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February 21, 2019 Oregon Transportation Commission Meeting Minutes Prepared and Distributed by Jacque Carlisle, Michelle Bryant and Cooper Brown (503) 986-3450 022119_OTC_MIN_Searchable.doc

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OREGON TRANSPORTATION COMMISSION

Minutes of the Regular Monthly Meeting February 21, 2019

Salem, Oregon On Thursday, February 21, 2019 at 8:00 a.m., the Oregon Transportation Commission (OTC) and Oregon Department of Transportation (ODOT) staff held a pre-meeting briefing session and agenda review at the Transportation Building, conference room 240 at 355 Capitol Street NE, Salem Oregon. Highlights of the pre-meeting were:

Director Garrett reviewed the day’s agenda and ODOT staff briefed the Commission on the federal grant processes and timelines. Additionally, several Oregon Department of Justice attorneys were recognized by the OTC and Director Garrett for their exceptional work representing ODOT before the Oregon Supreme Court on recently decided cases involving the privilege tax and portal fees.

The workshop began at 9:05 a.m. at the Oregon Department of Transportation Headquarters downstairs in the basement conference rooms A/B in Salem, Oregon. Video recording of the meeting is available online through the commission website: http://www.oregon.gov/ODOT/Get-Involved/Pages/OTC_Main.aspx Background materials for all agenda items are stored in Director/Commission/History Center File, Salem, Oregon. Notice of these meetings was made by press release to local and statewide media circulation throughout the state. Those attending part or all of the meetings included: Chair Tammy Baney Commissioner Alando Simpson Commissioner Julie Brown Commissioner Robert Van Brocklin Commissioner Martin Callery Director Matthew Garrett Assistant Director Travis Brouwer Trans. Dev. Div. Admin. Jerri Bohard Central Services CAO Bob Gebhardt Hwy. Div. Admin Kris Strickler

Deputy Hwy Div Admin Mac Lynde Rail and Public Transit Div Admin Hal Gard Comm. Section Mgr Tom Fuller Region 1 Manager Rian Windsheimer Region 2 Manager Sonny Chickering Chief Auditor Marlene Hartinger OTC Chief of Staff Cooper Brown Commission Assistant Jacque Carlisle Commission Assistant Michelle Bryant

http://www.oregon.gov/ODOT/Get-Involved/Pages/OTC_Main.aspx


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Strategic Investment

Workshop #1 The commission participated in a Strategic Investment Workshop that was designed to help the commission understand transportation funding and requirements in preparation for development of ODOT’s 2021-2023 budget and the 2024-2027 Statewide Transportation Improvement Program (STIP). Background: In preparation for the development in 2020 of the Oregon Department of Transportation’s (ODOT) 2021-2023 budget and the 2024-2027 Statewide Transportation Improvement Program (STIP), the Commission will engage in a series of educational workshops focused on strategic investments in the multimodal transportation system. The workshops will build understanding among the Commission about:

• Investment decision cycles and the Commission’s roles in investment decisions, including ODOT’s budget decisions and the STIP.

• Funding and financing sources, including trends and issues within Oregon and nationally. • How Oregon transportation funding works, including major transportation funding

sources, whether they are formulaic or discretionary, restrictions on their use, whether there are limits on the availability of funding and similar considerations, how ODOT and other transportation agencies prioritize where transportation funds -- both capital and operational -- are spent.

• Current funding levels and needs across different transportation modes and a clear articulation of the gap between existing transportation resources and funding needs.

• Funding options to help close the gap between available resources and needs. The objective of the workshop series is to help the Commission effectively exercise its role in directing investments in the transportation system by:

• Discussing the commission’s role in fiscal decision-making in the budget and STIP, the timelines and cycles for these decisions, and the work leading up to these decisions.

• Preparing the Commission to effectively exercise its decision-making role in ODOT’s 2021-2023 budget.

• Preparing the Commission to effectively exercise its decision-making role in development of the 2024-2027 STIP.

• Ensuring alignment between the Commission’s investment decisions and ODOT’s strategic investment priority area work under the agency’s Strategic Business Plan.

• Understanding future funding trends and developing policy and program options to mitigate risks and address potential issues.

• Understanding gaps between available transportation funds and capital and maintenance needs.

• Discussing potential options to close the gap between available resources and needs. • Developing a better understanding of policy decisions that impact investment decisions.


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• Developing a better understanding of transportation funding and use that will contribute to policy development around transportation funding in the next Oregon Transportation Plan.

• Developing key messages about revenue and expenditures to ensure commissioners and ODOT speak with one voice.

Workshop Phase 1 The first phase of the workshop covered the following topics. Background

• Purpose of workshops and overall plan • Investment cycles: budget and STIP, OTC role, and timelines • Overall revenues and expenditures in ODOT’s budget

Highways

• State Highway Fund: sources, uses, forecast and trends • Federal Funding: sources, uses, forecast and trends, federal infrastructure legislation • Preservation needs versus available resources and impacts on the system • Modernization funding and needs • Local road funding • Looking to the future

Among the key takeaways from the first workshop:

• Across all modes of transportation, HB 2017 met only a portion of the funding need for maintaining and enhancing the transportation system. In some areas such as bridges and pavement HB 2017 means we are falling behind more slowly; in other areas like bicycle-pedestrian we will be able to slowly eat away at significant unmet need; and in transit we will see significant service expansion that will meet only a portion of the need for public transportation.

• The commission plays a key role in making investment decisions for the transportation system and the agency, primarily through the Statewide Transportation Improvement Program.

• The Oregon Constitutional restriction on use of highway funds ensures that user fees are invested in the highway system but makes it challenging to fund non-highway modes.

• The constitution’s requirement for cost responsibility between light and heavy vehicles underlies our unique weight-mile tax and ensures trucks pay their fair share for their use and impact on the roads.

• A key principle underlying highway funding—particularly in Oregon—is that users should pay for their use and impact on the transportation system.

• The State Highway Fund relies on a three-legged stool of fuels tax, driver and motor vehicle fees, and motor carrier taxes and fees, which represents a well-balanced portfolio of revenue sources.

• Oregon’s overall highway taxes are lower than most western states, and Oregon has among the lowest vehicle fees of any state in the nation.


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• ODOT has effectively used bonding to pay for transportation projects, but debt service payments will limit the ability to fund new projects in the future.

• Inflation erodes most of our highway revenue streams. • Increasing fuel efficiency will erode the fuels tax, the primary source of transportation

revenue; per-mile road usage charges could be a solution. • Federal funding has been flat for about a decade, and federal funding is at serious risk of

being cut because federal fuel taxes haven’t been raised since 1993. • Oregon is a fix-it first state. The Oregon Transportation Plan and Oregon Highway Plan

put the focus on preserving the system and making it safer; highway improvements are focused on enhancing efficiency and the capacity of existing facilities rather than building new ones.

• HB 2017 (2017 Transportation Funding) met only a portion of the funding need for the highway system. Bridges and pavement conditions will continue to decline, but at a slower rate.

• Major modernization projects over the past decade have relied primarily on legislative earmarks.

• Tolling may be a way to pay for major highway expansion projects that don’t have a funding source, but federal law limits where a state can impose tolls.

• Local governments rely on a mix of local, state and federal funds to preserve and improve their road systems.

• Oregon is relatively generous in comparison to other states in sharing federal and state highway funding with local governments.

Future Phases Future phases of the workshop will cover multimodal transportation funding and other topics requested by the Commission. Once an educational foundation has been laid, discussion will turn to decision-making processes and development of the 2021-2023 budget and 2024-2027 STIP. Presentation: ODOT Assistant Director Travis Brouwer presented a PowerPoint that was created to help the commission understand transportation funding and requirements to ensure the commission can effectively exercise its decision-making roles. Brouwer noted ODOT will hold a series of strategic investment workshops to better understand:

• Federal, state and local transportation funding • Current and future transportation needs • The restrictions on the use of certain types of funding • The gap between current funding sources • How to address funding gaps.

Brouwer provided background on the agency’s budget and Statewide Transportation Improvement Program (STIP) basics. Brouwer noted these two areas as points of focus for the commission because they are key processes for OTC engagement. Brouwer noted the timeline for STIP and the agency budget are very different. The STIP is projected out many years. For instance, the commission allocated STIP funding through 2024 and ODOT is currently

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_WS1_OTC_Strategic_Investments_Workshop_Part_1_PPT.pdf


