Governor Rick Scott informed U.S. Transportation Secretary Ray LaHood of the state’s decision to reject President Obama’s Tampa to Orlando high speed rail project. This project was encouraged by Obama, with high speed rail being one of his priorities. Even with $2.4billion worth of state funding, Florida has rejected the plans.
Scott released a statement today explaining his reasoning. He states that he “sent a budget proposal to the legislature that reduces the size and scope of government; reduces the costs of that government and passes those cost savings on to taxpayers so that we can create new jobs and turn Florida’s economy around.
“That is why today I am announcing my decision to reject the Obama administration’s plan to partially-fund the costly Tampa to Orlando high-speed rail project.
“Today I spoke with U.S. Transportation Secretary Ray LaHood to inform him of my decision. I appreciate the Secretary’s efforts to work with us and I look forward to working with him in the future.”
Scott stated his decision to reject the project came down to three main economic realities:
- Capital cost overruns from the project could put Florida taxpayers on the hook for an additional $3 billion.
- Ridership and revenue projections are historically overly-optimistic and would likely result in ongoing subsidies that state taxpayers would have to incur (from $300 million – $575 million over 10 years)
- I the project becomes too costly for taxpayers and is shut down, the state would have to return the $2.4 billion in federal funds to D.C.
The statement also stated that ‘historical data shows capital cost overruns are pervasive in 9 out of 10 high speed rail projects and that 2/3 of those projects inflated ridership projections by an average of 65 percent of actual patronage.’
Scott believes that instead of investing in a high-risk rail project, Florida should be focusing on improving our ports, rail and highway infrastructure to be in a position to attract the increased shipping that will result when the Panama Canal is expanded when the free trade agreements with Colombia and Panama are ratified and with the expansion of the economies of Central and South America.
