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Florida Fast Rail Set in Motion

BRADENTON, Fla. — Crews this week began geotechnical and survey work on the first phase of Florida’s $2.6 billion high-speed rail project from Tampa to Orlando, which is set to be built in the median of Interstate 4.

During a briefing in Tampa Monday, state Department of Transportation officials told federal lawmakers that the process to select a public-private partnership to design, build, operate, maintain, and finance the first phase of the state’s high-speed rail system is expected to begin in November.

As the P3 procurement gets under way, it will become clearer if bonds will be used to finance any part of the project. To date, 30 firms have expressed interest.

While lawmakers lauded the effort to build the first high-speed rail system in the U.S., they warned the DOT it should not take too long to start construction since the federal government has awarded $1.25 billion from federal stimulus funds to pay a portion of the cost.

U.S. Sen. Bill Nelson, who represents Florida, said that while he was grateful the state won a big share of the initial stimulus funding and could expect more federal funding, the DOT needs to expedite the process to begin construction as soon as possible.

“The purpose of the stimulus bill was to stimulate jobs,” he said. “I’m hopeful we can keep that objective in mind.”

U.S. Rep. Kathy Castor questioned how the DOT would ensure that locals receive the jobs created by the project.

The state plans to hold outreach sessions in coming months to inform minority, disadvantaged, and small businesses about opportunities there will be to participate in the project, according to Kevin Thibault, executive director of the new Florida Rail Enterprise — an agency within DOT overseeing the project.

The agency has had numerous discussions with the companies interested in the P3 and they all realize that to be competitive they have to partner with local firms, Thibault said.

Industry forums are planned later this year in which the state’s expectations for hiring and implementing an aggressive schedule will be unveiled. Officials also are looking for ways to overcome delays created by lengthy permitting processes at the state and federal level, he said.

“We will be the first state with true high-speed rail with speeds of 150 miles per hour or greater,” Thibault promised.

That sentiment was echoed by Orlando Mayor Buddy Dyer, who focused on the economic benefits. The Orlando region is home to central Florida’s mega-theme parks and it is where the unemployment rate was 11.1% in May, according to the Bureau of Labor Statistics.

“We’re very focused on being first” to build high-speed rail in America, said Dyer, who pointed to a recent report commissioned by the U.S. Conference of Mayors that studied the economic impact of high-speed rail in four cities, including the Orlando metropolitan statistical area.

High-speed rail could bring up to 27,500 new jobs, $2.9 billion in new business sales, $1.2 billion in new wages, and $255 million annually in new visitor and business spending to the Orlando area, according to the study. Additional development around rail stations and the Orlando Convention Center could help generate more than 50,000 jobs, the study found.

Dyer said area officials are working on local connection services to move high-speed rail riders to their final destinations, including a regional commuter-rail system on which work begins early next year.

Tampa and surrounding Hillsborough County also are working on a bus and light-rail project, but it is dependent on the passage of a one-cent sales tax increase by area voters in November.

The Tampa-to-Orlando leg is the first phase of a system in which trains will run up to 168 miles per hour. It is projected that about two million passengers will ride the train each year. The second leg of Florida’s system will run from Orlando to Miami and studies are under way to determine the alignment.

Florida has 93% of the right of way for the Tampa-to-Orlando route and is beginning work to purchase the remaining parcels, said Nazih Haddad, chief operating officer for Florida Rail Enterprise.

An investment-grade ridership study done in 2002 is being updated to obtain more specific data and new surveys. Currently, about 200 people are working on the project but that number is expected to grow to about 11,000 at the height of construction.

Between 600 and 1,000 permanent jobs directly related to the high-speed rail line are expected to be created after it begins operating, while another 500 jobs indirectly related to the system are expected to be created.

In May, the Federal Railroad Administration approved a “record of decision,” a determination that allowed the state to proceed with right-of-way acquisition, design, and construction. The same month, Florida received $66.7 million as the first installment of stimulus funding to complete 30% of the design work, update ridership projections, and prepare bid documents.

The state will apply for additional FRA funds later this year, Haddad said.

In addition to work on developing the project and advance preliminary engineering to firm up costs, the state is preparing for the procurement process to select qualified firms interested in the P3 contract to design, build, operate, maintain, and finance the first phase of the system.

As envisioned, the 30-year P3 will require public-sector investment in the infrastructure, with the private sector taking the risk for designing, building, operating, and maintaining the system, Haddad said.

The consortium winning the P3 contract for the Tampa-to-Orlando phase likely will be given a first right of refusal for the Orlando-to-Miami leg, which has “much better profit potential,” Haddad said.

Requests for qualified firms are expected to be sought in November, after which the DOT will short-list firms that will be asked to submit proposals. Construction on the Tampa-Orlando leg is expected to start in mid-2012 and be ready in 2015.

Florida’s high-speed rail consultant team is composed of KPMG LLP for financial services, New York-based Freshfields Bruckhaus Deringer LLP for legal services, and HNTB Corp. and Wilbur Smith Associates as project managers.

State officials said many large consortiums and firms have shown interest in the system.

They include FCC Construction, Globalvia Infrastructure, Fluor Corp., OHL, SNCF — the French National Railways, URS, Bombardier, Global Rail — a Korean rail firm, Dragados USA/ACS Infrastructure, Kawasaki, Siemens, Sumitomo Corp., Cintra Developments LLC, Shaw Group, Flatiron Construction Corp., Talgo Inc. — a Spanish railroad, GE Transportation, Skanska USA/Granite Construction Inc., Lockheed Martin, Bechtel, Kiewit Southern Co., Magellan Ventures — Central Japan railway, ALSTOM Transportation Inc., Ames Construction Inc., Hyundai-Rotem USA Corp., Raytheon, Acciona Infrastructures Canada Inc., and Herzog Contracting Corp.

In December, the Florida Legislature met in special session and created a comprehensive structure for passenger-rail service throughout the state, including a nine-member Florida Rail Commission to oversee services. Six members have been appointed but the remaining three have yet to be announced by Gov. Charlie Crist.

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