Rail expansion supports economic activity in ID
Idahoans living in communities across our large state create quality, innovative products, making access to reliable and affordable transportation options critical for the success of Idaho small businesses and agricultural producers. Short line railroads are proven to be extremely efficient at moving Idaho goods to customers worldwide. I had the opportunity to join executives from Watco Companies, LLC; Burley Mayor Merlin Smedley; and other local officials in Burley to celebrate a major expansion of short line railroad service, a welcome step in bringing jobs and expanded economic activity to Idaho.
The rail shipment and storage facilities being established by Kansas-based Watco Companies, LLC could quadruple the amount of commodities and other products shipped out of Idaho via short line rail. The effects of the project are expected to be felt from Burley to Pocatello, to Idaho Falls, Twin Falls and Boise. Watco purchased the former Keystone RV manufacturing facility in Burley and will use the 156,000 square-foot facility to establish a new warehouse and distribution facility taking agricultural and other products to market by rail. The company estimates it may increase by five times the short line shipping of commodities in the immediate region through efficient use of climate controlled facilities and state-of-the-art faster rail loading facilities. Another 100 acres surrounding the project can house future businesses related to rail shipping.
Project Perishable: Idaho’s Agricultural Gateway to the Nation’s Markets is being established in a partnership among Watco Companies, LLC; Union Pacific and other class one rail operations; Idaho producers; and commodity distributors. The new plan vastly reduces turnaround time for shipping and loading rail cars to get products to markets across the U.S. Watco chose southern Idaho as the starting point for Project Perishable in part because of the robust potato market and Idaho’s reputation worldwide for quality potatoes. Watco says the shipping and storage facilities will include operations in Pocatello and the company expects to expand into the Idaho Falls area in the coming months.
Seeing a project that will support economic opportunities in our state take shape is encouraging as I have been working with Idahoans and my colleagues in Congress for many years to establish federal policy that supports short line expansion. This includes leading the enactment of federal tax incentive legislation that has helped with this rail expansion project by improving investment tax credits for short line railroads. I am now working to make this a permanent change in the tax code.
As a senior member of the Senate Finance Committee, I am continuing to work with my Senate colleague and fellow Finance Committee Member Senator Ron Wyden (D-Oregon) and others to pass the Building Rail Access for Customers and the Economy (BRACE) Act. The bipartisan measure is one of the most co-sponsored bills in the Senate. The BRACE Act would make permanent a critical tax credit used to repair and upgrade short line railroad operations. This legislation is targeted at long-term rail improvements by providing certainty to rail operators making use of critical tax credits for infrastructure improvements. Since 2006, Congress has acted periodically to extend the credit, often retroactively and typically almost a year after expiration. The uncertainty can cause private investment to decline, limits investments in safety and customer service and provides uncertainty to businesses, farmers and employers that cannot be globally competitive without freight rail. I will continue to work to advance this legislation through the Senate that supports expanded rail operations to the benefit of Idahoans and our economy.