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identifying projects. Next year the commission will review and approve the 2021-2024 STIP and select projects. Brouwer noted the following month the commission will start work on the 2024-2027 STIP cycle. By the end of the year the commission will have allocated funding into various transportation programs seven years into the future. Brouwer noted ODOT is currently updating its budget process to include the commission’s role in earlier phases of the budget decision making process. Brouwer noted ODOT has a complicated budget that relies on large number of funding sources, each of which comes with specific restrictions and requirements. Brouwer said ODOT has become a more multimodal agency but ODOT’s federal and state funding is heavily tilted toward highways. Brouwer explained most highway funding comes from user fees. In Oregon, this principle is especially strong due to the weight-mile tax. Oregon is trying to strengthen the principle more with per-mile road usage charge. Oregon’s Constitutional restriction on the use of highway funds that ensures that user fees are invested in the highway system but makes it challenging to fund non-highway modes. Brouwer explained state funds can be used for construction, maintenance and agency operations while federal funds can only be used for construction. Brouwer noted HB 2017 raised the gas tax in multiple steps over a six year period. Registration and title fees will increase in three steps, surcharges for electric vehicles and hybrids that pay little in gas tax will ensure they pay more for the use of roads. Due to Oregon not having a vehicle sales tax or a property tax on vehicles, Oregon has the lowest vehicle fees of any state of the nation. Brouwer explained the flow of revenue in the state highway fund and noted the net from fuels tax, DMV fees and motor carrier fees constitutes the net state highway fund for distribution which is then distributed to local governments and ODOT’s State Highway Fund. Brouwer noted ODOT uses it share for highway projects, debt service on bonds, highway maintenance and agency operations. ODOT Economic and Financial Analyst Daniel Porter gave an overview of the revenue forecast for the State Highway Fund. Porter noted the total gross revenue is before expenditures, apportionments and debt service. Porter highlighted packages such as the Oregon Transportation Investment Act III (OTIA) and Jobs and Transportation Act (JTA) boosted Oregon’s revenue sources. Porter noted HB 2017 (2017 Transportation Funding) is the recovery and expansion period and forecasted that for the next couple of years Oregon will likely experience economic growth, albeit slowly. However, the State Highway Fund revenue in total is barely growing, even with HB 2017’s tax increase, when accounting for inflation. Porter noted the purchasing power of the gas tax is continuously eroded by inflation. The same is true of driver and vehicle fees and the weight-mile tax. Porter noted increasing fuel efficiency and more electric and hybrid vehicles will erode the fuels tax, the primary source of transportation revenue. Porter explained ODOT is investigating per-mile road usage charges because the gas tax provides just under half of the State Highway Fund’s ongoing revenues. Porter noted the federal gas tax provides a significant majority of the resources flowing into the federal Highway Trust Fund. Brouwer explained ODOT’s bonding and debt service. Brouwer noted ODOT has effectively used bonding to pay for transportation projects, but debt service payments will limit the ability to fund new projects in the future. Brouwer noted the Legislature has to authorize all bonding. ODOT uses three types of bonds, differentiated by repayment source:


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1. State Highway Fund bonds 2. Lottery bonds (legislature provides for specific projects and programs) 3. General obligation/general fund bonds (legislature provides for specific projects and

programs) Brouwer explained ODOT has a prudent and well managed bonding program and endeavors to keep the agency’s bonding to no more than a third of available State Highway Fund revenue. Brouwer noted the available amount is left for maintenance and other functions and ODOT maintains a high credit rating. Brouwer explained ODOT has sold or plans to sell over $4.4 billion in highway fund-supported bonds which includes $900 million in HB 2017 bonds, though the legislature has not authorized the Rose Quarter Bonds. Brouwer noted when all the bonds are sold, ODOT will be paying about $250 million in annual debt service from the State Highway Fund which will constrain resources available for new projects for the next three decades. ODOT Federal Affairs Advisor Trevor Sleeman gave an overview of the federal highway funding and noted federal revenue is highly dependent on the fuels tax, which has not been raised since 1993. Sleeman noted highway funding is distributed by formula to states. States and local governments select their projects using their formula funds. Sleeman said projects must follow federal environmental processes, procurement requirements and design standards and generally have to be on the federal-aid highway system. Sleeman noted that the majority of the funding is for the National Highway System while other money goes to local governments and safety. Sleeman explained federal funding has been provided through 2020 under the Fixing America’s Surface Transportation (FAST) Act and since the federal gas tax hasn’t increased for decades, there is a significant gap between user fee revenue flowing into the Highway Trust Fund and expenditures. Sleeman noted Congress would have to transfer over $100 billion of general fund revenue into the Highway Trust Fund to provide current funding levels. When the FAST Act expires in 2020, the Highway Trust Fund will dip into negative territory and funding could be cut by more than a third. Sleeman noted this is why it’s hard for ODOT and local governments to plan long term for major projects. Sleeman explained STIP is largely made up of federal funds and could fall by 10% after the FAST Act expires. ODOT staff will revisit and complete phase 1 of the strategic investment workshop in the upcoming months. Discussion: Commissioner Simpson asked ODOT to provide the commission with a list of STIP projects and the details of each project to help make decisions and see how they align with the OTP to help prioritize for the future. Key takeaways from the strategic investment workshop:

• When is a new investment strategy needed? • How does the investment strategy nest with the Oregon Transportation Plan (OTP)? • The commission wants more clarity on how the budget is built and tradeoffs

rationalized within STIP discussions.


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• In terms of balance and depending on transportation modes, ODOT has many needs in regards to revenue and expenditures.

• The commission asked to compare budget structure with other states as the agency moves forward.

• The commission must remain aggressive about Road Usage Charging (RUC) to ensure equity.

• The commission needs a clear understanding of debt services, in particular, is leveraging funds through bonding prudent?

Action: None taken.

Directors Report

Agenda Item A

Director Matthew Garrett provided a report to inform the commission of three items of interest, which were: • Key transportation indicators:

o Preliminary vehicle miles traveled for the year to date through December 2018 increased by 0.9% compared to the previous year. Excluding the strong January 2018 growth, overall preliminary vehicle miles travel growth is flat for the year. Oregon’s year to date growth rate is weaker than Idaho, Nevada, and Washington, but stronger than California.

o Preliminary traffic fatalities for the year to date through December 2018 were 467 compared to 439 the previous year. The estimated fatality rate for 2018 is 1.23 deaths per 100 million vehicle miles traveled. This rate has been unchanged each month since September 2018. ODOT will continue to focus on vending that line and the implications.

o Motor fuel year to date revenue increased 13.7% through December compared to the previous year. The increase is driven by 4 cent per gallon (13.3%) fuels tax increase effective as of January from House Bill (HB) 2017. The actual gallons sold through all of 2018 are up 0.3% over 2017.

o Weight and mile year to date revenue increased 22.4% through December 2018 compared to the previous year. The increase is driven by a 25% tax increase effective as of January form HB 2017. If it was not for the tax increase, weight-mile revenue would have stayed constant over 2017.

o The number of surrendered out of state licenses from Department of Motor Vehicles (DMV) through December 2018 totals to 90,311. This is an increase of 1,749 over the same period in 2017 and is the second strongest year since 2000. The peak year was 2016.


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• On February 5, ODOT was informed by the Federal Rail Administration that Oregon was awarded $1.3 million in federal discretionary grant funding through the Consolidated Rail Infrastructure and Safety Improvements program (CRISI). The CRISI program was established by Congress in the Fixing America's Surface Transportation (FAST) Act in 2015. The Federal Railroad Administration manages the program to support safety enhancements and other improvements to the nation's passenger and freight rail systems. This funding will help ODOT and Union Pacific Railroad complete work on the Peninsula Junction Passenger and Freight Rail Improvement project. The $1.3 million Peninsula Junction project in North Portland will realign tracks and upgrade railroad switches to allow trains to make safer, more consistent, and more fluid movements through the junction as trains merge onto and off of the BNSF Railway mainline at North Portland Junction. The Peninsula Junction project is the third and final phase of the overall $18 million North Portland and Peninsula Junction Rail Improvements project. North Portland Junction and Peninsula Junction are among the busiest railroad convergence points in the state of Oregon and on the Pacific Northwest Rail Corridor for both passenger and freight rail traffic. Approximately 41 trains, including 12 Amtrak trains, pass through these junctions daily. Garrett congratulated the ODOT Rail Team & Federal Affairs for the hard work in securing the grant.

• ODOT Rail and Public Transit Administrator Hal Gard will be retiring from ODOT in June of this year after twenty-five years of steadfast service. Hal joined ODOT the agency's first archaeologist. He came on to establish much-needed relationships with the tribes, and his hard work and dedication laid the foundation for the successful partnerships ODOT experiences today with the nine federally recognized Oregon tribes. In fact, ODOT's tribal relations program continues to be held up as a model for other states and jurisdictions. From there, Hal worked on environmental streamlining for the OTIA III Bridge program, where his work helped shift our environmental permitting from a process-based approach to an outcome-based approach. Hal then took the lead position in the Geo-environmental Section and advanced numerous initiatives including sustainability, culvert replacement, fish passage, environmental justice, Portland harbor cleanup and others. In 2012, Hal was asked to take over the Rail Division, and shortly after to pick up the Transit Division to create the Public Transit/ Rail Division construct. Garrett said throughout Hal’s career, he has brought a tactful firmness and intelligence to the demanding positions he has held at ODOT. As a leader he has modeled reason, fairness, and compassion and has always provided a steady hand of consistency. Garrett thanked Hal for all he has done and to be proud of the legacy he will leave behind as he moves forward to write the next chapter in his life's journey.

Public Comments

Agenda Item B Sharon Nasset with Economic Transportation Alliance, Third Bridge Now, said a Portland company plans to build smart meters for electric vehicle drivers. Nasset recommended the


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commission to partner with the company. Nasset noted Clark County needs a transit route to employment centers. Ron Swaren noted he read ODOT’s seismic upgrading plans. Swaren said he’s found research and reports that have been conducted and has a basic understanding of seismic upgrading. Swaren said the reports confirm there is a greater risk in the Cascadia subduction zone. Swaren said he has been actively engaging in the possible changes to the Interstate system and the possibility of a new Interstate bridge to Washington. Swaren expressed his thoughts on what should be considered for a new bridge between Oregon and Washington. Swaren highlighted the feasibility of various bridge types. Swaren said he hopes discussions about project budgets are informed about the seismic risk and take a conservative approach.

