Judge Denies Document Request in Florida Train Lawsuits

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BRADENTON, Fla. - A federal judge denied requests by two Florida counties for new documents about public financing for the All Aboard Florida private passenger train project, moving their lawsuits closer to a ruling on dismissal.

U.S. District Judge Christopher R. Cooper said Monday that documents submitted voluntarily by All Aboard Florida and records already filed in the case "are likely to provide the court with a sufficient record upon which to decide the defendants' pending motions to dismiss.

"The burden and delay associated with the requested discovery therefore outweigh its likely benefits," he said.

Cooper ordered Indian River and Martin counties to submit by Jan. 16 their written opposition to pending motions filed by the U.S. Department of Transportation and All Aboard Florida to dismiss the counties' lawsuits.

USDOT and All Aboard Florida must file their responses by Jan. 30.

AAF had submitted documents in response to the counties' request for additional discovery, but none were filed by USDOT.

The documents from AAF included a letter from USDOT to U.S. Rep. Bill Posey, R-Fla., who questioned a ridership and revenue study conducted for the 235-mile, $3.5 billion passenger train project from Miami to Orlando.

"The U.S. Department of Transportation does not evaluate ridership, revenue, or creditworthiness in determining the eligibility of projects for Private Activity Bond allocations, and therefore did not consider the study in connection with its PAB allocation to the AAF project," Blair Anderson, USDOT undersecretary for policy, said in a Nov. 1 letter to Posey.

The lack of vetting of the project by the USDOT in its private activity bond approval process is "disturbing," George Cecala, spokesman for Rep. Posey, said in a Jan. 3 interview.

The USDOT declined to comment.

Indian River and Martin counties filed separate federal lawsuits in 2015 contending that USDOT failed to consider its $1.75 billion PAB allocation for the train project in a federal review process under the National Environmental Policy Act.

The legal challenges by both counties, which are along the state's east coast where the train owners propose 32 daily nonstop trains, have cited potential harm to public services and archeological sites.

Cooper ruled last August in a potentially precedent-setting decision that the counties proved that the USDOT's approval of tax-exempt bond financing for the train project should have been undergone the NEPA review process.

Proceeds of the bonds, which remain unissued, would have been used for entire project except in Indian River and Martin counties where no stops are planned.

After Cooper's August ruling, AAF withdrew its request for $1.75 billion of private activity bonds and filed a new application for $600 million of bonds, which USDOT approved on Nov. 22.

The smaller allocation, AAF said in its application, will be used to finance construction work on phase one of its project along a 67-mile corridor between Miami and West Palm Beach, which has completed the NEPA review and approval process.

AAF also told the USDOT that it would submit a separate application at a later date for $1.15 billion in PABs for phase two of its project - the 168 miles from West Palm Beach to Orlando, which would take the trains through Martin and Indian River counties.

The second phase of the project has undergone most of the NEPA review process, but it has not received a "record of decision" from federal officials granting it final approval.

The new financing strategy employed by AAF, leaving the second phase without bond financing for now, led AAF and USDOT to file motions arguing that the legal challenges brought by the two counties were moot and that the lawsuits should be dismissed.

AAF, which will brand its passenger train as Brightline, has said it plans to begin service from Miami to West Palm Beach in mid-2017.

The company is owned by Fortress Investment Group LLC.

The suits are pending in the United States District Court for the District of Columbia.

Indian River's case number is 1:15-cv-00460 and Martin County's case is 1:15-cv-00632.

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