Charleston maritime agency sees inland port costs soar on unexpected expenses

Date: Wednesday, February 28, 2018
Source: Post and Courier

The cost of building an inland port to handle cargo moving between the Pee Dee region and the Charleston waterfront has ballooned to $50.5 million because of unexpected road, rail and technology costs.

The State Ports Authority announced the latest estimate Thursday.

The construction bill for the cargo hub along Interstate 95 in Dillon — scheduled to open April 1 — is more than 26 percent higher than the initial $40 million price tag. The project was announced in September 2016.

The overruns will be split between the SPA and CSX Corp., the railroad operator that will serve the property.

The SPA's board of directors on Thursday approved additional expenses of up to $6 million, bringing the maritime agency's total investment to a maximum of $41 million. While the SPA is a public agency, it does not receive tax dollars and instead funds its expenses through operations and borrowing on the bond market.

CSX, a publicly traded company, will pay the remaining $4.5 million in overruns, bringing the rail carrier's total investment to $9.5 million.

About $1 million of the SPA's extra expenses are for additional work, fill material and environmental remediation needed to stabilize the site because CSX wants to add more tracks to accommodate trains of up to nearly three miles in length. The longer trains will help CSX more efficiently move cargo that's transferred between trucks and rail cars on shipments to and from the Port of Charleston.

The SPA also is picking up the $1.5 million cost of an operating system that will help direct traffic and cargo at the inland port. The agency learned after construction started that CSX no longer plans to use the information technology system that was to be installed at the facility.

"We had to scramble a bit to secure our own operating system that will dovetail with what we're doing here in Charleston," said Barbara Melvin, the SPA's vice president of operations and terminals.

More than $2.7 million will be spent on additional paving, construction and utility costs.

Melvin said there also is a "significant need for road work" to handle heavy trucks moving to and from the terminal. Those costs total $755,000.

"We're asking the county to do some work on the roads to handle freight volume," said Jim Newsome, the SPA's president and CEO. "If they can't or won't do it, we're going to have to do it. So that's money that may or may not be spent."

Despite the higher costs, Melvin said construction has been smooth and on time.

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