ODOT Director Recruitment and Hiring Process

Agenda Item C The commission reviewed and were requested to approve the search and recruitment process for the Oregon Department of Transportation (ODOT) Director. Background: Per House Bill 2017 (2017 Transportation Funding), section 20(1), the Oregon Transportation Commission (OTC), in consultation with the Governor, has the authority to appoint the ODOT Director. The Commission will review the search and recruitment process as outlined by OTC Vice Chair Van Brocklin in his February 14 memorandum to the OTC (Attachment 1) and the Vice Chair’s draft Director recruitment and hiring plan (Attachment 2). Presentation: Vice Chair Van Brocklin noted director Garrett has been an extraordinary leader in the agency and has been a tremendous asset to Oregon. Van Brocklin noted director Garrett announced his resignation in January, 2019 and plans to resign on or before June 30, 2019. Van Brocklin explained Garrett’s resignation puts the commission in the position to develop a hiring process and hire Garrett’s successor. Van Brocklin explained the passage of HB 2017 has given the commission the authority to hire ODOT’s director. Van Brocklin said the commission plans to hire a consultant to conduct a national level recruitment for Garrett’s successor. Van Brocklin noted the recruitment will be an inclusive process. Van Brocklin noted the commission wants the process to be open and transparent throughout the entire process. Van Brocklin gave an overview of the requested actions for the commission’s approval:

• Establish a search committee. • Appoint Chair Baney, Vice Chair Van Brocklin and Brendan Finn, Governor’s Policy

Advisory on Transportation to serve on the search committee. o One of the provisions in HB 2017 is to make the decision in consultation with the

commission and the Governor.

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_C_Attach_1_Vice_Chair_Van_Brocklin_Memorandum_to_OTC.pdf

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_C_Attach_2_Draft_ODOT_Director_Search_Hiring_Matrix.pdf


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• Authorize the search committee to hire a search consultant that will not exceed $125,000 unless expressly adjusted by the commission.

• The search committee will report the progress of hiring a search consultant at the March 21, 2019 OTC meeting.

• Initiate a public comment period for the draft hiring and recruitment plan (attachment 2). Van Brocklin noted attachment 2 has revisions in yellow to ensure the dates in the recruitment and hiring plan align. Van Brocklin noted the public comment period will begin February 22, 2019 and close on March 7, 2019. Van Brocklin said after the public comment period is closed, the search committee will incorporate the comments in to the matrix to be approved by the commission at the March 21, 2019 OTC meeting.

Action: Commissioner Simpson moved to approve the establishment of an ODOT Director Search Committee, the appointment of Tammy Baney, Brendan Finn, and Bob Van Brocklin to serve on the Search Committee, the appointment of Bob Van Brocklin to Chair the Search Committee, authorizing the Search Committee to hire a Search Consultant to assist the OTC in conducting a national search, report back to the OTC at the March 21st Commission Meeting about that hire, limit total costs for the search to $125,000 without additional authority from the OTC, AND initiate a public comment period through March 8, 2019 on the draft recruitment and hiring timeline matrix and propose a final matrix for OTC approval at the Commission’s March 21st meeting.

House Bill 2017 (2017 Transportation Funding) Implementation Update

Agenda Item D The commission received the monthly progress report and status update on the ongoing work efforts related to implementation and execution of initiatives and projects required under House Bill 2017 (2017 Transportation Funding). Background: HB 2017 (2017) made important transportation policy changes and raised a variety of taxes and fees to increase investments in all modes of Oregon’s transportation system. The Oregon Department of Transportation (ODOT) has developed implementation plans for all requirements within the bill and brings items to the Commission for review, input and approval on a regular basis. Per Commission request, ODOT staff will present the Commission with the HB 2017 implementation dashboard monthly progress report to provide status updates on Commission-related work efforts, including detailed reports on implementation efforts that the Commission identified as requiring close oversight and engagement. Presentation: ODOT HB 2017 Implementation Manager Kat Silva, presented the monthly progress report and gave the commission a status update. The update highlighted the ongoing work efforts related




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to implementation and execution of initiatives and projects required under HB 2017. Silva noted there are big items coming forward such as the Connect Oregon sponsor plans. In addition, the Statewide Transportation Improvement Fund (STIF) approval plans will be brought to the commission for a decision in March, 2019 for the transit formula funds allocations. Silva noted ODOT anticipates all 18 submitted plans from the qualified entities are coming forward with a recommendation. Silva noted all local governments reported their local infrastructure conditions on the Transparency Accountability Performance (TAP) website, in accordance with the standards the commission adopted. Silva acknowledge the TAP implementation team for their outreach to the local governments to submit their report on time. Silva said the data is being aggregated with the ODOT owned bridge and pavement information. Silva noted ODOT will bring forward a statewide transportation infrastructure condition report to the commission to review and provide input. If the commission accepts and approves the report they will submit it to the legislature by April 1, 2019. Silva noted the gap analysis for the proportionate user fee report is an outstanding initiative but is in Department of Administrative Services (DAS) que and will be moving forward in spring 2020. Silva referred to the quarterly report on HB 2017 positions and noted ODOT has made significant progress since the September 2018 report. Silva noted one position recruitment was dependent on the launch of Work Day, the statewide technology solution for Human Resources. Silva noted the other inactive position was a vacated position, ODOT will resubmit that position for recruitment. Action: None taken.

Legislative Update

Agenda Item E The commission received a legislative update for the 2019 legislative session. Presentation: ODOT Government Relations Manager Lindsay Baker updated the commission on the 2019 legislative session. Baker reminded the commission the 2018 legislature passed a bill to extend the start date of the long legislative sessions. Baker noted the interim time that was previously used for reviewing bills and preparation for informational hearings was absent from 2019 legislative session. Baker noted there has been 2100 bills entered into the process and ODOT reviews all of the bills. Baker noted as of February 20, 2019 ODOT is tracking 700 of the 2100 bills, the 700 bills have a range of impact to the agency. Baker said 62 bills were referred to the Joint Committee on Transportation (JCT), ODOTs number one policy making committee. Baker said the absent of reviewing bills has resulted in many informational hearings with the JCT. Baker said ODOT presented to the JCT on various topics such as how ODOT has been implementing the fund 2017 funding package, program and budget overview, real ID implementation and how revenues have been coming in from the HB 2017 transportation package.


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Baker highlighted a few bills ODOT has been engaging in: • HB 2045 is a bill that was brought forward by Oregon State Police, it increases their

trooper staffing levels. Baker noted agencies typically don’t support or oppose or take positions on bills. However, for this particular bill ODOT reached out to the governor’s office and asked if it was okay to provide support formally, ODOTs director was in front of the House Committee on Judiciary speaking about this bill.

• Host of bills regarding speed and speed setting methodology • Transportation around network companies such as Uber and Lyft and how the state

may be interested, or not, in regulating those companies. • HB 2020 the Climate and Carbon Package for 2019 session. Baker noted there is

significant interest from leadership and the governor’s office in moving forward with climate policy and carbon reduction policy. Baker noted the Joint Committee on Carbon Reduction has been meeting since last summer and formulating a package that would address carbon emissions across the state and set a cap and trade program. Baker noted the OTC and ODOT is called out in the package but the language is at a very high level. Baker noted the committee is doing their work and over the next three weeks JCT will be conducting 4 public hearings across the state, ODOT remains to stay engaged in that conversation.

Action: None taken. The commission recessed for lunch in conference room 240 at 11:57 a.m.

Lunch session

During lunch, commissioners and ODOT staff engaged in an informal conversation with members of the Joint Committee on Transportation, Senator Brian Boquist and Representative Caddy McKeown. The group discussed ODOT’s efforts to date implementing HB 2017 projects as well as potential ODOT-relevant legislation under discussion in the current legislative session. The business meeting resumed in conference room 103 at 1:07 pm.

Tolling Update Agenda Item F

The commission received an update on next steps for analysis and implementation of tolling on Interstate 5 and Interstate 205 and provided feedback on a recommended approach to consider feasibility of system-wide freeway pricing in the Portland region, as required by HB 2017 (2017 Transportation Funding).


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Background: At its August 2018 meeting the Oregon Transportation Commission (OTC) directed the Oregon Department of Transportation (ODOT) to prepare an application to implement congestion pricing projects on segments of Interstate 5 and on Interstate 205 for submission to the Federal Highway Administration (FHWA) requesting FHWA approval, and develop a scope of work for conducting a system-wide congestion feasibility analysis on the entire Portland metropolitan area freeway system. The application was submitted to FHWA on December 11, 2018. In January ODOT received a response from FHWA which acknowledges the feasibility analysis process and provides clarification and policy direction for the next steps. Next steps for tolling analysis and implementation are summarized below. Next Steps on Interstate 5 and Interstate 205 Analysis and Implementation: The feasibility analysis identified initial projects for further evaluation. As indicated in the application to FHWA and the response letter, ultimate federal approval will require review under the National Environmental Policy Act (NEPA). The Planning and Environmental Linkage (PEL) is the next phase of work that will be conducted with the objective of advancing the project to review under NEPA. During the PEL phase ODOT and the project team will further analyze how tolling these sections would affect the performance of traffic flow on the freeway. Major tasks under the PEL phase will include:

• Completing detailed traffic, transit and equity analyses that show probable tolling impacts on the regional freeways and local street system, as well as on transit operations and low-income and other environmental justice groups;

• Identifying a preferred project alternative (project terminus points) for the Interstate 5 and Interstate 205 tolling locations through a public process;

• Producing environmental studies that comply with federal NEPA standards that demonstrate the impacts of tolling to resources; and,

• Completing detailed traffic performance and revenue analysis under different tolling scenarios.

Throughout the process, ODOT will engage in a thorough and inclusive public involvement process that includes comprehensive tribal and agency coordination. Cost and Timeline Region 1 is currently in the process of engaging a consultant to undertake the work for the PEL phase which is expected to cost $6-8 million. Preliminary drafts of the scope and schedule are targeting a two-year process for completion of this phase, beginning in the spring of 2019.


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System-Wide Pricing Analysis Objectives: In August the OTC also directed ODOT to develop a scope for evaluating system-wide pricing on the regional freeway system. ODOT has developed a proposed approach to meet the following objectives:

• Build on the technical analysis and public engagement that will be done to advance the Interstate 5 and Interstate 205 projects in the upcoming PEL phase, as described in the OTC application to FHWA.

