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High-Speed Rail International Lessons for U.S. Policy Makers
PETRA TODOROVICH, DANIEL SCHNED, AND ROBERT LANE High-Speed Rail International Lessons for U.S. Policy Makers Petra Todorovich, Daniel Schned, and Robert Lane
Policy Focus Report Series The policy focus report series is published by the Lincoln Institute of Land Policy to address timely public policy issues relating to land use, land markets, and property taxation. Each report is designed to bridge the gap between theory and practice by combining research findings, case studies, and contributions from scholars in a variety of academic disciplines and from profes- sional practitioners, local officials, and citizens in diverse communities.
About This Report This report was prepared with the Regional Plan Association as part of the Lincoln Institute/ Regional Plan Association joint venture partnership known as America 2050. This is the third report on high-speed rail generated by America 2050 since 2009, when the U.S. High-Speed Intercity Passenger Rail Program was launched. The program has made investments of $10.1 billion in high-speed and conventional passenger rail corridors across the country. Previous reports by America 2050 proposed a federal decision-making framework for invest- ments in high-speed rail based on regional factors that contribute to ridership demand, such as population density, employment concentrations, the presence of rail–transit connections, and existing intercity traffic flows.
This report assembles key lessons and research on the potential benefits of high-speed rail, drawn from nearly 50 years of experience with this mode of transportation in more than a dozen countries across the globe. Intended for policy makers, professionals, and interested citizens, it documents the approaches to high-speed rail that best leverage public investments for transportation benefits, economic development, and environmental and safety concerns. In the context of a new and controversial U.S. commitment to major high-speed rail projects, such as the statewide California system, this report offers recommendations for federal policy and explores various funding and financing strategies, as well as ideas about station location and design. It points to the Northeast Corridor and California as the two most promising regions in which to pursue high-speed rail initially, and suggests steps toward building support for those projects.
Copyright © 2011 by Lincoln Institute of Land Policy All rights reserved.
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Fax: 617-661-7235 or 800-526-3944 ON THE COVER: Email: [email protected] Germany’s Inter-City Express (ICE) high- Web: www.lincolninst.edu speed rail system began operation in 1991. ISBN 978-1-55844-222-1 © COMSTOCK Policy Focus Report/Code PF029 ......
Contents
2 Executive Summary
4 Chapter 1. International Experience with High-Speed Rail 6 What is High-Speed Rail? 7 High-Speed Rail’s Track Record 8 Prospects for a U.S. System 14 Summary
15 Chapter 2. Potential Benefits of High-Speed Rail 15 Transportation Benefits 16 Economic Benefits 19 Environmental Benefits 21 Summary
22 Chapter 3. U.S. Policy and Programs for High-Speed Rail Investment 23 The Current Legislative and Funding Framework 24 The High-Speed Intercity Passenger Rail Program 26 Federal Rail Policy Challenges 27 Summary
28 Chapter 4. Station Location and Design: A Typology and Case Studies 28 Four European Stations 35 Taking Advantage of Redevelopment Opportunities 36 Summary
37 Chapter 5. The Promise of High-Speed Rail in California and the Northeast Corridor 37 High-Speed Rail Plans in California 39 Current Conditions in the Northeast Corridor 45 Summary
46 Chapter 6. Funding and Financing Options for High-Speed Rail 48 Government Financing Tools 49 Public-Private Partnerships 53 Summary
54 Chapter 7. Recommendations for High-Speed Rail in the United States
57 References 60 About the Authors 60 Acknowledgments 61 About the Lincoln Institute of Land Policy, America 2050, and Regional Plan Association
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([HFXWLYH6XPPDU\ © ISTOCKPHOTO
The departures board igh-speed rail has been adopted In 2009–2010, the U.S. Congress appro- at Paris’s Gare du Nord throughout the world, and is priated $10.1 billion for a new high-speed TGV station. now being planned and devel- and intercity passenger rail program. Appli- oped in the United States. Over cations from 39 states requested nearly $75 theH past 50 years, U.S. transportation spend- billion, demonstrating broad interest in ing has favored the development of inter- and support for this program. The available state highway and aviation systems. In the funds were awarded to dozens of conven- meantime, countries such as China, Japan, tional intercity passenger rail projects and Spain, France, and Germany have been in- a few dedicated high-speed rail projects in vesting in modern high-speed rail systems 32 states and the District of Columbia, and to satisfy the travel demands of current and those projects are now moving forward. future generations. As the United States em- The U.S. Department of Transportation, barks on the High-Speed Intercity Passenger which manages the passenger rail program, Rail Program launched in 2009, it can learn has adopted a tiered approach, which em- from the experiences of other countries in phasizes investments appropriate to the planning, constructing, and operating different markets and geographies in the high-speed rail. United States. It defines three categories
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of passenger rail service that are intended to This report describes several funding strate- work together as a network: Core Express refers gies that have proven to be successful in other to high-speed trains operating on dedicated countries, and makes specific policy recommen- tracks with frequent service; Regional service dations to better position the federal high-speed operates at moderately high speeds and high rail program for success. frequency on shared corridors; and Emerging/ Feeder service is less frequent and connects Strengthen the federal policy and man- smaller and emerging markets to major markets agement framework by expanding the feder- located along Regional and Core Express routes. al role in planning and prioritizing high-speed Decades of international experience with rail corridors and working with the states to high-speed rail suggests that it could create secure rights-of-way. similar transportation, economic, environmen- tal, and safety benefits in American cities and Prioritize corridors that meet investment regions. While it requires high upfront invest- criteria by clarifying the objectives and desired ment, high-speed rail promotes economic growth outcomes of the federal program and promot- by improving market access, boosting produc- ing investments in those corridors that exhibit tivity of knowledge workers, expanding labor the characteristics that are indicative of success. markets, and attracting visitor spending. When planned thoughtfully with complementary in- Establish new mechanisms for corridor vestments in the public realm, high-speed rail management by developing legislation that can promote urban regeneration and attract enables the creation of public infrastructure commercial development, as shown in several corporations that can operate across state and European examples. High-speed rail has greater national borders and attract private investment. operating energy efficiency than competing modes and takes up less land than highways. Plan for maximum land development The initial investment of $10.1 billion in the benefits by coupling high-speed rail station U.S. High-Speed Intercity Passenger Rail Pro- investments with policies that encourage land gram, after years of minimal federal investment, development around station areas. In general, required that the federal government and par- well-connected stations in center-city locations ticipating states quickly scale up to the challenge offer the greatest potential for urban revitalization. of laying the groundwork for a foundational pro- gram and implementing it at the same time. Focus initially on the Northeast Corridor Those states that had the staff capacity, exper- and California, which offer the best opportu- tise, and experience in rail planning, such as nities for Core Express high-speed rail service in Illinois, North Carolina, and Washington, were the United States, by addressing the management successful in securing high-speed rail grants. and financing challenges each region faces. However, carrying the momentum of this initial investment forward has proven to be a struggle Secure adequate and reliable funding in a difficult fiscal environment, and California by drawing on a full complement of potential is currently the only federally funded Core Express federal, state, and private sources. Such sources high-speed rail project moving forward. In 2011, could include increasing existing transportation- Congress voted to strip funding from the program. related fees (such as a portion of the gas tax or The expiration of the legislation authorizing the ticket surcharges), creating an infrastructure high-speed rail program in 2013 may provide bank, forging public-private partnerships, and an opportunity to consider policy changes. expanding existing credit assistance programs.
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The Tokaido ince the 1964 inauguration reduces fuel use, saves energy, regenerates Shinkansen of Japan’s first Shinkansen bullet cities and regions, and increases economic bullet train was train connecting Tokyo to Osaka, productivity. launched on commercial high-speed rail lines With the exception of the higher-speed October 1, 1964, Shave been constructed in 14 countries. Acela Express service operated by Amtrak at Tokyo Station. Together these lines provide billions of pas- on the Northeast Corridor, the United States senger trips, save many hours of travel time, has failed to develop high-speed rail and and provide an exceptional level of safety. fully realize its benefits, despite numerous Now considered a well-established and planning studies and aborted attempts to proven technology, high-speed rail continues expand rail service in various regions since to offer benefits to the nations and regions the 1960s. As a result, most Americans it serves. This reliable, rapid, and safe are unfamiliar with high-speed rail and its ground transportation system offers in- potential impacts on our cities, regions, creased regional mobility and accessibility, and national landscape.
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Significant investments in the U.S. Jeddah, and the French engineering group Interstate Highway System since the 1950s Alstom has announced preliminary plans initially produced excess surface transpor- to build a high-speed rail line connecting tation capacity, but congestion is now com- Baghdad and Basra in Iraq (Telegraph 2011). mon on many highway sections, particularly Within the European Union system Spain is in and around major metropolitan areas. constructing some 1,500 miles of high-speed The federal government has also subsidized rail lines, France is planning more than the aviation industry, but has lacked a com- 2,500 miles of new high-speed rail lines, parable federal commitment to funding and England has proposed the second phase passenger rail infrastructure (figure 1). Such of its national high-speed rail network. funding has been a precondition for bring- The United States has been slow to invest ing large rail capital projects to fruition in in high-speed rail, but planning and policy every other country where they exist. making are now being pursued more seri- At least 19 countries around the world ously. In 2009 and 2010, the U.S. Congress are building or planning new high-speed appropriated $10.1 billion toward a new, rail lines (UIC 2011). China has invested competitive grant program for high-speed several hundred billion dollars in building rail, and President Barack Obama’s 2012 the world’s most extensive high-speed rail budget proposal assigns $53 billion over system by 2012 (Bradsher 2010). Several the following six years to begin developing oil- and gas-producing states in the Middle a national high-speed and conventional East are planning to spend billions of dollars passenger rail network that could connect on high-speed rail systems linking that up to 80 percent of Americans. region (Independent Online 2011). In Saudi Broad support for the program across Arabia, construction has already begun on a the country is evident in the 39 states that 276-mile high-speed rail line connecting the applied for funding since 2009, yet that Islamic holy cities of Medina and Mecca via support is not universal. Some critics have
FIGURE 1 Total Federal Spending on Highways, Aviation, and Rail, 1956–2009
$70,000
$60,000 Highways Aviation $50,000 Rail
$40,000
$30,000
$20,000
$10,000 Spending (Millions of 2009 Dollars)
$-
19561958 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
Data Source: Congressional Budget Office (2010).
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labeled it wasteful, lacking focus, or failing per hour (mph). In 1996 the European Union to aim for “true” high-speed technology (EU) officially adopted Directive 96/48, which (Laing 2011a). The fledging program has defines high-speed rail as trains capable of experienced its share of growing pains reaching speeds of 155 mph on dedicated, because the recent $10.1 billion infusion high-speed tracks or 125 mph on conven- has required simultaneous planning, policy tional tracks. As of January 2011, trains in making, and grant administration by the 11 countries already operate at speeds up to U.S. Department of Transportation Federal 185 mph, and several can reach 215 mph— Railroad Administration (FRA). The agency the current international standard for new has adapted quickly, but these tasks are far lines. The world’s fastest passenger train outside FRA’s traditional role of enforcing in commercial operation, in Shanghai, safety regulations on America’s railroads. China, reaches top speeds of 260 mph To build and sustain support for a long- using magnetic levitation technology term commitment to develop a national (Givoni 2006; UIC 2011). high-speed rail network in America, propo- nents will need to lay out a compelling case Major Operational Models for its benefits, particularly those related to Over the last half century, four different U.S. travel behaviors, land use patterns, and operational models of high-speed rail have urban and regional economies. Chapter 2 emerged, consisting of various combinations outlines potential benefits based on the ex- of new train and track technology (Campos periences of other countries in building and and de Rus 2009; UIC 2010c). operating high-speed rail systems since the 1. Dedicated: The world’s first opera- 1960s, and the following sections introduce tional high-speed rail model is Japan’s Shink- some characteristics of high-speed rail. ansen (“new trunk line”), which has separate high-speed tracks that serve high-speed trains WHAT IS HIGH-SPEED RAIL? exclusively. The system was developed be- The term high-speed rail refers to a variety cause the existing rail network was heavily of modern railway technologies that allow congested with conventional passenger and passenger trains to reach higher velocities freight trains and the track gauge did not than conventional trains. Due to advanced support the new high-speed trains. signaling systems, these high-speed trains 2. Mixed high-speed: Exemplified can also operate with greater frequency, by France’s TGV (Train à Grande Vitesse), this thus creating greater capacity to move more model includes both dedicated, high-speed passengers. However, high-speed rail is more tracks that serve only high-speed trains and than just upgraded tracks and new trains. It upgraded, conventional tracks that serve is a complex system of rail operations and both high-speed and conventional trains. maintenance technologies and procedures, 3. Mixed conventional: Spain’s commercial and management policies and AVE (Alta Velocidad Espanola) has dedicated, approaches, and innovative financing sources high-speed, standard-gauge tracks that serve and mechanisms. Each component of this both high-speed and conventional trains system contributes to high-speed rail’s utility equipped with a gauge-changing system, and competitiveness (UIC 2010a). and conventional, nonstandard gauge How fast is high-speed rail? The interna- tracks that serve only conventional trains. tionally recognized definition of high-speed 4. Fully mixed: In this model, exempli- refers to rail operations at or above 155 miles fied by Germany’s ICE (Inter-City Express),
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The third generation of Germany’s ICE high-speed trains can reach speeds of 190 miles per hour. This train is traveling on the Frankfurt-– Cologne Line.
