Law 360: Counties Say $1.15B Fla. Rail Line Rife With Deadly Risks

By: Adam Rhodes, Law 360

A pair of Florida counties on Friday urged a D.C. federal judge to scrap a $1.15 billion tax-exempt bond funding the construction of a private passenger rail line, saying federal agencies failed to account for significant public safety and environmental concerns.

In the Friday brief, Florida’s Indian River and Martin counties, along with Citizens Against Rail Expansion in Florida and the Indian River County Emergency Services District, urged the court to grant them summary judgment in their suit looking to block the second phase of the All Aboard Florida/Brightline Intercity Passenger Rail Project, which would link Miami and Orlando.

The plaintiffs also urged the court to rule that the project was not eligible to receive private activity bond financing and to deny cross-motions for summary judgment by the U.S. Department of Transportation, the Federal Railroad Administration, agency officials and AAF Holdings, which is part of a group of private companies that were created in relation to the project.

In the brief, the plaintiffs told the court that the defendants had failed to closely examine the potentially deadly consequences of the project, especially at informal rail crossings.

“FRA now has approved a project that will send 32 additional trains barreling down that largely unfenced, densely developed corridor, with numerous formal and informal at-grade crossings, at speeds exceeding 100 mph, and will alter the tracks to allow freight trains to ramp up their speeds,” the plaintiffs warned. “This approval occurred without any serious consideration of whether and how the proposed change in the number, type, and speed of trains will exacerbate existing risks to the safety of pedestrians along the mainline right of way or of the measures that could be taken to minimize such risks.”

Criticizing a final environmental impact statement prepared by the defendants, the counties said that the past decade has seen more than 100 pedestrian deaths along the Florida East Coast Railway corridor.

“Those pedestrians were killed by freight trains travelling far slower and less frequently than the freight and passenger trains that will be running at grade crossings in the corridor if the AAF project becomes fully operational,” the counties argued.

Aside from the public safety concerns, the plaintiffs also accused the defendants of unlawfully glossing over impacts related to faster freight trains, the project’s noise and vibration, “project-related vessel queueing at railroad bridges over navigable waters” as well as alternatives that would avoid those environmental and safety concerns.

The plaintiffs also hit back at allegations that they lack standing to assert public safety and environmental claims, arguing that their interests arising out of the potential harms from the project are protected by provisions of the Internal Revenue Code covering private activity bonds.

“If the plaintiffs are not within the zone of interests protected by the statute, then what type of plaintiff would be?” the counties said.

The counties then took aim at the legality of the bond allocation, arguing that the project was ineligible to receive the tax-exempt bonds because it did not get federal assistance under the title of the U.S. Code covering highways. Instead, the plaintiffs argued, it merely benefited from the assistance given to previous projects along the existing Florida East Coast Railway corridor.

The counties then blasted the defendants’ interpretation that the project properly received private activity bond allocation under another section of the U.S. Code, responding that passenger rail projects are not mentioned there.

Rounding out their brief, the counties told the court that approval by Florida Gov. Rick Scott is not enough to satisfy a requirement that a private activity bond be approved by “each governmental unit” that has jurisdiction over an area affected by the project. 

The suit was originally filed in February, less than a year after a D.C. federal judge dismissed suits brought by the counties challenging the agency’s approval of $1.75 billion in tax-exempt bonds for the railroad, saying the cases were moot because the original approval was withdrawn before being submitted in its current two-phase format.

The plaintiffs filed their motion for summary judgment in mid-July. That motion was followed by opposing motions by the agency defendants and AAF Holdings, which moved to intervene in February, in late August.

Martin County and Citizens Against Rail Expansion in Florida are represented by Stephen M. Ryan, Amandeep S. Sidhu and Sam C. Neel of McDermott Will & Emery LLP.

Indian River County and the Indian River County Emergency Services District are represented by Philip E. Karmel of Bryan Cave Leighton Paisner LLP.

The agency defendants are represented by Acting Assistant Attorney General Jeffrey H. Wood and Barbara M.R. Marvin of the U.S. Department of Justice and Charles E. Enloe of the U.S. Department of Transportation’s Office of the General Counsel.

AAF Holdings is represented by David H. Coburn and Cynthia L. Taub of Steptoe & Johnson LLP and Eugene E. Stearns and Matthew Buttrick of Stearns Weaver Miller Weissler Alhadeff & Sitterson PA.

The case is Martin County, Florida et al. v. Department of Transportation et al., case number 1:18-cv-00333, in the U.S. District Court for the District of Columbia.

--Additional reporting by Adam Lidgett and Darcy Reddan. Editing by Joe Phalon.