Florida Corridor and Southeast Corridor

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HIGH - SPEED RAIL CORRIDOR IN THE U.S.

FLORIDA CORRI DOR

PROPOSAL ON IMPLEMENTING SUGGESTIONS

FRA–2016–0014

CHINA HIGH-SPEED RAIL ENTERPRISE CONSORTIUM

AUGUST,2016 BEIJING,CHINA

CONTENTS

I PROPOSER’S NAME(S) AND CONTACT INFORMATION ··························· 1 II EXECUTIVE SUMMARY ······················································································ 9 2.1 Markets Served ···································································································· 9 2.2 Stations/Stops ······································································································· 9 2.3 The Intercity Trip Time ························································································ 9 2.4 Peak & Operating Speeds ···················································································· 9 2.5 Routes and ROW ······························································································· 10 2.6 Train ··················································································································· 10 2.7 Organizational Structure ···················································································· 10 2.8 Operation and Cost ···························································································· 11 2.9 Investment Estimated and Financial Plans ························································ 11 III TECHNICAL DESCRIPTION ··········································································· 12 3.1 Populations of Markets Served by Each of the Proposed Stations ···················· 12 3.2 Existing Intercity Traffic ···················································································· 12 3.3 Proposed Stations Location ················································································ 13 3.4 Intermodal Travel Connections with other Transportation Services and Systems ····································································································································· 14 3.5 Trip Time and Fare Comparisons ······································································· 16 3.6 Operation Plan ··································································································· 19 3.7 Annual Ridership and Revenue Projections ······················································· 20 3.8 Operating Costs ·································································································· 21 3.9 The Impact of the Project ··················································································· 23 3.10 The Impact of the Project on the Growth of Existing Services ······················· 25 3.11 Impact on Other Rail Services ········································································· 25 3.12 Use of Land and ROW ····················································································· 27 3.13 Required Infrastructure Investment and Transformation Equipment ·············· 28 3.14 To Minimize the Adverse Effects of the Project ·············································· 29 3.15 Types and Quantity of Trains ··········································································· 29 3.16 Project Construction Cost ················································································ 30 3.17 Contribute to the Development of the National HSR System ························· 31 3.18 Analysis of Travel Time and Expected Reliability ·········································· 32 3.19 Summary and Reference of past Related Research on HSR···························· 32 IV FINANCIAL PLAN ······························································································· 34 4.1 Operation Revenue ···························································································· 34 4.2 Operation Cost ··································································································· 34 4.3 Financing ··········································································································· 34 4.4 Sources of Funds and Instructions ····································································· 36 4.5 Credit Assumptions ···························································································· 36 4.6 Insurance Plan for Construction and Operation ················································· 36 4.7 Construction Cost Risk ······················································································ 36 4.8 Income Operating Cost Risk Sharing ································································ 37 4.9 Estimated Private Investment and Sources ························································ 37 4.10 Compensation ·································································································· 37 4.11 Main Financial Indicators ················································································ 37 V INSTITUTIONAL INFORMATION ··································································· 39 5.1 Project Organization Chart ················································································ 39 5.2 Legal and Financial Structure of the New Entity ··············································· 39 5.3 Service Integration ····························································································· 39 5.4 Feasibility and Method to Obtain the ROW ······················································ 40 5.5 Government Action ···························································································· 40 5.6 Relationship with the State Railway Plans ························································ 40 VI LEGAL ACTION ··································································································· 41 6.1 Legal Support ····································································································· 41 6.2 Public Funding ··································································································· 41 6.3 Government Credit ···························································································· 42 VII LEGAL COMPLIANCE ····················································································· 43 7.1 Employee Law ··································································································· 43 7.2 Buy American Act ······························································································ 43 7.3 Railway Law ······································································································ 43 7.4 Environmental Law ···························································································· 44 7.5 Americans with Disabilities Act ········································································ 44 I Proposer’s Name(s) and Contact Information

August 31, 2016

Federal Railroad Administration Docket Operations, M–30, West Building Ground Floor, Room W12–140, 1200 New Jersey Avenue SE., Washington, DC 20590

Subject: Response to Notice of Request for Proposals for Implementing a High-Speed Rail Corridor (Docket Number: FRA-2016-0014)

China High-Speed Rail Enterprise Consortium (hereinafter referred to as China Railway Team) hereby kindly submits its response to Notice of Request for Proposals for Implementing a High-Speed Rail Corridor (Docket Number: FRA-2016-0014) to the Federal Railroad Administration. China Railway (CR) follows closely high-speed rail projects in the U.S., and is interested in providing assistance in plan and construction of 11 HSR corridors for the FRA. China Railway Team is led by CR International Co., Ltd. (CRIC) authorized by CR, and its members include CREC, CRCC, CRRC, CCA, CRSC, FSDI, CREEC, TSDI, SIYUAN and CEC. Moreover, China Railway Team is supported by financial institutions such as the Export-Import Bank of China for financial affairs. The following is an introduction of the 11 members and the Export-Import Bank of China: 1. China Railway (CR) The predecessor of CR is the former Ministry of Railways of the People’s Republic of China. During the reform on separation of government and enterprise in China, CR is established in March 2013 to be responsible for uniform dispatching & control of Chinese railway network as well as operation and safety management of passenger trains and wagons. It formulates national railway development plan, prepares investment and construction plan, and takes charge in preliminary work, construction management, operation management and safety production of railways in China. By the end of 2015, railway operation mileage managed by CR has surpassed 120,000km, including 19,000km of high-speed rails. With a total asset of USD 1 trillion and employees of 2 million people, CR has 18 railway bureaus, 1 international company (CRIC), 1 scientific and research institute (China Academy of Railway Sciences), 1 design institute and 3 transportation companies. CRIC is a wholly-owned subsidiary of CR, responsible for execution of its overseas projects. It leads the China Railway Team on behalf of CR to promote the study on 11 high-speed rail corridors identified by the FRA. 2. China Railway Group Limited (CREC) CREC is super-large group integrating survey and design, construction and installation, industrial manufacturing, real estate development, resource and mining, finance and investment. In 2015, it ranked No.1 on the list of the Largest 250

Contractors in the World by ENR. In 2016, it was listed 57th on Fortune Global 500. The company has over 290,000 employees. CREC has undertaken over 55% of high-speed rails in China, with accumulated HSR operation mileage exceeding 10,000km. From 1970s to now, it has built thousands of large infrastructure in about 100 countries and regions in Africa, South America, Middle East and Southeast Asia, with the project type covering highway, railway, metro, light rail, bridge, tunnel, airport, wharf, mine, municipal works, etc. 3. China Railway Construction Corporation Limited (CRCC) Established on November 5, 2007 in Beijing, CRCC is a Fortune Global 500 company. It was listed on Shanghai Stock Exchange (stock code: 601186) and Hong Kong Stock Exchange (stock code: 1186) on March 10th, 2008 and March 13th 2008 respectively. The registered capital of the company is USD 2 billion. Its business scope includes project contracting, survey and design consulting, industrial manufacturing, real estate development, logistics, material trade, etc. Its operation spreads all over China as well as nearly 100 countries and regions around the globe. CRCC has 33 special-class certificates for general contracting of project construction, as well as multiple Class-A certificates for project design, project survey, project supervision and real estate development. As a team member, CRCC will contribute its capabilities in construction, equipment procurement, system integration and project financing. 4. CRRC Corporation Limited (CRRC) CRRC has 46 wholly-owned or partially-owned subsidiaries with staff number surpassing 170,000. It inherited all businesses and assets of CNR and CSR, and is the rail transit equipment supplier with leading technology, largest scale and most complete category in the world. Its main business include locomotive and rolling stock, motor train unit, rail transit car, engineering machinery, electromechanical equipment, electronic equipment and spare parts, R & D, design, manufacturing, repair, sale, lease and technical services for electronic appliances and environment protection equipment, information consulting, industrial investment and management, asset management as well as import & export. 5. China Construction America, Inc. (CCA) Established in 1985, CCA is the North America and South America branch of CSCEC which is the largest construction and real estate group in the world. It provides a wide range of construction services for both public and private clients, such as project management, construction management, general contracting, Design-Build and Public-Private Partnership. Its operation revenue of 2014 was about USD 2 billion. It ranks 32nd amongst American contractors and is No. 23 in terms of construction management. As the team member with rich local experience, CCA will contribute its expertise in project management, bridge the gap between China and U.S. in business and engineering aspects, and provide its capacities in construction of civil works, equipment procurement and project financing. 6. China Railway Signal & Communication Co., Ltd. (CRSC) CRSC is a technology, product and service supplier in signaling and communications field for rail transit industry. It is a forerunner and leader of control system in Chinese rail transit sector. As the largest solution provider regarding rail traffic control system, It processes complete industrial chain of rail transit control system integrating design, R & D, equipment manufacturing and engineering service. It is the entity in charge of equipment system, technical standard and product specification of rail transit control system in China, and is the only entity authorized by National Railway Administration of the People’s Republic of China for technical review of standardized railway control

2 system and signal & communications product. On August 7, 2015, it was listed on Hong Kong Stock Exchange (stock code: 03969). CRSC has 20 first-level subsidiaries and 15,000 employees. CRSC processes Class-A certificates for survey, design and consulting as well as Class-I certificates for railway electric service contracting, communication engineering service contracting, computer information system contracting, municipal works, house building, general contracting of mechanical and electrical installation and construction. It has integrated one-stop service capabilities for mega projects, and is granted with the qualification for foreign trade and overseas project contracting. CRSC is leading the technology application and innovation in operation and control system of railway and urban rail transit projects in China. It establishes CTCS-3 high-speed train operation and control system with advance technology and independent intellectual property right as well as CBTC urban rail transit train operation and control system. It processes system technology and product with leading technical level which are successfully applied to Beijing-Shanghai High-Speed Railway, Wuhan-Guangzhou Passenger Dedicated Line and other high-speed rails. CRSC has successfully executed urban rail transit projects in dozens of cities in China including Beijing and Shanghai, and is involved in overseas projects in Argentina, Pakistan, Kenya, etc. Its influence is leading in the industry. 7. China Railway First Survey & Design Institute Group Co., Ltd. (FSDI) FSDI was established in 1953 and it is now affiliated to CRCC, a Fortune 500 company. FSDI is a comprehensive international group with extensive businesses covering survey & design, general contracting, project supervision, project consulting, investment & financing, international training, overseas projects, etc. Over the past six decades since its establishment, the Company has successively designed a number of well-known projects, including China’s first electrified railway, China’s first desert railway, China’s first railway across saline lake, the world’s first railway in alpine frozen soil area, the world’s first high-speed railway in collapsible loess area, and the world’s first high-speed railway across high and cold region. In total, it has led the design and construction of more than 30,000km of railway lines and undertaken the consulting and design work for over 5000km of high-speed railway lines. Moreover, it provides consulting or design services for over 2000km of railways, highways and metro lines in more than 40 countries. As a leading company in high-speed rail design, FSDI has obtained 26 national comprehensive Class-A qualification certificates in such fields as survey, design, supervision and consulting, and passed ISO9001 certification. In addition, it has developed a comprehensive management system for quality, environment, occupational health and safety that has been accredited by UKAS. As a member of the China Railway Team, FSDI will contribute its expertise in survey, design, technical consulting, equipment procurement, investment and financing consulting, project management, etc. 8. China Railway Eryuan Engineering Group Co., Ltd. (CREEC) CREEC was established in 1952 and has now developed into a large state-owned enterprise group. It is affiliated to CREC, which is on the lists of both Fortune 500 and World’s 500 Most Influential Brands. CREEC is an international comprehensive group specializing in extensive businesses including survey and design, general contracting, project supervision, project consulting, investment and financing, international education & training, overseas project, etc. The Company has made great achievements in EPC projects, and its survey and design income has ranked first for seven consecutive years in China. In 2014, CREEC USA was incorporated in