• Establish the preferred alternatives for Interstate 5 and Interstate 205 – a critical outcome of the PEL phase – to represent future background conditions for the examination of additional pricing project implementation.

• Avoid confusion among stakeholders and the public regarding two separate efforts: the PEL phase and the system-wide approach. Public input for the system-wide approach could be informed by the Value Pricing Feasibility Analysis and the PEL phase, but would also require input specific to the system-wide approach. As such, stakeholder engagement would be separate from and supplemental to outreach for the PEL phase.

• Support the OTC in developing their vision for a broader statewide policy perspective to ensure that the OTC vision will be supported by and consistent with relevant state policies, such as the Oregon Highway Plan (OHP) and Oregon Transportation Plan (OTP).

• Support the development of clear Oregon vision, objectives, and policies for freeway pricing. This will support efforts initiated by Oregon and inform our engagement with other agencies seeking to initiate pricing projects, plans, or policies.

Recommended Approach for System-Wide Pricing Analysis: To achieve the objectives outlined above, ODOT recommends a two-phase approach to system-wide pricing implementation. Phase 1. OTC Vision, Statewide Policy Foundation, and Opportunity Identification (Approximately $300,000 to $350,000) The first phase, as described below, would be conducted concurrent with the PEL work for the Interstate 5 and Interstate 205 projects. The timing of key tasks, relative to related tasks from the PEL, is shown in Figure 1.


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Figure 1. Relative Timeline of Freeway Pricing Studies

As Figure 1 shows, the two-phased approach builds on work conducted by the PEL but that is needed specifically to support the system-wide pricing analysis. Phase 1 could be conducted for approximately $300,000-350,000 in consultant services. Variables affecting cost would include the level of engagement with the OTC, regional and statewide stakeholder outreach, additional analysis of statewide policy, and supplemental evaluation of the preferred alternatives identified in the PEL. Task 1A. OTC Vision: Support the OTC in developing the OTC vision for freeway pricing/tolling. This effort would be informed by statewide public engagement. The engagement effort would seek to inform stakeholders of issues and lessons learned and to gather input about concerns, priorities, and suggestions. This effort would be separate from the PEL phase outreach, though it would be informed by efforts conducted in Region 1. Other strategies could include targeted stakeholder interviews, presentations and/or meetings with Area Committees on Transportation or other existing forums, and/or on-line engagement. Task 1B. Tolling policy analysis and update: Review current state, regional, and federal policies related to pricing/tolling and compile a report of findings and recommendations for consideration, including integration with upcoming updates to the OHP and OTP. A similar policy analysis will be required for the PEL phase for the Interstate 5 and Interstate 205 projects. Task 1B will build on the PEL work but with a focus on policy issues as they relate to the OTC vision (Task 1A) and potential system-wide implementation and/or statewide policy. Task 1C. Vision and Policy Report: This report will document the OTC Vision statement(s) and policy priorities. The report is intended to be a clear statement of Oregon’s guiding principles and priorities for freeway pricing with reference to supporting policy in the OHP, OTP, and other relevant sources (e.g., Federal policies, Oregon constitution, Regional Transportation Plan). Task 1D. Pricing Opportunity Evaluation: Findings and Implications of the Preferred Alternatives: A major outcome of the PEL analysis will be identification of the preferred alternative, including the north/south terminus locations for tolls on Interstate 5 and Interstate 205. This determination will address many of the issues raised by neighborhoods adjacent to tolling locations and will also meet specific procedures required under NEPA. The evaluation of the preferred alternative will include analysis of traffic impacts on the surrounding regional


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transportation system. For example, the analysis would examine whether the proposed tolling projects are expected to change overall traffic conditions, for better or worse, due to changes in route choice, mode of travel, or time of day. The results of this analysis would be needed to identify potential candidate locations for subsequent feasibility analysis of congestion pricing. The determination and analysis of the preferred alternative(s) will be conducted as part of the PEL phase. For the system-wide approach, the findings of the PEL analysis would be evaluated and reported to the OTC with specific consideration of any findings that point to potential candidate locations for further pricing implementation. Phase 2. Analysis of Potential System-Wide Pricing Strategies/Implementation (Cost TBD) Phase 2 would include feasibility analysis of additional freeway tolling, including the analysis, project development, and engagement required to evaluate comprehensive pricing studies. The priority outcomes and potential locations for consideration would be identified as part of Phase 1. At this point, the OTC could choose to consider either or both of the following general approaches to roadway pricing, especially as they relate to the OTC vision developed in Phase 1. Task 2A. Phased Implementation of Additional Freeway Tolls: Under this approach, ODOT would conduct an analysis similar to the value pricing Feasibility Analysis conducted in 2017-2018 to identify potential additional areas of the Portland metro area freeway system where pricing should be examined. This approach would be consistent with a suggestion from the Value Pricing Feasibility Analysis, which was to consider a phased implementation to additional Interstate 5 and Interstate 205 freeway pricing (called Concept C in the feasibility analysis) as well as the potential for pricing to support added capacity to accommodate future growth. Under Task 2A, once the preferred alternative(s) are developed for Interstate 5 and Interstate 205, the analysis of future conditions with these projects implemented will enable the OTC to identify whether ODOT should conduct further analysis to examine these or other potential projects. Some potential pricing projects have been identified in the Value Pricing Feasibility Analysis by members of the PAC or other stakeholders, or in public meetings, including the Interstate 5 Boone Bridge, Interstate Bridge, or segments of Interstate 84, Interstate 405, U.S. 26, Oregon 217, Interstate 5 or Interstate 205. While it is too soon to estimate the cost of this effort, the order of magnitude would likely be similar to or greater than the effort for the 2017-2018 feasibility analysis (approximately $5 million) for the feasibility and related analysis on back office systems. Task 2B. Alternative approaches to system-wide pricing: As an alternative or in addition to Task 2A, consider approaches to pricing other than traditional freeway tolls. Some examples could include expanded use of the road usage charge (RUC) or other distance-based or time-of-day tolling. Analysis of these topics could dovetail with efforts that some regional partners are considering. In particular, the recently adopted Regional Transportation Plan (RTP) identifies a Regional Congestion Pricing Technical Analysis, and the Portland City Council has also directed Portland


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staff to study congestion pricing. An undertaking under Task 2B could support collaboration with regional partners in these efforts. Presentation: ODOT Region 1 Manager Rian Windsheimer noted ODOT sent an application to Federal Highway Administration (FHWA) regarding the feasibility analysis ODOT conducted on Interstate 5 and Interstate 205. Windsheimer noted the commission wanted the team to develop a scope and cost associated with a larger regional perspective. ODOT Value Pricing Program Manager Judith Gray presented a PowerPoint that gave an overview of the steps accomplished in submitting the application to the FHWA and the response received from FHWA. Gray noted the application was sent to FHWA on December 10, 2018. ODOT and the commission received a response from the FHWA on January 8, 2019 that helped clarify the policy direction to make sure ODOT is moving forward in the most efficient and comprehensive way to be successful. Gray noted the team is entering into the planning and environmental linkage (PEL) stage of the process. The PEL stage will be the analysis ODOT will do to prepare for the National Environmental Policy Act (NEPA) process. Gray noted ODOT has a consultant contract underway that is expected to proceed in April. Gray noted moving forward ODOT will be addressing mobility and equity strategies they heard from the commission, community and the Policy Advisory Committee. Gray noted ODOT will be looking at ways to improve public transit and transportation options, provisions for environmental justice and low-income communities and strategies to minimize potential impacts from diversion. Gray noted getting into the PEL phase will include refining the analysis of traffic operations, revenue and determining the project end points. Gray said by determining the project end points ODOT will be consistent with federal tolling policies and environmental reviews. Gray said ODOT has initiated public and stakeholder outreach because there will be a considerable amount of comments to review in this transition. Gray noted ODOT has been working on an approach for the System-Wide Pricing feasibility analysis. Gray noted the team wants to establish preferred alternatives for I-5 and I-205 projects for future “baseline” conditions. Gray explained the baseline will include the commissions’ vision for tolling and help clarify the purpose of congestion and value pricing. Gray said after developing the objectives the team recommends a two-phased approach, policy foundation and feasibility analysis. Gray explained the elements of each phase would include the OTC vision, policy analysis from all sources (federal, state, local) and opportunities. Gray explained the PEL phase and phase one, policy foundation, can be integrated and phase two is to be determined because it will be based on the foundational outcomes of phase one. Gray noted the feasibility analysis phase has two subsets which can be identified as freeway tolling analysis and alternative approaches. Windsheimer noted the team has been struggling with determining how to move the projects forward because they want the statewide vision ingrained in the future System-Wide Analysis. Public Testimony: Craig Dirksen, Metro Councilor noted he was a member of the Value Pricing committee and is aware of the challenges and the hard work ODOT staff has done to date. Dirksen noted value pricing and the related policy considerations and implications are very important to the Metro Council. Dirksen said the current system for raising funds for transportation is inadequate and

