FECI has released thru MIA politicians proposed All Aboard Florida.
http://www.allaboardflorida.com/wp-content/uploads/2012/07/SFBJ_June-29-2012.pdf?utm_source=FECI+-+SoFla+Biz+Journal&utm_campaign=AAF+SoFla+Biz+Eblast&utm_medium=email
"The Company does not want any public subsidies", said EVP Husein Cumber. This as well as the start-up of private passenger rail in Italy is music to this free marketer's ears. Go baby go!
Hopefully they will be successful. And hoping further the politicians will get the word. Scrap Amtrak and foster privately funded and privately operated passenger rail services where they make sense. Some government support may be necessary to create the required infrastructure, but eventually the users should pay for the services and return a profit to the investors. And the government should get its money back. The government? I mean we the people. It is our money.
Amtrak can co-exist quite easily with this service and one can benefit the other. For some time, I have felt that UP could make money in the Chicago - St. Louis - Kansas City corridor if it was clever in all things. Amtrak coexists with commuter authorities all over the place and can co-exist with this privately run service also. Remember Southern ran an excellent passenger service and cooperated with Amtrak for many years, and to some extent so did the D&RGW.
Southern and Rio Grande did run excellent trains before they finally tossed in the towel but they also ate a lot of losses before turning over their passenger operations to Amtrak.
But their losses were NOT because of any lack of cooperation by Amtrak. Both got full cooperation. Timetables of both were shown in the Amtrak National timetable. And Southern's through cars were handled properly by Amtrak between NY and Washington and serviced properly at Suynnyside.
Rode 'em both. Southern several times. D&RGW 32 times. Leonard Berstein said he had no complaints about Amtrak's cooperation. In turn, the old Amtrak SFZ did detour over the D&RGW at least once.
I think Amtrak will ask permission to rent space and move into the FEC station. An improvement over what they have now!
CSSHEGEWISCH Southern and Rio Grande did run excellent trains before they finally tossed in the towel but they also ate a lot of losses before turning over their passenger operations to Amtrak.
The Southern and Rio Grande trains were essentially long distance trains, although the Rio Grande train was a coach only train with a dome car and dinner from Denver to Salt Lake City. I rode it several times as well as the Crescent from New York to Atlanta when it was operated by the Southern Railway.
Not in my wildest dreams do I believe that a private operator can make money or even cover its costs outside of relatively short, high density corridors. The proposed private operations (Italy and southern Florida) are targeted for relatively short, high density corridors where passengers trains make some sense.
Let the market decide. If there is a demand for the service, it will thrive. If the demand for the service is insufficient, it will wither, which it should.
One numerous postings I have argued again subsidies for all modes of transport. Not just passenger rail! If the subsidies were removed, which is unlikely because of the politics and not the economics, and everyone was placed on the level playing field, the best technology, management, etc. would win out. But the ultimate winner would be the taxpayer, who would no longer be required to subsidize a transport service that he or she does not use.
No, transport services are not the same as defense, education, security, etc.
Regarding youor last statement, many many people would disagree with you. Some Swiss cities have considered having internal transportation absolutely free! Completelyi tax suported.
I think one citiy did decide, possibliy Zurich.
Subsidizing a mode of transport disguises the true cost to the users. Moreover, it subsidizes all the people who use it even though many people could afford to tote the note.
For people below a given income level, i.e. XX per cent above the official poverty level, I would issue them vouchers (a credit card) similar to the ones issued for food stamps. In this manner the truly needy would get help.
Under the current arrangement a rider on the Long Island Railroad, who makes $500,000 a year, gets a subsidized ride. Whether his incremental tax payments offset the subsidy is unknown, because we don't know what he pays in taxes.
Austin, TX tried free public transport. It attracted seemingly every bum, drunk, and drug addict in the city. The program drove away every lower and middle class user who could find an alternative mode of transport. Apparently the promoters of the idea never figured out that most people don't want to sit on a bus or any other place beside a filthy street person who reeks of alcohol. The experiment was dropped.
