P3s Seen as Prime Mover for High-Speed Rail

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DALLAS – The task of building a national high-speed rail network is a job for public-private partnerships rather than federal or state governments, transportation experts told members of a House panel looking into the lack of progress on bullet train projects in the U.S.

Congress has appropriated more than $10 billion for high-speed rail since 2009 but so far only Amtrak's Acela service along the Northeast Corridor operates at speeds of up to 165 mph and then only for a few miles, Rep. John Mica, R-Fla., chairman of the House Oversight Committee's panel on transportation, said during the hearing.

"Seven years later, we only have high-speed rail as part of our imagination," Mica said. "We don't have any real projects we can point to that are operational, or even close to that."

The 2009 stimulus package included $8 billion for HSR, with another $2.5 billion appropriated by Congress in 2010.

Congress has not approved any additional federal funding for HSR projects over the last six years despite several requests from President Obama.

U.S. bullet train projects have stalled because the Federal Railroad Administration has been lax in providing guidance to potential HSR efforts and state transportation departments lack expertise in the field, Baruch Feigenbaum, assistant director for transportation policy at the Reason Foundation, told panel members.

"The Obama administration and future administrations should more closely examine building high-speed rail through public private partnerships," Feigenbaum said. "All of Japan's Shinkansen trains are privately operated as is one of Italy's two main lines."

Asking potential investors what it would take to create a viable P3 rail system in the Northeast Corridor could provide valuable information on what might be possible, he said.

"That would enable the government to develop a request for proposals, inviting qualified teams to respond with specific proposals for how they would transform the corridor," Feigenbaum said.

Obama's 2009 stimulus plan called for the construction of 10 HSR lines serving 34 states. The proposed construction funding included an $8 billion initial investment and $1 billion per year for five years but that was insufficient for a national effort of that size, he said.

California's plan to build a bullet train from San Jose to Bakersfield has received almost $4 billion of the designated federal stimulus funding for HSR, Feigenbaum said.

"A relatively short high-speed rail line --250 miles-- costs at least $20 billion to build, more than all of the federal funds the president planned to obligate," he said.

Creation of a national infrastructure bank dedicated to HSR and other transportation projects would stimulate investor interest in U.S. rail projects, Thomas Hart Jr., co-founder of the U.S. High Speed Rail Association, told panel members.

"The idea of an infrastructure bank and other public and private partnerships are likely the best option for raising the significant amount of funding to take the next step in the journey for HSR," Hart said.

The $10.5 billion of federal funding for high-speed rail since 2009 is dwarfed by China's $126 billion investment for bullet trains in just fiscal 2015, according to Sarah Feinberg, head of the Federal Railroad Administration.

Congress has rejected a dedicated funding source for rail and $35 billion of HSR funding requested by President Obama since 2010, she said.

"America has been falling behind," she said during the hearing. "Despite continued demand from communities and leaders across the country and the administration's repeated budget requests for additional funding, Congress has provided no new substantial amounts of passenger rail development funding."

More than half of the rail projects funded by the 2009 stimulus package have been completed, Feinberg said. Any unexpended HSR stimulus funding remaining at the end of fiscal 2017 must be returned to the Treasury Department.

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