PODCAST: Connecting America’s Communities with Short Line Railroads

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Stacy Lake Hello, everyone. Welcome to Insights by Bergmann, a podcast that provides timely commentary from subject matter experts on topics and trends related to our built environment.

I'm your host Stacy Lake. And joining me today is Lucas Brewer, a project manager with our rail practice. Today we're here to talk about a topic on which Lucas is really a resident expert, shortline railroads and why they are so integral to our society and infrastructure. And before we dive in, I wanted to share a little background on Lucas, he has a pretty impressive resume. He is a civil engineer with nearly two decades of experience, specifically in railroad track and bridge improvement, rehabilitation and reconstruction. And in 2019, he was actually selected as one of railway ages 10 under 40, fast trackers, which is an incredible accomplishment. He plays an integral role in management of rail projects across our firm, and also manages our short line and regional railroad Grant Writing Program, which is really impressive in and of itself, this program has helped railroads obtain more than $65 million in state and federal funding over the past few years. And when Lucas is not serving our clients, he is serving our country as a lieutenant colonel in the US Army Reserves. So again, a really impressive background. I'm not going to say too much more, because, Lucas, I want you to be able to share in your own words, thank you so much for joining us today. Welcome.

Lucas Brewer Thank you. It's a pleasure to be here.

Stacy Lake Great to have you. So I think it would be really awesome for our listeners to hear directly from you on your background a little about more what you do and your role and how you got into this work with the rail industry.

Lucas Brewer Thank you. So my role was Bergmann as you sound project manager I, a lot of what I deal with is some shortline railroads where we build, build the grant grant writing programs, we help them get funding for some of their programs. And we also support some of the class one railroads as well. How I got started, I served in Iraq in 2000 2000, to 2007 to 2008. When I got home, confined work, and got really lucky. And a representative from Veterans Affairs got me in touch with a local railroad. And I hired on as their secretary to work in their office. Five years later, I worked my way through their programs through the shortline railroad. And I left there as their assistant chief engineer. That's when I came to Bergmann Associates.

A funny story was the president handed me a box of old microfiche cards. And I said, What are these? He said, Well, that's gonna be our problem in three years, we have to rate our bridges. And all we have are these boxes of old microfiche cards that we can't even read. So I bought a a microfiche reader off amazon for 10 bucks, started going through it, opened up my books from military engineering, and taught myself how to write a bridge. And after working with engineering firms to check my work 250 bridges later, their entire system was compliant with federal regulations and all their bridges had bridge rating. So it was really a really a fun, challenging time to work my way up to that program. So that's how I got started in the railroad industry.

Stacy Lake That's amazing. It's amazing. You're basically self taught you had this opportunity. And it sounds like you started working with a shortline railroad initially. And here you are now working with numerous railroads across the country, which has got to be really exciting, something new every day, right? It is. That's awesome. So you know, the rail industry is so intriguing to me. And I love talking with you and the rest of the team here at Bergman about it because it's, you know, rail is such a part of our history and so much of our industry and growth is a result of those rail lines. And I'm starting to learn a little more about the shortline railroads can. I'm embarrassed to say I don't know a ton though, can you tell us and the listeners more about what shortline railroads do and why they're so integral?

Lucas Brewer Oh, absolutely. shortline railroads are usually smaller railroads, often with less than 200 miles of track or so. But they're directly tied to their local economies in which they operate. Their operating preserving tracks that decades ago were in danger of being abandoned by the much larger class one railroads, the the national lines, the National railroads could no longer operate them profitably. So they turned over these lines, these poor performing lines to private entrepreneurs, who have now operated them with Drive and ingenuity. So it really is a large part of the system. That's, that's incorporated with the shortline railroads. Now shortline railroads often serve what we call first. In the last mile, they link the class one railroad network, that's a national and international system, it looks at to look, it links it to the local communities. So without the short lines, local industries often would have no way to get their freight to class one railroad network, they would either have to go by truck, or go by truck to a local transfer station, where could then be translated onto the network of the large railroads.