most of the tracks are compatible with all Maglev technology is completely different high-speed, conventional passenger, and from traditional steel-wheel-on-steel-rail freight trains. technology. It involves using an electromag- netic force stored in very powerful magnets New Technologies embedded in the guideways and underbody Two of the most notable high-speed rail of the trains that cause the train to hover technologies developed over the last few and propel it forward at extremely high decades are known as a tilting mechanism velocities. Test maglev trains in Japan have and magnetic levitation (maglev). achieved speeds over 360 mph (Takagi In regions where high-speed trains must 2005). This dedicated track technology run on the conventional rail network, sharp means that maglev trains are incompatible curves can create centrifugal forces that with other passenger and freight rail tracks, cause significant discomfort to passengers. and conventional and freight trains are To solve this problem, rail engineers devel- incompatible with the maglev guideways. oped a mechanism that counteracts these China is currently the only country with forces by slightly tilting the trains as they an existing maglev train in commercial slow down to enter the curves. Many Swedish operation (Givoni 2006). and Italian high-speed trains, as well as Amtrak’s Acela Express and Cascades HIGH-SPEED RAIL’S services, use this tilting technology while TRACK RECORD running on conventional tracks. This alterna- High-speed rail is hardly a new transport tive avoids the high costs of constructing new, technology. Japan has been the global dedicated high-speed tracks in areas without pioneer since 1964, when the Shinkansen sufficient demand to justify such an invest- Tokaido line opened as the world’s first high- ment (Givoni 2006). speed rail service. It had an initial speed of
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“Transport technologies seldom make a comeback, save in a mixed high-speed rail system that utilizes nostalgia trips for well-heeled tourists. . . . But there is a spectacular conventional tracks on the approaches exception: railways, written off thirty years ago as a Victorian to main stations to avoid major disrup- tions due to construction and unnecessary anachronism destined to atrophy before the steady growth of scarring of the urban fabric (Chen and motorway traffic, have suddenly become one of the basic Hall 2011). Italy was the only other country technologies of the twenty-first century. The reason of course to develop high-speed rail in the 1980s. is the high-speed train.” — Banister and Hall (1993, 157) In 1991, Germany’s Deutsche Bahn opened its first Inter-City Express (ICE) 130 mph, but the maximum speed has risen service between Hamburg and Munich via to 168 mph, bringing Tokyo and Osaka Frankfurt. Originally the system was designed within a three-hour rail journey of each to be fully compatible for passenger and other (JR Central 2011c). The Tokaido line freight trains, but this model has shifted in has served more than 5 billion passengers favor of segments with limited or no freight and is by far the world’s busiest high-speed service, including those from Cologne to rail line (Envoy Media 2010). Thus, 1964 Frankfurt and from Cologne to Berlin via marked the beginning of what Banister Hannover (Chen and Hall 2011). Spain’s and Hall (1993) term the world’s second Alta Velocidad Española (AVE) line between railway age. Madrid and Seville began running in 1992 High-speed rail did not catch on right at speeds of 199 mph. The only other away, however. It was not until 1981 that country to construct a high-speed rail service France introduced its TGV Sud-Est line, in the 1990s was Belgium, which connected Europe’s first high-speed rail line, connecting Brussels to London and Paris in 1997 via Paris with Lyon, France’s second largest the Eurostar system (UIC 2011). urban area. Operating at a speed of 168 Since 2000, high-speed rail service has mph, the line reduced travel time to two High-speed trains wait been introduced in England, South Korea, at the South Railway hours for the 280-mile journey. France was Switzerland, Taiwan, The Netherlands, Station in Beijing, China. able to lower construction costs by adopting Turkey, and the United States. The eighth and by far most notable recent entry into high-speed rail is China, which opened its first high-speed rail line in 2003. Shortly thereafter it had already built the world’s most extensive high-speed rail network. According to the International Union of Railways (UIC 2011), by January 2011 China had opened 3,914 miles of high-speed rail (nearly 40 percent of the world total), had over 2,696 miles under construction, and was planning another 1,802 miles (table 1).
PROSPECTS FOR A U.S. SYSTEM High-speed rail in the United States is a story that, until recently, has been limited to the Northeast Corridor, where Amtrak © ISTOCKPHOTO/HANHANPEGGY
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TABLE 1 High-Speed Rail in Operation and Under Construction Worldwide In Operation Under Construction Total First year Percent Top Speed Percent Top Speed Percent Annual Country of operation Miles of Total (mph) Miles of Total (mph) Miles of Total Ridership China 2003 3,914 37.2 220 2,696 55.9 220 6,610 43.1 290,540,000 Japan 1964 1,655 15.7 190 235 4.9 230 1,890 12.3 288,836,000 Spain 1992 1,278 12.2 190 1,098 22.7 190 2,376 15.5 28,751,000 France 1981 1,178 11.2 200 130 2.7 200 1,309 8.5 114,395,000 Germany 1991 798 7.6 190 235 4.9 190 1,033 6.7 73,709,000 Italy 1981 574 5.5 190 — — 574 3.7 33,377,000 South Korea 2004 256 2.4 190 116 2.4 190 372 2.4 37,477,000 USA 2000 362 2.1 150 — — 362 1.5 3,200,000 Taiwan 2007 214 2.0 190 — -— 214 1.4 32,349,000 Turkey 2009 146 1.4 160 317 6.6 160 463 3.0 942,000 Belgium 1997 130 1.2 190 — — 130 0.8 9,561,000 The Netherlands 2009 75 0.7 190 — — 75 0.5 6,005,000 United Kingdom 2003 70 0.7 190 — — 70 0.5 9,220,000 World Total — 10,513 100.0 — 4,827 100.0 — 15,340 100.0 928,362,000 Notes: Data is sorted by miles in operation. China’s annual ridership is an estimate based on various news reports. USA’s annual ridership reflects FY 2010 ridership on Amtrak’s Acela Express service on the Northeast Corridor. Source: UIC (2011; 2009). began operating the Acela Express service improve conventional passenger rail service in 2000. Its trains reach top speeds of 150 and develop selected high-speed rail corri- mph and average around 75 mph. Federal dors simultaneously. Most other countries investments being made in the south end of historically have built and improved their the corridor, where trains average 86 mph, conventional rail networks over decades and will soon bring top speeds to 160 mph. The then made the leap to dedicated, high-speed Northeast Corridor is the country’s largest corridors as the conventional lines reached segment of publicly owned passenger rail capacity and required upgrades. In contrast, infrastructure, which has contributed to its the case of California represents a leap from relative success. Most other passenger rail minimal existing passenger rail service services nationwide operate on tracks today to a statewide high-speed rail system, owned by private freight railroads. The similar to new corridor investments in Spain challenges of balancing freight and passen- and China. ger operations in a single corridor restrict the ability to develop passenger rail speed, Project Grants and Tiers of Service frequency, and reliability. In 2009, the Obama administration Despite a history of disinvestment in rail launched the High-Speed Intercity Passen- passenger service by previous administra- ger Rail (HSIPR) Program, a competitive tions and Congresses, the Obama adminis- grant program that makes awards around tration is now moving ahead to build and the country for projects that seek to develop
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dedicated high-speed rail corridors and ment in dedicated high-speed rail. Lesser increase speeds, frequency, and reliability investments in Regional or Emerging/ on existing rail lines. Feeder corridors could serve smaller networks In awarding the projects, the FRA of metropolitan regions and emerging developed a new definition that distinguishes markets, using an incremental approach three tiers of high-speed and intercity pas- to making improvements over time. senger rail service, which differ somewhat Under these definitions, the planned from international definitions of high- California high-speed rail system is the only speed rail (figure 2). The top tier U.S. service, project awarded a federal grant to date that termed Core Express, operates at speeds is designed to be a Core Express service above 125 and up to 250 mph on dedi- with top speeds of 220 mph on new, dedi- cated tracks. cated tracks. The existing Acela Express According to the U.S. Department of service in the Northeast Corridor currently Transportation, the “FRA’s vision for a meets the FRA’s definition of Regional national high-speed rail program is to devel- service, though plans for the Northeast op tiered passenger rail corridors that take Corridor would bring the service up to into account the different markets and Core Express (see chapter 5). Most other geographic contexts found throughout the passenger rail services operating on freight United States” (U.S. DOT 2010, 10). This rights-of-way in the United States fall into is consistent with the recommendation in the category of Emerging/Feeder service. this report that investments in Core Express corridors be directed toward the largest Shared Passenger and markets in the country, where population Freight Corridors density and congestion on competing modes While Core Express corridors are expensive of transportation justify the level of invest- to plan and construct, they avoid conflicts with freight operations and allow trains to run at top speeds. Conventional, shared pas- FIGURE 2 senger rail corridors face the challenge of U.S. Definitions of High-Speed and Intercity Passenger Rail Corridors balancing passenger and freight service on tracks owned primarily by private freight Conventional Rail railroads. Some freight railroads have raised Regional concerns about expanding passenger rail Tracks: Dedicated & Mixed Length: 100–500 miles service on their networks, fearing it will Service: Relatively Frequent limit their ability to expand freight opera- 125 Emerging / Feeder 100 150 tions in the future (Levitz 2010). Tracks: Mixed Length: 100–500 miles 75 175 The American Association of Railroads Service: Relatively Frequent (AAR), the industry organization for North 50 200 American railroads, has developed principles 25 225 to balance passenger and freight needs MPH 0 250 on shared corridors. They focus on safety, High-Speed Rail access, and capacity; full compensation to Core Express freight railroads; and adequate liability pro- Tracks: Dedicated Length: 200–600 miles tection (AAR 2011). While the association Service: Frequent has not specified a preferred speed limit for Data source: U.S. DOT (2010). passenger trains on freight railroads, it notes
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FIGURE 3 Megaregions of the United States
Source: America 2050 (2008). that at higher speeds passenger trains should important challenges that could be operate on separate tracks from freight addressed by investments in passenger trains. The speed at which passenger trains and freight rail (U.S. DOT 2010). can travel on freight-owned tracks has been Megaregions are large networks of a sticking point in negotiations between metropolitan areas linked by overlapping states and railroads, with differing views commuting patterns and business travel, over whether 79, 90, or 110 mph should economic activity, urbanization, and cultural be the limit for passenger trains on shared resources. They stretch over hundreds of corridors (Levitz 2010). miles with populations of greater than 10 million people (America 2050 2008). They Focus on Megaregions provide an ideal setting for high-speed rail The factors conducive to high-speed rail networks because they concentrate multiple ridership, such as population density and metropolitan areas and their central busi- congestion on competing modes of travel, ness districts within corridors or networks are found primarily in 11 large megaregions of 100 to 600 miles (America 2050 2011). that contain 75 percent of America’s popu- As figure 4 illustrates, this is the distance at lation and jobs (figure 3). In the most recent which high-speed rail trips are more time- draft of the National Rail Plan, the U.S. and cost-effective than trips by automobile Department of Transportation highlights or airplane (Steer Davies Gleave 2004). the growing population, road congestion, Sir Peter Hall (2011, 352) has recently and air congestion in U.S. megaregions as commented favorably on the potential
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FIGURE 4 profitable) short haul air corridors. Elsewhere— The Best Transportation Mode for Different Trip Distances first in Japan and now in Europe—HSR has quickly seized the lion’s share of traffic along analogous corridors: Tokyo-Nagoya-Osaka, Paris-Lyon-Marseille, London-Manchester, Paris-Brussels-Amsterdam and Madrid-Zaragoza- Barcelona. There is no reason to believe that the result will be different on corridors such as Washington-New York-Boston or San Source: Prepared by the authors. Francisco-Los Angeles. (Hall 2011, 352) for high-speed rail in the California and Northeast Megaregions, although he is Many U.S. megaregions, including those less sanguine about the megaregions further in California, the Northeast, the Midwest, from the coasts. Cascadia, and Texas, contain corridors of comparable length and connect metropoli- [T]he spatial scale of these regions is ideally tan regions comparable in size to successful suited to HSR as a competitor to air, with the high-speed rail corridors around the world major cities spaced along linear corridors over (figure 5). The distances between urban cen- distances up to 500 miles, served by some of ters in these corridors are also long enough the world’s most trafficked (and hence most- for trains to reach high speeds, making
FIGURE 5 Comparison of International High-Speed Rail Corridors to California and the Northeast
1:57 TGV Sud-Est 28 France Paris Lyon
1:36 0:49 Tokaido 170 170 Shinkansen Tokyo Nagoya Osaka Japan Metro Trip Time Population Weekday Trains 1:26 1:19 1:17 AVE 18 17 22 Spain Barcelona Zaragoza Madrid Seville
0:30 2:09 1:18 HSR Proposal 43 43 33 California SF San Jose Los Angeles San Diego
0:352:50 1:05 0:58 0:35 Acela Express 10 10 15 15 15 Northeast Corridor Boston Providence NYC Philadelphia Baltimore DC
Distance (miles) 0 100 200 300 400 500 600 700
Source: Prepared by the authors.