California, US. 9. The Third Railway Survey and Design Institute Group Corporation (TSDI) TSDI was established in 1953 and its assets total RMB 6.6 billion. It is a large enterprise group specializing in survey, design, consulting, supervision, general contracting and project management of railway, urban rail transit, highway and other projects. It ranked 62th on the list of 2015 ENR Top 225 International Engineering Design Enterprises and 7th among all Chinese design companies. TSDI boasts strong technical expertise and complete division of disciplines, and has more than 4,600 employees, including over 3,800 technical personnel. It has established national & local joint engineering lab for rail transit survey and design, workstations for academicians and experts, postdoctoral scientific research workstations and other R&D facilities, and has developed quality management system, occupational health management system and environmental management system. By 2015 TSDI has completed the survey and design of more than 74,000km of railway lines in China. The operating mileage has exceeded 37,000km, more than one third of the national total. As one of the compilers of China’s Railway Network Plan, TSDI has not only been involved in the preparation of the Medium-Long Term Railway Network Plan, but also led or participated in the preparation of 24 major national and industrial standards and specifications. The Company has also completed the survey and design of such projects as the Datong-Qinghuangdao Railway (China’s first double-line electrified railway that operates 10,000-ton heavy-haul unit trains), Beijing-Tianjin Intercity Railway (China’s first high-speed rail running at 350km/h), Beijing-Shanghai High-Speed Railway (the world’s longest high-speed railway line with the highest-standard constructed in a single phase), and Jakarta-Kota Bandung High-Speed Railway (the first project under China’s “going global” efforts). 10. China Railway Siyuan Survey and Design Group Co., Ltd. (SIYUAN) SIYUAN was established in 1953 and now has more than 4400 employees. SIYUAN is among the first batch of companies in China that have obtained the comprehensive Class-A qualifications in engineering design. It owns comprehensive Class-A qualifications for engineering design and engineering survey and over 20 Class-A qualifications for surveying and mapping, supervision, consulting, environmental impact assessment, water and soil conservation, prevention of geological disasters, etc. Incorporating 40 disciplines, such as alignment, station & yard, bridge, tunnel, geology, subgrade, power and electrification, and communication and signaling, it is able to undertake the survey, design, supervision, consulting and general contracting of projects of various types, covering the whole industrial chain of project construction. The management systems developed by SIYUAN according to ISO9001, ISO14001 and GB/T28001 have been approved and accredited. Over the past six decades since its establishment, the Company has completed the survey and design of over 60,000km of railway lines and more than 20 large railway hubs, about one third of China’s railway construction projects since 1949. In addition, SIYUAN has participated in the design and construction of over 50% of China’s high-speed railway lines that have been put into operation, making it one of the most experienced design institutes that have designed high-speed railway lines with the longest combined mileage and highest standard in the world. SIYUAN has created its “three core brands” of high-speed rail, modern railway station building and underwater tunnel, and established “six complete sets of technologies” including railway network planning, railway hub, railway in mountainous areas with complex geological conditions, urban rail transit, bridge and system integration (communication, signaling, electric power and electrification systems).

11. China Railway Engineering Consulting Group Co., Ltd. (CEC) CEC is a large comprehensive survey & design consulting company specializing in survey, design, consulting, supervision, general contracting, and R&D. It is a wholly-owned subsidiary of CREC, a Fortune 500 company. As one of the 50 Chinese enterprises that have obtained comprehensive Class-A qualifications for engineering design, CEC owns 12 Class-A qualifications for comprehensive engineering survey and design, project consulting, project supervision, etc. It has been awarded the qualification for general contracting and authorized to contract and operate overseas projects. In addition, CEC has obtained the certification of ISO9001 quality management system, ISO14001 environmental management system and GB/T28001-2011 occupational health and safety management system. At present, CEC has over 2,400 employees, including more than 2200 technical experts. 12. The Export-Import Bank of China (China EXIM Bank) China EXIM Bank was founded in 1994 with its headquarters located in Beijing. It is a state bank solely owned by the Chinese government and under the direct leadership of the State Council. Its international credit rating is the same as China's sovereign credit rating. By the end of 2015, China EXIM Bank has set up more than 20 business branches inside China, and one branch and three representative offices outside China, namely the Paris Branch, the Representative Office for Eastern and Southern Africa, Representative Office for Western and Northern Africa, and St. Petersburg Representative Office. It has established correspondent banking relationships with 1,408 banks at home and abroad, with its correspondent banking businesses covering over 160 countries and regions. The Bank's primary responsibilities are to facilitate the export and import of Chinese mechanical and electronic products, complete set of equipment and high-tech products, assist Chinese companies with comparative advantages in their overseas project contracting and foreign investment, enhance China-foreign relationships, promote international economic and trade cooperation, and provide financial services.

China Railway Team has completed plan, management, construction, operation, manufacturing and maintenance of nearly 20,000km of HSR in China. A series of technical innovation is made in high-speed rail, locomotive and rolling stock, existing line speed acceleration, etc. It processes complete set of technology and equipment covering the whole process of survey and design, construction, equipment manufacturing, system integration and operation management, able to construct high-speed rails with a speed of 200km/h-350km/h and passenger-freight dual-purpose line with a speed under 200km/h. In major technical fields, globally advanced level is achieved and independent intellectual property right is obtained. Currently, network scale of Chinese HSR is ranking top in the world with its mileage accounting for 60% of the world’s total. Representative high-speed rail projects are as shown in the following table: Construct Maximum Length Starting and ion No. Project Name Operation Characteristics (km) Ending Point Period Speed (km/h) (Month) Beijing-Shanghai Railway with 1 1318 Beijing-Shanghai 380 38 High-Speed Railway highest speed Harbin-Dalian 2 350 Harbin-Dalian 350 63 Frigid highlands High-Speed Railway Lanzhou-Urumqi Desert with large 3 1776 Lanzhou-Urumqi 350 61 High-Speed Railway wind

Construct Maximum Length Starting and ion No. Project Name Operation Characteristics (km) Ending Point Period Speed (km/h) (Month) Coastal High-Speed 4 514 Xiamen-Shenzhen 250 73 Coastal region Railway Corridor Zhengzhou-Xi’an 5 Passenger Dedicated 505 Zhengzhou-Xi’an 350 54 Loess region Line Beijing-Guangzhou Beijing-Guangzho Passing multiple 6 2298 350 48 High-Speed Railway u climates Speed Acceleration Speed Reconstruction of acceleration 7 384 Qingdao-Jinan 200 35 Qingdao-Jinan reconstruction of Railway existing line Speed Acceleration Speed Reconstruction of Beijing-Qinhuang acceleration 8 294 200 22 Beijing-Qinhuangdao dao reconstruction of Railway existing line At the same time, CR cooperates extensively with other countries around the globe. Successful cases include: 1. Russian High-Speed Railway (Moscow-Kazan) Project Moscow-Kazan High-Speed Railway undertaken by China railway team starts from Kursk Station in Moscow hub, and travels out of Moscow city to Tatarstan. It is a passenger-freight dual-purpose railway with a maximum operation speed of 400km/h and a total length of 770km. It has 15 stations, 7 dispatching points, and a bridge ratio of about 20% with no tunnel. After completion, the travelling time between Moscow and Kazan will be reduced to 1/4 of the original time, from 14 hours to 3.5 hours. Chinese team undertakes survey and design of the Project. By the end of June, the Chinese team has submitted all preliminary design documents for the 368km from Moscow to Nizhni Novgorod to the Employer. In the design process, the Chinese team has come up with successful experience of undertaking survey and design of high-speed railway in Russia. 2. California High-Speed Rail in the U.S. California High-Speed Rail connects Los Angeles and San Francisco with a total length of 1280km and a top deign speed of 400km/h. It is planned to be put into operation in 2029. CR starts actively following the Project since 2013, and has completed Report on Standard Comparison between Design Principle of California High-Speed Rail and Chinese High-Speed Railway Specifications. It actively responds to Request for Expression of Interest for the Delivery of an Initial Operating Segment and prepares a formal response which was submitted to the California High-Speed Rail Authority in September 2015. Amongst all the 36 responses received by the Authority, the one prepared by CR is the most complete one. In March 2016, a famous U.S. engineering consulting company was recruited to assist CR’s analysis and study. According to the requirements of Unsolicited Proposal Policy, combined with contents in 2016 Business Plan, CR is committed to proposing an execution proposal that not only gives full play to its comprehensive advantages but also satisfies the Authority’s needs, and submitting it at appropriate time to relevant authority. Through years of study on California High-Speed Rail, CR gains a preliminary understanding of technical specifications and laws of the U.S.. 3. Djakarta-Bandung High-Speed Railway in Indonesia

Djakarta-Bandung High-Speed Railway undertaken by China railway team has 7 stations and a length of 152.3km. Chinese HSR standard is adopted. The railway is designed as double-track electrified railway with EMUs adopted. The maximum design speed is 350km/h. The estimated total cost is USD 5.573 billion, including USD 4.498 billion for Phase I. A joint venture (KCIC) is formed between Indonesia state-owned company and Chinese state-owned company, and the joint venture will be responsible for all the work including financing, design, construction and operation. To date, construction has been commenced. 4. Hungary-Serbia Railway Hungary-Serbia Railway undertaken by China railway team has a total length of 350km, including 166km in Hungary and 184km in Serbia. European standard (compatible Chinese standard) is adopted for the project. This project is reconstruction of existing single line into double line. The proposed line is a passenger-freight dual-purpose line with a design speed of 160-200km/h. The total travelling time will be less than 3 hours. This railway is a project utilizing Chinese loans with sovereignty guarantee provided, and the total cost is up to 2.6 billion Euros. On November 24, China signed Cooperation Agreement on Development, Construction and Financing of Hungary-Serbia Railway between Chinese and Hungarian Governments with Hungary and General Contract of Modernization Upgrading and Reconstruction of Serbian Section on Hungary-Serbia Railway with Serbia. The two documents symbolize the official start of the project.

