DOT Finance High-Speed Rail

Opening High-Speed Rail to the Market — Before the Market’s Even There

» The good old money-making American tradition continues, but in whose interest?

Matthew Lewis’ brilliant story published today by the Center for Public Integrity and partially in Politico provides material evidence for the direct involvement of corporate lobbyists in the push for high-speed rail in the United States. The article is sobering in the details it uncovers on the degree to which public and private lobbying groups have attempted to influence decision-making in Congress and at the Department of Transportation. All this despite — or even because — the federal government has yet to announce even the first of the $8 billion in stimulus money it plans to award over the next few years to states and other agencies embarking on fast train system construction.

If Mr. Lewis’ report doesn’t provide specific evidence of government officials altering their planned allocations because of the influence of lobbying groups, it certainly warns that there are plenty of people spending millions of dollars to do just that. Should we be afraid?

In many cases, those lobbying are the allies of the livable communities and smart transportation movements; Mr. Lewis’ map includes, for instance, the City of Portland and the Commonwealth of Pennsylvania, each of which have acted proactively in favor of positive transportation investments. Everyone lobbying for high-speed rail funds wants more of them, just like you and I. So what’s the problem?

For those excited about the possibility of a U.S. high-speed rail network, coordination and advanced planning are key. Without those elements, the American fast train system could resemble something more like a series of disconnected segments, some fully built-out, others incomplete. The danger of this possibility is lost money: underinvestments in some areas and overspending in others others. If lobbyists are able to successfully push for earmarks to be spent to their preferred projects, rather than those most likely to succeed or those most necessary for the nation’s good as a whole, everyone’s mobility will suffer.

One fundamental problem is the lack of obvious contenders in the high-speed game. Though California citizens, for instance, have demonstrated their own interest in the program by authorizing $10 billion in investments, it is not clear that the federal government believes that the state is best qualified to receive the money. It would be easy enough to argue that Florida’s competing plan — despite the lack of local funding — is closer to construction and therefore a better match for the jobs-creating aspect of the stimulus. For Democrats hoping to keep Florida a Blue State, it could be a better choice for funds; if lobbyists happen to be more powerful from the Sunshine State, too, it could mean more inside deals. This is just a hypothetical comparison, but the point remains true.

This situation results most directly from Washington’s repeatedly demonstrated reluctance to clarify its grant-making process. Instead of establishing a set of objective, reliable guidelines for awarding funds, the DOT has simply given itself full reign over making well-informed decisions — i.e. political and subjective — from inside of the organization. Though President Obama’s Administration is far less biased towards corruption than its predecessor, and though its high-level officials have the least private-sector involvement of any in decades, we cannot discount the possibility that Secretary Ray LaHood’s DOT can be influenced by outside sources.

The DOT could take a major step to combat the problem of corporate lobbyists in the construction of our high-speed system by instituting more specific rules about who gets funding and by demonstrating greater transparency in the allocations process. Without changes in that direction, it will be difficult to examine why projects are being chosen for funding and the internal motivations of administrators at the DOT.

Commuter Rail Intercity Rail Minneapolis

As Minnesota’s Proposed Northern Lights Express Rises in Cost, Chances for Its Construction Fall

Northern Lights Express Route Map» 155-mile line between Duluth and Minneapolis would cost nearly $1 billion.

The Northern Lights Express is too expensive to justify construction.

For inhabitants of northern Minnesota hoping to be provided a quicker route into the Twin Cities, that fact is heart-breaking. Indeed, the initial promise of this 155-mile line, which would run between Minneapolis and Duluth, via Cambridge, Hinckley, Sandstone, and Superior, was exciting for its proponents: it would provide two-hour service along a corridor whose Amtrak operations were discontinued in 1985 and provide for increased economic competitiveness in parts of the state that have suffered as Minneapolis has grown.

The Minneapolis-Duluth/Superior Passenger Rail Alliance, which has been pushing the train link since 2007, completed a preliminary study of the corridor last year, and claimed that the project could offer eight daily round trips by 2012 at the cost of just over $300 million — or up to $615 million using a more conservative estimate. New trains would run on a mostly double-tracked corridor at speeds up to 110 mph. With an estimated 3,000 daily passengers, the cost hardly met standards of efficiency even then. Yet the group has already managed to convince the federal government and a series of local bodies to hand over several million dollars in planning funds so far; the hope was that a quick start-up of this NLX project would mean a steady flow of funds and rapid completion. The line would, according to backers, generate $2 billion worth of investments in the affected areas.