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them time-competitive with other modes. Decisions about where to invest in High-speed rail is For example, to reach 200 mph, high-speed Core Express corridors versus Regional envisioned to connect trains require about 16 miles of straight and and Emerging/Feeder services will require a America’s largest metropolitan areas, flat track to accelerate (Amtrak 2010a). High- more robust planning and decision-making such as Chicago, speed trains also need significant distances framework at the federal level than has been with other cities up to brake and come to a stop, so stations must possible to date. Recent research by America to 600 miles away. be well-spaced along high-speed rail corri- 2050 (2011) provides a potential starting dors to maximize reductions in travel time. point for understanding which rail corridors As envisioned by the FRA, a national may justify different levels of investment passenger rail network would be built around and service. That study rated potential investments in high-speed, high-capacity existing rail corridors nationwide on a scale Core Express corridors that connect major of 0 to 21 based on factors contributing to metropolitan centers in the nation’s megare- rail ridership demand, such as population gions and are fed by Regional and Emerging/ density, employment concentrations, transit Feeder service on routes collecting passen- connections, existing air markets, and con- gers from smaller markets (U.S. DOT 2010). gestion on parallel road corridors (figure 6). For distances greater than 600 miles, the A similar approach should be adopted by aviation system will continue to provide the federal decision makers to prioritize invest- most cost-effective and energy-efficient trans- ments in high-speed rail corridors, combined portation options between megaregions and with a study of construction and operating to more remote places. costs for each corridor.
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SUMMARY a competitive grant program for which the High-speed rail has a history of providing FRA has defined three levels of passenger safe, efficient, and rapid ground transpor- rail service: high-speed, dedicated Core tation for more than four decades, and it Express service; Regional service on shared currently operates in more than a dozen tracks; and Emerging/Feeder service that countries around the world. A variety of supports smaller and emerging markets. operational models are in use, from dedi- This range of service types reflects the vari- cated tracks for high-speed trains to tracks ety of development patterns and markets shared by high-speed and conventional pas- across the United States. Core Express is senger trains. In general, high-speed trains the only service that meets the international tend to serve trip distances of 100 to 600 definition of high-speed rail, and currently miles, the distance at which fast trains it is being pursued only in California. It can compete for market share with auto- would connect two megaregions where mobiles and airplanes. such service is likely to be successful due The United States has only recently to the concentrations of population and begun to support high-speed rail through economic activity.
FIGURE 6 Relative Market Demand of Potential Passenger Rail Corridors in the United States
Source: America 2050 (2011).
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early a half-century of inter- TRANSPORTATION BENEFITS High-speed rail offers an national experience with high- High-speed rail is first and foremost a alternative to congested highways in California. speed rail has proven that it is transportation improvement that provides capable of producing a wide a framework for other secondary benefits. rangeN of transportation, economic, and environmental benefits. Every potential Shorter travel times: High-speed high-speed rail corridor requires unique rail can create travel time savings for those considerations and treatments, based on who would have used a different mode of the characteristics of the megaregion it transportation between urban centers. It serves and the metropolitan regional plan- improves overall access to many destinations ning context of each station along the route. in the megaregion and brings those places This chapter outlines the range of benefits closer together, a phenomenon referred to that high-speed rail can offer, and suggests as the “shrinking continent” (Spiekermann how to maximize them. and Wegener 1994).
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Mode shift: Where it is competitive transportation network, rather than to with other intercity transportation modes, reduce travel times (Givoni 2006). high-speed rail can capture a large share of Efficient land use: A typical high- passenger volume. International experience speed rail line has the ability to transport suggests that high-speed rail usually captures approximately the same number of people 80 percent of air or rail trips, if the travel in the same direction as a three-lane high- time by high-speed train is less than two and way, but on a fraction of the land area. The a half hours (UIC 2010a). Mode shift to rail right-of-way width of a typical two-track provides the greatest benefit in regions high-speed rail line is about 82 feet—one- where road and air capacity is constrained. third the width of a standard six-lane high- Safety: High-speed rail systems around way (246 feet). This difference in land use the world have experienced excellent safety amounts to a savings of 24.3 acres per mile records. Until a deadly accident in China in of high-speed rail. Such a savings could be July 2011, high-speed rail operations on particularly significant in environmentally dedicated tracks had never experienced a sensitive areas that need protection and in single injury or fatality (UIC 2010b). If urbanized areas where land for highway high-speed rail is built in the United States expansion is costly to acquire (UIC 2010a). and meets historic safety standards, one result could be fewer transport-related ECONOMIC BENEFITS deaths as more passengers choose rail High-speed rail’s ability to promote eco- for intercity travel. nomic growth is grounded in its capacity to Reliability: Dedicated high-speed rail increase access to markets and exert positive services usually operate at greater frequen- effects on the spatial distribution of eco- cies than conventional rail, and have fewer nomic activity (Redding and Sturm 2008). delays and better on-time performance than Transportation networks increase market cars and airplanes. The average delay of access, and economic development is more a Shinkansen train on the Tokaido line is likely to occur in places with more and bet- only 30 seconds (JR Central 2011b). Spain’s ter transportation infrastructure. In theory, AVE provides a full refund to passengers if by improving access to urban markets, high- their train is more than five minutes late speed rail increases employment, wages, (RENFE 2011). and productivity; encourages agglomeration; Capacity: By adding capacity to the and boosts regional and local economies. railway network, high-speed rail can divert Empirical evidence of high-speed rail’s a large share of passenger rail service to impact around the world tends to support new, dedicated tracks, thus freeing up the following theoretical arguments for capacity on the conventional rail network high-speed rail’s economic benefits. for freight and other intercity and com- Higher wages and productivity: muter rail services. For example, the United The time savings and increased mobility Kingdom has chosen to address capacity offered by high-speed rail enables workers constraints on its West Coast Main Line in the service sector and in information- with the implementation of the proposed exchange industries to move about the High Speed 2 (HS2) line. In Japan, the megaregion more freely and reduces the main motivation for implementing the costs of face-to-face communication. This Tokaido line between Tokyo and Osaka enhanced connectivity boosts worker pro- was to provide additional capacity to the ductivity and business competitiveness,
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leading to higher wages (Greengauge 21 2010). Deeper labor and employment markets: By connecting more communities to other population and job centers, high- speed rail expands the overall commuter shed of the megaregion. The deepened labor markets give employers access to larger pools of skilled workers, employees access to more employment options, and workers access to more and cheaper hous- ing options outside of expensive city centers (Stolarick, Swain, and Adleraim 2010). Expanded tourism and visitor spending: Just as airports bring visitors and their spending power into the local economy, high-speed rail stations attract new tourists and business travelers who might not have made the trip otherwise. A study by the U.S. Conference of Mayors (2010) © ISTOCKPHOTO/PÉRIG MORISSE concluded that building high-speed rail anchor investment in commercial and resi- The high-speed train would increase visitor spending annually by dential developments around train stations, station and surrounding roughly $225 million in the Orlando region, especially when they are built in coordination development in Lille, France. $360 million in metropolitan Los Angeles, with a broader set of public interventions $50 million in the Chicago area, and $100 and urban design strategies (see chapter 3). million in Greater Albany, New York. These interventions ensure that high-speed Direct job creation: High-speed rail rail is integrated into the urban and regional creates thousands of construction-related fabric, which in turn ensures the highest jobs in design, engineering, planning, level of ridership and economic activity. For and construction, as well as jobs in ongoing example, the city of Lille, France, experi- maintenance and operations. In Spain, the enced greater than average growth and sub- expansion of the high-speed AVE system stantial office and hotel development after from Malaga to Seville is predicted to create its high-speed rail station was built at the 30,000 construction jobs (Euro Weekly 2010). crossroads of lines linking London, Paris, In China, over 100,000 construction work- and Brussels (Nuworsoo and Deakin 2009). ers were involved in building the high-speed Spatial agglomeration: High-speed rail line that connects Beijing and Shanghai rail enhances agglomeration economies by (Bradsher 2010). Sustained investment creating greater proximity between business could foster the development of new manu- locations through shrinking time distances, facturing industries for rail cars and other especially when the locations are within the equipment, and generate large amounts rail-friendly 100 to 600 mile range. Agglom- of related employment. eration economies occur when firms benefit Urban regeneration and station from locating close to other complementary area development: High-speed rail can firms and make use of the accessibility to generate growth in real estate markets and varied activities and pools of skilled labor.
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High-speed rail has also been described A case study in Germany (box 1) exem- as altering the economic geography of plifies increased economic benefits associated megaregions. By effectively bringing eco- with high-speed rail, but in other cases the nomic agents closer together, high-speed rail results have fallen short of expectations. can create new linkages among firms, sup- This mixed evidence underscores the im- pliers, employees, and consumers that, over portance of ensuring that transportation time, foster spatial concentration within re- connections, station locations, urban devel- gions (Ahlfeldt and Feddersen 2010). This opment, and promotional strategies are in interactive process creates net economic place to maximize the economic impact gains in addition to the other economic of this capital-intensive investment. benefits described here.
BOX 1 Economic Benefits of High-Speed Rail in Montabaur and Limburg, Germany
n 2002 a new dedicated high-speed rail line in Germany between Frankfurt and Cologne connected the country’s two largest I regional economies and its busiest airport. Trains on the line travel at speeds over 185 mph, reducing the travel time between the two cities by 74 minutes and bringing total travel time to less than an hour along the 110-mile route. The new line has five stations, including those in the rural towns of Montabaur and Limburg (figure 7). Locating stations in these towns was contro- versial, due to their small potential markets. The towns have 12,500 and 34,000 residents, respectively, and are only about 12 miles apart, limiting the trains’ ability to maintain maximum speeds. FIGURE 7 A study by Ahlfeldt and Feddersen (2010) was able to isolate the Montabaur and Limburg Stations in the effect of the rail stations on the two small cities because they are in German ICE Rail Network peripheral locations and had negligible economic growth prior to the construction of the stations. Any increase in economic devel- Cologne opment could be measured easily and could be assumed to be Hamburg exogenous to the towns’ natural growth paths. Furthermore, the Berlin decision to locate the stations in these two towns was driven mainly Germany Cologne by politics; in other words, it was a discretionary decision and the Siegburg Frankfurt situation is replicable. Bonn
The researchers found that the areas surrounding the new stations Munich experienced a 2.7 percent annual increase in overall economic activ- Montabaur ity compared with the rest of the region, and that this growth was Limburg persistent. They concluded that the economic gains experienced in these two towns were due to the introduction of the high-speed rail
service, which increased accessibility to the regional markets of Rhine & Main Rivers Frankfurt Frankfurt and Cologne. The service helped Montabaur and Limburg Autobahn 3 Cologne-Frankfurt InterCityExpress Rail Line attract new residents, which increased the local employment pools and consumer markets, and eventually attracted new businesses
010205 Miles Frankfurt that helped to drive the towns’ growth. The study notes that the International Airport political leadership of these towns helped to ensure this growth by securing developable land close to the new high-speed rail stations. Source: Prepared by the authors.