Through discussions among members of the China Railway Team, the 5 engineering design companies split the responsibilities of preparing proposals of the 11 high-speed rail corridors to distribute resources rationally, and other members will support by providing related data. FSDI takes charge of the South Central Corridor and Gulf Coast Corridor; CREEC undertakes the California Corridor, Pacific Northwest Corridor, and Chicago Hub Network; TSDI is responsible for the Keystone Corridor and Northeast Corridor; Siyuan is in charge of Empire Corridor and Northern New England Corridor; CEC studies the Florida Corridor and Southeast Corridor. Please see Attachment for proposals on the 11 high-speed rail corridors. Given that the high-speed rails are mainly located in the U.S., the China Railway Team will cooperate with American local companies to provide a package solution for high-speed rail financing, design, construction, operation and maintenance, realizing the expected goals of the client. We are convinced that armed by advanced ideas, and relying on rich experience and technical advantages, CR can provide the most valuable solution for the Project. China Railway Team is willing, under the principle of reciprocity and mutual benefit and consultation on an equal footing, to sign an appropriate project cooperative framework agreement with the high-speed railway owner, to provide a package solution including design, construction, electromechanical products manufacturing, operation & management, investment& financing, etc. and to provide all-around service to promote high-speed rails development in the United States. Should you have any questions regarding the Response or the team members, please feel free to contact us at the following:

Name: Yidong YANG Position: Deputy General Manager of Americas Department

Company: CR International Co., Ltd. Tel:+8610-51871823 Email: [email protected] Add: #10 Fuxing Road, Haidian District, Beijing, China. 100844

Name: Yang XIE Position: Chief Executive Director Company: CRI USA Tel: +1 (323) 369 8866 Email: [email protected] Add: 1210 Suite, 200 Spectrum Center Drive, Irvine, CA92618

We expect to make positive contribution to the construction of high-speed rail corridors in the U.S. through cooperation with the Federal Railroad Administration. We look forward to sharing our experience with you and discussing the proposals in detail.

Attachment: Response Proposal for Implementing a High-Speed Rail Corridor in the U.S.

Sincerely,

Chairman CR International Co., Ltd.

II Executive Summary 2.1 Markets Served FLORIDA HSR CORRIDOR is located in Florida peninsula.Railway connects Tampa,Orlando and Miami with length of 508.5 km. The new railway would be constructed from Tampa to Orlando, with length of 129 km, Brightline railway under construction would be used from Orlando to Miami, with length of 379.5 km.The market served are the traffics of the intercity passengers, including commuter, tourism, commerce, friends visits and so on. As shown in the figure below:

2.2 Stations/Stops The length of FLORIDA corridor is about 508.5km and there would be 8 stations/stops: 4 stations/stops would be constructed from Tampa,FL to Orlando,FL, including Tampa Union Station, Lakeland,FL, Disney/Celebration, Orange County Convention Center. From Orlando,FL to Miami,FL, Brightline railway under construction would be applicated ,including 4 stations/stops , Orlando International Airport、Fort Lauderdale、West Palm Beach、Miami. 2.3 The Intercity Trip Time On our proposal ,the minimum differences to the trip time from Miami,FL to Orlando,FL,Miami,FL to Tampa FL,Orlando,FL to Tampa,FL would be reduced by 5.2h、5.4h、1.8h to the existed trip time( see train timetable released in 1/11/2016 by Amtrak). The trip time would be reduced by 25% at least. 2.4 Peak & Operating Speeds

Peak speed of 250 km/h and operation speed of 200 km/h would be adoptable in the HSR Corridor. 2.5 Routes and ROW From the new Tampa union station to the Orange County Convention Center , the high-speed railway would be parallelled existed CSX railway or No. 4 interstate highway. From the Orange County Convention Center to the Orando International Airport(Orando), high-speed line would be along the interstate No. 528 state highway. With the railway or highway area of more than 95%. Brightline railway under construction would be used from Orlando to Miami by the HSR, including high-speed rail(HSR) from Orando to Cocoa parallel interstate No.528 with length of 66 km, and that east coast railway would be upgraded from the Cocoa to Miam with the length of 379.5km pass Fort Lauderdale and West Palm Beach. In order to obtain rights-of-way(ROW), increase the feasibility of project implementation, high-speed railway should parallel to existing roads or railways as more as possible, utilize of public ROW, and negotiate and enter into agreements with property owners of public road right and related parties of land requisition and demolition. 2.6 Train Adoptable EMU types would be that of 155 MPH (250 km/h). CRRC Corp’s China EMU train (CEMU) is Recommended. 2.7 Organizational Structure

2.8 Operation and Cost Adopting the transport organization of high- speed passenger railway and operating with different speeds. The operation speed and service quality are greatly improved. With operating costs increasing, the ticket price should also be increased accordingly. Centralized dispatching mode for operation is recommended. Main indexes of operating cost are shown below. Tab 2.8-1 Operating Costs Year 2025 A.D. 2030 A.D. 2040 A.D. Operating costs ($million) 165.47 184.35 204.25 2.9 Investment Estimated and Financial Plans 2.9.1 Investment Estimated The length of Florida Corridor is 129km and the investment is $4.66 billion, the index of investment is $36.15 million/km. 2.9.2 Financial Plans The following financial channels can be considered but not limited to: Tax Increment Financing（TIF）、Public-private Partnership（PPP）、Transportation Infrastructure Finance and Innovation Act（TIFIA）、State Infrastructure Bank（SIB）、 China Exim Bank、Government Financial Allocation. In order to reduce the burden on the government, we propose PPP mode.

III Technical Description 3.1 Populations of Markets Served by Each of the Proposed Stations 3.1.1 Definition of Scope The project is located in the southeast of the United States Florida peninsula. This railway starts from Orlando, via Disneyland, ends at the Tampa Hillsborough county. This project and existing Miami to the Orlando railway forms Florida intercity railway system which can be connected to the United States inland railway network by Orlando to Jacksonville railway (planning). Therefore, this study focuses on the social economy and traffic structure of Florida and cities along the line, systematic analysis passenger transportation demand of the corridor. 3.1.2 Regional Social and Economic Characteristics Florida is a state located in the southeastern region of the United States. The state is bordered to the west by the Gulf of Mexico, to the north by Alabama and Georgia, to the east by the Atlantic Ocean, and to the south by the Straits of Florida and Cuba. Florida covers 151.67 thousand square kilometers. It has 19.89 million people (2014), accounting for about 6% of the U.S. population. The capital is Tallahassee, and the main industries include agriculture, tourism and manufacturing, as well as Disney World, Hollywood and other famous tourist attractions. 3.1.3 Overview of Social and Economic Situation along the Corridor 1. Orlando Orlando is a city in central Florida and located in swamp. It is a large citrus fruit distribution center, with food processing, electronic components, rocket engines and other industries. City landmark is Lake Eola. There are Disneyland, Universal Studios, sea world theme park, future world, Harry Potter and the magic world, Kennedy Space Center, etc. 2. Tampa Tampa is seaport in the west coast of Florida Peninsula, belongs to Hillsborough County. It is located in Hillsboro, near Tampa Bay, outside Mexico bay. After the building of South Florida railway, highway and the improvement of the port conditions, benefiting from prosperity of cigar manufacture and tourism, Tampa develops rapidly and becomes one of the major coastal cities of the United States. Tampa is famous for phosphate ore and citrus fruit. It’s main industries including chemicals, food, shipbuilding, tobacco, aluminum products, etc. Tampa is one of the most important tourist attraction with advanced international airport. There is Clearwater Beach and Disney style Busch Gardens. 3.2 Existing Intercity Traffic 3.2.1 Regional Transportation Network Land, sea and air traffic of Florida is highly developed. The length of highway is

12 about 140 thousand kilometers, there is 7000 kilometers railway, 1600 kilometers inland waterway, 13 deep water ports, 20 airports with regular routes and 6 international airports, also there is overseas highway which starts from Miami, connecting several coastal islands with a bridge, ends at island city of Key West, with total length of 250 km, known as the world's longest overseas highway. 3.2.2 Passenger Traffic volume and Service Frequency of Each Existing Transportation Modes In the division of passenger transport in different ways, the main is road and civil aviation. The passenger railway is supporting. According to statistics, there are 2 of the world's top 50 airports in Florida and the total number of passenger throughput is more than 75 million person-time, which includes 40 million person-time of Miami International Airport, 35 million of Orlando International Airport person-time. Existing intercity transportation modes are mainly including self-driving, coach, rail and airline. Self-driving’s passenger volume is accounted for the largest proportion and the highest frequency of service. Its passenger volume is the sum of residents commuting, tourism, business, visiting relatives and other passenger flow. The coach service frequency is about 5-7 buses per day between major cities (Miami, Orlando, Tampa, the same below), and the annual one-way passenger volume is about 150 thousand person. The railway service frequency is about 2 pairs per day, and the annual one-way passenger volume is about 400 thousand people. The airline service frequency is about one hundred soties per day, and the annual passenger volume of main cities is about 3 million people. 3.3 Proposed Stations Location 3.3.1 Distribution of Stations The total length of this railway is about 508.5km, there should set up 8 stations: 4 newly-built stations for Tampa-Orlando section, include Tampa Union Station, Lakeland, Disney/Celebration, Orange County Convention Center, Application of 4 stations of Brightline railway for Orlando-Miami section, include Orando International Airport, Fort Lauderdale, West Palm Beach, Miami. Tampa Union Station and Miami are starting station, and the rest of them are intermediate station. 3.3.2 Station Buildings Station buildings are important infrastructure of HSR system, the main functions of station buildings includes passenger transportation operation, technical operation. HSR station buildings should meet the functional requirements, spatial pattern, connection& transfer of comprehensive transportation, comprehensive commercial development and comfort demands. Station is usually composed of central concourse building for passenger and two wings building for station office work and relative equipment. The principle of

13 functional layout of passenger station is separation of arrival and departure, coordination of station and urban function by scientific arrangement of traffic within station and urban transit of adjacent area. Taking HSR station as central core, building comprehensive transportation junction, increasing stream of people, enlarging service scope of station, integrating station and adjacent area by development of station. 3.4 Intermodal Travel Connections with other Transportation Services and Systems 3.4.1 The Transfer between HSR and Urban Rail Transit Both subway and light rail are belonging to urban rail transit system which has a strong potential to be a huge draw for the passenger flow due to its natural advantages. Transfer mode has changed from the first flat type transfer to the subsequent three-dimensional transfer and one-platform interchange mode has been the most popular in recent years. Meanwhile, most of the railway passenger flow has been transferred to urban rail transport. However, this situation requires that urban rail transit line has a wide coverage to let it in-depth connect with the city's various residential areas and commercial areas, and its capacity can meet the demand for the transfer of a large number of passengers during peak hours. According to the construction experience of the railway passenger terminal which has been built in China, the urban rail transit line which is mainly based on the subway is usually arranged at the bottom of the hub, and the railway line is distributed on the ground floor. Platform transfer, station transfer, channel transfer, outside station transfer and combined transfer are the main way to connect the railway passenger hub and urban rail transit system.