Stacy Lake Interesting. So it's all really interconnected. And you know, as a consumer of goods myself, it's, you don't think about where they come from, or how they get to your door, you know, you order on your app, or you go to a store, and you don't really think about how they get there. And clearly, the rail lines play a huge role in that. I was looking up some stats, actually. And it looks like there's about 50,000 miles of track operated collectively by the shortline railroads, which is what about 40% of the whole national network? Is that accurate? Yeah, somewhere between a third and 40% of the entire rail network is operated by short lines. That's amazing. And, you know, you provided some really great background as to why they're so necessary for the transfer of goods, when you think about everything that we're doing right now. COVID-19. And, you know, needing to transfer such, you know, important supplies and PPE. I imagine the shortline railroads have played a big role in that, you know, do you have any insight into just the increasing importance as to what they've been doing to support our economy during this time.

Lucas Brewer I know that freight railroads have had a shift, many of them have struggled with, with the reduction in freight traffic, due to COVID-19. But some of them have T roles, transporting essential goods, especially into like New York City. A lot of traffic goes by freight railroads on the New York and Atlantic railroad. It really is essential and railroads have been operating nonstop throughout this period, to ensure that these goods keep moving. All those Amazon packages, all those ups packages. UPS is a very big customer of the large railroads. And a lot of that material goes by rail in order to get to the regional hubs, where it is then shipped out of.

Stacy Lake Okay, so you know, there are there are a lot of different modes of transportation that companies like UPS use. So why, what makes shortline railroads a good choice to, you know, utilize more or incorporate into their mix of transportation options.

Lucas Brewer Railroads offer a more cost effective shipping option for all for shippers, and it provides economic benefits to the community served while providing it. There's so much more efficient, because you can fit three to four truckloads in a single rail car. According to the Association, American railroads, railroads can move one tonne of freight, an average of 475, nine miles on just one gallon of diesel. So once once the freight starts rolling on the rail, it's very cost effective to move it. Wow, that's really interesting. You know, it makes me think about you know, the work that we Bergman are doing to support shortline rail, can you give us a little bit more background on some of the you know, maybe not specifics of the projects, but the types of projects that we're doing? You mentioned bridges and the track improvements and the grant writing, can you tell us more. So many of the projects that our clients are going after our capital improvement projects, they range from simple track work, which is called a state of good repair, which is installing new rail ties, upgrading rail, adding ballast stones, surfacing the line, and it also includes bridge repairs, bridge rehabilitation, bridge replacement, we've seen a lot of really good projects or a combination of a couple bridges, maybe a few bridge deck, some grade crossing upgrades to our new crossing surface, and then throw in your standard state of good repair work to put ties down the line and either a section of the track that may need it, or even spread it down the entire line, just to make sure that you've got a comprehensive capital improvement program that you can then apply for a grant, whether it's a state grant or a federal grant. Even some of our clients go after both further reducing their local contribution by bringing in other sources of funding.

Stacy Lake Okay, interesting. So you know, funding certainly has got to be a big need for the shortline railroads as they continue to operate what what are, you know, what do they need to keep growing? Is it more talent? Is it more funding? You know, is it new technology? What is it?

Lucas Brewer So before selling these lines that class one railroads had deferred the maintenance for many years. So when these entrepreneurs got these lines, they're often in a poor state, and they've kept it going for decades. However, in order to increase capacity, unless these lines, increase them to the industry standard of 286,000 pound carloads, they really need to invest more capital. So they don't have access to levels of private capital that these large international and national railroads have access to. So grant funding is a great source. And the Krissy grant is one of the primary sources, the FRA came out with that. And it really aims and provides funding straight to shortline railroads who can apply and competitively win these grants.

Stacy Lake So the Krissy program is one of the ways that we help our clients with the grant writing that we do. Can you tell us a little bit more about you know, some of the specifics?