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© ISTOCKPHOTO/FOTOVOYAGER ENVIRONMENTAL BENEFITS High-speed rail has the potential to provide greater environmental benefits and energy efficiencies than other modes of long dis- tance travel. However, several conditions must be met to obtain these benefits. Energy efficiency and ridership: High-speed rail offers greater operating effi- ciency on a per passenger mile basis than competing modes, such as single-occupancy automobiles or airplanes that require signifi- cant amounts of fuel to get off the ground. For example, Shinkansen trains are estimated to use one-quarter the energy of airplanes and one-sixth that of private automobiles per passenger mile (JR Central 2011a). To achieve environmental benefits, high- speed trains must maximize load factors to realize the greatest efficiencies. As high- through a combination of mode shift and A bullet train leaves Tokyo speed rail ridership increases, so does its rel- attracting new passengers to high-speed rail. Station near the Shiodome ative energy efficiency, whereas a high-speed Energy mix: High-speed rail is the only skyscrapers. train carrying no passengers ceases to be available mode of long-distance travel that efficient in any sense. currently is not dependent on motor fuels. In regions where the number of total High-speed rail is powered by electricity, trips is not growing, high-speed rail can which is not without environmental prob- bring about a net reduction of energy use lems depending on its source (see table 2). through mode shift by capturing passengers If it is powered by electricity generated from automobile or airplane trips. In re- from fossil fuels, such as coal or natural gions like California where population and gas that discharge harmful greenhouse gas trips are projected to keep growing, high- emissions, then its environmental benefits speed rail can help reduce the energy and are limited. However, electricity is generally climate impacts on a per passenger basis considered an improvement over petroleum-
TABLE 2 Origins of Electricity Used by European Railways in 2005 Member State Solid Fuels Oil Gas Nuclear Renewable Belgium 12% 2% 25% 58% 3% Germany 54% 0% 8% 27% 11% Spain 38% 4% 18% 22% 18% France 5% 2% 3% 86% 5% Italy 34% 10% 42% 0% 15% United Kingdom 37% 1% 37% 20% 5% Source: IFEU (2008).
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Passengers boarding generated power and provides a crucial dioxide emissions if the energy mix were a Thalys international advantage as the United States aims to shifted to low carbon emitting sources. high-speed train at reduce its dependence on foreign oil. Nuclear power is a significant source Gare du Nord, Paris. Amtrak’s Northeast Corridor and parts of of electricity for passenger rail in countries the Keystone Corridor (connecting Harris- such as Belgium, France, Germany, and burg, Pennsylvania to Philadelphia) are Spain. France is by far the largest nuclear electrified. Most other conventional pas- power user, with a share of more than 85 senger trains in America operate on freight percent for railway operations. However, rail lines and are powered by diesel fuel. growing concerns about nuclear power fol- Energy planning needs to be a part of lowing the 2011 Fukushima Daiichi plant the planning for high-speed rail to ensure accident in Japan raise doubts about its role the reduction of greenhouse gases and other in the development of a U.S. high-speed harmful pollutants. Even with the current rail system in the near future. Spain’s rail energy mix that includes fossil fuel sources, network uses renewable energy sources for however, high-speed rail can yield signifi- 18.4 percent of its electricity (IFEU 2008). cant environmental benefits. A recent study Japan’s high-speed rail uses geothermal by the University of Pennsylvania (2011) and hydro power to meet up to 56 percent found that a new high-speed line in the North- of its energy needs (Tan 2011). east Corridor, powered by electricity from Technological innovation: The energy the current energy mix, would divert nearly efficiency of different models of high-speed 30 million riders from cars and planes, attract trains also varies considerably. With all other 6 million new riders, and still reduce car factors being equal, increases in a train’s emissions of carbon monoxide by more speed require proportional increases in the than 3 million tons annually. The system amount of energy needed to propel it, com- would also result in a reduction of carbon pared to a conventional passenger train.
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Designing trains to be lighter in weight and Act of 2008, which requires all passenger more aerodynamic can offset these energy trains and certain freight trains to have ad- requirements. vanced train control technologies on board For example, the energy efficiency of by 2015 (Hymon 2008). This new feature Japan’s Shinkansen trains has improved over ensures that trains remain separated by a time. Current models use nearly one-third safe distance and automatically applies the less energy than those introduced in the brakes if trains get too close to each other. mid-1960s, and they travel significantly The FRA has acknowledged that high- faster. This energy savings was achieved, speed trains operating on dedicated tracks in part, by switching from a concentrated with train control systems in place do not traction system to a distributed traction sys- require the same crashworthiness standards tem. The latter system replaces trains using as a conventional train on a freight network. a single locomotive with trains that have Recently, FRA officials have indicated a powered axles on every passenger car. This willingness to update their rules to reflect change lightens the axle load, increases the a “system safety” approach, which focuses reliability of operations, and lessens the im- more on crash avoidance than crashworthi- pact on the track. These factors have ness. However, before changing nationwide encouraged other nations such as France safety standards to accommodate high-speed and Germany to make similar transitions trains, the agency has indicated it will con- in rolling stock technology (JORSA 2008). sider issuing waivers on a case-by-case basis, U.S. regulations requiring crashworthiness such as for the California system, in which of passenger trains present a challenge for trains will continue to operate on tracks with high-speed trains to achieve better aero- conventional passenger trains in certain dynamics and lighter weight. Federal rail segments, though not with freight trains safety regulations traditionally have required (U.S. DOT 2009b). that passenger and commuter trains be built to withstand a collision with a freight train. SUMMARY The 2008 head-on collision in Los Angeles High-speed rail provides a range of potential between a Metrolink commuter train and transportation benefits, including greater a freight train occurred because a train speed, safety, frequency, and reliability of operator did not see a red stop signal. The ground transportation, and brings cities and accident killed 25 people, demonstrating their regions closer together by shrinking time the serious risk of this type of incident. distances and effectively increasing access European and Japanese guidelines for to markets. This increased access expands high-speed trains take a completely different economic productivity and labor markets, approach, focusing on crash avoidance and with benefits for businesses and workers, and providing strict physical or time separation promotes spatial agglomeration of businesses between passenger and freight trains and in related industries. High-speed rail can also other system safety precautions. Crash boost tourism and visitor spending, and when avoidance systems are seen as the preferred coordinated with other strategies it can pro- approach to safety and are utilized success- mote urban regeneration. The environmental fully in high-speed rail systems around the benefits of high-speed rail depend on several world (AHSRA 2011a). conditions: strong ridership, clean energy The California accident led to the pas- sources to power trains, and mode shift sage of the U.S. Rail Safety Improvement from less efficient forms of transportation.
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The Susquehanna River Bridge between
Perryville and Havre de © JAMES G. HOWES/WIKIMEDIA COMMONS Grace in Maryland was built in 1906. It is just one of Amtrak’s older bridges in the Northeast Corridor that need to be replaced.
ach country that has developed Act (PRIIA), which authorized funding for high-speed rail has done so with Amtrak and state-led efforts to develop high- strong national government lead- speed rail corridors between 2009 and 2013. ership. Prior to President Barack In February 2009, just months after PRIIA Obama’sE recent embrace of high-speed was signed into law at the end of 2008, the rail, federal government support had been act became the vehicle for appropriating $8 a missing ingredient in U.S. passenger rail billion for high-speed rail under the Ameri- development. However, significant federal can Recovery and Reinvestment Act (ARRA). investments in high-speed rail in 2009–2010 An additional $2.5 billion for high-speed put the federal High-Speed Intercity Passen- rail was appropriated by Congress in the ger Rail (HSIPR) Program on a solid initial Fiscal Year (FY) 2010 budget (figure 8). footing. Whether that commitment can be These appropriations, totaling $10.5 sustained in a difficult fiscal environment billion for high-speed and passenger rail, will determine whether high-speed rail in transformed the preservation-focused pro- the United States can become a reality. gram established by PRIIA into a highly The federal commitment to high-speed visible high-speed rail initiative that later rail began in 2008, when Congress passed became the centerpiece of the Obama the Passenger Rail Investment Improvement administration’s infrastructure agenda.
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However, this sudden infusion of funding funding to improve rail corridors. While also revealed PRIIA’s limitations and the PRIIA is an improvement over the previous challenges of creating an ambitious high- lack of a U.S. passenger rail policy, it is not speed and intercity passenger rail program well-suited to a more ambitious, sustained virtually overnight. federal commitment to building dedicated, The subsequent Congressional appro- multistate high-speed rail corridors. priation for FY 2011 stripped the program Unlike the U.S. highway and transit of any funding in 2011 and rescinded $400 programs, which rely on dedicated revenue million from the FY 2010 budget. This streams from the federal motor fuels tax, pas- abrupt reversal underscores the program’s senger rail has no dedicated source of reve- vulnerability to shifting political winds as nue and thus relies on Congress for general long as it has to rely on annual Congres- fund appropriations. Prior to the passage of sional appropriations for its funding. PRIIA, most passenger rail appropriations were made directly to Amtrak each year, but THE CURRENT LEGISLATIVE with no multiyear authorization since 2002. AND FUNDING FRAMEWORK Numerous Amtrak officials have testified to The current federal policy framework for Congress over the years that the uncertainty high-speed rail was shaped in response to of these annual, often politicized, appropri- both the history of unreliable and minimal ations makes planning and operating the federal contributions for passenger rail and railroad difficult. the efforts of individual states acting on In the absence of consistent federal their own initiative and with their own support for passenger rail, states including
FIGURE 8 U.S. Funding of Passenger and High-Speed Rail, 1991–2010
12,000
Amtrak Total 10,000 High-Speed Rail Passenger Rail Total 8,000
6,000
4,000 Dollars (thousands)
2,000
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Note: Dollars not adjusted for inflation. Source: National Association of Railroad Passengers (2008).
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California, North Carolina, Pennsylvania, ments to existing passenger rail corridors and Washington have established dedicated that could enhance service, relieve conges- funding streams to improve conventional tion, and develop new high-speed rail ser- passenger rail corridors operated by Am- vices on either existing or new rights-of-way trak. Other states, such as Illinois, Maine, (table 3). These statutes provide the basis for and Vermont, have directed state general the HSIPR Program, administered by the funds or flexible federal funds to subsidize U.S. Department of Transportation. and supplement their passenger rail service The program began in June 2009 with (U.S. GAO 2010). an announcement of funding availability These state investments have led to the and interim guidelines (U.S. GAO 2011). purchase of new rail cars in Washington, The FRA was charged with administering track upgrades for and re-electrification of the program, selecting applicants, awarding the Keystone Corridor in Pennsylvania, and grants, negotiating funding agreements, more frequent, reliable service and higher and writing a national passenger and freight ridership on all state-sponsored lines. State rail plan. These new responsibilities required funding for rail has come from various the FRA to increase its planning staff sources, including portions of state gas and quickly, since most of its existing employees diesel taxes, flexible funding from the feder- were focused on the traditional roles of the al Congestion Mitigation and Air Quality agency—safety and regulatory enforcement Improvement Program, state rental car of freight and passenger rail services. taxes, and proceeds from specially branded The HSIPR Program has three funding Cash Train scratch lottery tickets in categories to which states, groups of states, Washington state. interstate compacts, public agencies, or Amtrak are eligible to apply. One of the THE HIGH-SPEED INTERCITY programs, the High-Speed Rail Corridor PASSENGER RAIL PROGRAM Development Program, is restricted to the In recognition of these and other state ini- 11 federally designated high-speed rail cor- tiatives, PRIIA established a competitive ridors, although grants can be obtained federal grant program to assist the states through the other two funding categories and Amtrak in making capital improve- for projects on other corridors.
TABLE 3 Federal Statutes Created by the Passenger Rail Investment Improvement Act of 2008 PRIIA Statute (2008) Eligibility Purpose Intercity Passenger States, groups of states, interstate Capital costs of facilities, infrastructure, and equipment Rail Corridor Capital compacts, and public agency rail Assistance (Sec. 301) operators
High-Speed Rail Corridor States, groups of states, an Broadly defined capital projects to acquire, construct, and improve rail Development (Sec. 501) interstate compact, public agency structures and equipment. High-speed rail is defined to include service rail operators, or Amtrak, for reaching operating speeds of at least 110 miles per hour. The project federally designated high-speed must be included in a state rail plan. (An exemption was made to this rail corridors requirement in PRIIA.)
Congestion Relief States and Amtrak Projects to reduce congestion or facilitate ridership growth in heavily (Sec. 302) traveled rail corridors and projects identified by the Surface Transportation Board to improve on-time performance and reliability
Source: U.S. DOT (2009a).
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FIGURE 9 HSIPR Program Awards by State
Round 1 Round 2 Reallocation Round 3 January 2010 October 2010 December 2010 May 2011
All Other All Other All Other All Other States/Agencies States/Agencies States/Agencies States/Agencies Amtrak/NEC WA 6 IL 10 14 CA 14 MI 13 9 22% NC 30% CA 7 7 37% MI 10 WA 7 IA 9 52% CA 18 10 29 13 CA WI 16 FL 16 Midwest 18 FL 33 Joint Application IL FL NY
Source: U.S. DOT (2011d and 2011e).