3.4.2 The Transfer between HSR and Bus Both the stop site and operation line of the conventional bus all have a nice flexibility and it can quickly make adjustments if the actual situation changes. Meanwhile, bus has a greater advantage in transportation capacity than the other traffic methods. Rail transport in some areas is just in the development and even exploration stage and that the imperfect network and poor management are a common problem in these areas. In this context, bus is still an important public transportation means and plays a pivotal role for the transportation system of the railway hub. Compared with other means of transportation, the conventional public transport has the characteristics of low transfer cost and wide radiation surface, so it has an irreplaceable function. There are three modes for connection between HSR and urban public transit within HSR passenger transportation junction: firstly, setting roadside bus stop along the main road which is connected with station; the next, setting origin bus stop within station square, this mode is recommended; the third, setting bus stop outside the station area and the passenger need to go to bus stop by foot.

3.4.3. The Transfer between HSR and Taxi Compared to urban rail transit and conventional bus, taxi has the characteristics of private transportation such as convenient, fast, flexible and comfortable. And the concentricity of taxi is better than the mass public transport. There is no limit of the departure interval of the taxi and the driving line of the taxi is not fixed, so that the passengers can take taxi when he want to and get to the destination directly. In a word, the features above can reduce the transfer time and running time for the passenger. In railway transport hub, the transfer connection between railway and taxi is mainly reflected in two aspects: the design of the flow line and the parking. In general, the unloading zone and a waiting area of taxi will be designed in the railway transport hub. The waiting areas always designed near the EXTI of the railway hub and the unloading zone is near the entrance of the railway hub. 3.4.4. The Transfer between HSR and Private Cars

For the railway passenger transport hub, this kind of transfer mode should be avoided. Currently, the main approach for this transfer mode is building the parking lot in the station square or the underground of the station for the parking of private cars. But this approach will severely reduce the land use intensity of the hub and reduce the passenger evacuate capacity of the station. It can be seen that the influence of urban rail transit and conventional public transport on the transfer efficiency of the hub is larger than the other two ways, they are the most common and important traffic transfer modes of railway passenger transport hub. 3.4.5. The Transfer between HSR and Air Travellers The cooperation between high speed railway and aviation is a big challenge. The main consideration is the convenience and quick access to the facilities between them. Such as build the airport line from the airport to high-speed rail station to transfer some air travellers the high speed rail travel then can reduce some passenger flow pressure of the airport. 3.5 Trip Time and Fare Comparisons 3.5.1 Trip Time （1）HSR According to the route plan, within the scope of design, the estimate travel time between the main cities of trains which have different schedule plan are shown in tables: Tab 3.5-1 Trip time between major cities Program The minimum Stop at main Present Nonstop Stop at all stations differences Original and Distance stations trip with the destination （km） The The time（h） Trip Trip Trip current number number time（h） time（h） time（h） situation of stops of stops （h） Miami,FL～ 5.2 379.5 2.5 1 2.6 8 3.2 2.0 Orlando,FL Miami,FL～ 5.4 508.5 3.1 2 3.3 12 4.1 1.3 Tampa,FL Orlando,FL～ 1.8 129.0 0.6 0 0.6 3 0.9 0.9 Tampa,FL

（2）Other means of transportation After the implement of the high-speed rail, it will not only attracts the passenger flow of existing railway but also attracts the passenger flow of other public transport （It mainly includes the passenger flow of civil aviation and a small part of the bus passenger flow）and self-driving passenger flow. 1）Civil aviation According to the flight information provided by Ctrip, civil aviation trip time of

major cities in the surrounding area is shown in tables: Tab3.5-2 Civil aviation trip time between major cities Unit：Min ToWashington RichmondRaleigh GreensboroCharlotte GreenvilleAtlantaColumbiaSavannah JacksonvilleOrlando TampaMiami From DC Washington 55 66 62 79 90 105 84 97 112 131 132 158 DC Richmond 197 165 72 169 98 180 177 220 115 241 146

Raleigh 150 53 194 80 197 208 220 107 108 124

Greensboro 53 156 71 143 161 182 94 195 126

Charlotte 38 67 43 57 74 95 94 116

Greenville 58 142 150 220 84 241 267

Atlanta 59 62 67 83 123 114

Columbia 170 322 202 210 276

Savannah 227 206 206 244

Jacksonville 198 66 77

Orlando 214 62

Tampa 61

Miami 2）Self-driving According to the information provided by Google, the trip time of the self-driving of major cities is shown in tables: Tab3.5-3 Self driving trip time between major cities Unit：Min ToWashington RichmondRaleigh GreensboroCharlotte GreenvilleAtlantaColumbiaSavannah JacksonvilleOrlando TampaMiami From DC Washington 106 247 279 354 435 557 409 73 586 704 766 872 DC Richmond 147 300 254 335 457 309 385 486 604 666 771

Raleigh 75 150 231 353 194 270 371 489 551 656

Greensboro 85 166 288 162 286 387 505 567 672

Charlotte 95 217 85 214 315 433 495 601

Greenville 129 89 215 316 434 491 601

Atlanta 177 203 281 357 371 536

Columbia 140 241 359 421 526

Savannah 115 233 306 401

Jacksonville 122 188 289

Orlando 78 198

Tampa 231

Miami 3）Bus According to the information provided by Greyhound, bus trip time between major cities is shown in tables:

Tab 3.5-4 Bus trip time between major cities Unit：Min ToWashington RichmondRaleigh GreensboroCharlotte GreenvilleAtlantaColumbiaSavannah JacksonvilleOrlando TampaMiami From DC Washington 125 330 490 605 720 925 660 745 895 1155 1345 1490 DC Richmond 170 300 420 425 735 450 555 735 995 1160 1275

Raleigh 100 220 480 635 345 335 500 710 925 1040

Greensboro 110 364 425 354 624 794 995 1210 1325

Charlotte 135 245 95 365 535 985 1175 1320

Greenville 150 105 715 735 860 1070 1215

Atlanta 275 275 465 480 610 820

Columbia 255 425 875 1065 1210

Savannah 135 350 620 660

Jacksonville 150 320 460

Orlando 100 270

Tampa 405

Miami （3）Comprehensive comparison of travel time Compare with the civil aviation, the additional time (such as the waiting time and the check in time) is generally 2h more than HSR. For the passengers whose travel distance is more than 800km, the civil aviation has the obvious speed advantage, compared with the bus, self-driving, HSR’s speed advantage is more prominent. 3.5.2 Ticket Price The service price of the existing railway provided by Amtrak will be adjusted according to the market demand. According to the passenger information provided by Transportation Bureau website statistics and Amtrak website, the average transport rate of the main original and destination is about $0.2per passenger/kilometer, and the transport rate of Acela is about $ 0.3 ~ 0.4 per passenger/kilometer. As a public transport method, HSR’s main competitor is civil aviation. In this research area, the civil aviation transport rate is about $ 0.8 per passenger/kilometer, and there are little short-haul flights and many of them need to transfer. After the implication, the transport speed and service frequency of this line will be better than Acela Express, and the benchmark transport rate can be $0.4per passenger/kilometer, and it can be adjusted according to the market demand. The price of HSR is competitive with civil aviation, and according to the information provided by Ctrip，a day of civil aviation price is shown in the table below:

Tab 3.5-5 Civil aviation bottom price between major cities Unit：Dollar ToWashington RichmondRaleigh GreensboroCharlotte GreenvilleAtlantaColumbiaSavannah JacksonvilleOrlando TampaMiami From DC Washington 454 340 228 253 228 391 591 704 234 268 268 206 DC Richmond 400 324 474 352 274 398 398 301 157 424 346

Raleigh 398 300 330 274 398 398 466 414 480 175

Greensboro 290 418 447 418 418 418 101 451 414

Charlotte 289 510 340 305 576 470 472 507

Greenville 495 394 394 425 133 605 408

Atlanta 536 478 401 353 297 218

Columbia 398 287 187 207 286

Savannah 876 398 398 416

Jacksonville 499 293 228

Orlando 279 123

Tampa 237

Miami 3.5.3 Comprehensive Comparison Compares with the bus, HSR has the advantage of trip time, but the fare is much more higher；Compares with the civil aviation, the trip time of HSR is basically equivalent as the civil aviation, but the fare is lower; Compares with the self-driving， HSR has the advantage of trip time, but the fare is little bit higher. 3.6 Operation Plan 3.6.1 Operation Organization Mode The Operation Organization Mode of this line will adopt the passenger dedicated line operation organization mode, with different speed demand, different Electric Multiple Unit (EMU) will operated. 3.6.2 Train Operation Schedule The operation time of the train is from 6:00 to 23:00. About 20% of the trains are concentrated in the morning and evening rush hour. With reference to the Chinese standard technical characteristics of the EMU, the average acceleration rate is 0.25 m/s2, the average deceleration rate is 0.5 m/s2，the highest average operating speed is 240km/h and stop time in large stations is 3min, in small stations is 1min，the train starting additional time is 2.5min，train stopping additional time is 1.5min，all running time are in the table below:

