The TC Palm: All Aboard Florida: We’ll build even if tax-exempt bonds are blocked
Posted on May 13, 2015
Indian River County’s effort to derail All Aboard Florida by blocking its financing won’t stop the project, according to court documents. It only will make it more expensive.
All Aboard Florida and the U.S. Department of Transportation on Monday asked a federal judge to deny Indian River County’s attempt to temporarily block the sale of $1.75 billion of tax-exempt bonds. That money would fund most of the $3 billion project.
The county previously claimed that All Aboard Florida and DOT, which in December gave preliminary approval to bond issuance, violated environmental laws by approving the financing before receiving final federal approval.
The county’s March 31 lawsuit asks the court to invalidate DOT’s decision and prevent sale of the bonds until the federal requirements have been met.
A hearing on the preliminary-injunction request is set for May 29 in Washington, D.C.
An injunction, depending on its duration, could permanently block tax-exempt funding for All Aboard Florida. DOT’s approval is conditional on All Aboard Florida selling its bonds by July 1.
All Aboard Florida previously has called the $1.75 billion of private-activity bonds the “linchpin” of the project. In Monday’s court documents, however, attorneys said the bonds are the best, but not the only option available.
All Aboard Florida already has invested hundreds of millions of dollars, according to the defendants’ response.
If denied private-activity bonds, All Aboard Florida likely would seek traditional bonds at an increased cost of $277 million to $394 million, according to the defendants’ filing.
Government agencies also are deeply invested — they’ve contributed to station infrastructure and track-crossing safety upgrades — and also would see increased costs if the private-activity bonds are denied.
All Aboard Florida plans to run 32 trains a day between Miami and Orlando by 2017. It previously said it would use bond financing to purchase equipment and upgrade and build new tracks.