The sudden $10.1 billion in funding for the 2000s, was awarded a total of $2.4 bil- high-speed rail in ARRA and the FY 2010 lion for the initial Tampa–Orlando segment budget was welcomed with great enthusiasm of the statewide high-speed rail project. by states nationwide, 39 of which applied However, this project was cancelled in early for rail planning or construction grants. But 2011 by newly elected Governor Rick Scott. it required a rapid increase in capacity at The remaining federal grant awards went the federal level and within state transpor- to conventional rail projects, such as those tation departments to administer and par- in Washington and Illinois, for projects to ticipate in the program. This new program increase the speed, reliability, and frequency relied on the states to submit applications of passenger rail services on shared passen- for eligible projects. Given the previous lack ger and freight corridors. of federal commitment to passenger rail, By mid-2011, the distribution of grants only a few states had staff capacity for rail largely reflected the status of rail planning planning or the expertise to develop propos- efforts across the country, with some atten- als for Core Express high-speed rail. States tion to geographic equity. The FRA’s grant- with previous commitments to rail planning making process was criticized for a lack of and funding generally were able to put to- transparency by Chairman John Mica of the gether successful proposals in the 2009 and House Transportation and Infrastructure 2010 rounds of grant making (figure 9). Committee. However, a U.S. Government The two states that had already developed Accountability Office (GAO) report that he plans for Core Express high-speed rail were commissioned states: “The FRA established the most successful in the competition for a fair and objective approach for distribut- federal funding. California voters had passed ing these funds and substantially followed a $9 billion bond act in 2008 to fund a Core recommended discretional grant award Express high-speed rail project connecting practices used throughout the government” Northern and Southern California, and the (U.S. GAO 2011, 22). state was awarded federal grants of approx- By August 2011, two years after the imately $3.6 billion. Florida, which was able launch of the HSIPR Program, nearly 75 to resubmit its high-speed rail proposal from percent of the awarded funds had been
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released to 25 states, the District of Colum- criticisms that the program is diffuse, ineffec- bia, and Amtrak, allowing them to start tive, and dependent on ongoing subsidies. work. However, the program continues to Nationally available data could help to eval- face criticisms, largely focused on the per- uate the most promising regions for attract- ceived high cost of rail investments; unim- ing ridership and enhancing economic and pressive trip time savings; and the lengthy other benefits. A phasing plan and funding timeline for rail planning, engineering, allocation strategy could help develop the environmental review, and construction. full build-out of a national network by helping states secure rights-of-way for FEDERAL RAIL POLICY high-speed rail corridors. CHALLENGES Another challenge is to clarify the Even though PRIIA is authorized through differences between conventional and 2013, stakeholders in the rail industry, in- high-speed rail corridors. PRIIA provides cluding one of the drafters of PRIIA, have federal grants for both conventional pas- remarked on the need to adjust federal rail senger rail and new high-speed corridors, policy to respond to current circumstances, although the media has tended to focus on including greater political instability in the high-speed program. Neither PRIIA the Middle East and its implications for nor ARRA specified the share of federal America’s dependence on foreign oil; grow- funding to be used for high-speed Core ing international and private sector interest Express corridors versus conventional in helping to finance high-speed rail in the passenger rail. In fact, the dearth of high- United States; and the president’s own am- speed rail projects in the planning pipeline bitious proposals for a national high-speed means that grants will be shared among rail network to give 80 percent of Americans various types of rail projects. access to high-speed rail over the next 25 A more active role by the federal govern- years (Gardner 2011). ment could help clarify the respective roles Such a vision requires a stronger and of high-speed Core Express corridors and more active federal commitment that must conventional Regional and Emerging/Feeder start with secure funding. The most recent routes, including funding them through setback of zero funding for high-speed rail separate programs and clearly defining in the FY 2011 budget underscores the need the objectives for each type of rail service. for a sustainable revenue source as reliable Funding for maintaining and upgrading as funding for highway and transit programs existing rail corridors could be provided in the past. President Obama’s proposal to through formula funds based on passenger include a $53 billion, six-year high-speed rail train movements, track miles, or ridership. program as part of the surface transportation President Obama’s FY 2012 budget pro- bill would help to achieve this kind of equity posal for the Department of Transportation among transportation modes. moved in this direction by establishing dif- In conjunction with a funding strategy, ferent competitive grant programs, includ- the role of high-speed rail in America’s larg- ing network development for constructing er transportation network needs to be better new corridors and system preservation defined (U.S. GAO 2009). A sharper, more for maintaining safety and reliability on narrowly focused program directed at corri- existing corridors (White House 2011). dors that meet clearly articulated objectives The national high-speed rail program for high-speed rail service would address also must overcome a lack of effective
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institutions and administrative structures SUMMARY for building and operating multistate corri- The PRIIA legislation enacted in 2008 dors. Public benefit corporations capable provided a transition from an era with no of entering into public-private partnerships federal partner for high-speed and passen- could develop and maintain high-speed rail ger rail to a period of active federal part- infrastructure across megaregional, multi- nership with the states. Thirty-two states, state, and even binational territories. These the District of Columbia, and Amtrak have corporations would be responsible for the been awarded funding through the HSIPR tracks, while separate public and private Program and are moving ahead to plan or entities would operate the trains. Federal build high-speed and conventional rail proj- legislation could be developed to enable ects. Given the quick start-up nature of the the creation of these public infrastructure program, the FRA did an admirable job of corporations. responding to many simultaneous new du- International examples of publicly char- ties, but also faced challenges in both laying tered infrastructure corporations include the groundwork for a foundational program the High Speed 1 (HS1) and High Speed 2 and implementing it at the same time. (HS2) companies in the United Kingdom, The setbacks experienced in 2011, when Spain’s state-owned Administrator of Rail- several governors cancelled rail projects and way Infrastructures (Adif), and Réseau Ferré Congress appropriated zero dollars for high- de France (RFF), the French Rail Network. speed rail, provide an impetus to reset the Regional public benefit corporations could program in a way that will better position be created in the United States to develop it for long-term success. Federal policy initi- and manage track infrastructure, receive atives could set the program on firmer foot- federal high-speed rail grants, and enter into ing for a long-term commitment and restore contracts with private consortia for design, public confidence in an era of fiscal austerity. construction, and maintenance.
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he potential of high-speed rail to It is difficult to generalize across all of promote urban regeneration in these conditions, but existing European sta- conjunction with new or enhanced tions suggest a typological framework that rail stations is one of its most prom- may help to guide planning for high-speed Tising economic benefits (U.S. Conference rail in the United States (figures 10a and 10b). of Mayors 2010). The experience with land In particular, different station locations nec- development around high-speed rail stations essarily create a different dynamic between has been mixed, but one thing is clear: high- existing concentrations of activities and the speed rail cannot generate growth by itself. increased access provided by high-speed rail. High-speed rail can play a prominent role Center-of-city stations can reinforce in economic regeneration, but it is difficult established concentrations of development. to isolate its impacts from other comple- Their potential to spur further development mentary actions that are necessary to stimu- is often magnified by the connectivity of late a larger economic development success the existing urban fabric and the extent story (Givoni 2006). of nearby transit connections. To take advantage of high-speed rail’s Edge-of-city stations can alter the potential land development benefits, cities center of gravity of a city’s core and spur must adopt policies and planning strategies redevelopment of underutilized areas at that encourage station-related development the urban periphery. and undertake careful planning of the track Suburban and exurban stations can routing, station location, and intermodal create new centers that concentrate growth transportation connections. Significant around the station or enable corridor devel- land development effects have been docu- opment between the station and a nearby mented more frequently in places with existing node. In some cases, such stations robust regional economies and linkages with are located too far from the key regional other transportation modes, especially rail destinations and fail to attract much rider- transit links to nearby urban centers, and ship or spinoff development. places with public sector support for policies Special purpose stations can either that encourage development (Sands 1993; retain their narrow function as intermodal Greengauge 21 2006). facilities, such as airports, or can develop High-speed rail stations have been located as mixed-use centers in themselves. in almost every setting—from the highest density centers of major cities to the most FOUR EUROPEAN STATIONS pastoral landscapes. In each case, the loca- Center of City: Lleida Pirineus tion reflects a complex interaction of physical, Station, Lleida, Spain economic, logistical, and political consider- Lleida, with a city population of 137,000, ations. Similarly, the designs of the stations is the capital of the province of Lleida in illustrate rich variety, from the moderniza- Spain’s Catalan region. Surrounded largely tion and adaptive reuse of historic buildings by agricultural land, the nearest cities also to the construction of completely new, served by high-speed rail are Zaragosa purpose-built structures. (700,000; 80 miles away), Huesca (52,000;
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FIGURE 10A Typology of High-Speed Rail Station Locations
Center of City
Newer Center Historic Center
024 Miles 0.5 Miles
Lleida, Spain Impact Lessons Learned City Population: 137,000 Tourism grew 15 percent Supporting urban design interven- Metro Population: 250,000 annually. Business con- tions beyond the immediate station Year Opened: 2003 ventions up 20 percent. area leveraged the role of the Frequency of Service: 41 trains daily (in summer) New high-tech industrial station as a seam between older Distance to Major Destinations: park built nearby. and newer parts of the center city. 2 hours to Madrid; 1 hour to Barcelona
Edge of City
Historic Center
Urban Area Industrial Zone
024 Miles 01 Mile
Avignon, France Impact Lessons Learned City Population: 95,000 The economic develop- Lack of integration with the his- Metro Population: 255,000 ment impacts are unclear toric center city, in part because Year Opened: 2001 at best. If anything, the of physical barriers, has created Frequency of Service: 65 trains daily (in summer) historic center city station a competitive rather than com- Distance to Major Destinations: area may have declined. plementary dynamic with the 2 hours 40 minutes to Paris; 1 hour to Lyon center city station area.
Prepared by the authors.