The problem with cross subsidies is no user knows the true cost of the services that he believes that he is paying for. So he tends to over or under use them.
I don't believe for a minute that we will dump the subsidies. They are too deeply embedded in our system. As soon as one tries to lift a rational discussion about them, emotionalism takes hold and nothing changes. Nevertheless, I believe looking at alternatives is a worthy exercise.
Amtrak, which has chewed up more than $27 billion since its inception, was an emotional response. Lets save the dying American passenger train, although most people had walked away from them between 1945 and 1970.
OK, you don't car eabout decent internal or external tourism, about and elderly handicapped access to the country, about the money that would have been spent in hgihway and airport expansion and land taking if the Amtrak money had not been spent, and most of it was spent on corridors, not long distance..
Often, transportation is vital to defense and education.
Anyway, these are people who are willing to give self-suporting and even possibly profitable passenger service a try . More pwoer to them and I wish them every success.
And again, I think the UP could do the same Chicago - St. Louis - Kansas City. With the top speed only 110 mph.
Sam1 "The Company does not want any public subsidies", said EVP Husein Cumber. This as well as the start-up of private passenger rail in Italy is music to this free marketer's ears. Go baby go! Hopefully they will be successful. And hoping further the politicians will get the word. Scrap Amtrak and foster privately funded and privately operated passenger rail services where they make sense. Some government support may be necessary to create the required infrastructure, but eventually the users should pay for the services and return a profit to the investors. And the government should get its money back. The government? I mean we the people. It is our money.
I don't quite get the FEC proposal. If you ballpark the revenues against the capital required, it just doesn't work.
Assuming 12 round trips a day with 200 passengers (5 coaches, 50% load factor) per trip travelling 200 miles each at 30 cents per mile, you get revenues of about $100M per year. Even if you applied all of this to the $1B debt, that's quite a long simple payback period.
I can only guess they will come after some public capital and then hope to make money on operations.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
oltmannd Sam1: "The Company does not want any public subsidies", said EVP Husein Cumber. This as well as the start-up of private passenger rail in Italy is music to this free marketer's ears. Go baby go! Hopefully they will be successful. And hoping further the politicians will get the word. Scrap Amtrak and foster privately funded and privately operated passenger rail services where they make sense. Some government support may be necessary to create the required infrastructure, but eventually the users should pay for the services and return a profit to the investors. And the government should get its money back. The government? I mean we the people. It is our money. I don't quite get the FEC proposal. If you ballpark the revenues against the capital required, it just doesn't work. Assuming 12 round trips a day with 200 passengers (5 coaches, 50% load factor) per trip travelling 200 miles each at 30 cents per mile, you get revenues of about $100M per year. Even if you applied all of this to the $1B debt, that's quite a long simple payback period. I can only guess they will come after some public capital and then hope to make money on operations.
Sam1: "The Company does not want any public subsidies", said EVP Husein Cumber. This as well as the start-up of private passenger rail in Italy is music to this free marketer's ears. Go baby go! Hopefully they will be successful. And hoping further the politicians will get the word. Scrap Amtrak and foster privately funded and privately operated passenger rail services where they make sense. Some government support may be necessary to create the required infrastructure, but eventually the users should pay for the services and return a profit to the investors. And the government should get its money back. The government? I mean we the people. It is our money.
I have not looked at the proposal in depth. My information came from the Miami Herald. As I understand, they will be essentially renting space on the FEC. Undoubtedly, they may get some indirect infrastructure and tax breaks. I suspect that they will get significant tax breaks, i.e. enterprise zone breaks, etc. They may also get some help from equipment and infrastructure manufacturers.
The annual payment on $1 billion spread over thirty years at the U.S. Treasury long bond rate would be $49.5 million. The promotors will probably qualify for tax free financing, in which case they may be able to get a better rate than the long bond rate.