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_F_Tolling_Update_PPT.pdf


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additional sources must be found. Dirksen said the Metro Council believes the value/congestion pricing has the potential to be a good tool for funding regional transportation system upgrades and managing the increased amount of the travel demand in the Portland region. Dirksen said the councils overall goal for congestion pricing program is to manage demand, increase transit access, and improve outcomes for low income communities along the priced corridors. Dirksen noted Metro President Lynn Peterson asked him to testify and convey Metro Councils thoughts on value pricing and the work going forward. Dirksen said Metro Council has expressed the need for a comprehensive regional study of pricing strategies. Dirksen said a more detail study of pricing strategies in the region will help advance the conversation statewide and help policy makers better understand the different ways that pricing can be implemented in our region and the policy outcomes such a program could effect. Dirksen noted now that the value pricing committee’s work is complete, Metro intends to move forward with a policy and modeling study within the next six months. Dirksen noted Metro welcomes the opportunity to coordinate with ODOT staff and the OTC on that effort. Dirksen noted Metro has held off on a regional system-wide pricing study in order to allow ODOT to work through the value pricing committee process and in appreciation of ODOTs leadership on this complex issue. Dirksen said ODOT and the commission need to review existing state policies in order to create a policy framework for congestion pricing. Dirksen noted the Regional Transportation Plan serves as the policy framework for Metro’s entire regional transportation system. Discussion: Chair Baney noted she wants the team to align their work with the other efforts happening in the Portland Metro region. Baney noted the public in that region will be impacted and wants to ensure ODOT identifies mitigation strategies. Windsheimer said the goal of being successful with this project is to be clear and open about ODOTs process to ensure the agency is integrated and leveraging with the ongoing efforts in the region. Commissioner Simpson asked what phase in the system-wide timeline are regional governments and municipalities looked at in a broader impact strategy to ensure ODOT achieves its outcome. Simpson noted the process has to be inclusive and collaborative. Windsheimer said the vision and analysis report will identify what the system-wide objectives are and where ODOT is trying to go from a statewide policy perspective. Windsheimer noted once that has been identified the team will begin to analyze the impact of the system from a local and regional perspective. Gray explained the policy analysis will focus on compliance with the Regional Transportation Plan requirements because the Federal Highway Administration (FHWA) will want that information regarding the I-5 and I-205 projects. Gray noted to expand and build a foundation ODOT will work independently to be informed and collaborate with municipalities. Gray noted it will be important to have independent work but ODOT will have to be respectful of the timing of the work in order to collaborate and move forward at the same time. Simpson noted it will be important to have conversations with Region 1 regarding strategic investment planning moving forward. Action: None taken.


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Consent Calendar

Agenda Item G 1. Approve the minutes of the January 17, 2019, commission meeting in Salem.

2. Confirm the next two commission meeting dates: o Thursday, March 21, 2019, commission meeting in Salem. o Thursday, April 18, 2019, commission meeting in Salem.

3. Approve to adopt a resolution for authority to acquire real property by purchase, condemnation, agreement or donation.

4. Approve of the following Oregon Administrative Rules: a) Adoption, amendment and repeal of 46 rules in chapter 731, divisions 146, 147 and

148 relating to procurement. b) Amendment of 735-010-0020 and 735-020-0040 relating to DMV record inquiry

accounts. c) Adoption of 735-018-0115 and the amendment of 735-010-0250 and 735-018-0110

relating to electronic transfer of registration renewal at Department of Environmental Quality (DEQ).

d) Amendment of 735-063-0220 and 735-063-0340 relating to Commercial Driver License (CDL) medical qualification.

e) Temporary amendment of 740-050-0610 relating to Consumer Price Index Replacement.

5. Accept the ODOT 2018-2019 Internal Audit Plan Update.

6. Approve amending the Oregon Highway Plan and, per Jurisdictional Transfer (JT)

Agreement No. 809, transferring jurisdiction of Unit 3 of the Pacific Highway and directing the Department to convey the property interests. Region 3 and the City of Phoenix both recommend approval of this Jurisdictional Transfer.

7. Approve amending the 2018-2021 Statewide Transportation Improvement Program (STIP) to add $400,000 to the Northeast Fir Lane and Northeast Elm Lane project. The primary purpose of this railroad project is to install active train warning devises at the existing highway/rail grade crossing at Northeast (NE) Fir Lane and eliminate the highway/rail crossing at Northeast (NE) Elm Lane.

8. Approve amending the 2018-2021 STIP to add $200,000 of Rail Crossing Safety Funds towards the City of Woodburn’s proposal to realign Hardcastle Avenue. The proposal is to improve visibility and turning radius located where Hardcastle crosses the Pacific Railroad line and intersects with North Front Street. The funds will go towards purchasing train-activated warning devices at the highway/rail crossing, as part of the City of Woodburn’s proposed project.

https://www.oregon.gov/ODOT/Get-Involved/OAR%20012019/731-146-0010NoticeTC.pdf





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9. Approve amending the 2018-2021 STIP to cancel the existing U.S. 30: Old Portland Road to

Millard project and transfer $4,588,000 of these unexpended funds to the new U.S. 30: Millard and Bennett Roads (St Helens) project. An additional $1,779,568 is also requested for the new project.

10. Approve amending the 2018-2021 STIP to add $1,335,215 to the construction phase for the

Boones Ferry Road: Oakridge Rode/Reese Road – Madrona Street project. The total cost of the project will increase from $32,613,657 to $33,948,872 and will be paid for by the City of Lake Oswego.

11. Approve amending the 2018-2021 STIP to cancel three Operations Program projects:

Oregon 99 West at mile point 20.85 drainage improvements project in Washington County; Oregon 22 rockfall remediation mile point 72 and 81 project located in Linn County; U.S. 101 rockfall remediation project in Tillamook County.

12. Approve amending the 2018-2021 STIP to increase the funding on the U.S. 97: Sunriver

Interchange – Oregon 31 project by $200,000 to account for asphalt escalation. The project is in Deschutes County. The total estimated cost for the project will change from $14,331,250 to $14,531,250.

13. Approve amending the 2018-2021 STIP to update the current Deschutes County Intelligent Transportation System (ITS) Plan to ensure compatibility with Federal Metropolitan Planning Organization (MPO) Reporting Standards.

14. Accept the 2019-2021 Oregon Transportation Commission Work Plan.

Action: Commissioner Simpson moved approval of Consent 3 files numbers 9278005 Oregon International Port of Coos Bay and 9385001 Union Pacific Railroad, Vice Chair Van Brocklin declared a conflict and will abstain from voting and deliberations. Commissioners, Simpson, Callery, Brown and Baney unanimously approved the motion. Van Brocklin abstained from voting. Commission Van Brocklin move approval of the remaining files in consent 3, Commissioners, Van Brocklin, Simpson, Callery, Brown and Baney unanimously approved the motion. Commissioner Van Brocklin, move approval of consent items 1, 2, 4-14. Commissioners, Van Brocklin, Simpson, Callery, Brown and Baney unanimously approved the motion.


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Connect Oregon Dedicated Intermodal Facility Projects

Agenda Item H The commission received information and recommendations regarding potential intermodal facility projects in the Treasure and Mid-Willamette Valleys. As outlined in Oregon Administrative Rule, the Commission received information and recommendations from multiple review groups. Project sponsors will also be afforded the opportunity to present their perspectives to the Oregon Transportation Commission (OTC). Background: House Bill 2017 included four Connect Oregon dedicated projects, of which two were intermodal facilities—one in Treasure Valley and one in the Mid-Willamette Valley. These projects were specifically named within the law and subsequent implementing rules and therefore are not subject to the competitive processes that typified the six previous rounds of Connect Oregon funding. In order to fund all four named projects, the Commission must review and approve project plans for each, which are to be submitted by the sponsoring entities. This review process is also legislatively mandated. The department has received three separate project plans related to the intermodal facilities; one for Treasure Valley, from the Malheur County Development Corporation, and two for the Mid-Willamette Valley, from the Linn Economic Development Group and Oregon Port of Willamette. Each project has a pre-determined funding amount—$26 million for Treasure Valley and $25 million for Mid-Willamette Valley. A portion of these funds (approximately 5% of total per location) were provided to the project sponsors to prepare their project plans. Of the two other dedicated Connect Oregon projects, the OTC funded the Port of Morrow’s East Beach Industrial Park rail expansion in September 2018 and the extension of the Brooks rail siding project is pending a legislative fix which would identify a more effective location for the new siding. Project sponsors formally submitted their project plan documents to the Department on September 27, 2018. Connect Oregon staff reviewed the project plans for completeness and inclusion of all elements noted in OAR 731-035-0065(5)(a). Upon deeming the project plans complete, The Oregon Department of Transportation (ODOT) forwarded them to the Tioga Group Inc., the third party reviewer contracted to perform an assessment of each project plan, as required by rule. Upon initial review, the Tioga Group requested additional information from all three project sponsors to help clarify some of the information within the proposals. The three project sponsors provided their responses to the Tioga Group on November 15, 2018. As part of their review, the Tioga Group analyzed the feasibility and potential return on investment for all three proposals. Tioga finalized their technical review of the project plans on January 8, 2019, and forwarded recommendations for approval for the Treasure Valley and Linn Economic Development Group (Millersburg) projects to the Department (Attachment 1).


