Florida is looking to the private sector to bankroll high-speed rail. The state’s proposal for federal funding anticipates that private-sector funding would cover all operations and maintenance expenses for a planned line between Orlando and Tampa. State transportation planners aren’t committing any state funding to the system for the foreseeable future. Despite widespread enthusiasm for the project, the president of the Florida Transportation Builders Association is worried about high-speed rail’s long-term impact on state transportation funding, especially since the state has no dedicated funding source for a rail system.
“There doesn’t appear to be any recognition at all of the cost to the state,” says Robert G. Burleson, president of the FTBA in Tallahassee. “All the studies show that the train isn’t really profitable until you get it extended to Miami.” Burleson estimates that extending the system to Miami would require an annual commitment of between $100 million and $150 million for about 30 years.
“If there’s a new revenue source for high-speed rail ... we can live with that,” Burleson adds. “If [a potential subsidy] is supposed to come out of the current dollars that we have, then I just don’t see how it’s feasible. Given the big budget deficit that the state faces, there are going to be tremendous pressures to take money out of the transportation trust fund.”
The Florida Dept. of Transportation’s high-speed rail website, www.floridahighspeedrail.org, states that the system would be paid for with “private and federal dollars first and with user fees.” Moreover, it states, “The Florida legislature has mandated state funding be minimized.”
“The idea is the state would not be putting any kind of monies toward operational deficits,” says Nazih Haddad, FDOT manager for passenger rail development. “We’re focused on having a PPP where the private sector is going to be responsible for the operations of the system and accept the risks associated with the system’s revenue.”
There appears to be interest within the private sector. At a recent industry forum, FDOT held “individual meetings” with a list of interested parties that included a number of major transportation infrastructure contractors and engineering firms: OHL Group, Skanska/Granite, Fluor, Sumitomo, Siemens, Kiewit, French National Railways, URS, Bombardier, Global Rail/Korean Rail, Bechtel, Kawasaki and Japan Central Railway.
Haddad says FDOT isn’t sure whether the state would utilize a turnkey design-build-operation-maintain-finance approach—as it has done recently on I-595 in Broward Co.—or utilize a design-build contract to get construction started and another contract for the rest. He believes that the Orlando-Tampa route has an edge for three reasons: its costs are lower than competing proposals, nearly all environmental permitting and right-of-way acquisition have been completed and there are no constructability challenges.
“I think we stand an excellent chance,” Haddad says.