State funding sought for rail access project

The state would provide matching funds for the development of an industrial rail access business park under a proposal heard Feb. 18 by the Revenue Committee.

Under LB40, sponsored by North Platte Sen. Mike Groene, a nonprofit economic development corporation could apply to the director of the state Department of Economic Development for up to $10 million in matching funds to cover the project’s development costs.

The funds could be used for site acquisition and preparation, utility extensions and rail spur construction for the development of a new industrial rail access business park, including expenses incurred to help an initial tenant in the manufacturing, processing, distribution or transloading trades.

The project would have to be located in a county with a population of fewer than 100,000 inhabitants.

If the application is approved and the Legislature appropriates the funds, the applicant would receive a dollar-for-dollar match from the state for the total amount of their investment in the project over a five-year period.

Groene said the proposal is similar to legislation passed last year that requires the state to provide matching funds for a potential project at the University of Nebraska Medical Center in Omaha. LB40 could provide a similar economic boost to rural Nebraska by directing state funds to a potential facility near Union Pacific’s Bailey Yard in North Platte, he said.

Groene said the project could attract manufacturers and distributors seeking to reduce their shipping costs and provide jobs in an area of the state that has lost population in recent years.

“Rural Nebraska needs good jobs,” he said. “People want to live there — we just need good jobs.”

Gary Person, president of the North Platte Area Chamber and Development Corporation, testified in support of the bill. He said Union Pacific historically has discouraged rail development near Bailey Yard because of the scale and complexity of the yard’s operations. With the rise of automation and precision scheduling, he said, the company now supports development of a nearby rail access business park.

Person said LB40 would help North Platte compete for companies whose priority when choosing a new site is direct rail access. He said a number of companies, none with a current presence in Nebraska, are interested in the idea.

“We believe this bill can assist not only our community but other rural communities [to] diversify their economies,” Person said.

No one testified in opposition to the bill and the committee took no immediate action on it.