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65 miles away), and Tarragona (155,000; boulevards lead to surface parking lots 50 miles away). around the station. This high-speed rail station is located Economic development impacts: north of the historic center, about a half- The area around the railway station is being mile from the hilltop fortifications that rebuilt as part of a comprehensive plan that mark the symbolic epicenter of the city. The calls for approximately 980,000 square feet station is on a loop of track that branches of commercial, retail, and entertainment off another line that enables some high- space, as well as gardens, bridges, and park- speed trains to bypass the city center. The ing. Since the high-speed rail service was station is at a strategic point of transition initiated in 2003, tourist visitation has in- between the older historic center to the creased by about 15 percent and demand south and newer districts to the north. As for business conventions has risen 20 percent the tracks enter the city along its northern each year (Burnett 2009). An example of edge, they are covered by a boulevard lined collateral development outside the station with newer buildings. Several major streets area is a new high-tech industrial park radiate from the station area into the core established in 2005. High-speed rail is seen of the city and into the areas to the north. by the station developer as crucial to attract- Connectivity: The station is well-con- ing companies such as Microsoft and Indra nected to a variety of other transport modes, Software Labs, a Spanish information including the Catalan regional commuter technology company. rail service and local and regional buses. Lessons learned: The Lleida station Long-range redevelopment plans call for is an example of investment in high-speed expanding the commuter network and rail to leverage not only the redevelopment relocating the bus station to the train station of the immediate station area, but also a area. While no major highways connect capital-intensive master plan to transform to the station directly, several multilane other nearby neighborhoods by taking
A bird’s eye view of the high-speed rail station in Lleida, Spain. © KERIS KOBA/CREATIVE COMMONS
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TGV Station in Avignon, France. © GORDON JOLY/CREATIVE COMMONS
advantage of the station’s strategic location a few buildings and access roads, but no between the older and newer parts of the city. regular street and block pattern. Connectivity: The Avignon TGV station Edge of City: Avignon, France is served by high-speed rail, but lacks any The Avignon TGV station is on the Medi- direct connection to the nearby conventional terranean high-speed rail line linking Paris, rail services. Shuttle buses travel to the city Lyon, and Marseille. While the region is center every 15 minutes, but most station heavily urbanized, it is still highly valued visitors access the area by automobile using a for its natural landscape qualities. Avignon, network of roads that link nearby highways a city of 95,000, is one of several significant to 1,800 parking spaces in the station lots. centers in Provence that are served by high- Economic development impacts: speed rail lines, including Orange (30,000; The economic development benefits of 15 miles away), Nimes (146,000; 25 miles high-speed rail service for Avignon are away), and Aix-en-Provence (143,000; 50 unclear because development was never miles away). Avignon is also linked to the contemplated for the immediate station area. major metropolitan areas of Montpellier (60 Rather, the station was always conceived as miles away) and Marseille (70 miles away). a signature, modern structure designed to The TGV station is located about two reflect local environmental conditions and miles from the historic center of Avignon landscape design traditions. In terms of on a dedicated high-speed rail route that broader municipal impacts, the TGV station bypasses the city along its southern edge. has become the primary gateway to the re- This largely industrial district is surrounded gion at the expense of development activity on two sides by the Rhône River and is cut around the conventional rail station in off from the rest of the city by rail lines and the city center. train yards. The area within a half-mile Lessons learned: The Avignon radius of the station is in a floodplain and TGV station exemplifies the limits of poten- thus consists of a designed landscape with tial benefits of high-speed rail for several
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reasons: lack of interconnectivity with local Camp de Tarragona. An amusement park and regional transportation networks; emer- and major tourist attraction, Port Aventura, gence of a competitive rather than synergis- is also located within a 25-minute drive. tic dynamic between the old and new station While the road network is fairly sparse, areas; and an isolated setting that inhibits ready access to highways and the dispersed the integration of its new development development pattern suggest that this area with the existing urban fabric. will continue to urbanize. Connectivity: The Camp de Tarragona Exurban: Camp de Tarragona, station is served exclusively by high-speed Tarragona, Spain trains, but the larger Barcelona–Tarragona The Camp de Tarragona high-speed rail region is well-linked by local and express station is located about 7 miles north of the buses and conventional commuter rail city of Tarragona, an industrial center of services. Buses also link the station to the 155,000 people with a university and a port city center, but automobiles are the primary on the Mediterranean. The high-speed rail mode of access to the station and its 648 network branches north to Lleida and south parking spaces. to Castellon de la Plana, but does not go Economic development impacts: into the center of the city. The nearest Since the establishment of the EU in 1992, large city is Barcelona (1.6 million; 60 Tarragona and other mid-sized industrial miles away). centers have benefited from integration with The area between the station and the the rest of Europe, enabling manufacturers city of Tarragona is characterized by his- to achieve new economies of scale, higher toric small towns, several new community production standards, and access to larger developments, and scattered industrial markets (Hamilton and Rodriguez-Pose estates in an otherwise agrarian landscape 2001). It is likely that the high-speed rail that forms an historic territory known as station has reinforced this trend and the
The Camp de Tarragona AVE Station is located 7 miles outside Tarragona, Spain. © ANDREW F. GRIFFITH
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FIGURE 10B Typology of High-Speed Rail Station Locations
Exurban
Urbanizing Landscape
Center City 024 Miles 01 Mile
Tarragona, Spain (Camp de Tarragona Station) Impact Lessons Learned City Population: 155,000 High-speed rail connectiv- The city is already well-connected Metro Population: 676,000 ity with the rest of Europe to metroplitan Barcelona. Given the Year Opened: 2006 has reinforced the role of cost of bringing high-speed rail into Frequency of Service: 46 trains daily (in summer) Tarragona as a industrial the center, the decision to locate Distance to Major Destinations: center. the station in an outlying but 2 hours 40 minutes to Madrid; 30 minutes to Barcelona urbanizing part of the landscape makes sense in this case. Special Use
CDG Airport
Paris Center
0 24Miles 0 1 Mile
Roissy, France (Airport Charles de Gaulle) Impact Lessons Learned City Population: 2,500 Economic development The station successfully serves its Metro Population: 11.8M impacts are difficult to purpose as an intermodal center Year Opened: 1994 determine. and as such helps distribute the Frequency of Service: 79 trains daily (in summer) benefits of international air travel Distance to Major Destinations: 22 miles to center of Paris; to a variety of provincial centers. 2 hours to Lyon; 3 hours to Marseille
Prepared by the authors.
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growing prosperity of the region through and regions throughout the country. Several increased connectivity with other parts of of the TGV rail services that connect to Europe. The rail line also functions as a kind CDG TGV intentionally bypass Paris, which of high-speed commuter connection among is served by separate high-speed rail lines. regional capitals, including Tarragona, Connectivity: The station can be Lleida, Zaragoza, and Catalayud. However, accessed only via the airport, and it was it is difficult to disaggregate the marginal designed specifically to allow for inter- benefits of high-speed rail service in this modal transfers. The four-level structure dynamic area, especially since Tarragona is located within Terminal 2 and includes is already well-connected to Barcelona by a variety of basic retail services. The TGV bus and conventional rail services. trains share this station with the suburban Lessons learned: The Camp de rail lines and buses that connect the airport Tarragona station is a case where high- with Paris. The station is fully integrated speed rail serves a regional center that is into the airport and is linked with the already within the economic sphere of other terminals via a light-rail shuttle. influence of a major metropolitan capital There are about 11,000 parking spaces and well-connected by other means of at Terminal 2, but they are shared with transport. There was not a significant im- other airport users. pact on tourism activity, due to the station’s Economic development impacts: distance from the attractive areas on the Because the station was constructed to con- coast. The cost of bringing the service to nect the airport with cities throughout the the center of the city may not have been country, it is difficult to assess the develop- justified because it would not have changed ment impact of this high-speed rail service the fundamental dynamic between this on the region. There is little development city and other regional capitals. around the airport, and neither the airport nor the high-speed rail station is oriented Special Use: Airport Charles de toward the immediate surroundings. Addi- Gaulle, Roissy, France tionally, it is hard to separate the economic The Charles de Gaulle TGV Station (CDG impact of the TGV station from the airport TGV) is located within Charles de Gaulle itself, since the station supports and serves Airport, about 22 miles from central Paris. only CDG, which is the second busiest The complex is located just beyond the airport in Europe. urban edge of Paris and is surrounded by Lessons learned: High-speed rail farmland, in addition to some airport- is often seen as an alternative to air travel, related commercial, logistic, and hotel but the network of high-speed rail lines that development. The main economic activity connect to the CDG TGV station comple- of the area is generated from the airport ment airport service. The station has been and its associated offices, retail stores, and successful in serving its purpose to provide hotels. However, this activity is isolated, and greater access to France’s busiest airport there are few residents or businesses outside and to international flights for residents the airport site. throughout the country, and it has done so In contrast to the airport itself, CDG without requiring a transfer flight through TGV is more oriented to France’s provincial Paris for domestic passengers. This in turn cities than to Paris. It is a stop along four dif- has freed up air capacity at CDG for long- ferent TGV lines that serve major destinations distance flights.
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TGV Station at Charles de Gaulle Airport in Roissy, France © DANIEL WATANABE/CREATIVE COMMONS
TAKING ADVANTAGE nomic geography (Chen and Hall 2011). OF REDEVELOPMENT Lille, a city in the north of France, is cited OPPORTUNITIES frequently for its significant redevelopment These case studies demonstrate that it is activity after 1994, when a station opened possible for any of the four station location on the new high-speed rail line connecting types to create a redevelopment dynamic Paris to London or Brussels. between the existing center and new acti- The Lille station, on the site of a former vities. But these examples also support a military barracks at the edge of the historic principal finding of the literature: well- town center, was developed into a major connected stations in center-city locations, mixed-use center, including offices, hotels, when coupled with other investments, offer housing, a shopping center, a conference the greatest potential for urban revitaliza- center with exhibition hall, and a public tion (Ribalaygua and Garcia 2010). park. The high-speed rail station at the Our analysis of aerial photos of 52 new rail junction for three major European stations in Spain and France supports the capitals sparked a complete reorganization finding that larger cities are more likely to of land use and development in the city bring high-speed rail service to stations in (Nuworsoo and Deakin 2009). the city center than smaller cities with smaller In declining neighborhoods and post- markets and fewer resources (Facchinetti- industrial areas, high-speed rail service can Mannone 2009). The Tarragona case study offer benefits by reactivating properties that suggests that center-city locations may not previously had not attracted investment for always be justified. redevelopment. New high-speed rail stations High-speed rail can alter the dynamic in these cases can bring economic vitality between a city and its larger neighboring and redevelopment to land and historic economic hubs by shrinking the travel time structures that would otherwise remain between them and creating a shift in eco- idle (Bertolini and Spit 1998).
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However, some new high-speed rail SUMMARY stations have not experienced appreciable Four European rail station case studies point economic effects. For example, TGV stations to a variety of experiences with high-speed were located on the outskirts of the cities of rail and development impacts. It is difficult Le Creusot and Haute Picardie to be more to isolate and quantify the specific impacts accessible by automobile. However, their of high-speed rail service alone because the remoteness and the dearth of existing busi- most successful high-speed rail initiatives are ness activity discouraged investment and part of larger urban redevelopment plans failed to attract development to the area that include collateral investments and poli- (Greengauge 21 2006). cies. However, it is clear that high-speed rail Facchinetti-Mannone (2009) has observed service in itself will not guarantee develop- that peripheral stations usually are not as ment around a station. well-integrated into the surrounding trans- Center-city locations generally are more portation networks or into the urban areas advantageous than peripheral sites, but the they serve. Attempts to mitigate this prob- case studies reveal the degree to which the lem with shuttle services have been only benefits of high-speed rail in any given moderately successful, since they still re- location are moderated by the existing quire an additional intermediary trip. The physical and economic circumstances. These case of Avignon suggests that even when a observations can guide corridor and station peripheral station is close to the city center, location decisions in the United States and the potential benefits of high-speed rail are other countries contemplating the intro- diluted, and the new station instead may duction of high-speed rail systems. have negative impacts on the center-city station area because it creates a different competitive dynamic.
The North Railway Station in Valencia, Spain, is served by high-speed trains. © ISTOCKPHOTO/STEVE GEER
36 POLICY FOCUS REPORT O LINCOLN INSTITUTE OF LAND POLICY ...... CHAPTER 5 The Promise of High-Speed Rail in California and the Northeast Corridor © CALIFORNIA HIGH-SPEED RAIL AUTHORITY
he government’s tiered approach expanded transportation alternatives to A high-speed to passenger rail service reflects the satisfy demand for a growing number of train in the vast diversity of spatial development intercity trips. desert of patterns and markets for rail rider- California, as rendered by Tship across America. While some regions HIGH-SPEED RAIL PLANS designers. may not be positioned for high-speed rail IN CALIFORNIA today, the Northeast and California Mega- In 2008 California voters approved a bond regions have the population density, con- act that will direct $9 billion toward build- gestion, and projected growth that make ing a statewide high-speed rail system. In investing in high-speed Core Express making the case for the project, the California service most feasible. High-Speed Rail Authority (2010) estimated California’s 2009 population of 37 million that to meet the same level of demand for is projected to grow by more than 25 million intercity trips in the future, California would people by 2050 (State of California 2007). need to add roughly 3,000 highway lane The Northeast Megaregion, with approxi- miles and five new airport runways through- mately 52 million people today, will add an out the state, at twice the cost of high-speed additional 18 million by 2050 (Woods and rail investments. Poole Economics 2010). On both coasts, As evidence of the demand for travel major highways and airports are reaching between northern and southern regions of capacity and creating a need for new and the state, California has the largest short-
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haul air market in the nation, with approxi- speeds up to 220 mph, reducing the travel mately 3.14 million annual passengers be- time to 2 hours and 40 minutes for the tween northern and southern California 432-mile trip. In addition to the state bond airports (figure 11). The state also suffers act, the federal government has awarded from some of the worst traffic congestion California approximately $3.6 billion in in the nation, particularly in and around its high-speed rail grants. The state anticipates metropolitan areas. California already hosts closing its funding gap with additional the largest existing intercity rail market in federal grants and financing through the country outside the Northeast Corridor, public- private partnerships. with 2.6 million and 1.6 million annual As the only U.S. example of Core Express passengers on the Pacific Surfliner Cor- high-speed rail, the California project ridor and Capitol Corridor, respectively would, if fully realized, inspire confidence (Amtrak 2011d). in America’s high-speed rail program, while Construction of the first phase of an its failure would confirm skeptics’ doubts. 800-mile high-speed rail system connecting The project faces several challenges, the San Francisco to Anaheim/Los Angeles is greatest obstacle being the state’s significant expected to start in fall 2012, at an estimated budget deficit, estimated at approximately cost of $43 billion. Upon completion, the $20 billion annually through 2016 (Califor- California system will operate trains at nia Legislative Analyst’s Office 2010). This
Figure 11 Air Passengers on Short-Haul Flights in California and the Southwest
250K Sacramento 500K 1m
San Francisco 2m Passengers Per Year San Jose
Las Vegas
Riverside
Los Angeles
San Diego Phoenix
Tuscon
Source: America 2050 (2011)
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California’s high-speed trains will serve Los Angeles’s historic Union Station. Public authorities are purchasing the station along with 38 acres surrounding it in order to capture the value created by high-speed rail access.
