Gov. Rick Scott Kills High-Speed Rail for Florida

by Lou Dolinar

Florida governor Rick Scott has just rejected $2.4 billion in federal high-speed-rail funds for his state, at the same time blasting the administration’s economic policies for making the U.S, and Florida, uncompetitive. There’s nothing to add. His press release is pitch perfect:

My decision to reject the project comes down to three main economic realities:

First — capital cost overruns from the project could put Florida taxpayers on the hook for an additional $3 billion.

Second — ridership and revenue projections are historically overly-optimistic and would likely result in ongoing subsidies that state taxpayers would have to incur. (from $300 million – $575 million over 10 years) — Note: The state subsidizes Tri-Rail $34.6 million a year while passenger revenues covers only $10.4 million of the $64 million annual operating budget.

Finally — if the project becomes too costly for taxpayers and is shut down, the state would have to return the $2.4 billion in federal funds to D.C.

— The truth is that this project would be far too costly to taxpayers and I believe the risk far outweighs the benefits.

— Historical data shows capital cost overruns are pervasive in 9 out of 10 high speed rail projects and that 2/3 of those projects inflated ridership projections by an average of 65 percent of actual patronage.

— It is projected that 3.07 million people will use the train annually.  Keep in mind that Amtrak’s Acela train in Washington, D.C., Boston, Philadelphia, New York and Baltimore only had 3.2 million riders in 2010.  And that market’s population is 8 times the size of the Tampa/Orlando market.

— President Obama’s high-speed rail program is not the answer to Florida’s economic recovery.

— We must make investments in areas where we will get a return for the shareholders – Florida’s taxpayers.

— Rather than investing in a high-risk rail project, we should be focusing on improving our ports, rail and highway infrastructure to be in a position to attract the increased shipping that will result when the panama canal is expanded when the free trade agreements with Colombia and panama are ratified and with the expansion of the economies of central and south America.

— By capturing a larger share of containerized imports entering our seaports, expanding export markets for Florida businesses and emerging as a global hub for trade and investment we can create up to an additional 143,000 jobs according to a recent chamber of commerce study.

— It is absolutely critical that we make smart investments with taxpayer dollars, whether state or federal, and I believe our state will be better served by spending these funds on projects that will benefit Florida and not turn into a spending boondoggle.

— The answer is to reduce government spending, cut government’s leash on our state’s job creators and then hold that government accountable for the investments it makes.

— That is what I was elected to do and that is how I plan to govern. Let’s get to work!