But the news this week that state rail officials now estimate that the project will cost up to $1 billion to construct strikes a death blow onto the fantasies of its proponents. While there are certainly reasons to support improved passenger rail, Duluth’s relatively small metropolitan population — at less than 300,000 — means that the corridor will never be able to attract the ridership numbers to make this line more worthy of investment than the hundreds of other rail links in the United States that require significant upgrades. The fact that none of the cities between the Twin Cities and Lake Superior have populations of more than 10,000 people solidifies this argument and throws out the oft-mentioned idea that this project could evolve into a commuter line for Minneapolis’ northern suburbs.

With the Twin Cities’ Central and Southwest Corridor light rail lines in planning, and with the latter line still in need of additional funds — especially if it is to follow a more advantageous route — it would be outrageous to invest so much money in the NLX project. Minneapolis already has a test case for commuter rail with the Northstar line, which opened two weeks ago. It should should spend several years analyzing whether that project can be made into a valuable investment before it spends big on another underperforming corridor.

If NLX proponents suggest that their project would produce significant development in Minneapolis once rail operations commence, the stimulating nature of their proposal seems limited, especially compared to light rail. After all, while a passenger rail line covering a 155 mile distance replaces some air and some long-distance car travel, it can’t do much to transform the daily travel habits of most of its users. On the other hand, a local light rail line allows users to abandon their car use entirely, clearing the ground for transit-oriented development in a much more serious way.

Minnesota, like most states, lacks resources during this recessionary period. Handing over funds to the NLX would be squandering.

Image above: Northern Lights Express route map, from Northern Lights Express

Congress Finance

Problems with a Front-Loaded Infrastructure Package

» The projects funded will be mostly roads-based. How about a series of grants to public service agencies instead to keep up operations?

Even as the nation’s GDP expands, job losses continue to mount; the stimulus earlier this year wasn’t large enough to offset the mammoth effects of the recession. Faced with the possibility of devastating losses in the 2010 mid-term Congressional elections, Democrats have no choice but to focus next year on job creation.

Nancy Pelosi had it right when she argued thatThe debate between deficit reduction and job creation is not a real choice, because we’ll never have deficit reduction unless we have job creation.” Indeed, the U.S. government must push for measures that will increase overall employment, both for the health of the Democratic Party and that of the federal budget.

As a result, some members of Congress are looking to a second stimulus in the form of major spending on infrastructure as the right solution, since construction efforts are some of the most employment-heavy investments possible. Senator Richard Durbin (D-IL) has proposed a $150 billion “front-loaded” infrastructure stimulus for early next year that would move forward some of the $450 billion proposed by the House for transportation spending over the next six years. In other words, the U.S. government would invest $150 billion in one year, versus $75 billion planned. That is, assuming most of the money will be headed towards transportation.

At the moment, the government lacks the money to finance the bill and would have to rely on further deficit spending to produce the cash. This makes the plan unlikely, since the Obama Administration is currently attempting to cut department allocations across the board, not increase them. If the government wanted to find a new source of revenues, an increase in the gas tax is a possibility, though the idea has been repeatedly dismissed by both Congress and the White House. Another possibly more politically feasible option is a small tax on stock transactions being proposed by Oregon Democratic Representative Peter DeFazio. If implemented, that source could provide up to $150 billion in money annually.

But even if the funds were reserved for transportation, the front-loading of spending is problematic. If $150 billion of the bill is spent next year alone, investments in each of the other five years will diminish to an average of only $60 billion. This means that investments in the transportation bill will automatically privilege projects that are ready for construction now, rather than those that may be buildable two to five years from today.

For transit advocates, this is a huge problem. Agencies do have capital projects in which they’d like to invest, but few major expansions are ready for construction next year. On the other hand, states have a huge surplus of easier-to-plan road work they’re ready to get done. This means that a $150 billion immediate investment in transportation would probably mean a lot of new highways — and not much new transit. A bill with investments pushed toward the end of the six-year spectrum would actually be best for public transportation, especially if the government encouraged municipalities to begin planning big projects now, with construction ready in a few years.