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On January 11, 2019, ODOT convened a Dedicated Projects Final Review Committee (FRC) to assess the project plans and to make a recommendation to the OTC. During the meeting, the Committee identified potential risks and benefits and, ultimately, recommended funding the proposal in Treasure Valley and Millersburg on the condition that project sponsors meet detailed implementation requirements (Attachment 2). ODOT subject matter experts reviewed the project plans for consistency with the project plan requirements and identified risk and benefit areas for all three projects. Subsequently, ODOT Director Garrett’s conclusion recognizes many of the same conclusions of the FRC and Tioga Group. Director Garrett generally supports the recommendation from both Tioga and the FRC to support the Treasure Valley and Millersburg proposals. However, this recommendation is based on establishing an incremental path forward to help ensure key questions and issues are addressed prior to full funding being allocated (Attachment 3). Concurrently, Oregon Business Development Department (OBDD) staff reviewed the project plans to evaluate the potential economic viability of the projects as well as overall economic and transportation benefits to the State of Oregon. Subsequently, based on OBDD’s standard viability and feasibility assessments, OBDD Director Harder does not recommend final approval for any of the three proposed projects. OBDD believes all three projects require further development to address the deficiencies outlined below prior to receiving further consideration for funding of long-term capital assets (Attachment 4). All of these recommendations—from the Tioga Group, the FRC, ODOT and OBDD are being formally brought before the Commission for consideration. Additionally, the three project sponsors will also present their perspectives to the Commission, as outlined in their respective letters to the OTC (Attachment 5). All recommendation letters and reports have also been posted on the Connect Oregon website at http://www.oregon.gov/ODOT/TD/TP/pages/connector.aspx. Links to Project Plans: Project Plans for Brooks Project Plans for Millersburg Project Plans for Treasure Valley Presentation: ODOT Planning Section Manager Erik Havig gave an overview of the process for the Connect Oregon dedicated projects. Havig noted the commission will eventually approve one or two of the project plans per HB 2017. Havig noted the Oregon Administrative Rule states the commission will receive information and recommendations from multiple review groups. Havig said the project sponsors have been afforded the opportunity to present their perspectives to the commission. Havig said the project sponsors will present any additional information on their project proposal they feel has been inadequately considered or not fully and fairly represented in the results of the formal review process. Havig noted the commission

http://www.oregon.gov/ODOT/TD/TP/pages/connector.aspx

https://www.oregon.gov/ODOT/Programs/TDD%20Documents/Brooks%20ITF%20Project%20Plan.pdf

https://www.oregon.gov/ODOT/Programs/TDD%20Documents/MWVIC%20Project%20Plan%20Proposal.pdf

https://www.oregon.gov/ODOT/Programs/TDD%20Documents/TVRC%20Project%20Plan%20Proposal.pdf


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adopted Administrative Rules that outlined the requirements for project plans and what process will be used when reviewing project plans and making recommendations to the commission. Havig highlighted the five guiding principles of the process element:

1. Establishment of fair and consistent process for all project sponsors. 2. Minimize and avoid opportunities for outside influence. 3. Minimize and avoid biases that might have happened throughout the legislative process

or into the project planning work. 4. Maintain transparent and open communications with all of the project sponsors fairly

and equitably. 5. Utilize, when ODOT could, the original Connect Oregon program processes and

procedures. Havig noted ODOT met the guidelines and the review groups have reviewed the project plans based on the materials that were submitted. Havig noted in the early stages of the process the Tioga Group was given the chance to identify key questions or missing information from the project plans that the group felt they needed to inform their recommendations to the commission. The Tioga Group identified a series of questions for each project sponsor, those project sponsors then had an opportunity to answer those questions. Havig noted the Tioga Group made recommendations based off of the answers and forwarded them to the final review committee. Havig said the information was then available to ODOT Director Garrett and Business Oregon Director Harder to make a recommendation. Havig noted the process was align with past practices for the Connect Oregon program. Havig noted the project sponsors were provided with information throughout the process from the Tioga Group and the Dedicated Projects Final Review Committee (FRC). Havig noted the discussion between the project sponsors and the commission is to ensure the commission receives the necessary information they need to move forward. Havig noted in the future the commission will be asked to approve one or more of the Connect Oregon project plans. Havig noted the commission has four approval options available when the time comes:

1. Approve the project plan for Treasure Valley and not approve either project plans for the Mid-Willamette Valley.

2. Approve one of the project plans in the Mid-Willamette Valley and not the project plan in Treasure Valley

3. Approve the project plan for Treasure Valley and one of the project plans in the Mid-Willamette Valley.

4. None of the project plans should be approved. Dan Smith and Frank Harder, principals from the Tiago Group explained their role in the review process for the three Connect Oregon project proposals. Smith noted all of the proposals were technically and operationally feasible and aligned with grant program goals. Smith presented a PowerPoint that outlined the concerns the group found for each proposal such as the success in the commercial and operational business and the contractual relationships with the railroads, ocean carriers and other parties. Smith noted he wanted to clear up confusion between an intermodal and a transloading facility because they needed to be clearly defined. Smith explained the Millersburg and Brooks project proposal would be


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intermodal terminals because they are moving a loaded or empty container intact over multiple modes, usually rail, and truck or marine. The Millersburg and Brooks project proposal would link at the Mid-Willamette Valley terminal with the Ports of Seattle and Tacoma via rail. The Treasure Valley reload center would be a transloading facility because they are transferring freight between vehicles and modes e.g. from trucks to boxcars or containers. Smith noted the Treasure Valley facility would be used primarily for agricultural products delivered by truck and held briefly in the center, then transloaded through a railcar. Smith said the Millersburg and Brooks project proposal include transloading facilities within the intermodal terminal. Smith noted they are separate lines of business and can complement one another. Smith explained the Tiago Group reviewed the proposals through an intermodal function lenses. Smith addressed the Tiago Group concerns for each proposal:

1. Treasure Valley reload center: the center would be served by Union Pacific Railroad (UP). Smith noted Tiago questioned whether the facility would succeed commercially and operationally in Nyssa and create the public anticipated benefits. Smith noted Tiago has concerns that need to be addressed before full funding. Smith noted they think the planners designed a facility that is too big for the size of the market that can be accessed and financials should be refined and reviewed once required contracts are in place.

2. Willamette Valley Intermodal context: the Tiago group doesn’t believe either Willamette Valley proposals can succeed on a standalone basis. The operation would have to be priced below cost to compete with trucking industry. Smith explained the Millersburg and Brooks project proposal can only succeed in the market place if they can provide the services, schedule reliability and bring the cost down to the low cost competitor Northwest Container Services (NWCS). Smith noted the estimates of rail, terminal and drayage costs will be superseded by actual negotiations.

a. The Mid Willamette Valley Intermodal Center Millersburg Proposal would be served by UP and connect to NWCS in Portland. Smith noted NWCS is an asset to this proposal because it has an existing relationship with UP. Smith noted NWCS has worked out ways to connect the trains with marine terminals in Seattle and Tacoma, Washington. Smith noted that process is more complex and expensive than contemplated in the proposal. Smith noted the facility design may need refinement that exceeds the program funding amount and environmental status needs resolution before constructing funds are submitted.

b. The Port of Willamette at Brooks proposal would be served by the Portland and Western railroad connecting to BNSF or UP in Portland or Vancouver. Smith noted the innovative terminal design appears workable. Smith explained there is ambiguity in the contractual agreements because the terminal operating plans are unclear. Smith noted Portland and Western railroad is engaged and motivated, but the rail operating plan is incomplete and BNSF is not engaged.

c. Smith noted both Mid-Willamette Valley proposals appear to have institutional and commercial challenges. Smith said the challenge is getting the contractual agreements in place to create the required intermodal service, including a schedule, commitments to car supply and rates to be able to offer that to importers and exporters below the cost. Smith said if that can happen, the remaining issues can be manageable.

Smith explained Tiago’s recommendations to the commission:


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1. All the proposals construction grants should be conditioned on successful negations to ensure there will be a working service and signed contracts.

2. With the contracts in place, the proposers need to clarify some of the roles and functions to know how the chain of commander will operate. In addition, resolve property or environmental issues and revise the financials.

Dedicated Projects Final Review Committee (FRC) Chair, Tony Hyde presented general observations the committee found after reviewing the project sponsors proposals and Tiago’s plan. Hyde noted all three facilities found common risk areas amongst the project plans which include the level of commitment and rates of rail service, and the underlying economic assumptions appear to be overly optimistic with a need for ongoing subsidies. Hyde read the Dedicated Projects Final Review Committee Letter that highlighted observations the FRC found in each project plan and the recommendations the FRC proposed. Representative of Union Pacific Railroad (UP), Cindy Roberts said since 2017 UP has been asking project sponsors for critical information including commodities, associated project volumes, shippers, seasonality commodities, dray origins, rail destinations and markets, modes the current community is moving today, plans for refrigerated cars. Roberts noted to date UP has not received that information. Roberts explained the analysis of that data is critical in the UP 12-18 month track construction process timeline. Representative of UP Network and Industrial Development, Melissa Meier gave an overview of UP track construction process timeline. Meier gave an overview of what it looks like if an industry is looking to locate on UP. Meier explained how it differs when there is an industrial park or a transload such as the project sponsors sites that want the conceptual approval beforehand to market the site. Oregon Business (OB) Director Chris Harder noted ODOT requested OB to assist in reviewing the three project plans. Harder said OB considered the project’s financial viability and broader economic feasibility. Harder noted OB’s evaluation did not include and does contemplate the opportunity cost of the proposed investments. Harder said the successful facility could provide both the local community and state considerable direct, indirect and induced economic benefits. Harder noted OB recommends all three projects require further development to address the deficiencies outlined prior to receiving funding for long term capital assets. Harder noted OB identified and documented areas of concern common along with all three applications, detail of each area of concern is found in the OBDD Director Recommendation Letter:

1. Operation liquidity 2. Interim funding 3. Railroad commitment 4. Land commitment 5. Public agency support

ODOT Director Matthew Garrett read the language from HB 2017 related to the Connect Oregon earmarked projects. Garrett noted ODOT has received and reviewed three proposals for the two intermodal facilities identified in HB 2017. Garrett noted based on the perspectives and expertise on freight and transportation matters brought to bear by the ODOT and OB staff, the third party reviewer and the Final Review Committee, several concerns and risks were

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_H_Attach_2_Dedicated_Projects_Final_Review_Committee_Letter.pdf

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_H_Attach_4_OBDD_Director_Recommendation_Letter.pdf

https://www.oregon.gov/ODOT/Get-Involved/OTCSupportMaterials/Agenda_H_Attach_4_OBDD_Director_Recommendation_Letter.pdf


