This fireside chat-style session was moderated by RSI President Jim Riley. Speakers included:
- Husein Cumber, Senior Advisor, Brightline Holdings
- Robert Pearsall, Partnerships Director, USHSR
- Benji Schwartz, Director of Government Affairs and Advocacy, APTA
- Greg Regan, President, TTD
To kick off the session, Riley asked panelists, “What ways have your organizations realigned your messaging or your overall strategy following the election?
Both APTA’s Schwartz and TTD’s Regan agreed that the goal was not a realignment but a refinement of messaging when seeking federal funding today. “We have always made the economic case for public transportation [to members of Congress], and we have been saying for years how public transportation is a 5-1 return on investment, so now it’s a matter of how we translate that and show them that public transportation, and railroads specifically, is not a blue state or blue city issue,” Schwartz said. “When we meet with a Congressional member in Eastern Kentucky [for example], we need to [point to] a manufacturer in Eastern Kentucky that will benefit from that member’s support of rail programs.”
“It’s about emphasizing different aspects and finding out what the benefits are for a different constituency in the federal government,” Regan said. “So, when we talk about public roads, public schools, public libraries, public parks, public transportation, which I would put Amtrak and commuter rail as part of, when you say public in that way, this is an investment in ourselves. We’re investing in our communities for the benefit of the people who live in those communities … This is not about just a cost.”
USHSR, in particular, has removed messaging that once included climate sustainability and is focusing on how high-speed rail can be an economic driver, according to Robert Pearsall.
Since the Infrastructure Investment and Jobs Act can be considered “just the start of funding primarily addressing our nation’s long list of deferred maintenance projects,” what actions can Congress take “to deliver a future-focused service bill that will allow our country to begin building once-in-a-generation capital rail projects?” Riley asked panelists.
TTD’s Regan said that “having wins to justify further investment is important.” He pointed to the state-sponsored Borealis trains that Amtrak operates between St. Paul and Chicago. According to Amtrak, the service topped 205,800 riders in its first year of service—exceeding expectations.
“Looking toward the next surface transportation reauthorization, we need to [realize that] advanced appropriations is entirely unlikely to happen again,” noted APTA’s Schwartz. “But other means of ensuring that the funding is guaranteed year-over-year [will be important], be that switching over to contract authority or other means. That’s a huge part of what made the IIJA as instrumental as it was for public transportation.”
Earlier this year, the U.S. Department of Transportation revoked federal funding for Amtrak under its Corridor Identification and Development Program for proposed high speed rail service in Texas. “While we’re still early on in this new Administration, what signal does this send to the industry regarding the Administration’s approach to New Start passenger rail projects?” RSI’s Riley asked the panelists.
“I think that getting Amtrak, in this particular case, out of that mix, is going to make it easier for private-equity folks to take the lead on that project, which, of course, is the model that Brightline West is following [for planned high-speed service between Las Vegas and Southern California], and I think that’s what the Administration prefers,” USHSR’s Robert Pearsall said.
According to Brightline’s Cumber, the signal that the Administration is sending is this: “If you don’t have a complete financial plan for your project, they’re not going to incrementally fund it.”
Added APTA’s Schwarz: “I think it just adds to the uncertainty we’ve been seeing from the federal government—like adding lines to grant agreements after a grant has been awarded, or in the early days of the Administration, when there were blanket funding freezes—and this is not always healthy for investment in infrastructure projects.”
Both Regan from TTD and Cumber said that having a “proof of concept” is critical to getting more projects off the ground. Cumber pointed out that with it, “the cost of debt [would go] down significantly; you would be able to raise the equity, because you’ve got affordable debt.”
Since USHSR held its annual conference earlier this month in Washington, D.C., Riley asked Pearsall about its key takeaways. Permitting reforms for environmental reviews was one; another, Pearsall said, was “having more private capital,” and, of course, “stable, guaranteed funding is critical.”
“The President has for decades touted his ability, first and foremost, as a builder,” RSI’s Riley pointed out. “What are the economic benefits of improving or adding passenger rail service that can be used as examples to encourage the Administration and Congress to support it?”
Cumber answered first. “The President’s a real estate guy,” he said. “So, I think for him, it’s not a hard sell to say, if you put the stations in the right place, the real estate opportunities that come from that, the economic development opportunities are significant.” Having Brightline Florida in POTUS 47’s “backyard” is also helpful, Cumber noted, given the transit-oriented development that came about near stations in downtown Miami, Fort Lauderdale and West Palm Beach. Vanderbilt University, for example, is opening a campus in downtown West Palm Beach specifically because they want to be near Brightline, according to Cumber.
At APTA’s recent Legislative Conference, WMATA CEO Randy Clark told the story about a bus hangar being built for the transit agency’s expanding fleet, Schwartz told session attendees. “Most people hear ‘bus hanger’ and think it’s just a building,” he said. “But 14 Congressional districts are going to be supplying the steel, the parts, the cement, all the equipment that is going to that building. All of a sudden it goes from WMATA wants some extra money and its request gets dismissed by members of Congress because it’s a D.C. problem to be taken care of in D.C., to this is actually a national investment. If you give federal funds to infrastructure projects and public transportation projects, that money doesn’t just stay in whatever district the construction happens to be in or the rail happens to serve. That money is going throughout the entire country. It’s keeping small towns in rural America alive because they have the factories that are employing the people [building the products needed]. Those are the stories that we need to get to the Hill.”
RSI’s Riley and USHSR’s Pearsall also stressed to the audience the importance of meeting with members of Congress and inviting them for facility tours, for example. “This way, they get to know your businesses and the jobs that you’re creating,” Riley said. “And then, when they come back to Washington and they start hearing about surface transportation reauthorization or something else that impacts you, they’re going to immediately think of you, your company, the people that you employ.”
With the lack of “long-term predictability” in funding, how can transit agencies plan long-term capital projects now? Riley asked panelists.
“I’ve been hearing more and more from transit and rail agencies saying in the next surface reauthorization, we want less focus on discretionary [grants] and more focus on the formula [funding], so that even if they don’t get as much, even if they can’t afford to do these major capital projects, they at least know they can budget and have some idea of what they can afford on a year-to-year basis,” APTA’s Schwartz said. “There is not enough money in transit and rail right now to just bank up and save based off the formula. So again, without a large amount of money that comes in predictably, you cannot scrape and save for these major projects.”
TTD’s Regan put it this way: “If you’re a transit agency or if you’re a rail system, and you know how much money you have for the next six months, but you don’t know what you’ll have after that, are you going to do the big project, or are you going to put a few Band Aids over the bullet holes and try to keep things moving forward as best you can? That’s the biggest problem.”
Riley concluded the session by asking Cumber to share lessons learned from Brightline, the private-sector passenger rail service in Florida. Among them: “Being part of existing transportation corridors is really the way to build new systems,” he said. “That’s why you saw the Brightline West project go along an existing transportation corridor—the I-15 corridor … We have four parties along the right-of-way: the Nevada DOT, California DOT, Bureau of Land Management and San Bernardino County Transportation Authority. For us, that’s the way we do projects.” Another lesson: “leveraging federal innovative financing programs.”