Of course, “back-loading” infrastructure spending isn’t really an option because it wouldn’t result in the job-producing effects desired by Democrats desperately holding on to their congressional majorities.

But there’s an alternative: promoting spending on operations needs of state and local agencies that are currently suffering from huge decreases in tax revenues as a result of the recession. The University of California’s recent layoffs and tuition increases were the most obvious sign that the public sector has been unable to maintain its spending at stable levels. The difficulties many transit agencies have had keeping service at continuous levels is a similar manifestation of the same problem. As a result, one option is for the federal government to spend money on operations rather than capital expenditures. If the U.S. government wants to spend $150 billion to create jobs, the money could go out to hire more bus and train drivers and keep those who are currently employed from being laid off.

On the other hand, if a front-loaded infrastructure stimulus means much more spending on roads and little on transit, it would be good for the jobs market but terrible for transportation.

Dallas Light Rail Streetcar

New Rail Corridor for Dallas Would Double Downtown Transit Capacity

Downtown Dallas Transit Plans Map

» Streetcar project is also under consideration.

If the September opening of the first phase of Dallas’ Green Line was good news for what is becoming an increasingly impressive city from the standpoint of livability, Texas’ second-largest metropolis still has a while to go before it will be urban. The local transit authority, DART, has been proactive in planning for the city’s inner-city future, with new light rail and streetcar lines proposed downtown. Whether those projects will provide the kind of density of transit provision necessary to significantly alter attitudes about public transportation in D-Town, however, remains to be seen.

Dallas was one of the first cities to offer modern light rail in the country, but its system is expanding quickly in response to the region’s quick growth. The Green Line’s second phase, which will extend almost 30 miles from Carrollton to Buckner by 2010, is the longest such project in the nation. The planned Orange Line will connect downtown directly to Dallas-Fort Worth airport. And an extension of the Blue Line is currently being built.

All of this growth in the city’s rail transit system will require the creation of a new downtown trunk line, since the current system relies on a single corridor running through the central business district; otherwise, it would be overloaded by trains running at 30 second frequencies at rush hour. DART has allocated $500 million to the creation of such a corridor by 2016, called D2, in time to match the expected increases in ridership resulting from the opening of the Green and Orange Lines. In addition, the city is planning to invest in a downtown streetcar project that would supplement the existing M-Line trolley.

D2 would run from the environs of Victory Station northwest of downtown to Deep Ellum east of it, paving a new path through a less-developed part of the core than that currently served along Pacific Avenue and Bryan Street by the existing light rail. This summer, the Dallas City Council debated the issue, eventually stating a preference for an alignment along Lamar and Young Streets, with the primary goal of serving a new convention center hotel. Council members claimed during deliberations that the corridor was necessary because convention center users had to be able to get directly from the airport to the hotel.

This decision, however, comes despite the fact that the existing light rail service already has a convention center stop that could be improved relatively easily to allow for direct connections to the hotel. In addition, the hotel route would cost around $839 million to build because of the fact that it would have to be partially underground, compared to $500 million for a surface level route slightly further away from the hotel but which would attract more walk-up riders according to DART projections. In this case, the cheaper route seems like a better choice, and it may be one the city is forced to make, because Dallas doesn’t have any reserved fund to make up the remaining costs necessary to pay for the hotel route.

As in Oakland, where an airport shuttle train is being built instead of a bus rapid transit line that would serve far more people, Dallas’ politicians seem more interested in serving the city’s elite — people using the airport and convention center — than in building a rail project that would attract the largest number of riders. This emphasis on “choice” riders is the result of putting people who rarely use public transit in charge of deciding how future lines are routed, a problem common to almost every city.

No matter the route chosen, downtown Dallas is likely to become a construction mess over the next few years if the D2 project is built along with a planned streetcar. The city currently has a trolley service along McKinney Avenue north of downtown, and that M-Line is planned to be extended into downtown along Pearl Street, via the Woodall Rogers Park, which is being built on a deck over a freeway. The trolley would connect to the Dallas Arts Center just completed in northeast downtown.

