson City Chamber applied to MoDOT in July to form the Heartland Port Authority of Central Missouri. The group hopes MoDOT will make a decision about its application at a Sept. 5 Missouri Highways and Transportation Commission meeting.

If MoDOT approves the Heartland Port Authority, Allen said, they hope to fast-track construction.

"Our plan is to move pretty quickly to get these pieces put together," he said.

How to create a port

Approval of the Heartland Port Authority's application is far from guaranteed.

MoDOT considers six factors when determining whether to approve a port authority:

  • The population of the municipalities submitting the application.
  • The technical and economic ability of municipalities and local businesses to develop and run the port.
  • The economic impact on the applicant's region.
  • The economic impact on the state.
  • The proximity of other ports.
  • The amount of river traffic that would use a port.

The process is designed to set ports up for success, with each port authority choosing an approach that makes them successful in their eyes, said Cheryl Ball, MoDOT freight and waterways administrator.

"There's 14 port authorities, and there's 14 different ways they're approaching it," Ball said.

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But all successful ports in Missouri seem to have close relationships with local businesses, she said.

Areas with ports can form port improvement districts, which levy property taxes on buildings inside the districts to fund development costs, but voters need to approve the districts.

Usually, a private operator is hired to run the port, and port authorities charge boat operators fees as they load and unload goods. The fees can be used to pay down public debt after a port is built, Allen said.

Private firms often can pay for operating equipment like cranes and buildings, he added.

"It's the perfect public-private partnership," Allen said.

Under state law, port authorities are independent governmental bodies like school boards, with powers to tax, pay down debts and buy land.

MoDOT does not require port authorities to file annual reports with the department but does require ports authorities to disclose how they have used MoDOT grant funding, Ball said.

If formed, the Heartland Port Authority's bylaws will require the port authority to file annual reports with Cole County, Callaway County and Jefferson City, according to documents outlining the project. A board of commissioners made up of three members from Cole County, Callaway County and Jefferson City serving three-year terms would govern the port.

Several small ports, including the Howard/Cooper County Port, do not file annual reports. Farris, from the Howard/Cooper County Port Authority, provided limited revenue figures after a request by the News Tribune under Missouri's Sunshine Law.

New life for Boonville port?

The Howard/Cooper County Port wants to up its game.

Almost three years ago, the Howard/Cooper County Port Authority announced plans to revitalize its port by building a new dock and processing facilities on 19 acres of land next to the port.

Since that announcement, little has changed at the site.

"Our hope is to get private businesses to come," Burnett from the port authority's board of directors said. "Our river goes through the bread basket of the nation."

Burnett and Farris don't know how long it would take to revitalize the port. They say they likely would need to rely on a patchwork of federal, state and private grants to finish the project.

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In 2017, the Howard/Cooper County Port Authority received a $260,000 grant from MoDOT to purchase materials for an access road into the new port site, according to documents provided by Farris and Ball. In 2018, MoDOT gave the port authority a $25,240 grant to purchase half of the dock at the existing port from Interstate; the port authority owned the other half of the dock.

A MoDOT grant of $125,014 in 2019 will allow design work on the new port dock and facilities to commence. That grant will also allow work on the access road to start, according to the documents provided by Ball and Farris.

Likely $2 million-$3 million more will be needed to make the new facility operational, according to the February MoDOT report.

"There's not enough money to go around," Farris said.

In 2017, MoDOT allocated $4 million of its $2.5 billion budget for operating and capital assistance for the 14 existing port authorities statewide. During this year's legislative session, the Missouri General Assembly also allocated $8.2 million for improvements to existing ports.

Can two towns' ports co-exist?

A revitalized Boonville port and a new Jefferson City port have the potential to steal traffic from each other, the Cambridge feasibility study noted.

"If the freight is already moving by water, capturing traffic at a new port means it is being diverted away from an existing facility, such as the Howard/Cooper County Port," according to the feasibility report. "Being too dependent on attracting existing water freight is not favorable as there are no net gains or benefits to the larger region and state."

As MoDOT evaluates the Heartland Port's application, it would determine if the two ports could take traffic from each other.

At a February meeting at the Jefferson City Area Chamber of Commerce, Ball said the proximity of the two ports likely wouldn't pose problems.

"It's quite a ways river miles away, so I don't think you're going to be stealing customers from each other," the MoDOT administrator said.

The ports also plan to target different portions of Central Missouri, said Burnett, who is on the Boonville port authority's board of directors.

A revitalized Howard/Cooper County Port likely would target businesses in Mexico, Moberly, Fayette and other communities north of and on Interstate 70, while a Jefferson City port could attract businesses from communities surrounding Jefferson City and the Lake of the Ozarks area, Burnett said.

"There would be some place between where a guy could go either way," Burnett said. "One thing Jefferson City has that we don't is industry."

The Cambridge report cautioned that marketing the Jefferson City port to users outside Mid-Missouri would be key. Only 38 percent of potential traffic for the port sits within 500 miles of Boone, Callaway, Cole and Osage counties. To remain viable and self-sustaining, the report notes, the Heartland Port would need to capture 30-40 percent of its maximum potential market.

"This means that the port would have to be competitive for shorter-distance hauls, which are more challenging," the feasibility report cautions.

There are other key differences between the ports.

The Howard/Cooper County Port is on the north side of the Missouri River, but rail lines run parallel to the port on the river's south side. To reach rail lines, semi-trucks must drive about a half-mile on a neighboring bridge across the river to a small rail yard where trucks can be loaded or unloaded.

Jefferson City's port plans have more manageable rail problems. Union Pacific runs two rail lines through the area near the proposed south site. The company generally uses the north track for traffic moving through the area, while the south track services two existing local facilities.

A crossover point, which allows trains to switch tracks, exists 15 miles from the south site. Union Pacific wants to work with local officials to build this critical piece of infrastructure and may pay for some of the $2 million construction cost.

Though Interstate 70 runs through Boonville, Allen thinks Jefferson City's access to U.S. 63, 54 and 50 puts it in a better position to load and offload goods by truck.

"They're not operating on a very high level right now," Allen said of the Boonville port. "We think we can attract a lot more commerce at our port just because we are adjacent to a lot more highways.

Proponents of ports in Boonville and Jefferson City know a Missouri River port will be open only eight months each year — from late March through early December — when the river can be navigated.

But officials in both cities remain undaunted.

Allen said a Jefferson City port would create other economic development opportunities despite the limited navigation window.

"We think that the impact on new business to the area where the new port is will be a significant help to the economy in this region," he said.

This article was edited Tuesday, Aug. 21, 2018, to correct the estimated maximum potential market that the proposed Heartland Port in Jefferson City could attract.