Iowa Interstate Railroad building rail-truck facility in Iowa City

IOWA CITY — Iowa Interstate Railroad is preparing to build a transloading facility in southeast Iowa City that will allow the transfer of cargo between railcars and trucks.

The Cedar Rapids-based railroad bought about 30 acres in the city’s industrial campus on 420th Street for the facility. The land is shovel-ready, according to the city.

Construction is expected to start this spring, with the facility ready for use by mid- to late summer, according to Iowa Interstate Railroad.

The Iowa City Council last year unanimously approved the $1.5 million sale of the land, which the city has been marketing since 2008.

The site includes an existing rail spur and will connect to the 573-mile Iowa Interstate rail network, which provides direct access to all seven Class I railroads and various short lines.

The facility also provides access to Interstate 80 and Highways 6 and 218.

“As we have seen with the numerous other transloading sites existing along our network, these facilities provide significant value to our customers and open the door for many other companies to become rail shippers,” Iowa Interstate President and CEO Joe Parsons said in a statement.

Travero, Alliant Energy's transportation subsidiary, opened a 259,000-square-foot warehouse and transload facility in Fairfax in September 2021 to transfer cargo between rail and trucks. The facility -- known as Logistics Park Cedar Rapids, Fairfax campus -- connects to the CRANDIC rail line, owned by Travero, and is near Interstate 380 and The Eastern Iowa Airport.

Moving cargo

A transloading facility allows cargo to be moved between rails and another mode of transportation, in this case trucks.

James Mattsen, Iowa Interstate’s senior director of economic development, said the railroad company has had requests from customers — mainly in Iowa City and Cedar Rapids — looking to transfer cargo between rails and trucks.

“Because of the lack of infrastructure to load anything on a rail car in the Iowa City/Coralville Corridor, we started thinking about what might work,” Mattsen said.

Mattsen said the facility will help Corridor businesses receive bulk product by rail and give customers options they haven’t previously had.

“One of the benefits of transloading products to or from rail on the Iowa Interstate is we connect with so many other railroads,” Mattsen said.

Because of interest in the project, Mattsen said the railroad is evaluating the different needs to figure out what is most realistic for the facility.

“Export of farm products out of the area or supporting local manufacturers are really what's been driving the requests that we've had so far,” Mattsen said.

Advantages

A potential customer said the facility would make it possible for their truck drivers to be home every night, Mattsen said.

“Instead of driving to somewhere east of Chicago, they'll be able to drive to and from this facility, and they'll be able to make several trips a day, and then they’ll be able to sleep in their own bed at night,” Mattsen said. “So this should improve the quality of life for some employees that are based in the Iowa City/Coralville area.”

The city of Iowa City also highlighted how rail is “the most fuel-efficient way to move freight across the land, giving the city a more climate-friendly shipping option.”

“Projects like this are an excellent example of how actions on the local level contribute to solutions at a larger scale," City Manager Geoff Fruin said in a statement.

Moving cargo by rail instead of truck lowers greenhouse gas emissions by up to 75 percent, according to Iowa Interstate. In 2021, the rail company joined the Environmental Protection Agency’s SmartWay Transport Partnership, which helps companies advance supply chain sustainability.

“We’re just at the very beginning” of cities looking at how rail can support their environmental goals, Mattsen said. Typically the focus has been on working with the railroads to allow better flow of products.

Added Fruin: ”As we look for ways to continue to bolster our economy while making significant progress toward achieving our climate action goals, this partnership reflects the values and collaborative spirit of Iowa City.“

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