Lucas Brewer Absolutely. So first off, shortline, railroads are privately funded. So due to their limited access to that private capital, they often consider state or federal funding to support the capital improvement programs. Now, many of these railroads are quite familiar with the state level grants, we've helped some of them go after them. But most of them understand the local process and are fairly successful, and is when they take the next step to go after federal funding, that the grant process gets really complicated. And the two most common ones that a shortline railroad is interested in as either the build grant the US D O T. And that stands for better utilizing investments to leverage development. And then the Federal Railroad Administration Krissy grant, which is the consolidated rail infrastructure, and safety improvements program grant. Now, as you said, over the last 10 years, we've assisted our shoreline clients with obtaining more than $86 million in grant writing, primarily through net Krissy program, because it is so focused in such a great opportunity for short lines, that it really has been a success story for many of our real clients.

Stacy Lake That's really exciting. It's so good to hear that we can provide that. And, you know, do you have any insight into you know, clearly we had a change in administration at the national level, what are some of the things that you and the rest of your colleagues might be seeing here? Do we have any insight into what might be coming down the pipeline with this change in administration and what they're looking at from an infrastructure standpoint?

Lucas Brewer Unfortunately, I don't have details about that. But I'm I, like many others in the industry, we are eagerly awaiting to see what happens. We're interested to see who's appointed in key positions, such as the Federal Railroad Administration administrator, we're looking to see who's going to be appointed there. It really is an interesting time, and we're watching it along with everyone else to see what happens now.

Stacy Lake Sure, what do you think the next three to five years brings for shortline? Railroads?

Lucas Brewer So I think it's a great time to be in the railroad industry, especially in the shortline industry, there's such an opportunity for growth. The shortline, railroads are clawing for every car load. They're going, some of them only have two clients, and they go and meet with them. And they share. They share lunch with them. And what can we do to get two more car loads from you this year? Literally, they're there after every car load to so that they can be successful. So it really is an exciting industry of entrepreneurs, where you bring them all together, though, it's such a huge part of the network, like you said, between 30 and 40% of the entire rural network in the United States. But it's all local entrepreneurs, for the most part, who strive to help all the industries they serve, to do more business.

Stacy Lake Well, it's such an interesting industry. And it's great to hear how passionate you are and the rest of the team is and supporting the rail industry as a whole but specifically the shortline railroads because they do need that support and the funding that we can bring with the grant writing expertise. Is there anything else that you'd want to share about your experience with the shortline railroads that you think our listeners would be interested in.

Lucas Brewer It really is about the team we have here at Bergmann, we have a great grant writing team that has expanded their capabilities over the years over the last decade. These grant applications can be very complicated. And we bring our team of skilled and experienced grant writers who are familiar with all aspects of the grant process to include the project narrative statements of work, and the ever difficult benefit cost analysis, which usually takes a trained economist to perform. We have two people in our office who writes those, so that we're able to do those in house. In fact, one of the local Department of Transportation's rail group and one of the states who I won't name, they actually contract us to help write their benefit cost analysis for them as an option because they just don't have a trained economist on site staff to do it.

Stacy Lake Wow, that speaks volumes to the the team that we've got here. Very impressive. Well, I know that I'm going to look differently every time I go past a rail line are under a bridge or over a rail rail line when I'm driving, just knowing how integral they are to our day to day lives.

Lucas, thank you so much for joining us and for sharing your you know, Insight knowledge here, we're really excited to see what LTE you and the team can do to support this industry over the next year or so. Thank you very much. Just as my pleasure to be here. Thank you also to our listeners for joining us on this episode of insights by Bergman. We have many more exciting topics coming up in the future. So stay tuned. You can find our episodes at Bergman pc.com/podcast where you can sign up to receive emails alerting you to the new episodes as they're released. You can also find them on your favorite streaming channels including Spotify, Apple podcasts, breaker and many more. We'll see you next time.