Rumors vs. reality: Five big lies about high-speed rail project

Clark Osborne
Posted 6/16/20

Nearly every conversation that I have with friends, about the proposed "high speed rail" between Houston and Dallas, starts off with them saying something like "I thought that was dead". I wish it was, but sadly it is like a nagging cold...it won't go away.

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Rumors vs. reality: Five big lies about high-speed rail project

Posted

Nearly every conversation that I have with friends, about the proposed "high speed rail" between Houston and Dallas, starts off with them saying something like "I thought that was dead". I wish it was, but sadly it is like a nagging cold...it won't go away.

In case you haven't been keeping up with current events, here is a quick update. Private property owners in Texas won a huge victory last year when Judge Evans, of the 87th District Court, ruled that Texas Central: 1) was NOT a railroad 2) was NOT an interurban electric railway company and 3) did NOT have eminent domain authority.

Sadly, the 13th Court of Appeals in Corpus Christi recently ignored Texas Statute and opted to "legislate from the bench", in my opinion. Two elected justices and one political appointee reversed the lower Court's ruling. So, to the Texas Supreme Court we go! Hopefully, they will uphold the private property rights of all Texans, rather than capitulating to foreign investors.

With all that being said, let's look at some of the facts of this issue...Rumors vs. Reality.

1. Texas Central "claims" to be a railroad. That's the "rumor". Chapter 80 of the Texas Transportation Code is clear. Texas Central WASN'T incorporated by 2007 and they AREN'T "operating" a railroad. That's the reality.

2. Texas Central has claimed that the Dallas-Houston project will cost 10-12 BILLION dollars. That's the "rumor". Then the Draft Environmental Impact Survey estimated the cost at more like 15-18 BILLION dollars, in 2017. In the 11,512 pages of the Final Environmental Impact Survey released last week, the Federal Railroad Administration pulled the amount of 16-19 BILLION dollars out of some hat. The "reality" comes from the horse's mouth itself...Drayton McLane, the Chairman of the Board of Directors of Texas Central Railways. In a June 5, 2020 letter to Senator Robert Nichols, he states that "the project has turned into a $30B project"! Oops...sound like California yet?

3. Texas Central has always claimed that this project will be different from the other 111 similar projects in the World because...it is "PRIVATELY FUNDED". That is their "rumor". The reality is far from it. On the "Profitability" page of their website, the very first sentence is "The private approach to financing this project changes everything." On that same website, they admit that they may seek RRIF and TIFIA loans. (pssst...those are taxpayer-guaranteed loans). If you want the "reality", just go a little bit further down in Drayton's letter to Senator Nichols. "We feel that between the Japanese government funding and the monies we hope to receive from President Trump's infrastructure stimulus through the Department of Transportation, along with private equity that the project still has a great opportunity, is viable and can be construction ready this year". Wait...What? USDOT stimulus money? That sounds an awful lot like taxpayer dollars to me!

4. Texas Central has claimed that they will be big taxpayers, pouring millions of dollars in property taxes and sales taxes into the local cities, counties and school districts. That is the rumor. The reality is that, while they may pay a few dollars in property taxes, those funds won't increase the budget of any school district by one red cent...that's not how the State's funding equation works. And, as far as sales taxes go, you would thing that a company "operating" a railroad would know that ticket sales ARE NOT taxable in this State. That is the reality!

5. Texas Central has claimed, in the past, that the demand is there. That's the rumor! Again, from their website "There is increasing demand for high-speed trains as a travel alternative between Dallas and Houston. Travelers want a safe, reliable, productive option." I disagree! If there is a "silver lining in the COVID cloud", it may be that the virus will finally kill this project. A lot of corporate executives are finding out how well their businesses are running, with their employees "working from home". Instead, they are thinking about the millions of dollars they could save on office rental. There’s not going to be as many people commuting for work as there used to be. Couple that with social-distancing requirements, and the trains capacity will be lowered. They didn’t have the numbers to support this before COVID...they definitely don't now. THAT is the reality!

I have said this a thousand times...This thing may not be in your backyard, but it'll wind up in your back pocket!

Clark Osborne is a concerned landowner and taxpayer.

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