Florida TaxWatch off the rails

Florida TaxWatch's mission 

As an independent, nonpartisan, nonprofit taxpayer research institute & government watchdog for more than one third of a century,it is the mission of Florida TaxWatch to provide the citizens of Florida and public officials with high quality, independent research and analysis of issues related to state and local government taxation, expenditures, policies, and programs.

We support that mission, and have found much of Florida TaxWatch's work good and upholding that mission. But they seemed to overlook a few things in their recent report, The Rise of Commuter Rails in Florida (PDF).

The report "reviews" two commuter rail projects in Florida.  The SunRail, just began operating in Central Florida as of May 1, 2014, and All Aboard Florida, a project in development by Florida East Coast Industries (FECI), running from Miami up the east coast, then over to Orlando.

The research appears to be mostly consisted of lifting a few paragraphs from some press releases from the respective projects.

Regarding SunRail, TaxWatch states

A significant amount of public funds has already been allocated to these projects. In order to share tracks and prevent disruption of freight service, the state agreed to pay $432 million to CSX Corporation for the track upgrades and for terminal costs. The state also agreed to pay $66 million for operating costs and maintenance over the first seven years of service.4 In addition to state funds, public funds were provided by all four counties benefited by the system, and the City of Orlando. The federal government provided 50 percent of the funding of Phase I through a federal transit grant.

TaxWatch  then cites some  projections on jobs, economic growth, such as 17,000 construction and permanent jobs, but don't break it out, or quantify job-years, the most realistic measure for infrastructure development projects.  Also cited from the Chamber of Commerce is another $1.7B of new and planned development along the SunRail lines, with out any critical analysis.

SunRail crashes

What's missing regarding their SunRail analysis that will directly impact Florida taxpayers?

• All Florida taxpayers are paying to operate and maintain SunRail through 2020.
• Central Florida municipalities must begin paying the O&M starting in 2021.  Not one municipality in the region currently has a long term funding source.
• The agreement between the state and CSX that indemnifies CSX from an accident even if CSX is at fault, adding more risk to the Florida taxpayer.
• Actual recent ridership on SunRail, which, after the free rides, is currently running under 4,000 riders per day.  As a comparison, I-4 in Central Florida runs up to 200,000 vehicles per day.
• The fact that the $432 million paid to CSX to use 32 miles of track is the highest per mile amount ever paid. Some $13.5 million/mile.
• The support from John Mica and his arm-twisting to wave federal ridership requirements to get federal funds.  Mica's top campaign contributor?  CSX.

The analysis on All Aboard Florida is also missing some key points.

All Aboard Florida would connect Miami, Fort Lauderdale, West Palm Beach, and Orlando upon completion. This proposed commuter rail system will be the first privately-owned, operated, and maintained passenger rail system in the U.S in 50 years. Developed by Florida East Coast Industries (FECI), this system is intended to connect about 9 million residents along the rail line corridor.

First of all, in a conversations with an AAF representative, AAF is NOT a commuter rail going after the commuter market.  They are targeting the tourist market.  Additionally, South Florida already has Tri-Rail, a commuter rail, which is not mentioned in the report.  We note the state of Florida continues to bail out Tri-Rail at the rate of $15 million per year.

Finally, though South Florida’s newest rail line is privately funded, public money will still be needed for a variety of related projects, including local governments bearing the cost of rail crossing upgrades, and the current state budget includes $10 million to establish quiet zones at certain crossings. Essentially, unfunded mandates require cities and counties to pay for the upgrades needed at approximately 320 grade crossings between Miami-Dade and Brevard counties due to higher safety standards resulting from the increased rail traffic.

There is also no mention of the fact that AAF has applied for between $600M to $1.8B in
Federal Railroad Association loans. We are unsure of the actual loan amounts because they have not been made public. Regardless, AAF is not entirely privately-funded, it looks more like a public-private partnership. Additionally, TaxWatch does mention that there are unfunded mandates for upgraded road crossings and quiet zones that local municipalities must find a way to pay.  What will the municipalities do?  They've already started going to the state for more taxpayer money.

All Aboard Florida planned routes

As we've told All Aboard Florida, they would benefit from more transparency on their plans and funding.

Why is Florida TaxWatch rather soft in their analysis?  Could it be their funding and Board of Directors?  For example, The Walt Disney Company is represented on the Board of Directors, and TaxWatch actually cites a Bloomberg article Governor Rick Scott heeding the urgings of Disney. Coincidentally, Tucker/Hall, a Tampa Bay public relations firm formerly in charge of the Greenlight Pinellas campaign, is also on the BoD.  Additionally, a former Disney executive was recently named co-president and COO of All Aboard Florida.

Erstwhile Tampa Tribune rail cheerleader Joe Henderson could not resist writing about Florida TaxWatch against the grain report.  Henderson quotes his brother in mass-transit

“That’s interesting, coming from those guys,” Hillsborough County Commissioner and mass-transit advocate Mark Sharpe said. “I think the reality is starting to engage for all of us. People talk about how expensive rail is, but roads aren’t free, either."

Henderson then states

It’s almost impossible around here to engage skeptics of commuter rail. They have decided it will be a massive government boondoggle where the rich will get richer while the public gets fleeced. Because of that, their standard response to rail is to shout “NO” as loudly and often as possible.

Joe, the fact is that neither you nor the rest of the media are doing their job in reporting the facts.  We've just done more original reporting the one hour to write this blog post than you've done in a year in trying to understand the tradeoffs with rail investment that the media refuses to investigate.  Florida TaxWatch's soft report only adds to the skepticism.

If I can connect the dots in a hour, why can't those that are paid do it in the media or Florida TaxWatch do it?