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raised. Garrett noted he believes those risks are significant enough to warrant that the commission not provide full funding to any intermodal facility until more clarity or resolution can be achieved. Garrett explained he concurs with the principal reasons offered by the Tioga Group in their summary reports (dated 1/7/19, 1/8/19, 1/9/19) and the dedicated projects Final Review Committee (letter dated 1/25/19) to advance the sponsors of the Treasure Valley Reload Center and Mid-Willamette Valley Intermodal Center at Millersburg into negotiations with ODOT for an intergovernmental agreement. Garrett noted he acknowledges the caveats embedded in their respective narratives that the project sponsors still have several critical areas that need to be addressed that speak to operational and economic feasibility of said projects. Garrett said given the significance of the concerns raised by the various review groups, he strongly encouraged the commission to proceed in incremental steps. Garrett noted to aid in the incremental approach, he suggested that prior to the OTC March 21, 2019 meeting, the OTC require the project sponsors for the Treasure Valley and the Mid-Willamette Valley at Millersburg to identify a clear path and timeline to resolve the unanswered questions related to the UP commitment to the projects. In addition the Mid-Willamette Valley at Millersburg needs to identify the need for operational cross-subsidies to ensure commercial viability. Garrett noted the OTC should request a clearly articulated course of action from the project sponsors related to the challenges as a prerequisite before public funds are fully allocated. The project sponsors were allotted 30 minutes, 20 minutes for their presentation and 10 minutes for the commission to ask questions. Project Sponsor—Treasure Valley Oregon State Representative Greg Smith noted he attended the OTC meeting at his private capacity as the business owner and economic development director of Malheur County. Smith reiterated the issues identified by the Tioga Group and the Dedicated Projects FRC. Smith noted they have been working diligently with UP and explained this particular project has gone through the first few steps of the UP track construction process but the project sponsor did not have enough funding to move forward to next steps UP needs. Smith acknowledged he wants to be a part of UP solution to reach the demands of UP refrigerated rail cars. Smith noted the project has two escrow agreements secured, one with Farmer Property (290 acres) and the other with Nyssa Industries Property (79 acres). Smith noted there are alternative property options available if agreements or land issues arise. Smith noted the Director of Department of Land Conservation and Development (DLCD) worked closely with the project sponsor to determine if the land can be developed to industrial land. Smith noted the project team provided enough information to DLCD and concluded there would be enough opportunities available to make the transition to industrial land. Smith noted shippers have expressed interest in utilizing the potential rail service, two companies were based out of Idaho. Smith noted they hired Anderson Perry engineering firm to assist in the permitting process. Smith noted they anticipate to negotiate a triple net lease for the operation of the reload facility. Smith noted NWCS has expressed strong interest in serving the closed container needs for businesses in Treasure Valley. Senior Economist with ECONotherwest, Adam Domanski highlighted the considerations for shippers to utilize the potential facility if rail was incorporated. Domanski compared the estimated costs and speeds between a rail car and a truck. Domanski noted shippers who have lower time value, larger volume and longer distance


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to travel will utilize the facility. Domanski noted his department conducted a financial review based on the projected use of the facility and found the facility would be viable. Domanski noted the department identified why the facility would be a good use of public funds:

• Creation of shipping alternatives for Oregon’s industry • Enhancing business recruitment • Reduced in-state truck miles with improved highway safety • Reduced highway road maintenance • Reduced air pollution • Elimination of unnecessary carbon emissions

Smith noted they’ve ran an RFP for interim funding and have a construction line of credit with Bank of Eastern Oregon. Smith noted local companies are eager to build near the facility which will benefit the long term financial success of the facility. Public Testimony: Jim Maret, city Manager for the City of Nyssa said the city of Nyssa, city council, city planning commission and Nyssa residences are committed to the Treasure Valley reload facility. Maret assured the commission all necessary local permits will be handled in an expedient manner. Maret noted the urban growth boundary and zoning has been completed. Maret noted the partnership is very strong with the project sponsor and the city of Nyssa is dedicated to helping people grow the community. Maret said the project is a must in eastern Oregon. Lynn Findley, Oregon State Representative noted the Treasure Valley facility meets the legislative intent from HB 2017, to reduce traffic and emissions and viable methods to move products. Findley referred HB 2012 which designated an area in eastern Oregon as an economic development zone. Findley said a board was created to investigate why Idaho was the fastest growing region in the nation. Findley noted the board provided nine recommendations that were community driven. Findley noted those nine recommendations are being discussed during the 2019 legislative session. Grant Kitamura is a partner in Baker and Murakami Produce Company and serves as the president for Malheur County Development Corporation. Kitamura noted he has been in the onion shipping business for 40 years and in the last 8 years there has been a shortage in shippers due to the isolation in eastern Oregon. Kitamura noted there has been interaction with the legislature regarding the transportation need. Kitamura noted they want a partnership with Wallula, Washington. Project Sponsor—Brooks Salem Attorney and Executive Director of Oregon Port of Willamette, Kevin Mannix noted the Port of Willamette is a limited liability company that has been formed to carry out an intermodal facility in Brooks, Oregon. Mannix noted a significant amount of information was gathered after September 27, 2018 the Tioga Group did not have prior to their review and consideration. Mannix noted there is confusion in regards to the Brooks project team working with the Port of Coos Bay. Mannix noted the planning development with the Portland and Western rail road discussed how to connect the Brooks facility with the Port of Coos Bay rail


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line. Mannix noted the Brooks facility will be a short line rail road. Mannix said the competitiveness is dependent on the trucking industry rates and noted short line rail roads operate differently. Mannix noted the facility would use the Portland and Western Railroad line. Deputy Director of Oregon Port of Willamette Connor Harrington gave an overview of a compare and contrast of the Brooks and Millersburg facility. Harrington noted the Brooks project team has been working closely with the Portland and Western railroad and have a concurrence plan from PNWR. Harrington discussed the potential rail road connections and design. Harrington noted the Brooks facility will capture a larger volume of containers to serve agricultural producers from southern Oregon to as far north as Yamhill and Clackamas County. Harrington noted the Brooks facility would reduce congestion and carbon emissions going into and through Portland by 33,000 trucks/year within 3 years. Harrington noted the Brooks facility would be open 24 hours/day, 7 days a week to serve all customers which will encourage use during off-peak travel times. Harrington highlighted acreage dedicated to the intermodal facility in Brooks. Harrington noted there has been zoning work done and an environmental review has been completed for the Brooks facility. Harrington noted the environmental review was completed to identify all potential risks associated with Brooks project. President and Chief Commercial Officer of Cordele Intermodal Services, Johnathan Lafevers explained the Brooks site is ready for development and noted Cordele Intermodal Services is a key logistical provider. Lafevers noted the company develops an understanding of each shipper’s needs to ensure those loads get to the desired destination. Public Testimony: Brodie Harvey from Knife River offered support in the Mid-Willamette Valley at Brooks intermodal facility. Harvey noted he has been working with Mannix and Lafever to plan the design and construction of the proposed intermodal facility. Harvey noted he is an active member of the Freight Advisory Committee and the Oregon Rail Users League. Harvey expressed the need and excitement for an intermodal facility and the positive impact it would have on the freight system. Harvey noted Knife River would work with Northwest Oregon Shipping group to quickly finish the project design and safely deliver a quality project on time and on budget. Harvey noted the work will be leveraged by utilizing Knife River’s extensive knowledge of railroad construction experience, vast local resources and partnerships to maximize all project stakeholders. Harvey noted the proposed facility will benefit the community of Brooks. Randy Carpenter the director for Airport Drayage noted his company has been working with the Brooks project team to develop the next phases of the intermodal project. Carpenter explained the benefits of the proposed transload facility and the challenges of drayage containers. Carpenter noted the company has been investigating the process of using electric trucks to move to and from the intermodal facilities to reduce carbon emissions at a local transportation level. Kathy LeCompte co-owner of a wholesale nursery in Brooks discussed the beginning stages of the project planning involved getting business owners input on how to build the proposed facility. LeCompte noted the Brooks community believes the facility will build strong partnerships in the community and already has serious support for the proposed facility.


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Steve Rippeteau expressed his appreciation for the open meetings that were conducted throughout the planning process of the Brooks intermodal facility. Rippeteau noted the proposal of the facility is impressive and meets the states demands. Kathy Clark, Mayor of Keizer noted the city of Keizer supports in the Mid-Willamette Valley at Brooks intermodal facility. Clark noted the city of Keizer City Council approved a letter of support for the facility. Clark noted the facility would help with the city’s economic growth and provide reliable transportation for agricultural goods. Clark noted the facilities project plan was developed with a holistic approach and is comprehensive in addressing the city of Keizer’s current and future needs. Greg Gilmer from NORPAC foods in Salem, Oregon. Gilmer discussed the background of NORPAC and discussed different production facilities around the west coast. Gilmer noted NORPAC exports products internationally and nationwide using containers, domestic trucks and rail and refrigerated box cars. Gilmer noted the company has worked with the Mid-Willamette Valley Brooks group over the last year and half on transportation issues related to the northwest. Gilmer noted the proposal for the Brooks facility meets the needs for NORPAC and the company offers support. Project Sponsor—Millersburg Linn County Board of Commissioners Chair, Roger Nyquist noted Linn County has allocated $600,000 to date for work on the Millersburg project. Nyquist noted Linn County believes the Millersburg project is a generational opportunity. Co-Owner of Stahlbush Island Farms, Karla Chambers discussed the routes her business uses to export goods. Chambers noted the issues her business has encountered over the years and expressed the need for an intermodal facility in Millersburg. Chambers noted the facility would help with competitive exporting rates and increase capacity for volumes of loads being transported and road usage. Economic Project Manager for Linn Economic Development Group (LEDG), Greg Smith noted the land that would be used for the Millersburg facility is unique because it’s parallel to UP mainline, Interstate 5 and zoned in to industrial land. Smith noted the Millersburg project team reached out to the Department of Environmental Quality (DEQ) to request a written record of the environmental issues in the area were. Smith noted DEQ stated there were no issues were found. Smith noted the Millersburg project team has submitted all the necessary documents to UP and are ready to conduct the business analysis with UP. Smith noted the Millersburg project team has a plan and is ready to secure real estate with International Paper. Smith noted there won’t be a debt service and plan to enter a triple net lease agreement for the Millersburg project. Domanski discussed the operational feasibility concerns that were raised by the Tioga Group. Domanski noted the Millersburg project team plans to leverage the current marketing conditions. Domanski said they will utilize the Portland facility and divert trucks to the Port of Tacoma to reduce congestion and carbon emissions. Domanski discussed the federal hours of service regulations for the trucking industry and addressed how the facility would benefit the public. Public Testimony: Phil Lindgren from Oregon Seed Association offered support in the Mid-Willamette Valley at the Millersburg intermodal facility. Lindgren noted the facility would provide cost benefits and