Tab 3.6-1 Section Trip time Tampa→Orlando interval Tampa→Orlando Starting and distance Starting and Pure runtime Stations Pure runtime stopping additional （km） stopping additional （min）（min） time（min） time（min） 1.5 Tampa Union Station 2.5 11.5 45.8 11.5 2.5 1.5 Lakeland 1.5 2.5 14.3 57.2 14.3 2.5 1.5 Disney/Celebration 1.5 2.5 3.0 12.0 3.0 2.5 Orange County 1.5 1.5 Convention Center 2.5 3.5 Orlando International 14.0 3.5 2.5 1.5 Airport 32.3 - Sum 129.0 32.3 - 3.6.3 Operating Plan In this line, it is planning adopt the EMU which is made in China and considering the characteristics of AcelaExpress train, every EMU will consisted with 8 vehicles and accommodate about 300 people. After the completion of this line, the service frequency of passenger trains is greatly improved. According to the actual passenger flow, the stopping method such as non-stop train, train which stop in main stations and train which stop in each station can be adopted. In this line, the middle and long distance train will be responsible for the passenger flow between major cities, in order to improve the mainstream passenger service, the proportion of trains that stop in all stations shall be reduce, the proportion of the regional short-distance inter-city trains that stop in all stations shall be increase. Stop times=Stop Ratio×Train Number, preliminary stop schedule plan is in the table below: Tab 3.6-2 The stop schedule plan of main operation route Passenger train number Stop schedule plan Original and destination nonstop at main Stop at all 2025 2030 2040 stop stations stations ～ Miami,FL West Palm 30 37 44 10% 20% 70% Beach,FL Miami,FL～Tampa,FL 25 31 43 10% 40% 50% ～ Tampa,FL 11 14 15 10% 60% 30% Jacksonville,FL Sum 66 82 102 3.7 Annual Ridership and Revenue Projections 3.7.1 Base year and Research year Base year: 2015 Tentative completion of this line and the opening year: 2022

The tenth year for delivery of this project and operation: 2031 3.7.2 Premise of Freight Volume Forecast Comparing with 2009, Florida’s population grows 6.65% and total passenger volume increased more than 14% in 2014 and Amtrack, completed five hundred and thirty thousand railway passenger transport volume which tourist accounted for 50% in Florida. Compared with 2009, the growth rate is about 10%. In addition, from a tourist aspect, Florida received a total of 105 million tourists in 2015 which increased of 6.6% compared with 2014. Orlando received 66 million tourists, it growth 5.5% than 2014. 3.7.3 Method of Freight Volume Forecast This forecast is considering the whole society passenger volume attracted by this line in the current situation, after analysis of the social and railway passenger demand trend in the affect region and the main impact factors and guided by the four stage forecasting technology. After the analogy analysis and analyzing how the economy and population increasing impact on the traffic volume, the passenger flow density of this line can be carried out. According to the density of the passenger flow, the train formation, the distribution of urban agglomeration, the population scale and so on, the number of passenger trains and operation scheme are analyzed. 3.7.4 Ten Years Volume Forecast Table 3.7-1 Ten Years Volume Forecast Result Table Unit: ten thousand people 1 2 3 4 5 6 7 8 9 10 Origin-Destination 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Orlando,FL～Tampa,FL 195 203 211 220 229 239 249 259 270 277 Passenger turnover and operating income in the first 10 years of operation is shown below. Table 3.7-2 Passenger Turnover and Operating Income 1 2 3 4 5 6 7 8 9 10 Year 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Turnover（ten thousand people 41714 501125 519219 537976 557422 577582 598483 620153 642620 665914 kilometers） Transportation income（ten 16686 200450 207687 215190 222969 231033 239393 248061 257048 266366 thousand yuan） Other income（ten thousand yuan） 1001 12027 12461 12911 13378 13862 14364 14884 15423 15982 Total income（ten thousand yuan） 17687 212477 220149 228102 236347 244895 253757 262945 272471 282348

3.8 Operating Costs The operating cost will calculated by activity-based costing method, and decompose the transport process into train departure and arrival job, operation job, track foundation job, electricity and traction power supply job, station accommodation

21 and service job, and calculate the operation wages, power, materials, and other subjects. The calculation parameters are according to the research results of the Beijing-Shanghai high speed railway, and Zhengzhou-Xi’an high speed railway, and the electricity price and staff wages will be adjusted according to the actual situation of the Unites States. Tab 3.8-1 Job content and its corresponding cost cost cost account Job classification classification Operating wages power material Other cost Wage costs of Station passenger additional staff at Departure service charges every station and arrival job Other costs of the Other indirect costs station sending at the station job New train crew Train crew wages wage Operation Power job Train traction costs of power consumption the train Operation expenditure operation job Train medium-capital Salary of train Materials costs of overhauling overhauling staff train overhauling expenditure Maintenance Personnel salary Materials costs of operation Train daily maintenance costs of train daily train daily maintenance maintenance Train other Other costs of the maintenance costs train maintenance operation Personnel salary Materials costs of The overhauling of main line’s main line’s costs of main line overhauling overhauling Personnel salary Materials costs of Daily maintenance of main line’s main line’s daily costs of main line daily maintenance maintenance Track Personnel salary foundation The overhauling Materials costs of job of station and costs of station track’s station and track’s track overhauling overhauling Daily maintenance Personnel salary Materials costs of costs of station of station and station and track’s track track’s daily daily maintenance maintenance Turnout Personnel salary Materials costs of maintenance costs of turnout turnout maintenance maintenance Foundation Mechanical Materials costs of job Maintenance of the the road’s road mechanical maintenance Other indirect costs of works Other costs of departments works departments Labor costs of Personnel salary traction power of traction power supply system supply system Materials costs of Materials costs of traction power traction power Electricity and traction supply system supply system power supply maintenance maintenance job Machinery and Machinery and equipment costs of equipment costs of the power supply the power supply maintenance maintenance Communication Personnel salary

cost cost account Job classification classification Operating wages power material Other cost signal system labor of communication costs signal system Communication Communication signal system signal system maintenance maintenance material costs material costs Personnel salary Equipment Integrated control of integrated maintenance cost of center costs control center integrated control center Other indirect costs Other costs of of electrical works electrical works department department Overhauling and Station daily maintenance Housing accommodati of buildings maintenance on and service job Train heavy and medium Personnel salary Materials costs of Maintenance of train heavy train heavy operation maintenance expenditure maintenance maintenance

Expenditure rate of passenger transportation cost is in the table below: Tab 3.8-2 Expenditure rate of cost Item 2025 2030 2040 Expenditure rate of passenger transport variable cost 1984 1647 1492 （dollars per ten thousand passenger kilometers） Expenditure rate of fixed cost 26 29 31 （ten thousand dollars per running kilometer）

3.9 The Impact of the Project 3.9.1 Impact of the Project on Airline and Highway Traffic Congestion The main purpose of this project is to undertake intercity passenger flow of urban agglomeration, urban commuter flow and taking into account the long-distance passenger flow across the line. Therefore, the impact of road transport is greater than air transport. The impact of road congestion, specifically speaking, mainly includes three aspects. First, reduce road congestion of Miami, Orlando and Tampa. Second, significant reduce road congestion between Miami and West Palm. Third, increase the municipal road congestion which surrounding the large scale railway station in Miami, Orlando and Tampa. 3.9.2 Energy Saving and Reduce Pollutant Emissions （1）Energy Saving The United States was the largest transportation energy consumer of the world in 2012, consuming 13 million barrels of oil equivalent per day (b/d) （EIA）. Rail transport accounts for 2% of the country’s total transportation energy use, while passenger railways consume 3% of energy in this category（EPA）. Most of the existing railway system in local area is internal combustion traction, which performs low energy efficiency. Electrically traction high-speed railway system is recommended in this project,

23 which can be powered by electricity generated from renewable energy, such as wind, solar, geothermal and tidal energy reducing the local demand for the fossil fuels effectively. Based on the experience of the existing projects, electrically-powered trains consume 30% less energy than internal combustion traction when manufactured with the same longitudinal gradient and same speed conditions. This project could help improving energy efficiency. In terms of transport efficiency, railway transport has obvious advantage than any other forms of transport. For per person/Mile, trains consume 27% energy less than motor car, and 19% less than plane. In all types of railway, high speed railway performs high-level energy efficiency even better. It carries 1.8 times (Passenger–kilometers) than commuter train per unit of energy, and 3.2 times than regional train. The recommend CRH train comes with light-weight design and AC-DC-AC electric drive technology, which can reduce energy consumption and increase the traction efficiency. Regenerative braking function is also adopted in CRH trains. With this technology, energy generated during breaking can be saved in the power system and 10% of it can be used by other trains. Due to the efficient and recycling use of energy, this project can lead a sustainable development of the society. （2）Reduce Pollutant Emissions The proposed alignment as small curvature which provides low rolling resistance to CRH. Both characters contribute to the excellent aerodynamic performance and also lower noise impacts. In all modes of transportation, the railway has the advantage of less greenhouse gas emissions. Railway has a positive impact on the environment as the transport volume of one trans can be 200 times than one car while only one-tenth CO2 emission. Compared with existing internal combustion traction train, electric traction high-speed train can significantly reduce the transportation’s impact on the environment by lowering emissions of greenhouse gases and other air pollutants that result from production and combustion of transportation fuels. When the train is powered by internal combustion traction, contamination is typically encountered in areas where petroleum and/or hazardous materials spill occur during a transfer between rail cars, tanker trucks and supply depots. While electric powered train can get rid of this kind of environmental problem, the vacuum collection system is adopted in CRH train, and all the waste can be collected without the pollution to the environment. 3.9.3 Save Land and Increase Employment The main impact on the land use is to increase the usage of temporary land during the project construction period. To build new railway will increase the usage of

24 permanent land but it won’t happen to the reconstruction of the existing line during the project construction and operation time. Increase employment opportunity: It will increase the usage of industrial product and raw material thus increasing employment opportunity during the project construction period. During the operation of the project, it will further promote employment by increase high-speed rail employee and expand the service industry. 3.10 The Impact of the Project on the Growth of Existing Services The development of high-speed railway lines is helpful to promote the development of passenger volume between intercity rail and commuter lines. In fact, passenger volume generated by other means (aircraft and motor vehicles) can also promote the development of passenger volume in ordinary railways, as the ordinary railway can be used as a channel to transport passenger flow to high-speed rail. Therefore, the operation company of the high-speed railway can discuss with the current railway operators (Amtrak, Caltrain, UP, BNSF, Metrolink, etc.) to bidding for the coordination service and jointly working for the formulation of the parking mode and the train operation schedule. By improving high-speed rail operation speed, improving security, the elimination of level crossings, installing modern signal system and modernizing the operation schedule, existing railway companies will benefit from the high-speed rail project which will promote the modernization of the road network. All of these improvements can improve transport capacity, promote the operation regularity and improve the quality of railway operation. By chain reaction to improve passenger volume, formats a virtuous cycle and attract more people to choose high-speed rail. The development of high-speed rail passenger line will release the existing line’s cargo capacity and freight operators will get benefit. Two factors will stimulate the development of freight: (1) Large investments of railway construction will increase demand of transportation. Firstly, the material transport during the high speed rail construction and maintenance period, secondly the transportation demand of vehicle manufacturers, rail manufacturers and the entire railway industry. The transportation of raw materials and finished goods required by the various projects will bring new development opportunities to the freight carriers. (2) The improvement of the global railway infrastructure quality. The new infrastructure with the operation and management of modern technology can release the railway network capacity and bringing the growth of passenger traffic volume. Infrastructure modernization will transform the passenger to the high-speed passenger dedicated line, this can create a huge development space for freight line. 3.11 Impact on Other Rail Services 3.11.1 Services