situation could create competition between until a stronger, multiyear federal commit- long-term high-speed rail investment and ment can be made. annual budget priorities, such as education, healthcare, and public employee pensions. CURRENT CONDITIONS IN California is also facing resistance to build- THE NORTHEAST CORRIDOR ing rail infrastructure from local communi- The 455-mile Northeast Corridor (NEC) ties in densely populated areas, where new between Boston and Washington, DC, is high-speed rail tracks may require elevated America’s most intensively used rail line, structures and increase visual or noise and one of the most heavily traveled corri- impacts. dors in the world, carrying an estimated 260 Despite federal commitments of $3.6 million rail passengers per year. Eight differ- billion to date, the uncertainty of future ent commuter railroads and Amtrak’s inter- federal funding for the project is a variable city services share the corridor. Intercity rail over which the state has little control. The passengers on Amtrak’s Acela Express and California rail authority’s 2009 business Northeast Regional services account for plan estimates that approximately $17 to approximately 13 million annual passengers, $19 billion of total project costs will be which is 45 percent of Amtrak’s total U.S. needed from the federal government. How- intercity ridership (Amtrak 2010a; 2011a). ever, recent federal actions to defund the Demand for both commuter and inter- HSIPR Program, including the $400 million city rail services on the corridor is expected rescission in the FY 2011 budget, have to grow as gas prices rise and travelers seek raised doubts about whether the federal transport alternatives to the automobile. program will be able to meet California’s Since November 2009, Amtrak has seen 20 future high-speed rail funding needs. Cali- consecutive months of ridership growth and fornia will have a difficult time convincing is on pace to set an annual ridership record its own voters and state legislators to sup- in 2011 (Amtrak 2011c). Amtrak anticipates port continued state funding for the project that by 2030 ridership will grow 59 percent
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and train movements 38 percent on the repair, and an additional $43.5 billion Northeast Corridor (Amtrak 2010b). is needed to maintain facilities, replace Despite the Northeast Corridor’s vital aging assets, and expand the corridor’s role in sustaining mobility in the Northeast capacity and reliability through 2030 Megaregion and supporting a robust inter- (Amtrak 2011b). modal transportation network, several · Congestion: Several key segments of issues undercut its potential for expansion the corridor operate at 100 percent capa- (Amtrak 2010b). city. Minor operating problems often The Baltimore and · Condition: Although billions of dollars cause severe congestion and delays, and Potomac Tunnel in have been spent in recent years to im- repairs on other segments of the corridor Baltimore, Maryland, prove the rail corridor, many long stretches also cause backups throughout the system. built in 1873, limits have deficient or outmoded tracks, bridges, · Divided ownership and dispatching: train speeds on this stretch of the Northeast power, communications, and other sys- While most of the corridor is owned Corridor to 30 mph, tems that need to be upgraded. The by Amtrak, segments in Massachusetts, due to a sharp turn whole corridor has an estimated backlog Connecticut, and New York are owned and steep grade. of $8.8 billion to achieve a state of good by those states’ transportation departments. Trains dispatched from New Rochelle, New York, to New Haven, Connecticut, for example, are controlled by Metro- North Railroad, which prioritizes its commuter trains in this territory. As a result, Amtrak trains must operate at slower speeds in this segment of the cor- ridor. In addition, agreements with the maritime community limit the number of Amtrak trains that can cross coastal bridges in Connecticut to 17 per day in each direction, or just over one train per hour (de Cerreño and Mathur 2006).
The Northeast Corridor rail network has evolved over 180 years, beginning in the 1830s, and much of the existing infrastruc- ture was constructed by the Pennsylvania Railroad in the late nineteenth and early twentieth centuries. Key components of the early system included the Baltimore and Potomac Tunnel, the Hudson River tunnels, and Manhattan’s Pennsylvania Station, com- pleted in 1873, 1909, and 1910, respective- ly. The final section, including the Hell Gate Bridge and New York Connecting Railroad, was completed in 1917. Most of the rail corridor is owned by Amtrak, a private corporation controlled by © YOAV HAGLER
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the federal government. Amtrak was estab- lished in 1971 after Penn Central, the last remaining passenger railroad company on the Northeast Corridor, went bankrupt and was forced to sell its assets. Amtrak acquired all of Penn Central’s segments of the corri- dor that were not sold to public commuter transportation authorities, and it was also charged with providing intercity passenger service throughout the country. In 1976 and again in 1992, Congress passed laws, including the Northeast Cor- ridor Improvement Project (NECIP) and the Northeast High Speed Rail Improve- ment Program (NHRIP), which mandated Amtrak to reduce trip times on the corridor. Inspired by the success of high-speed rail services in Japan, France, and Spain, Con- gress appropriated billions of dollars to the Northeast Corridor for improvements that would set the stage for future high-speed rail service. Amtrak introduced Acela
Express as a higher speed rail service in © JEFF FERZOCO December 2000, but it has struggled to obtain enough funding for basic mainte- nance or capital investments to continue to improve trip times and reliability. The Acela Express service reduced travel most high-speed rail systems around the An Acela train stops times between Boston and New York to world. For instance, Japan’s Tokaido Shinkansen at the Newark Airport Station on the about 3 hours and 30 minutes, and between trains can carry more than 1,300 passengers Northeast Corridor. New York and Washington to about 2 hours while traveling at over 160 mph, operating and 45 minutes. In 2010, Acela trains car- on 5–10 minute headways, and keeping the ried more than 3.2 million passengers and average delay below 30 seconds (JR Central earned $450 million in ticket revenue, which 2011b). By comparison, Acela trains can more than covered its operating expenses carry only 300 passengers while operating (Amtrak 2011d, 96). Since 2001, Acela has on 60 minute headways at average speeds provided more than 25 million passenger of less than 80 mph with a 84.3 percent trips on the Northeast Corridor (Amtrak on-time performance (Railway Technology 2011a). 2011; Amtrak 2011b). Lacking a dedicated track network, Acela Acela trains are capable of reaching top trains must operate on congested tracks that speeds of 150 mph, but they can reach this also carry Northeast Regional service and speed only on short segments of the corridor eight different commuter rail lines. Accord- due to congestion and tight curves in the ingly, they have much lower rates of on-time track alignment. The average speed of the performance and frequency compared with Acela trains is 62 mph between New York
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and Boston, and 86 mph between New speed commuter rail services in the corri- York and Washington, DC. dor, modeled after the successful Javelin ser- vice that utilizes capacity in the HS1 corri- New Visions for the Corridor dor in Southeast England. The combination In the spring of 2010, a team of planners of high-speed intercity and commuter ser- at the University of Pennsylvania (UPenn) vices could expand and integrate commuter developed a proposal for a dedicated, two- sheds and housing markets across the North- track high-speed rail right-of-way running east, increasing the economic productivity the length of the Northeast Corridor from of the megaregion as a whole. Boston to Washington. The proposal called for frequent, 90-minute service from New Governance and Operational York to Washington, DC, and 100-minute Challenges service from New York to Boston (figure 12). Two of the challenges facing the Northeast In a follow-up study in 2011, the UPenn Corridor are its pattern of fragmented gov- team estimated that the proposal would ernance among eight states and the District cost $103 billion, including $14 billion of Columbia and the competing intercity in upgrades to the existing rail corridor, and commuter rail services that share infra- and found that the project had a strong structure and create congestion. The corridor benefit-cost ratio of 1.38 (University of has neither the capacity nor the alignment Pennsylvania 2010; 2011). that would permit it to be used for Core Inspired by the original UPenn proposal, Express high-speed rail service. At the same Amtrak developed its own “next-gen high- time, the existing infrastructure requires speed rail” plan that was made public in the several billion dollars annually for necessary fall of 2010. Amtrak also concluded that repairs and enhancements to increase capa- it would be feasible and beneficial to build city to meet projected demand for rail travel a dedicated, two-track high-speed rail right- by 2030. Achieving both goals—to provide of-way along the length of the corridor, but true high-speed rail service and meet the choose a different alignment between New growing demand for commuter rail service York and Boston. The estimated cost of —will require major new management the Amtrak proposal is $117 billion structures and new investment. (Amtrak 2010a). To respond to these needs, PRIIA autho- Both the UPenn and Amtrak proposals rized the creation of the Northeast Corri- found that high-speed rail would generate dor Infrastructure and Operations Advisory a range of economic and mobility benefits Commission, which is composed of repre- for the Northeast Megaregion. The UPenn sentatives of the nine jurisdictions served study also dealt with revitalizing the econo- by the corridor, U.S. DOT, FRA, and mies of the Northeast’s weaker market cities. Amtrak, to collaborate on infrastructure Both studies called for new stations to be and operational decisions on the corridor. developed in Center City Philadelphia and While the new commission provides a ven- downtown Baltimore, which would create ue for collaborative decision making, it does significant economic development potential not restructure or consolidate ownership in those cities. of the corridor or appear to fundamentally The UPenn study also proposed that change the way the corridor is operated. some of the capacity created by the new Reforms in the administration and oper- high-speed rail line be used to provide high- ation of European high-speed and intercity
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FIGURE 12 Proposed Northeast Corridor High-Speed Rail Service Plan
Riverside Express Worcester Springfield BDL Airport Boston South Station Limited Regional Boston Back Bay Hartford Route 128 Airport Providence Westerly Shore Line Mystic New London Bridgeport Old Saybrook Commuter Service Stamford New Rochelle New Haven All Trains Stop ISP Airport Suffolk Some Trains Stop Newark, NJ Nassau JFK Airport Metropark New York Moynihan Station EWR Airport Cornwells Heights
Trenton
Philadelphia Market East Station PHL Airport Wilmington Newark, DE Baltimore BWI Airport New Carrollton Washington Union Station
Source: University of Pennsylvania (2011, 57). rail services suggest an alternative approach and Adif, a company that has successfully for the Northeast Corridor. The EU requires developed over 2,000 miles of high-speed that national railroads unbundle their oper- tracks and facilities. The United Kingdom’s ating and infrastructure functions and pro- HS1 also provides an example of splitting vide open access to their rail lines, making operations from infrastructure manage- it possible for public and private operators ment. In the Northeast Corridor it may to offer competing services on the same be advantageous to take a similar approach lines. In most European examples, each of separating operations and infrastructure, country’s national railroad has benefitted particularly if the region chooses to embark from its established position in the market- on an ambitious plan of building two place, although budding competition from dedicated tracks for high-speed trains, as new operators has encouraged entrepre- proposed by Amtrak and UPenn. Creating neurial innovations. In practice, however, a publicly chartered infrastructure corpora- many routes continue to function as state- tion for the Northeast Corridor to carry out operated monopolies due to the challenges this mission would relieve the dual burden of providing multiple maintenance facilities currently borne by Amtrak to develop high- on each route. speed rail infrastructure and operate a Spain’s high-speed rail network separates sprawling national train network. operations and infrastructure responsibilities A megaproject of this magnitude is also between RENFE, the national rail operator, likely to require a single-purpose entity
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with the appropriate staff expertise, financial rail, but there is no similar single mechanism transparency, and ability to attract private for achieving a corridor-wide vote of confi- capital to carry out its mission. This entity dence across the eight states and the District would charge neutral and fair access fees to of Columbia in the Northeast Corridor. all train operators on the corridor, which Building consensus among these jurisdictions would also provide a steady revenue stream and the federal government will require that could be used to pay back infrastructure substantial research and public outreach, bonds and loans and to reinvest in the corridor. starting with studies that estimate the econo- mic benefits of this project. Options for dif- Next Steps ferent alignments of the railroad also need Implementation of high-speed rail in the to be evaluated for their relative ability to Northeast Corridor will be at least a decade leverage rail investment for economic growth behind the effort in California, where con- and minimize environmental impacts. struction is scheduled to begin as early as The National Environmental Protection fall 2012. Infrastructure costs in the North- Act (NEPA) requires an Environmental Im- east Corridor are also considerably higher, pact Statement (EIS) for major transportation with estimates ranging from $89 to $117 and infrastructure projects, but the review billion for a new, dedicated system, and process often results in years of delay, add- between $14 and $52 billion for upgrades ing to already high project costs. A program- to the existing corridor (University of matic EIS for improvements to the North- Pennsylvania 2011; Amtrak 2010a; 2010b). east Corridor has been scheduled for 2011, Nevertheless, the $2.7 trillion economy to be led by the FRA in cooperation with in the Northeast (Bureau of Economic Amtrak and the northeastern states. Analysis 2009), its high population density, The federal and state agencies should and the growing congestion of its existing examine best practices for expediting the rails, roads, and runways all make a strong EIS process, such as those used for the rede- case for these investments. These dynamics velopment of the World Trade Center site. also make dedicated high-speed rail in the In that case, innovative project management Northeast financially viable. The UPenn techniques, memoranda of understanding, study found that such a system could environmental performance commitments, completely cover its operating costs and a and interagency partnerships significantly portion of its capital costs through farebox compressed the timeline for environmental and supplementary revenues (University regulatory review without sacrificing dis- of Pennsylvania 2011). closure or environmental performance. As in California, the path to high-speed Based on the Spanish and English exam- rail in the Northeast Corridor will not be ples, separating operations from infrastructure easy, but the federal government commit- management in the Northeast Corridor may ment to high-speed rail in 2009 and 2010 be desirable, primarily because the cost and has inspired planners and policy makers to complexity of building a high-speed rail in- consider some of the steps that could lead frastructure project of this magnitude requires to realizing a dedicated high-speed rail cor- a financially viable single-purpose entity that ridor with dramatically enhanced mobility could attract additional private capital. A for decades to come. publicly chartered infrastructure corporation California’s 2008 bond measure acted would design, build, and maintain tracks, as a statewide referendum on high-speed stations, dispatching, and other systems in
