New Freight RailCustomer Opportunity

Capital MetroBoard Rail Committee

June 14, 2010

Capital Metro Freight Obligations

Federal “Common Carrier” Obligations (administered by the Surface Transportation Board) require Capital Metro to provide freight services to:– Entities currently in existence on the rail line– New entities that purchase/develop facilities on the rail line

Freight operations must be in compliance with Department of Transportation and FRA regulations– Packaging and placarding in accordance with DOT– Train operation and track in accordance with FRA

New Freight Rail Customer Opportunity

Ethanol Distribution Facility near Decker Lane– Ethanol Distribution Facility is proposed to be developed in Austin– Volume = 400-500 train cars per month

– Expectation is this demand will more than double by 2020

Capital Metro Obligations– Agency and it’s common carrier contractor (Watco) would be obligated to

serve the new customer– Track infrastructure improvements (~$350,000 - $1.5 mm) required

– Funding alternatives are being evaluated

Capital Metro Benefits– Estimate CMTA will net approximately $250,000 per year

Community ImplicationsCommunity Advantages– Removes 35 – 40 Daily Tanker trucks from Highways– Helps community improve air quality standards– Creates new jobs

Community Concerns– Will add to train traffic in this area– Travis County has expressed concern about the shipment of this product

Other Considerations– Federal mandates on ethanol blending requirements may change over time– Consider alternative route via McNeil and Austin Junction

Project Timing

Current Target for implementation– Optimistic: September 15, 2010– More likely: February 2011

Facility Construction– Six months to begin initial operation (12 month total build out)– Includes track infrastructure improvements

Freight Rail Operations: Decker Transload Station

Deck

er L

ane

Decker Lane Siding is 15 track miles

West of Elgin Interlocker

Flint Hills Resources hasfuel storage tanks to convertto ethanol storage

Proposed Facility Location

Freight Rail Operations: Decker Transload Station

Decker Lane

Flint Hills Resources(around bend) currently hasfuel storage tanks to convertto ethanol storage

Decker Lane Siding is 15 track milesWest of Elgin Interlocker

Freight Rail Operations: Similar Facility in ArlingtonDirect Fuel West

Arlington, Texas

Freight Rail Operations: Similar Facility in ArlingtonDirect Fuel WestArlington, Texas

Freight Rail Operations: Similar Facility in ArlingtonDirect Fuel West

Arlington, Texas

Freight Rail Operations: Similar Facility in ArlingtonDirect Fuel West

Arlington, Texas

Questions ?