Florida Today: Matt Reed: How Posey tried to block the fast trains
Posted on June 22, 2015
Let the record show that U.S. Rep. Bill Posey has fought on constituents’ behalf to block All Aboard Florida’s proposed passenger-train service from Orlando to Miami.
Posey didn’t just criticize the venture in a letter to FLORIDA TODAY or ask for a Congressional probe of its agency approval.
On the floor of the U.S. House, the Republican from Rockledge recently tried to pass three cleverly written amendments that would have torpedoed All Aboard Florida’s business plan.
“These trains will move through our small beach towns at speeds of up to 110 miles per hour, with virtually no — none, nada — buffer separating it from our communities,” Posey told House members. “Why should you ask taxpayers to be on the hook for this train?”
Posey has a record of going his own way if he believes he is acting on principle.
This time, Posey bucked a key conservative policy reform and drew opposition from other Florida Republicans who said his legislation threatened privately financed rail projects nationwide.
His effort begs the question of just how “on the hook” we would be if All Aboard Florida flopped.
“I never thought I’d see the day a Republican would oppose private-sector investment in infrastructure,” said Rusty Roberts, an Orlando-based lobbyist for All Aboard Florida and former chief of staff to Rep. John Mica, R-Winter Park.
To raise $1.7 billion for construction, All Aboard Florida plans to take advantage of an idea passed by Republicans in 2005 to encourage private investment, in lieu of government spending, on new rail service and toll roads. With an OK from the Department of Transportation, it plans to sell tax-exempt “private activity bonds” to investors, using the rail line as collateral.
Besides the paperwork, the only “cost” to the U.S. public is the foregone tax revenue, which is why Washington must bless the bond sale.
As a backup, All Aboard Florida has kept open an earlier application for a federal loan, which it would have to repay with interest from operating cash flow.
On June 9, Posey introduced three amendments to the 2016 House transportation appropriations bill.
- Block “any actions with respect to the financing of a new passenger rail project that runs from Orlando to Miami through Indian River County.” (Getting from Brevard to St. Lucie County without passing through Indian River would be a neat trick.)
- Prohibit sales of private-activity bonds for new trains that won’t travel at least 150 miles per hour between stops. (All Aboard Florida’s trains wouldn’t go that fast.)
- Cap loans for any such rail project at $600 million (one-third the amount for which All Aboard Florida applied).
“Save federal tax dollars, stop corporate welfare and save lives by supporting Congressman Posey’s three amendments,” said a media blast from Treasure Coast activist group Citizens Against the Train.
Meanwhile, four Florida Republican representatives called on colleagues to vote “no.”
“The Posey Amendments will reverse a decade-long Congressional effort to encourage private investments instead of large federal grants and operating subsidies to projects,” said a letter signed by Mica and South Florida Reps. Mario Diaz-Ballart, Ileana Ros-Lehtinen and Carlos Curbelo. “While Republicans work to force Amtrak to adopt private sector efficiencies, we should not at the same time hinder the private sector’s move to build and operate passenger rail systems.”
Posey’s amendments failed, despite support from more than half of House Republicans.
Risk to taxpayers?
Like many residents along the Florida East Coast Railway corridor, Posey is understandably insistent that All Aboard Florida first complete an environmental impact study that covers noise, safety, pollution and wildlife.
Let the record refelct that the congressman from Brevard and Indian River counties stood up for those interests — our only interests, considering that the trains won’t stop in either county.
Fortunately, All Aboard Florida’s agreement with the Department of Transportation bars it from spending any bond money until 45 days after it completes the environmental process.
As for the financial risk to taxpayers, Posey and activist groups have harkened to deficit-running Amtrak while spinning the lack of tax revenue from bonds as a “cost” to paint a scarier picture politically.
Whether trains make a profit is the company’s problem, not ours.
Private investors, not taxpayers, will buy the $1.7 billion in bonds. The bonds are not guaranteed by any government. They will not increase public debt. All Aboard Florida will get no operating subsidy.
“Nowhere in this project are we taking free taxpayer dollars,” Roberts said. “But you can’t do a project like this without government being involved.”