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Feds’ stimulus for high-speed rail is low-speed

The tracks at Seattle's King Street Station are to be improved with federal funds for high-speed rail. Credit: Washington Department of Transportation

Where’s the money? That’s the question many are asking as 30 states, including Washington and Oregon, await their shares of $8 billion in federal stimulus funds for development of a high-speed passenger rail system, one of President Obama’s signature programs.

The simple answer is that the money is sitting at the U.S. Department of Transportation’s Federal Railroad Administration (FRA), which hasn’t yet settled on all the administrative and legal protocols that must be in place before the agency can write the checks. FRA spokesman Warren Flatau says it might be the end of September before the money goes out.

The high-speed rail (HSR) program would create a new generation of passenger services in 11 federally designated corridors, most of whose track is owned by private “host” railroads. President Obama personally announced the first round of program grant selections in January. Washington’s share was $590 million, a good chunk of the $1.3 billion Olympia had asked for.

Nearly a year and a half after Congress passed the stimulus legislation, and with President Obama having recently showcased the launching of the 10,000th stimulus project, high-speed rail thus finds itself on a low-speed track.

“We have the resources to be able to deliver the program in place,” commented Scott Witt, state rail and marine director at the Washington Department of Transportation, in an e-mail. He added, however, that the process for getting the $590 million “requires extensive documentation and agreements to be in place prior to distribution. Many of the agreement requirements were not available at the time of the grant project selections.”

Witt oversees Washington State’s sponsorship of the Amtrak Cascades service, whose trains ply the 466-mile HSR corridor between Eugene, Ore., and Vancouver, B.C. Under the HSR program, the corridor is expected — one of these days — to host trains traveling at up to 110 mph. They would make the Seattle-Portland traverse in two and a half hours, an hour faster than today.

Witt said that a finalized list of the projects to be bankrolled by the federal grant remains a work in progress. A working list includes the passenger cars for a new train and an assortment of track upgrades from Seattle south to Vancouver, Wash.

Oregon won $8 million in the January sweepstakes, a tiny fraction of its $2.3 billion request, and is now waiting just as Washington is. Idaho, which has no designated HSR routes, received no award.

Five states have in fact gotten ahead of the pack, receiving checks in May for relatively small projects whose regulatory threshold was easier to reach. Those outlays represented only about 1% of the $8 billion pot, however.

Asked to explain the slow pace, Flatau says that other federal agencies, such as the Federal Highway Administration and Federal Transit Administration, have well-established mechanisms for distributing federal dollars, stimulus funds included. By contrast, the FRA has historically focused on safety issues and has had to cobble together its HSR funding mechanisms from scratch.

“There’s not an institutionalized process,” he says. “There are a number of things that have to happen. We need to enter into grant agreements with the state recipients of the funds. That requires negotiation.”

He places some of the responsibility for the snail’s pace on state bureaucracies. “The states have to accomplish a number of things, including entering into agreements with [freight] railroads and Amtrak. The states have to have the capacity to manage these funds. All the parties need to have the institutional capacity — some would say the intellectual capacity — to move this thing forward.”

Until recently, Flatau says, “states have not allocated resources to staff or institutionalize robust or mature rail divisions, since the focus of federal transportation investment has been overwhelmingly focused on highway development. Washington State has been a leader, certainly.”

Both Oregon’s and Washington’s rail divisions have provided hundreds of millions of dollars for Amtrak services and infrastructure improvements since the 1990s. In all, 15 states fund Amtrak trains.

Flatau says Department of Transportation secretary Ray LaHood and FRA administrator Joseph Szabo are committed to disbursing the entire $8 billion by September 30, the end of the current federal fiscal year. “We are trying to expedite the process. We have folks working nights and weekends.”

The $8 billion represents only the first round of large-scale federal HSR investment. An additional $2.35 billion has been made available for a second round, applications for which are due to FRA by Aug. 6. “We hope that as we start getting into a routine, things will flow more quickly,” Flatau says.

Among the kinks in the funding process has been a controversial “guidance” the FRA issued in May. The document stipulates that host railroads must, without any dollar limit, underwrite all track improvements necessary to meet performance standards — which mostly means keeping trains on schedule — for the HSR service in question. The blank-check demand has rankled railroad executives, one of whom has reportedly described it as “a potential calamity” for the rail industry. Even the National Corridors Initiative, a pro-HSR advocacy organization, has called for the guidance to be scrapped.

“The prescriptive, punitive nature of the proposed FRA regulations are and will be non-starters for any normal business person who has to carefully assess projects for risks to his company, or face the wrath of his stockholders,” the group editorialized on its website.

Issuance of the performance-standards guideline “may have been precipitous,” Flatau concedes, adding that LaHood and Szabo met with several major-railroad CEOs recently “to assure them these guidelines would be revised.” A spokesman for the BNSF Railway, which owns the high-speed route between Portland and Vancouver, B.C., declined to comment for this article, citing the ongoing nature of negotiations.

Recent press coverage quoted LaHood as saying the issues would be resolved by about June 24, but no further reports on the negotiations have surfaced. Flatau says the revisions will be readied “in the near term.”

“The i’s have to be dotted and the t’s have to be crossed,” he adds. All of which leaves many interested parties as helpless as would-be passengers waiting for a late train.

“We recognize that the FRA has been until recently a regulatory agency not involved in funding,” says Lloyd Flem, executive director of All Aboard Washington, the state’s passenger rail advocacy organization. “So we’ve been patient with the apparent slow process in writing the checks. But it’s time now to put people to work, and we urge the FRA to quickly do what is required to get our Washington state projects moving.”

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