The Corner

Obama Administration Halts Plans to Finance High-Speed Rail Project

The Department of Transportation has decided to indefinitely postpone consideration of XpressWest’s application for a $5.5 billion federal loan. The company proposes to build a high-speed rail line from Victorsville, Calif., to Las Vegas, Nev., in order to alleviate traffic congestion in Interstate 15 and allow travelers’ “Las Vegas EXPERIENCE” to begin a few hours sooner.

The Heritage blog reports that Senator Jeff Sessions and Representative Paul Ryan, the top Republicans on their respective Budget Committees, received notification of the suspension from Transportation Secretary Ray H. LaHood. The lawmakers then submitted a letter to the Government Accountability Office explaining that the DOT found “serious issues” in the application and has “significant uncertainties” about the XpressWest plans.

Proposals for developing high-speed rail lines in the country have had a rocky history in Washington. Senate Majority Leader Harry Reid controversially attempted to push a similar Las Vegas rail plan into the 2009 stimulus bill, but the project was deemed ineligible for federal funds. XpressWest, formerly named Desert Xpress, submitted its loan application to the Federal Railroad Administration in December 2010.

Sessions and Ryan vehemently opposed the loan in a March 6, 2013, letter to LaHood, calling the project “costly, wasteful, and risky.” The Las Vegas Review-Journal reported in April that Senator Reid, “the project’s most powerful booster,” had assurances from LaHood and the FRA that the loan would be approved. The rail company, however, received notice of their application’s suspension on June 28.

The Heritage blog terms the DOT’s decision to postpone review of the loan request an “eleventh-hour pardon of federal and California taxpayers.”

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