The devil is in the details. They may be hard pressed to make a go of it. But I hope that they can pull it off. As I have said in previous posts, I don't want the government to run any commercial enterprise, i.e. postal services, air traffic control, railroads, etc., that can be operated by a properly regulated, competitive commercial enterprise. Side by side a for profit operation will trump a government operated enterprise any day of the week.
oltmannd I don't quite get the FEC proposal. If you ballpark the revenues against the capital required, it just doesn't work. Assuming 12 round trips a day with 200 passengers (5 coaches, 50% load factor) per trip travelling 200 miles each at 30 cents per mile, you get revenues of about $100M per year. Even if you applied all of this to the $1B debt, that's quite a long simple payback period. I can only guess they will come after some public capital and then hope to make money on operations.
There is much to find out about the FEC plans and revenue & cost projections. Some of which they are likely not to disclose because they are a private operation. But your passenger projections sound on the low side to me. If you have 200 passengers per train on average and 12 trips each way per day year round, that works out to 1.75 million per year. Roughly the same annual numbers as the Capitol Corridor in CA, by the way.
I think FEC plans to draw a fair chunk of their traffic from cruise ship passengers. A Google search shows around 4.1 million cruise ship passengers going through the Port of Miami and another 3.6 million through Port Everglades in Fort Lauderdale, That is a substantial customer base to offer packaged deals to also visit Orlando, Disney World, or fly into Orlando Airport and take the train to the Port with a shuttle bus connecting service. Part of the projected revenue stream for the FEC has to be packaged deals with the Orlando resorts and the cruise ship companies. Type of deals that would likely be awkward or present political issues for a publicly subsidized passenger train service.
Add in the Miami metropolitan area population of 5.5 million, greater Orlando of 2.1 million, that is a pretty big population base to draw on, not just for tourist travel, but for business and personal travel. FEC's projection may be 2.5 or 3 million passengers a year once the service is established. Which could generate enough ticket revenue combined with the land property plays and other revenue sources to pay for the upfront investments and operating expenses. I figure the FEC will be looking for either low interest rate municipal/state backed bonds or a federal RRIF loan to provide a sizable part of the supposed $1 billion cost. Claims of all private funding does not mean they won't seek government backed bonds in this day and age.
Maybe FEC is also looking at freight. The Orlando extension would put them in the Central Florida megalopolis, plus there is a coal fired power plant on the route near the airport.
MidlandMike Maybe FEC is also looking at freight. The Orlando extension would put them in the Central Florida megalopolis, plus there is a coal fired power plant on the route near the airport.
Freight has to be a part of the FEC plans. Maybe not freight trains to the Orlando airport, but once they build a new line to Orlando Airport and start service, a logical next step would be to extend the line to Tampa. Have the line run to the Tampa ports or get access via a connection to the CSX tracks. Get the support, approvals, and eminent domain they need from the state of FL to extend the line to Tampa as a passenger rail line, but quietly also plan to use it for freight shipments between Tampa, Miami, Jacksonville.
Alan F MidlandMike: Maybe FEC is also looking at freight. The Orlando extension would put them in the Central Florida megalopolis, plus there is a coal fired power plant on the route near the airport. Freight has to be a part of the FEC plans. Maybe not freight trains to the Orlando airport, but once they build a new line to Orlando Airport and start service, a logical next step would be to extend the line to Tampa. Have the line run to the Tampa ports or get access via a connection to the CSX tracks. Get the support, approvals, and eminent domain they need from the state of FL to extend the line to Tampa as a passenger rail line, but quietly also plan to use it for freight shipments between Tampa, Miami, Jacksonville.
MidlandMike: Maybe FEC is also looking at freight. The Orlando extension would put them in the Central Florida megalopolis, plus there is a coal fired power plant on the route near the airport.
Major airports are becoming logistic centers. Also CSX has intermodal terminal, auto loadouts, etc in Orlando. I can't see why FEC would pass up the opportunities.
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