The ASLRRA Business Development Award Competition recognizes the Class II and III railroads that have designed and enacted the most innovative and successful business-building initiatives in the small railroad industry. Please contact Mariel Takamura with any questions.
The nomination period for ASLRRA's Business Development Award has closed.
Short line railroads are always working to attract new business, but expanding partnerships with current customers can be just as effective in driving economic growth for multiple stakeholders. ASLRRA Business Development Award Winner Lake State Railway (LSRC) proved exactly that through its recent work with longtime customer Specification Stone, reshaping how aggregates move across Michigan.
Though this project was ten years in the making, recent completion of upgrades and a high throughput facility have positioned LSRC and Specification Stone to grow significantly in the future. Already the customer has expanded the loading capacity in Alpena, diversified the stone types shipped and opened up a new terminal near Flint, Michigan.
A decade ago, LSRC was serving Specification Stone’s Alpena quarry on the north end of the railroad’s line. The 120-mile stretch to Alpena was 10-mile-per-hour excepted track and the railroad-supplied railcars had holes and were unreliable. Specification Stone was understandably wary of investing in its operations because it did not appear the railroad could support any business growth.
Recognizing these shortcomings, LSRC began working to turn the situation around, leveraging multiple Consolidated Rail Infrastructure and Safety Improvements (CRISI) grants to procure a new railcar fleet, upgrade its locomotives and replace 100-year-old, 85-pound rail with 115-pound continuous welded rail. LSRC also installed other improved technology like defect detectors and a centralized traffic control (CTC) island.
The improvements on LSRC’s side gave Specification Stone the confidence to make its own investments. LSRC worked with their customer to obtain Michigan Department of Transportation grants to help build rail infrastructure in Alpena and further south in Burton, Michigan, where Specification Stone built a new state-of-the-art stone distribution facility on a brownfield site.
LSRC leveraged its strong relationships, local presence and entrepreneurial spirit to help move the project to completion. As a result, customers will have more competitive and reliable options for stone delivery in central and southern Michigan. This will benefit large-scale aggregate customers like road construction companies, which further supports economic development in the region. LSRC expects stone volumes to increase significantly over the next several years.
Not satisfied with the status quo, LSRC turned a long-term customer relationship into a greater success story through grit and determination. Bringing its equipment and infrastructure into the 21st century positioned LSRC to support shipper growth, resulting in significant benefits for the railroad, the customer and communities across Michigan.
ASLRRA’s Business Development Award recognizes its members’ most successful business projects, highlighting the innovative, out-of-the-box thinking that’s required to help short line railroads grow and thrive.
TGS Cedar Port Railroad (TGS Cedar Port), earned this year’s award for development of a new railcar cleaning and transloading rack bringing together multiple ancillary railcar services, including cleaning, de-gassing, nitrogen padding, repairs, requalification, storage and transloading. This facility enables customers to eliminate multiple off-site moves per car, lowering costs, reducing dwell time and improving asset utilization.
The TGS Cedar Port team recognized the inefficiencies its customers were experiencing, having to incur costs moving cars between different cleaning shops, repair facilities and storage yards. For some, this meant spending several thousands of dollars per car to complete required services. And when other facilities were experiencing service backlogs, shippers could find themselves facing significant delays.
The completed project offers customers complete vertical integration. Trans-Global Solutions (TGS), the railroad’s parent company, owns the industrial park and operates the cleaning and transloading rack. The park hosts repair companies and has over 125 miles of internal track served by TGS Cedar Port. There are also approximately 6,000 on-site railcar storage positions.
To maximize the project’s success, TGS Cedar Port worked with local partners. Coordination with Class I railroads Union Pacific and BNSF ensured efficient interchange and dependable car flow. Meanwhile, collaboration with Chambers County, Cedar Port Navigation and Improvement District and other local officials facilitated the infrastructure development and permitting needed to ensure the project’s long-term success.
As TGS’s Nicholas Mayorga noted, “These partnerships created a service network that lowers the customer’s cost and supports regional rail fluidity.”
While taking advantage of these streamlined offerings sounds like a no-brainer for shippers wanting more efficient car services, TGS Cedar Port still needed to convince wary customers to shift their business. To do so, TGS Cedar Port had to demonstrate a superior economic value with lower costs and faster turnaround. The marketing and operations teams worked together closely to bring in initial customers, offering introductory pricing and building strong relationships.
Once these early customers were on board, demand for services grew quickly. To date, the operation has cleaned over 2,800 railcars and supported over 3,000 associated truck movements. TGS Cedar Port has also added new full-time positions, as have the on-site repair companies. These services have attracted new tenants to the industrial park, increasing local investment and tax revenue for the community while improving productivity for businesses.
By improving efficiency, TGS Cedar Port helps customers reduce service cycles by a few days to up to several months. But customers are not the only ones to have benefited.
“For TGS Cedar Port Railroad, the project strengthened relationships with existing tenants, attracted new customers and established Cedar Port as a critical service hub in the Gulf Coast petrochemical corridor,” said Mayorga.
