An archived image of the tunnel at Camden Station, Courtesy of Library of Congress

Freight rail operator CSX has withdrawn its support for the much-awaited expansion of the Howard Street Tunnel, killing a dream of a significant future boost in productivity for the Port of Baltimore.

Maryland Transportation Secretary Pete Rahn announced the project-gutting decision yesterday, writing in a letter to U.S. Transportation Secretary Elaine Chao (via WBAL) that the state has pulled its request for federal funding for the project as a result of CSX’s “business decision.”

“As you can imagine, this decision by CSX was both surprising and incredibly troubling, especially considering the countless hours and energy that have been expended by the Hogan administration on this effort,” Rahn wrote.

Gov. Larry Hogan’s administration applied for federal funding for a second time last December, seeking $155 million in the form of a FASTLANE grant. The money, if granted, would have been paired with $290 million supplied by the state and CSX to expand the clearance of the 121-year-old Howard Street tunnel, which CSX owns. The goal was to lower the floor and create extra space on top. The total cost of the project was $445 million, a fraction of the original estimated cost of widening the berth of the tunnel, Hogan’s administration said.

Even so, CSX decided this week that helping to pay for the effort wouldn’t pay off for the company, given a new operating plan that it had launched in March.

“Given the operating changes that CSX’s new leadership team has made over the last several months, and upon an updated evaluation, we determined that the Howard Street Tunnel project proposal no longer justifies the level of investment required from CSX and our public partners at this time,” said a statement from the company.

It’s really all bad news for Baltimore. The project would have allowed the port to begin shipping double-stacked train cars into and out of the city, vastly increasing its productivity. The port has already started receiving mega-sized container ships, thanks to the recent widening of the Panama Canal. However, it hasn’t been able to take full advantage because the Howard Street Tunnel, an arterial freight route moving cargo into and out of the city, is too short to fit stacked containers.

Hogan spokeswoman Shareese DeLeaver-Churchill said in a statement that the governor’s feels CSX’s move is “deeply disappointing, but ultimately a decision that was made by a private company. The administration will continue to explore all ideas and pursue innovative options that will be beneficial to the Port, the City of Baltimore, and the entire state of Maryland.”

Maryland’s congressmen seem pretty peeved. The AP reports they’ve sent a letter to CSX CEO Hunter Harrison asking, in the AP’s words, “why a project that had been a priority for the railroad company — as well as local, state and federal officials — is suddenly no longer important to CSX, which owns the tunnel.”

Hogan’s administration had estimated the Port of Baltimore would have been able to handle 80,000 more containers once the tunnel was expanded, translating to boosted freight output, more jobs and benefits for the freight industry extending to the rest of the country.

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Ethan McLeod

Ethan McLeod is a freelance reporter in Baltimore. He previously worked as an editor for the Baltimore Business Journal and Baltimore Fishbowl. His work has appeared in Bloomberg CityLab, Next City and...