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tangible returns on investments for Oregon Seed Association. Lindgren asked for the Millersburg site to be approved. Jim Lepin, Mayor Millersburg, noted the Millersburg City Council is committed to the Millersburg project and has a cooperative agreement with the Linn Economic Development Group. Lepin noted he reran for election to help facilitate community support for the ongoing project. Lepin noted the land that would be used for the Millersburg site is industrial ready. Lepin expressed the need for the facility to kick start the community’s economic growth. Lepin assured the commission the city of Millersburg is committed, all local permits will be handled in expedient manner, and has a history of supporting industry businesses. Lepin noted the Millersburg site will be long term and help reduce carbon emissions traveling to and from the Portland region. Gary Weaver from Weaver Seed noted his company exports seeds to Asia and explained the Millersburg facility will reduce the number of miles traveled. Weaver noted the Millersburg facility will reduce congestion in the Portland metro region and carbon emissions. John Neil from Junction City, Oregon owns a small family business that exports forage to Japan and Korea. Neil explained his business ships a massive amount of forage in containers from Portland and transported by rail to the Port of Tacoma. Neil said if the proposed Millersburg facility was approved, his business would reduce their travel distance in half. Darrin Lane director of Linn County Road Department noted the infrastructure around the Millersburg site is adequate for the proposed traffic. Lane referred to the discussion about leveraging the BUILD grant. Lane expressed the desire to work with ODOT and the city of Millersburg to leverage his department’s capabilities for delivery and assisting the project for any additional future needs. Lane noted it is imperative the commission ensures there is a transparent and clear process on how the public funds are being spent. Floyd Collins has been involved with Albany Millersburg Economic Development Corp. the lead for LEDG. Collins explained the purpose of the environmental development projects in the central valley have been focused upon attracting, retaining and improving conditions for all citizens in the community. Collins noted the city of Albany took a huge economic hit when the city lost the mill. Collins noted the Millersburg facility would help economic growth in the community. Janet Steele the president and CEO of Albany Chamber of Commerce noted she has confidence the businesses in the region will utilize the Millersburg facility and knows the citizens are looking forward to the job opportunities that will be available. Steele noted the Linn and Benton county business community are agriculture, retail commercial service and manufacturing businesses. Steele noted the members are fully supportive of the Millersburg project and ask the commission for support. ODOT Planning Section Manager Erik Havig asked the commission to digest the information they received from the project sponsors, ODOT and OBDD recommendations and third party reviewers. Havig noted the agency recommends taking an incremental approach to determine


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how to move the projects forward. Havig noted the processes that were outline for next steps in the UP process will help outline the agency’s next steps. Discussion: Chair Baney asked Hyde if he’d like to highlight the environmental piece that were outlined in the final review committee recommendations. Hyde noted all of the project plans will help the environmental issues Oregon faces. Hyde noted Greensville is easier to mitigate than Brownsville. Commissioner Callery asked UP when they can provide an overview of rates and equipment that is available. Meier noted it would be step 5 in the UP track construction process. Commissioner Brown asked how long the business analysis steps take. Meier said it varies but if the industry has all the material it can take up to 30 days. Chair Baney asked where UP believes the projects are according to the UP track construction timeline. Roberts clarified UP has engaged with two projects because the Mid-Willamette Valley Brooks project does not need a direct connection with UP. Chair Baney asked if the commission needed to get more information from the projects sponsors could UP afford the opportunity to get through the steps that are necessary. Meier affirmed and said on average it takes 12 months to complete the UP timeline. Chair Baney asked if there are other considerations the commission should be aware of. Meier said no, UP feels comfortable with the information they’ve received from the project sponsors. Commissioner Callery said UP has a competing facility in Wallula, WA and noted there are a limited number of refrigerated rail cars for certain commodity movements. Callery asked how much of a competitive situation does UP see between Nyssa and Wallula, WA as far as availability with rail cars. Meier noted she can’t speak to the Wallula site, it would be the UP sales team. Roberts noted UP doesn’t have refrigerated cars and the customer will have to buy them. Commissioner Simpson requested suggestions from Garrett for steps the commission needs to take moving forward. Garrett recommended the commission to have the sponsors answer the questions and address any concerns that were outlined from each review group. Commissioner Callery asked Smith to clarify how he would receive UP refrigerated cars if UP noted in an earlier statement the customer would have to purchase UP refrigerated cars. Smith noted the Treasure Valley project team needs to do a market analysis to identify what will be the true demand in the region and facility. Callery asked what commodities are being considered other than agriculture. Smith noted compressed hay and mineral operations and a major food processing company in California have acquired about the facility. Callery asked if the entities want to utilize the facility once it’s running at full capacity or interested in investing in the facility. Smith noted the entities have a strong desire to acquire real estate, make capital investments and to utilize the rail service. Smith noted Treasure Valley project


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team will have to work with UP to identify what the entities and the facilities relationship will be. Commissioner Simpson asked if there has been analysis on whether there will an impact on truck driving jobs in Eastern Oregon. Domanski noted the trucking business shifts to location of demand but noted local trucking markets will be strong in the region. Simpson asked if infrastructure and capital cost were considered during the Treasure Valley financial review. Domanski noted capital cost will be added into the shipper’s fees and noted the capital cost will be funded by the state. Simpson asked if there is notation about the company’s aspirations in regards to minority families. Smith noted he would follow up. Chair Baney asked what Smith identifies as necessary from a partnership to move to the next phase and would the Treasure Valley facility need ongoing state funds to make the project viable. Smith noted the Treasure Valley project team needs to work with ODOT staff to update a project timeline and budget to identify bench marks that are needed to move forward. Smith noted the Treasure Valley project will need financial assistances to get to the next phase with UP process. Domanski noted the ongoing subsidies moving forward will not be a necessary. Garrett noted there is outstanding information regarding the Treasure Valley facility that hasn’t been given to UP. Garrett asked what level of investment is needed to supply UP to take the Treasure Valley project to the next steps and to be in a position where there is an opportunity for an agreement. Smith noted a minimal budget was created to get the facility where it stands today. Smith noted if there was an opportunity to follow the statutory allowance it would allow them to move forward. Garrett noted if that scenario happened, would that be enough resources to get to a point to supply the necessary information to UP. Smith affirmed and said his professional team is ready to move forward to meet the needs of UP. Chair Baney asked for clarity with connection between short line rail roads, UP and BNSF. Mannix noted the Brooks project team has not asked UP for an agreement because the Portland and Western railroad has the necessary package rights and agreements in place with UP to access to their systems. Mannix noted the rates will have to be negotiated if the Brooks facility is agreed upon but the Brooks project team is not asking UP to build tracks or connect to UP’s system. Commissioner Callery asked Mannix what the Brooks facility has available for refrigerated railroad cars. Lafevers noted refrigerated cars were not in the initial phase of the design plan. Cordele proposed they would source their own intermodal flat cars. Chair Baney asked why the Brooks project plan needs public funds if Cordele is willing to source the railcars. Mannix noted it would give the facility a jump start. Mannix noted the facility needs to be built big enough to meet the state’s needs. Chair Baney asked if the environmental review is in the works for the Millersburg site. Smith noted that ODOT Planning Manager Erik Havig created strict guidelines of what could be submitted from the project sponsors and Smith wanted to honor that process. Smith noted he


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is aware the environmental review is the next step and noted the budget allowed the project team to get to a certain point. Chair Baney asked Havig to build a matrix of concerns the Tioga Group and the Dedicated Projects Final Review Committee addressed and the project sponsors answers to those concerns. Commissioner Brown requested the commission to consider the questions being asked in the matrix because each project sponsor is at different phase of the Connect Oregon process. Garrett affirmed Baney’s request for a matrix and addressed concerns that could populate the matrix. Garrett noted the project sponsors should answer Tioga Group’s comment regarding the methodology for trucking distance. In addition the Tioga Group defined the difference between intermodal and transload facilities. Garrett asked the Tioga Group to consider the reason for addressing the difference between the two. Garrett asked the Brooks project team to create a timeline similar to UP’s track construction process, that addresses the necessary information to build the proposed facility. Action: None taken.

Chair Baney adjourned the meeting at 5:08 pm. [Original signature on file] Tammy Baney, Chair

[Original signature on file] Alando Simpson, Member

[Original signature on file] Julie Brown, Member

[Original signature on file] Robert Van Brocklin, Member

[Original signature on file] Martin Callery, Member

[Original signature on file] Cooper Brown, OTC Chief of Staff

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