Derailing Brightline – The Cost of Taxpayer-Funded Lawsuits

America’s love affair with trains began in the 1860s with the creation of the first intercontinental railroad. Linking the east and west coasts by rail opened new opportunities for commerce and began a love affair between Americans and trains that continues to this day. The construction of additional railroad lines facilitated the establishment and growth of towns in the Midwest and West by providing a relatively rapid means of transporting goods and people. Towns depended on the railroads and, therefore, were developed along railroad lines. In the East, railroads were built to serve existing towns and cities.

All Aboard Florida (AAF) is a privately-owned and operated intercity passenger rail service. When fully operational, AAF will provide express passenger rail service (known as “Brightline”) from Miami to Orlando, with stops in Ft. Lauderdale and West Palm Beach. With top speeds ranging from 79 mph to 125 mph, and a minimal number of planned stops between Miami and Orlando, Brightline will offer passengers an opportunity to travel from Orlando to Miami in roughly three hours.

Unlike other high-speed rail projects, Brightline will not require direct taxpayer appropriations. Ridership risk will be borne by the private sector. Funding for the construction and operation of Brightline will come from a combination of tax-exempt private activity bonds (PABs), which are backed by project revenues, and federal Railroad Rehabilitation and Improvement Financing (RRIF) Program loans and loan guarantees. Should the project default, only those who invested in the project are on the hook, not the taxpayers.

When completed, Brightline will pass through the Treasure Coast region of the state without any planned stops. This has prompted local governments in the Treasure Coast region to pursue legislative and legal remedies in an attempt to derail Brightline.