Obviously and very important thing is the development of high-speed rail transport shall not imperil other transport services. Whether it is from the operational point or from a variety of predictable and reasonable development of the possibility, high-speed rail transport are not allowed to have a negative impact on existing line transportation. In addition, high-speed rail transport shall also be as much as possible to promote the development of other transport services. Expected high-speed rail transport will mainly attract passenger flow from cars, aircraft and other means of transportation. However, when the distance between the stations is enough to achieve full speed effect to save a lot of time, the real benefits of high-speed rail is able to reflect. Therefore, the high speed rail network must be provided with other means of transport. In order to make high-speed rail as an environmentally friendly mode of transport, the use of the car shall be made in different stations around the good public transport network is in line with the public interest. Therefore, in accordance with the above, it need to ensure that these stations will combined transportation with other mode of transportation, and provides intercity trains and commuters to the nearest high-speed rail station. From the railway point, the establishment of a unified model to determine the service provided for passengers conforms to the interests of high-speed rail operators and traditional bus operators. Such cooperation will provide the opportunity for existing railway operators, learning from the experience of China Railway Corporation, the experience of global railway operators, this kind of cooperation are able to promote its overall service and develop a new marketing based on the high speed rail transport as the engine. This sharing of professional knowledge in accordance with the subject can be divided into: (1) The safety of trains and buses on a common track or corridor; (2) The cooperation of different kinds of transport type regarding to the transport capacity of the related railway hub and the railway line. (3) Best operational management requirements for mixed traffic; (4) Good coordination of station passenger transport to achieve the maximum synergy between high-speed rail and intercity / commuter services. The optimization of infrastructure will improve the quality of the global system, so that the traditional railway operators can provide better services in terms of scale, comfort and security. 3.11.2 Other Passenger Carriers HSR and traditional carriers of communication and transportation will be benefit on both sides. But in order to get a real and thorough efficiency, it is necessary having a well-coordinated commercial and ticketing method so that can ensure the travel will be considered as a whole rather than as a separate part by the passenger. This partnership will be satisfied with the customer and the resulting increase in traffic

26 volume. 3.11.3 Railway Infrastructure In the densely populated metropolitan area, high-speed rail needs to use existing railway. For existing stations, in particular having a long history one, cannot be simply abandoned. Taking these factors into consideration, in some cases, the high-speed rail infrastructure will be advantageous to connect with the existing railway infrastructure. 3.12 Use of Land and ROW 3.12.1 Planning route and Rights-of-Way(ROW) The Tampa-Orlando-Miami route and used ROW, as shown in the following table. Table 3.12-1 Statistical Table of Use of Line and ROW Use/Parallel existing traffic corridor length Section Phase Route region(railway or highway) （km） Use/Parallel proportion length（km）（km） New railway starts from Tampa Union Station，parallel CSX railway, along No.4 interstate, passes Lakeland, Mid-term Disney / Celebration to Tampa-Orlando 129 123 95 (6-10 years) Orange County Convention Center，along No.528 interstate to the east and ended in Orlando International Airport Use of the under construction Brightline railway, starts from Orlando International Airport station, parallel with the No.528 interstate and go to Under eastward to Cocoa. Orlando-Miami constructio 379.5 379.5 100 Up-gradation and n speed-raising the existing east coast railway, use this un-graded line and pass through Fort Lauderdale and West Palm Beach to Miami.

3.12.2 Get the ROW 1. Tampa-Orlando section is a newly-build railway. It shall maximize use public ROW of the existing roads and railways. But it is unavoidable to add new ROW, for this aspect, it shall take the necessary measures to reduce the new ROW impacts on the environment. Public Land: If the project will occupy the land belonging to the federal government or state government-owned agency, owners should consult and sign an agreement with

27 government institutions which manage the land, to acquire land for the project. Owners should sign a lease agreement with government agencies, the owners pay rent to government agencies, rent should be adjusted once a year. In PPP mode, the owners can strive for preferential policies to sign the lease agreement with government agencies, as a government support for public projects. Private Land: If the land for the project is private land, the owner should negotiate and sign agreement with the landowner. Normally, the owner should sign land purchase agreement with the landowner to obtain the right of permanent use the land. If the landowner agrees to sign a long-term lease agreement, the owner should pay the rent to obtain the right of long term use of the land. 2.Orlando-Miami section use of Brightline railway which is under construction, it is not necessary to obtain any more ROW, to avoid the duplication of infrastructure construction, improve the overall efficiency of the railway. 3.13 Required Infrastructure Investment and Transformation Equipment Main Infrastructure include： 1.60kg/m heavy rail is recommended in the main line, adoptone-time laying with trans-section jointless line. Main line with design speed of 250km/h high-speed railway mainly adopts ballast track. 2.Protective fence is recommended in the new line, implement fully enclosed, interchange cross with the cross street, highway and related parts of railway. 3.Single-phase AC (60HZ, 25kv) with AT power supply is recommended in the traction power supply system. 4.Branchconnection at HV side, sectionalized single-bus configuration at 27.5kV side and feeder circuit-breaker with fixed reservation system is recommended in traction substation. 5.Fully compensated elastic catenary suspension is recommended in type of catenary suspension in the main line. 6.Design of communication network should meet the requirement of comprehensive business development in transport control and increasing voice, data andgraphic. 7.Train operation control system based on transponder and track circuit is recommended in signaling system 8.Recommend to set up the natural disaster and rockfall monitoring system. 9.Recommend to set up the rescue and maintenance passageway in the whole line. 10.Mechanical maintenance and repair design is recommended in the maintenance system. Layout and planning of maintenance facility shall be specialized, resource integration and centralized management.

The final technical equipment standards will be determined in a more detailed design phase with reference to the site conditions, economic factors and the best practices of the contractor. 3.14 To Minimize the Adverse Effects of the Project 1.The planning project will cause noise and vibration physical impact in the nearby area. Sound barrier and green belt should be considered in designing phase to reduce the noise effects. 2.Natural environment features must be fully considered in designing the reasonable construction proposal, to reduce the negative impact to the natural environment, natural landscape, wildlife and habitats. 3.Organize and manage well to reduce the impact to existing traffic in the construction period. 4.To avoid the pollution to the body of water along the line, the vacuum collecting system is adopted in CRH train. 3.15 Types and Quantity of Trains The HSR technical of China was learning widely from others' strong points with the high technical standard. By technology import, scientific research and cooperation not only with the related foreign railway industry but also with the related other industry, China has developed the different kinds of High-speed railway EUM, and among them, the highest operation speed has reached 350KM/H. The Chinese EUM technical has proposed the system dynamics theory of the large coupling system of the High-speed railway train, established the design, experiment, detection and assessment platform based on the HSR train system, finalized the technical system of the design-manufacture-operation-maintenance which covered the whole service life of the high-speed railway train, all the above technical factors have formed the Chinese High-speed railway EUM technical standard system. The Chinese standard High-speed railway EUM is based on the existing and high development high speed railway system of China and guided by the standardization, serialization, modularization and self – determination. It is the new generation High-speed EUM which obtained the proprietary intellectual property rights and combined the design philosophy of safety and reliability, stability and comfort, economy and applicable, energy conservation and environment protection. After the introduction, digestion, absorption and re-innovation of the advanced technology and based on the existing CRH system, the Chinese standard EUM with the speed of 350 km/h has totally controlled the core technology of EUM system, car body, bogie, network, traction, braking and the significance components. All the adopted technical of the Chinese EUM was based on the requirement of Chinese national conditions and route conditions and with the target of unify the model and interconnection, the design will process the forward design with five steps. With the

29 realization of collaborative innovation of basic research system, design and manufacture system, experiment and certification system, application and maintenance system and standard system, the High speed Chinese EUM technical system with Chinese characteristics was finalized. The Chinese EUM has also realized the better initiative and passive safety design, the train tracking early warning device and earthquake early warning system was firstly applied which has enhanced the active safety of the EUM. The passive safety design philosophy was firstly introduced in to the HSR area. The crashing energy absorption device with the international advanced level was applied in the EUM, which will provide the basic security assurance for the passenger while the train crashed with the speed of 36km/h. Table 3.15-1 EMU parameters speed level 155mph（250km/h） formation quantity 8 highest operating speed（km/h） 250 total length of car（m） 209 track gauge（mm） 1435 platform height（mm） 1250 EMU life（year） 30 car body structure Aluminum alloy hollow profile seating capacity 300 ambient temperature(℃) -25～+40 Minimum curve radius（m） 250 axle load（t） ≤17 Contact voltage AC25kV，50Hz braking distance（m） 3200（250 km/h-0）

3.16 Project Construction Cost According to cost price of American local labor, materials, machinery and relevant laws, regulations on engineering construction, combined with cost structure of China similar high-speed rail project, estimate the cost of the project at the initial stage of construction. 3.16.1 The Main Content of Cost Expenditure Cost expenditure includes the following contents of initial construction investment on the project. 1.Land requisition and compensation; 2.Cost of bridge & culvert, subgrade, track structure, stations and other structures; 3.Cost of vehicles, maintenance equipment and facilities; 4.Cost of systems engineering such as communication, signal, power, etc.

5. Contingency. 3.16.2 Project Cost Estimation Results Total cost of Florida Corridor is $4.66 billion. The main expenditure of project construction cost is as follows: Land requisition and compensation, $0.32 billion; Track structure, $0.29 billion; Bridge & culvert, $1.42 billion; Subgrade, $1.17 billion; Stations, $0.08 billion; Vehicles, $0.39 billion; Maintenance equipment and facilities, $0.01billion; Communication and control system, $0.08 billion; Power system, $0.18 billion; Contingency, $0.71 billion. Cost expenditure is as below: Table 3.16-1 Main expenditure of Florida Corridor construction costs Unit: $ billion Florida Corridor（Tampa Union～ No. Name of project and cost Orando International Airport） Land requisition and 1 compensation 0.32 2 Track structure 0.29 3 Bridge & culvert 1.42 4 Subgrade 1.17 5 Stations 0.08 6 Vehicles 0.39 Maintenance equipment 7 and facilities 0.01 Communication and 8 control system 0.08 9 Power system 0.18 10 Contingency 0.71 Total cost 4.66

3.17 Contribute to the Development of the National HSR System The majority of population of the United States, industry and tourism are located in the coastal or lakeside area. The continuous development composed a plurality of urban agglomeration which including ‘Boston-Washington DC’, ‘Chicago-Pittsburgh’, ‘Charlotte-Atlanta’, southern California, northern California, southern Florida and other twelve, and the metropolitan area which including New York, Los Angeles, Chicago, Washington DC, Houston, Atlanta, Miami, and other ten. The American high-speed rail system mainly focuses on the planning and construction of the urban agglomeration and urban areas. The American high-speed rail system planning see figure below.

