Bullet train crosses federal hurdles even while Japanese ties questioned

By Roy R. Reynolds
Posted 9/21/20

Texas Central Railroad said Monday morning the U.S. Department of Transportation’s Federal Railroad Administration issued the final Rule of Particular Applicability and the Record of Decision for the planned high-speed rail line, approving the line’s planned path through Madison County on the Houston-Dallas route.

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Bullet train crosses federal hurdles even while Japanese ties questioned

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Texas Central Railroad said Monday morning the U.S. Department of Transportation’s Federal Railroad Administration issued the final Rule of Particular Applicability and the Record of Decision for the planned high-speed rail line, approving the line’s planned path through Madison County on the Houston-Dallas route.

The announcement came just days after anti-rail group Texans Against High-Speed Rail called into question the companies deeding already purchased property to secure a loan from the Japanese government.

On Sept. 10, the Japan Bank for International Cooperation said on its website that it had signed an agreement in 2018 to create a special purpose vehicle through a bank in the Cayman Islands -- Japan Texas High-Speed Railway Cayman LP – to make a loan for Texas Central Railroad.

Texans against High-Speed Rail noted that Texas Central filed a “Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing;” with the beneficiary of deeds along the planned route going to the offshore entity.

U.S. Congressman Kevin Brady expressed dismay at the move.

“Texans should be troubled,” he said via email. “Texas Central is deeding Texas land to the Japanese through a hidden offshore entity in the Cayman Islands titled ‘Japan Texas High-Speed Railway Cayman GP’. In the meantime, they are continuing to aggressively seek eminent domain power from Washington D.C. to seize more local land without the consent of the landowners.

“I’ll wager no landowner was ever told that when the project goes bust, the Japanese will own the land that runs through their family property. This action is very deceptive and raises a lot of concerns. TCR owes Texas lawmakers and our rural community leaders an explanation.”

Monday’s announcement of federal approvals also riled rivals of the project.

“The Federal Railroad Administration is neglecting its regulatory duty to protect Americans from life-threatening projects like the proposed high-speed rail project in Texas. This project has been flawed from the beginning and the FRA has ignored calls from concerned property owners, safety professionals, and even other rail companies,” said Taylor Ward, spokesperson for ReRoute the Route, a group of businesses and landowners opposed to the path selected for the project.

“On top of the dangerous consequences of the proposed route, Texas Central is now seeking a federal bailout to cover the costs of their project skyrocketing to $30 billion. We are hopeful Texas lawmakers - state and federal - will urge President Trump that not a single federal taxpayer dollar is spent on this insolvent and fatally flawed project.”

According to Texas Central Railroad, The Rule of Particular Applicability provides the regulatory framework for Texas Central Railroad, establishing a comprehensive set of safety requirements that will govern the high-speed rail system’s signal and trainset control, track, rolling stock, operating rules and practices, system qualifications, and maintenance. The rule, it said is based on a systems approach to safety which incorporates accident avoidance measures that are significantly more stringent than those required for conventional U.S. rail operations.

“This is the moment we have been working towards,” Carlos Aguilar, CEO of Texas Central Railroad said in a press release Monday. “The release of the final RPA and ROD by the Federal Railroad Administration represents years of work by countless individuals, affirming a very thorough and careful federal regulatory process that will make the Texas Central Railroad the first high-speed rail system to be implemented in the United States.”

Brady has a different view of things.

“The Federal Railroad Administration’s decision was expected, and does not give TCR’s controversial high speed rail project approval,” he said in a press release Tuesdday. “Nor does it give them construction authority or the power to seize property without the owner’s consent.

"The bottom line is TCR’s project remains unfeasible and unrealistic. The cost of this project has tripled since its inception, investors have abandoned the project, supporters have reneged on earlier promises and TCR is now actively seeking taxpayer dollars to subsidize the financially shaky project. This high-speed rail stands to severely harm our rural communities and could leave American taxpayers footing the enormous bill for this mistake.”

The company plans to replicate the 55-year-old Japanese Tokaido Shinkansen high-speed rail system, as operated by the Central Japan Railway Company.

The threat of a private company gaining eminent domain rights to purchase land along the planned high-speed rail line and the route in general have been contentious subjects for years.

“Texans’ properties should belong to Texans, not to foreign governments,” Ward said. “The stealth transfer of hundreds of deeds to an offshore Cayman Islands shell company is a profound betrayal of the trust with which many property owners sold their lands to Texas Central, which has no eminent domain power.”

Texas Central Railroad said it controls more than 600 parcels of land needed for the projects, as well as three station sites in Dallas, Houston and Roans Prairie. The deeds for those properties are now securing the Japanese loan.

“Despite unfounded rumors to the contrary, Texas Central Railroad, a Texas-based company, owns the property purchased for the state-of-the-art high-speed train project and continues to honor all of the commitments made to the landowners who have participated in the Land Option Purchase Program,” Aguilar said. “Texas Central provided a security interest on its acquired property to its lender which is customary practice in real property transactions.

As momentum builds toward physical construction, Texas Central continues to engage in personalized, open and collaborative discussions with landowners, outlining the project’s benefits, listening to their concerns and answering their questions.”

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