DART has proposed a modern streetcar for other corridors downtown, not necessarily as extensions of the M-Line, as shown in the dotted green lines on the map above. The primary east-west route being suggested would triple the east-west travel corridors through downtown, making its construction seem superfluous; as a result, a north-south extension of the trolley to an area south of downtown seems like a good bet for a first investment.

A group from Oak Cliff, a neighborhood located on the opposite side of the Trinity River from downtown, has proposed the Trinity Lakes Streetcar Loop, which would operate along 4.75 miles of one-way trackage mostly along Beckley Avenue. The project would require the construction or improvement of bridges across the river, but it has the strong support of the Oak Cliff community, which sees it as an opportunity to improve connections into downtown and revive a declining retail district.

Though the one-way nature of the streetcar loop would doom it to low ridership, a two-way version might be useful enough to justify its construction here, as it would expand downtown’s reach across the river and make possible future connections into West Dallas. The city should be sure to coordinate construction between the D2 light rail line and the streetcar, though, because it makes little sense to have two rail services providing the same access to adjacent areas. If you’re paying for both, the investment should be maximized so that they provide complementary transportation, rather than competitive offerings.

Unlike many of the dozens of American cities planning streetcars, Dallas actually appears likely to complete its project. The city has developed a business plan that would rely on the creation of a local government corporation called Dallas Streetcar, Inc. That company would be given initial “advances” to build the project that would be repaid in new tax revenue from development spurred by the project. It’s creative accounting; an easier way to put it would be to say that the government believes that its investment in infrastructure will pay off through more development downtown. A fine assumption.

High-Speed Rail Qatar

Qatar Signs Massive $25 Billion Deal with Germany’s DB to Develop Rail Network

» Rapidly growing Middle Eastern state will invest massively to expand already booming economy.

If Dubai and Abu Dhabi have grabbed most of the headlines recently, neighboring Qatar has been quietly building up from an out-of-the-way desert country to a center of world trade. Despite the country’s overall small 1.5 million-person population, the capital city Doha has been the site of increasing government-sponsored development thanks to huge oil and gas revenues and the country is now arguably the richest on the planet per capita. Next year, its economy is set to expand by 16%, the largest increase in the world, further solidifying its position as a regional powerhouse.

Government officials see infrastructure investment as a crucial element to economic viability, so last week Qatar signed a $25 billion deal with Germany’s Deutsche Bahn to develop local and high-speed rail links over the next fifteen years. The project will incorporate 180 miles of local light and metro rail for Doha city center, rapidly expanding public transportation offerings for what is now a car-centric place. In addition, more than 200 miles of new passenger and freight rail links would be capable of supporting fast trains traveling at up to 200 mph. Current plans suggest that the railway will be mostly complete by 2022, when Qatar hopes to host the World Cup, and fully done by 2026.

Qatar’s plans for high-speed rail would include a high-speed line between downtown Doha and its airport. In addition, the project would link the country directly to Saudi Arabia over a 25 mile-long causeway and connect the country’s most populous cities along its east coast, fronting the Persian Gulf. The network may also cross into Bahrain over the Qatar-Bahrain causeway, currently under construction and to be the world’s longest bridge when completed. Future interconnections between high-speed trains planned for the United Arab Emirates and Saudi Arabia are likely. These projects were proposed previously in the Qatar transport master plan.

Deutsche Bahn is laying its reputation — and its money — on the line for this project, which will be its largest-ever foreign investment. The German company will own 49% of the new Qatar Railway Development Company, 51% of which would be controlled by the existing Qatar Railways. The two groups would share investment costs and share profits. DB’s existing relationship with Siemens will likely mean the supply of Velaro trainsets for Qatar’s high-speed lines.

While the recent development exploits of oil-rich Middle Eastern countries never cease to amaze, Qatar’s investments are particularly surprising simply because of the country’s relatively tiny population. If the United States, 200 times as large in population, were to invest at similar levels per capita over the next fifteen years, it would spend $5 trillion in rail infrastructure only; as current government policy stands, it is likely to spend only about $1.5 trillion… on all transportation, including on roads and air travel, despite the fast that the U.S. has huge unmet infrastructure needs. If a country is defined by the spending it commits to its future, the U.S. is falling behind rapidly.