The project is located in the southern Florida urban agglomeration and the Miami metropolitan area, which is independent of American high-speed rail system. The main purpose is to undertake intercity passenger flow of urban agglomeration, urban commuter flow and taking into account the long-distance passenger flow across the line. Therefore, the construction of this project, realize the high-speed rail coverage of southern Florida urban agglomeration and Miami metropolitan, is to alleviate the urban agglomeration and urban traffic pressure, to reduce energy consumption and environmental pollution, to drive along the tourism development having an important significance. 3.18 Analysis of Travel Time and Expected Reliability In order to ensure the travel time and expected reliability, the following aspects should be fully considered： The recommended technical proposal is verified and reliable (such as track equipment, power supply equipment, vehicle design, etc.); The problem can be controlled in emergence by the System analysis of potential risks. To ensure that the products are normally produced and the method is also applicable to the testing phase. Before the start of the tax service, the key of the preparation of operation depends on the professional personnel training program and site practice. Meanwhile, it is necessary to be tested with customers under different operating conditions to ensure the overall safety. 3.19 Summary and Reference of past Related Research on HSR China Railway Team has completed plan, management, construction, operation, manufacturing and maintenance of nearly 20,000km of HSR in China. A series of technical innovation is made in high-speed rail, locomotive and rolling stock, existing

32 line speed acceleration, etc. It processes complete set of technology and equipment covering the whole process of survey and design, construction, equipment manufacturing, system integration and operation management, able to construct high-speed rails with a speed of 200km/h-350km/h and passenger-freight dual-purpose line with a speed under 200km/h. In major technical fields, globally advanced level is achieved and independent intellectual property right is obtained. Currently, network scale of Chinese HSR is ranking top in the world with its mileage accounting for 60% of the world’s total. Representative high-speed rail projects are as shown in the following table: Maximum Length Starting and Ending No. Project Name Operation Speed Characteristics (km) Point (km/h) Beijing-Shanghai Railway with 1 1318 Beijing-Shanghai 380 High-Speed Railway highest speed Harbin-Dalian 2 350 Harbin-Dalian 350 Frigid highlands High-Speed Railway Lanzhou-Urumqi Desert with large 3 1776 Lanzhou-Urumqi 350 High-Speed Railway wind Coastal High-Speed 4 514 Xiamen-Shenzhen 250 Coastal region Railway Corridor Zhengzhou-Xi’an 5 505 Zhengzhou-Xi’an 350 Loess region Passenger Dedicated Line Beijing-Guangzhou Passing multiple 6 2298 Beijing-Guangzhou 350 High-Speed Railway climates Speed Acceleration Speed acceleration 7 Reconstruction of 384 Qingdao-Jinan 200 reconstruction of Qingdao-Jinan Railway existing line Speed Acceleration Speed acceleration Reconstruction of Beijing-Qinhuangd 8 294 200 reconstruction of Beijing-Qinhuangdao ao existing line Railway

At the same time, CR cooperates extensively with other countries around the globe. Successful cases include: 1. Russian High-Speed Railway (Moscow-Kazan) Project 2. California High-Speed Rail in the U.S. 3. Djakarta-Bandung High-Speed Railway in Indonesia 4. Hungary-Serbia Railway We are convinced that armed by advanced ideas, and relying on rich experience and technical advantages, CR can provide the most valuable solution for the Project. China Railway Team is willing, under the principle of reciprocity and mutual benefit and consultation on an equal footing, to sign an appropriate project cooperative framework agreement with the high-speed railway owner, to provide a package solution including design, construction, electromechanical products manufacturing, operation & management, investment& financing, etc. and to provide all-around service to promote high-speed rails development in the United States.

IV Financial plan 4.1 Operation Revenue Refer to Amtrak's current revenues, the ticket income is the main income source of the project revenues, and the average railway tariff is $0.4 per passenger-kilometer; The remaining revenues include catering services and so on, accounting for about 6% of the ticket sales. The passenger flow density in each section is shown as follows. Tab 4.1-1 Section passenger flow density Passenger flow density（ten thousand people） Section 2025 2030 2025 Orlando,FL～Tampa,FL 220 270 350 4.2 Operation Cost 4.2.1 The Purchase Expenditure of EMU According to the principle of the consistency between benefit and cost, the quantities of rolling stocks’ purchase from the near stage to the distant stage, are 29, 36, 47. Each set of rolling stocks costs 49.23 million dollars. 4.2.2 Operation Cost Calculating by the research conclusions of the previous operation costs, the table below shows the annual operation costs. Tab 4.2-1 Operation cost Year 2025 2030 2040 Operation costs （million dollars） 165.47 184.35 204.25 4.2.3 Income Tax The federal income tax rate is 35%. The state income tax rate is 5%. 4.2.4 Non-operation Net Expense Rate The non-operation expenses of the railway transport enterprises include education funds, railway epidemic prevention funds, extraordinary losses, damages and other expenses. The non-operation net expense of this project is $0.001 per passenger-kilometer. 4.2.5 Cost of Depreciation The comprehensive depreciation rate of fixed equipment is 3.3%. Service life of a set of EMU is 16 years, and residuals rate is 5.12%, and basic depreciation rate is 5.93%. 4.2.6 Circulating Fund The circulating funds that unit conversion turnover volume needed is $0.0005 per passenger-kilometer, and using own funds for the time being. 4.3 Financing 4.3.1 Main Financing Methods

According to the characteristics of the project, there are some methods toobtain the finance as follows: （1）Tax Increment Financing(TIF) Government makes a plan in a particular area, and freezes the value of land and property in the area. The development will enable the land and property value increase. When the government developed the area, we will be able to issue bonds through this account and use special funds to repay debts. When the debt is paid off or the planned time is up, we will announce the end of the plan. We will also thaw the land to recalculate the amount of tax. （2）Public/Private Partnership Financing(PPP) Combined with the design, construction and operation of the integration of ideas, DBOO, DBOT, DBTO, other public and private partnerships can be adopted in Financing. （3）Transportation Infrastructure Financing and Innovation Act(TIFIA) TIFIA was proposed by the US Department of transportation. TIFIA makes money by charging or other forms due to the uncertain state and local government revenue. It is difficult for us to finance by a reasonable rate. The plan, via attracting a large number of private and no federal joint investment, is going to fill the gap in the market and the use of low-cost public borrowing. TIFIA credit aid is generally more favorable than the financial market conditions, so that it can be able to obtain financing for the project which has difficulty in financing. （4）State Infrastructure Bank(SIB) As a part of recent transportation initiatives on a national basis, states have been encouraged and authorized to establish State Infrastructure Banks (SIBs) to aid the development of transportation in their respective states. With the help of other areas of experience, these banks can provide low-cost financing for transportation projects. Because the railway project investment amount is relatively large, we can use SIB funds as the start-up capital to pre-design and financing. （5）China Import and export bank loan If the project can be built by Chinese party, fund can be guaranteed by the government. We can try our best to provide lower interest loans by the Export Import Bank of China to adapt the demand of funds in construction period .In general, the amount of loans provided by the China Import and Export Bank is not higher than 85% of the project contract amount. （6）Government Financial Allocation No matter what kind of financing mode is, passenger dedicated line, as large public transportation infrastructure construction, will be mainly supported by the government's financial support of construction and operating expenses. 4.3.2 Suggestions on Financing Modes

In addition to the federal government's funds, attracting the private capital investment is proposed. The introduction of social funds is a feasible way to reduce the pressure of government financial capital and improve the efficiency of construction and operation. Enterprise group investment and investment fund of China and the United States should be actively introduced to invest in this project. The investment amount of social capital can be determined according to the investor's investment ability, the ability of project profitability and the ability of resist risks. The uncertainty of social funds investment in a great extent decides on the strategy of the sources of the income of the project and the distribution of profits. Therefore, in the formulation of the financing plan, the benefits and risks of private capital should be fully considered, the investment agreement should be improved and the appropriate dividend payout ratio should be determined. Meanwhile, it is necessary for the United States government to perfect the laws and policies to protect the investors to participate in the investment, and get the due benefits. Debt funds may consider the use of bank loans, the proportion of own funds of this project temporarily consider by 50%. 4.3.3 Annual Plan for the Construction Funds Maintenance costs have been included in the operation costs. Considering the construction period is 5 years, and the proportion of funds invested in each year is: 20:20:30:20:10. 4.4 Sources of Funds and Instructions To be determined in Bidding in Public and business negotiation in the future. 4.5 Credit Assumptions To be determined in Bidding in Public and business negotiation in the future. 4.6 Insurance Plan for Construction and Operation There are various uncertainty factors in construction and operation of the project. In order to ensure the quality of project, progress, investment and safety target, we shall enter into an insurance contract in accordance with the relevant laws and regulations of the United States federal, state and industry. More detailed insurance plans will be made in the following stages. 4.7 Construction Cost Risk Construction cost risk mainly includes construction cost, quality cost, safe cost risk, etc.. Identifying and evaluating the risks is the precondition of controlling risk. We should take appropriate measures to prevent different types of risks mainly by the contract. It can be avoided by the insurance for the unforeseen risks. One of the key project structural criteria is that the risk is shared among all interested parties. The general principle is to allocate the risk to the most suitable one to assume that it is the best way to optimize the project completion and control costs. Certainly, the risk sharing will ultimately depend on authorities, project

36 investment, and project structure selected by public and private institutions. 4.8 Income Operating Cost Risk Sharing As railway project, the risk of operation is mainly derived from the uncertainty of traffic. The fixed cost of operation cost (mainly maintenance costs) and the traffic have smaller correlation. But variable costs, transportation revenues and transportation volume are highly correlated. The current revenues of Amtrak cannot support its normal operation. According to current practice in the U.S.A, as for operation losses, the policy subsidies for Amtrak Company mainly from all levels of government in order to ensure the normal operation of the project. Traffic can be regulated by market-oriented fares, to circumvent the risks of traffic. 4.9 Estimated Private Investment and Sources As for investment of external enterprises, China Railway team and other large Chinese enterprises can be as partner, to participate the PPP projects in different modes. 4.10 Compensation The project shall comply with the principle of "fair market compensation". When estimating the cost of the project, the fair market price of the property shall be assessed according to the reasonable evaluation method. At present, the project is still in the early stage, there are many uncertain factors, It can only be based on our experience to make a rough estimate. More details of the problem will continue to be studied and processed in the following work. 4.11 Main Financial Indicators Indicators of profitability before project financing is shown in the table below Tab 4.11-1 Indicators of profitability before project financing No. Indicators Value IRR of project investment 1 -2.03 （before income tax）（%） IRR of project investment 2 -2.03 （after income tax）（%） Net present value of project investment 3 -3290.77 （before income tax）（million dollars） Net present value of project investment 4 -3290.77 （after income tax）（million dollars） Payback period of project investment 5 >evaluation period （before income tax）（year） Payback period of project investment 6 >evaluation period （after income tax）（year）

We assume that the proportion of its own funds 50%, the rest of the interest rate

37 is 4% of the loan, the repayment period of 15 years to calculate, main financial indicators after financing is shown in the table below： Tab. 4.11-2 Profitability indicators table after financing No. Indicators Value 1 Financial IRR of equity investment（%） -3.26 Financial net present value of equity investment 2 -2984.32 （million dollars） 3 Equity investment payback period（year） >evaluation period

According to the table above, each route of this project has poor profitability itself. Therefore, the government needs to give the policy subsidies. Considering depreciation, the subsidies that should be given are 5.91billion dollars in 20 years..

V Institutional information 5.1 Project Organization Chart The chart shows entities relationship that the applicants team and all the between public and private involved in the project. The responsibility of entities includes financing, design, construction, operation and maintenance (including equity) and other participants in the project operational aspects.

The transportation department is the public sector responsible for all public affairs related to the project. The transportation department may set up the specialized agencies (responsible for this project, high-speed railway development within the state or) as the owner of the project, responsible for the project company signed the "General Contract " signed "operation of the project agreement" with the operator, on behalf of the public sector for the supervision, management and implementation of public sector support for the project. The company SPV is general contractor of the project, responsible for project design, construction and equipment supply and maintenance of vehicles. The company of daily operation and maintenance is responsible for the daily operation and maintenance of the high speed railway. 5.2 Legal and Financial Structure of the New Entity SPV Company and operating company are newly established entity. Depending on project needs and risk prevention, various sub-contractor might create a new entity in the project site, which provides a more "localized" service for the project. 5.3 Service Integration The project could be in cooperation with Amtrak company or other high-speed rail service provider, other intercity passenger transportation provider, local access

39 systems after put into operation, to participate in the operation and maintenance of the project, with other major adjacent lines open line across the line train, to maximize the integration of passenger system resources. 5.4 Feasibility and Method to Obtain the ROW To facilitate obtaining rights-of-way(ROW), increase the viability of the project, the railway route shall as much as possible in parallel with the existing road or rail corridor, use the ROW of the existing channels. For the using of the existing road rights, HSR owner should consult with the owner of the ROW and sign the agreement to obtain ROW; for newly acquired ROW, the owner needs to negotiate and sign an agreement with the relevant land, real estate owners. If the above two methods were unable to obtain the ROW, owners should apply for the transportation departments for the purpose of "public interest" to obtain the relevant land and property ownership through legal procedures to obtain ROW which needed for the project. 5.5 Government Action Providing high-speed rail service is the public transport project which benefits the people, government (including federal and state governments) should play a leading role in high-speed rail project, to provide full support and protection for the project, including but not limited: Financial support: including the provision of government financial subsidies, issuing government bonds for raising funds, providing some form of security for the project financing, providing annual operation and maintenance allowance for the project and so on. Technical support: FRA should work closely with local technical standards departments, professional consulting companies, developing technical standards and requirements for high-speed rail project, to provide guidance for the technical work of the project. Approval and process support: including project description required obtaining government approval process and requirements, simplify the approval process within the extent permitted by law, actively promote environmental impact assessment of projects and so on. The project across the respective states, owners should apply for approval of the Federal Railway Administration, which applicable federal law and applies the exemption of the state law in order to simplify the legal issues in the process of project work. 5.6 Relationship with the State Railway Plans If the project enters the implementation phase, the state railway plan shall be combined with, consider the state railway construction project integration and avoid unnecessary duplicate construction.

VI Legal Action 6.1 Legal Support FRA shall consider setting up a professional team with the background of high speed rail project design to assist them for the promotion of high speed rail projects. It is necessary to evaluate the proposals and draft the relative high speed railway standards and regulations with the knowledge of human resources and high speed railway profession fields. The new legal entity shall be established at federal and state government for the follow-up work. In addition, no matter what type of project sponsors are organized, the project shall be supported by the federal and states. Federal Department of transportation, the Federal Railway Administration (FRA) shall associate with the relevant States to provide federal funding for the development of high-speed rail corridor, and leading the construction of high-speed rail projects at the federal level, innovated implementation procedures to ensure the high-speed rail funds can be allocated to sustainable projects. Federal Law shall setup the general guidelines on how to use ARRA funds and other federal funding. The process of state's procurement law shall be comply with, when the relative State grant high-speed rail project contract. The "local content" requirement for the procurement will limit competition, the protest and litigation raised by the variety of organizations will also let the project development in the trouble. In order to standardize the relative state's procurement rules, FRA should work with the States to develop a transparent, fully competitive, fair and responsible contract process for the high-speed railway projects. "Federal Acquisition regulations" (FAR) and "the model of procurement procedures" are the starting point of this work. The “temporary guide”, “the passenger rail investment and improved method” 221st article, “the American Recovery and Reinvestment Act” and other legal documents have requirements of domestic procurement, in addition, the procurement law of relative state may also applied more stringent requirements, these requirements cause the agencies which provide high speed rail goods and services to bear the elusive and unclear legal responsibilities. In order to ensure the high-speed rail project could purchase the world's most advanced and economical equipment, it is recommended to make federal guidelines in this regard, especially need to be specified: (a) state selective applicable scope of the WTO Agreement on government procurement; (b) the federal department of transportation authorization shall suggest the state and local, make them agree to exempt scope and validation for "public interest" reason; (c) coordination between the various legal documents "buy American" requirements, the U.S. obligations in the trade agreement, the existing regulations and state laws. 6.2 Public Funding Public funding is very important to attract private capital, to accelerate the

41 progress of the project, to the target of reduce the carbon footprint. Funding methods include the provision of government financial subsidies, issuing government bonds for raising funds, providing some form of security for the project financing, providing annual operation and maintenance allowance for the project and so on. Suggesting that the government departments to provide the best possible commitment to the public funds to speed up the implementation of the project. 6.3 Government Credit “Railway repair and improvement financing plan” (RRIF) and “the transportation infrastructure financing and innovation act” (TIFIA) could encourage investment in high-speed rail infrastructure. These plans and other innovative solutions, such as state infrastructure bank and the railway relocation project, which will support private sector investment, and to provide more funding and credit for the party of achieving high-speed railway project financing In order to successfully implement the high-speed rail project, the two bills need to adapt to the special needs of high-speed rail projects. To benefit from the RRIF, TIFIA, and other similar financing assistance programs for high-speed rail projects, it is recommended to consider the following legislative actions: 1,Allow longer repayment period: These projects require to start the repayment of loans from 5~6thyears after the loan. However, the high-speed rail project may not be fully operational within 10 years and make profit, such requirements of repayment limit the validity of the federal loan and credit. 2,Reduce the costs: These two projects require the applicant to pay high costs. TIFIA requires the applicant to pay a credit rating fee, usually 0.2~0.3 million. RRIF borrowers have to buy credit risk insurance ("subsidy costs") throughout the period of the loan. RRIF applicants will also be required to pay up to 0.5% of the loan amount of investigation fees. 3,Expanding the scope of application: These two projects have a successful precedent, should expand the scope of application to meet the high speed rail project financing and credit demand. TIFIA's budget institutions limit the financing capability of the plan, which is difficult to meet the growing demand. In addition, TIFIA can only provide 33% of the total project cost of financing. At present, RRIF specifically designated a certain proportion of funds for non I class freight railway. For passenger rail projects, there should also be a special proportion of funding arrangements. 4,Waive the requirement of“buy America”; the requirement for the party who obtaining the RRIF loan commit to comply with the principle of“buy America”is not necessary, which will limit competition.

VII Legal Compliance 7.1 Employee Law As the United States Code title 49 sections24405pointed out that the legal rights and status of employees associated with route and service need to be guaranteed. United States Code title 49 sections24405 to protect employee rights and put forward some requirements, including requirements “rail carrier” to enforce federal law, including “the Railroad Retirement Act” (the U.S. Code chapter43 sections2231 etc.), “the Railway Labor Act” (the U.S. Code chapter43 sections 151etc.) and “the Railway Insurance Act” (the U.S. Code chapter45 sections 351etc..). High-speed rail Construction Company shall have the ability to meet these requirements, they shall be cooperation with the United States labor law experts, to develop a positive internal management policy, to provide training material for the management clerk and staff, shall be strictly abided by all labor laws in the United States. 7.2 Buy American Act As the United States Code title 49 section24405pointed out, the construction team shall comply with the basis of "buy American" of the United States Code title 49 sections24405 and relative requirements of FRA agency, but in order to control costs and improve efficiency, we suggest the federal transportation department apply the exemption of " buy American" for some products used on the high speed railway project. 7.3 Railway Law Abide by the railway safety laws, orders and regulations of the operation of high-speed rail, including but not limited to the provisions of the 49 chapter of the railway safety regulations and the ground transport Act. The project team involved in the construction of high-speed rail shall be aware of the importance of safe operation of the high speed rail system, must be strictly abide by the U.S. railway safety regulations. The United States enacted a large number of railway safety regulations, but for the high-speed rail system, these regulations need review to ensure the special requirements of high-speed rail being met, such as (a) the speed of high-speed rail more than 150mph; (b) timely monitoring system; (c) coordination among freight-commuter-high speed railway; (d) the equipment standards of high speed railway passenger transport. FRA is currently examining the European and world equipment standards, preparing the guidance for the high-speed rail train with the design speed up to 220mph. The experience of the high-speed rail operators will contribute to this work. The PTC signal system was adopted in “the American Railway Safety Improvement Act” in 2008. Adopting the modern operation management process,

43 through the close linkage establishment between the different operators, the railway safety improvement will also be achieved. The Chinese Railway team is willing to assist FRA preparing appropriate regulations to realize the current security requirements and achieve the higher safety demand. 7.4 Environmental Law The environmental laws and regulations mainly including the National Environmental Policy Act, the National Historic Preservation Act, the Ministry of transport act or other applicable federal, State Environmental Impact Assessment Act, etc.. The project shall be follow the provisions of “the National Environmental Policy Act”, “the National Historic Preservation Act”, “the Department of transportation method”No. 4 (f) , other applicable federal or state environmental impact assessment law to complete the required files or activities. 7.5 Americans with Disabilities Act In high-speed rail construction team shall comply with the requirements of “the Americans with Disabilities Act”and relevant laws, mainly including equipped the high-speed railway with the necessary facilities to make the disabilities accessible, and providing the disabilities with education, training and working opportunities in the whole process of the project implementation.