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High-speed rail plans for the Northeast Corridor would locate a station in Center City Philadelphia. the corridor, while one or more train opera- would have the effect of reimbursing the tors would pay track access fees to operate government for its initial investment in intercity high-speed trains on both the exist- the project. Finally, Amtrak, the commu- ing corridor and the new dedicated tracks, ter railroads, and potentially other private once they are built. rail operators would pay track access fees The new Northeast Corridor infrastruc- to provide high-speed intercity and com- ture corporation could also enter into con- muter services with a range of price- tracts with private concessionaires to design, points and services. build, and maintain portions of the project, such as segments of track infrastructure, SUMMARY tunnels, and bridges. A number of public- Both California and the Northeast Corri- private partnership projects in Europe have dor present strong cases for investment in been able to provide one-third or more of high-speed rail in their large and growing the total budget of high-speed rail projects economies. However, the path to realizing from private sources, stretching public that vision is not yet clear. It will require budgets in a time of fiscal austerity. securing reliable funding commitments After the track infrastructure is built, based on credible evidence that benefits the Northeast Corridor infrastructure cor- exceed costs. Without federal support, these poration could also offer long-term lease and other regional high-speed rail projects arrangements for portions of the corridor’s are unlikely to secure the necessary state right-of-way, similar to HS1 Limited’s lease and private funding commitments needed to its investors, Borealis Infrastructure and to proceed. the Ontario Teachers Pension Fund. This
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U.S. Capitol, Washington, DC © HEMERA © HEMERA
ike other modes of transportation Moreover, as long as the HSIPR Program and public goods, high-speed rail combines funding for both high-speed and generally does not pay for itself conventional rail, federal grants, not loans, through ticket fares and other will be required to support its initiatives. Loperating revenues. Reliable federal funding Since conventional rail services are likely is needed for some portion of the upfront to need continued operating subsidies, it capital costs of constructing rail infrastruc- is even more important to secure a federal ture, but operating revenues frequently cover funding source for capital infrastructure operating and maintenance costs. costs. A small but reliable transportation tax Two well-known examples of highly for high-speed and conventional passenger successful high-speed rail lines—the Tokyo– rail would demonstrate the federal govern- Osaka Shinkansen and Paris–Lyon TGV—gen- ment’s commitment to a comprehensive erate an operating profit (JR Central 2010; rail program, giving states the assurance they Gow 2008). German high-speed trains also need to plan high-speed rail projects and have been profitable on an operating basis, equipment manufacturers the confidence with revenues covering 100 percent of main- they require to invest in the industry. tenance costs and 30 percent of new track The challenge of securing revenue for construction (University of Pennsylvania 2011). rail investments is closely linked to the chal-
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lenge of funding the nation’s entire surface taining the system as passenger rail transportation program. While in the past ridership grows. revenues from the federal motor fuel taxes • Or, shift from a national gas tax to a per- were sufficient to cover the nation’s highway centage tax on crude oil and imported and transit priorities, the 18.4 cents per gal- refined petroleum products consumed in lon gasoline tax has been fixed since 1993, the United States to fund all the nation’s while the dollar has lost one-third of its pur- transportation needs (RAND Corpora- chasing power in that time (RAND Corpo- tion 2011). RAND estimated that an ration 2011). New sources of sustainable oil tax of 17 percent would generate revenue are needed to support not only approximately $83 billion a year (at mid- high-speed and conventional passenger rail summer 2010 prices of $72 per barrel). but also all of the nation’s surface transpor- Five billion dollars of this amount could tation obligations, including highways and be dedicated to passenger rail. transit. In recent years, Congress has addressed Alternatively, if the federal government the funding shortfall with short-term fixes switched from the current gas tax to a tax by transferring general fund revenues to the based on vehicle miles traveled (VMT) and highway trust fund. However, the need to two-tenths of a penny per mile were dedi- find a long-term solution presents the op- cated to passenger rail, $5.4 billion could be portunity to address existing surface trans- generated every year (U.S. DOT 2011d). portation needs and high-speed and passen- The VMT tax as a source of transportation ger rail all at once. At some point in the funding is supported by many transporta- near future, Congress must address the tion policy leaders, but has been disavowed shortfall in national transportation funding. by the Obama administration (Laing 2011b). At that time legislators could also dedicate Former Interior secretary and Arizona revenues for high-speed and passenger rail governor Bruce Babbitt has proposed that as part of the surface transportation pro- a gasoline tax surcharge in the Northeast gram, generated by a variety of small in- Corridor states could pay for high-speed rail creases or reallocations of current trans- in that region (Langdon 2011). This alterna- portation-related fees to provide at least $5 tive has the advantage of explicitly linking billion in annual funds. Several proposals the revenue sources to beneficiaries of the are currently being considered. system. Other regional taxes, such as a pay- • Raise the gas tax by 15 cents a gallon roll tax on businesses along the corridor, (The National Commission on Fiscal Re- could also be considered. Such a tax is now sponsibility and Reform, 2010) or more. used in downstate New York to help fund Each additional cent of gas tax generates New York City Transit. approximately $1.4 billion annually Any of these options will face the difficult (AASHTO 2011). Several cents could reality of the current political climate cen- be devoted to passenger rail. tered on austerity, in which large new infra- • Add a $1 surcharge on current passenger structure investments are easy targets for rail tickets to produce approximately $29 trimming government budgets. Under these million annually (Amtrak 2011d). Though conditions, direct government funding alone this is a relatively small amount of will not be sufficient to develop high-speed revenue, it could become an important rail. Innovative financing solutions will source of funds for expanding and main- require both the expansion of government
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subsidized financing options and private tation 2011). A national infrastructure financing initiatives. bank, and to a lesser degree the state banks, could provide crucial funding and financing GOVERNMENT assistance for the large upfront costs, while FINANCING TOOLS encouraging collaboration among the state, High-speed rail in Europe has been funded local, and private investors involved in the and financed by a variety of sources, includ- construction of high-speed rail lines. ing national governments and EU structural Two existing federal loan programs for funds. The European Investment Bank (EIB) transportation also could be expanded for provides subsidized loans with favorable high-speed rail financing. The Transporta- interest rates and long repayment periods, tion Infrastructure Finance and Innovation as well as loan guarantees and direct recruit- Act (TIFIA) provides long-term loans and ment of private lenders. While the United credit assistance through the U.S. Depart- States currently does not have an equivalent ment of Transportation to finance large in- to the EIB, President Obama has proposed frastructure projects with dedicated revenue a national infrastructure bank that could sources that allow repayment. The program play a similar role in providing loans, grants, is designed to leverage private co-investment, and credit assistance for transportation and can cover up to 33 percent of the proj- projects at a regional or national scale. The ect costs (U.S. DOT 2011b). president also proposed capitalizing the bank TIFIA could encourage even greater with $30 billion in the FY 2012 federal private investment if the program were en- budget (White House 2011). hanced to increase the maximum funding Some states already have their own state allowed to reflect current demand; permit infrastructure banks, which operate on a more flexibility in the project costs that system of revolving direct loans to increase can receive funding; and offer a simplified the overall number of projects that can be application and review process (Yarema built with limited federal transportation 2011). These enhancements would be funds (Ohio Department of Transportation beneficial for funding high-speed rail since 2011; Wisconsin Department of Transpor- the costs are large and lead times are already long, even before the time for required review processes is added. The Railroad Rehabilitation and Im- provement Financing (RRIF) Program pro- vides direct federal loans and loan guaran- tees to finance the development of railroad infrastructure. It is beneficial for high-speed rail because it can supply direct loans for up to 100 percent of project costs, with repay- ment periods up to 35 years and low interest rates locked in for the life of the loan term. To date, the program has been utilized pri- marily by small and medium-sized private railroads (U.S. DOT 2011c). Rail advocates have suggested modifying the stringent col- lateral requirement and credit risk premiums ©ISTOCKPHOTO/BENOIST SÉBIRE
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to make RRIF work for high-speed rail, parties, with the opportunity for both to as well as making high-speed rail’s eligibility benefit when ridership exceeds expectations. explicit in the criteria (AHSRA 2011b). Attention to the private entity’s susceptibil- ity to market downturns is also important. PUBLIC-PRIVATE The private entity should not shoulder so PARTNERSHIPS much risk that it could endanger its ability Public-private partnerships (sometimes to live up to the terms of the contract. referred to as P3s) generally constitute any Leveraging public investment: arrangement between a government spon- Leveraging public investment with private sor and a private sector entity in which the capital, either through the use of federal private entity provides one or more stages financing tools or availability payments, can of the project delivery process—designing, help pay for high-speed rail’s large upfront building, operating, owning or leasing, costs. These mechanisms make large projects maintaining, and financing parts of the feasible without the need for the govern- infrastructure. These partnerships offer ment to provide 100 percent public funding the benefit of flexibility to suit the specific in advance. needs of the public sector while encourag- Federal financing tools include quali- ing different models of private involvement fied tax credit bonds such as Build America and investment (Geddes 2011). Bonds, which can draw a wide variety of Public-private partnerships are consid- investors to contribute to transportation ered an especially attractive solution for projects. Availability payments allow teams financing infrastructure projects. For exam- of construction and finance firms to begin ple, the Florida Department of Transpor- construction of infrastructure projects tation was already in the process of finding through their own debt and equity. They a private partner to design, build, operate, later receive reimbursements from the maintain, and finance the state’s high-speed government as particular milestones are rail line before the project was cancelled reached. in February 2011 (Haddad 2010). Faster project delivery: Private While public-private partnerships are entities can draw on experience to deliver likely to increase in popularity as an option projects on time and on budget. They are for cash-strapped governments, applying also motivated by financial incentives for this approach to high-speed rail must be performance (including availability pay- done carefully, with a realistic understand- ments), which can be written into the ing of the benefits and challenges. structure of the deal. Sharing risk: Partnerships allow the Two ends of the spectrum of private public sector to share project risks related to sector involvement in public-private part- construction, environmental review, system nerships are design-bid-build agreements performance, and ridership with their pri- (DBBs) and design-build-finance-operate- vate partner. Properly assigning risk to the maintain agreements (DBFOM). DBB is party best able to manage it is critical to a considered the traditional method for successful project. In general, private part- construction project delivery. The public ners are better able to control construction entity chooses a design proposal from pri- and financing risk, and public partners are vate architects and engineers in the design better able to manage political and entitle- phase, and then accepts a bid from a private ment risk. Ridership risk is shared by both construction firm to build the project. The
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design and build processes occur indepen- ticket fares and track access charges. This dently with different private partners, and approach could be used for high-speed rail the public sector handles all financing, because it is the model that shares the most operations, and maintenance. risk with the private entity and also incen- DBFOM takes the DBB approach sever- tivizes a project of continuing quality. al steps further by having a single private Many other public-private partnership partner design and build the infrastructure models exist, including those with little project, and also assume additional respon- risk assumed by the private sector, such as sibility for its operations and maintenance, design-build (DB), and those with substan- as well as some of the responsibility and tial post-construction commitments from risks of financing it. The government awards the private sector, including build-operate- a concession to the private entity, or conces- transfer (BOT), long-term lease (LTL), and sionaire, usually a consortium of private build-own-operate (BOO), all of which give companies, for a determined length of time the private sector a degree of ownership and often over decades. The concessionaires over the infrastructure project for a provide funding, often through their own specified period of time. investors, although substantial government The following case studies illustrate funding is also required. different variations of public-private part- Concessionaires are eventually compen- nerships in four countries. sated through payments from the government, either on a yearly basis or as availability High Speed 1 (HS1), England payments, based on performance standards The HS1 line connects the Channel Tunnel and milestones. Concessionaires can also with St. Pancras International, the London receive payments from user fees, such as terminus of the high-speed Eurostar trains
The St. Pancras International Station in London.
© PRZEMYSŁAW SAKRAJDA
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that link the United Kingdom with Paris, Lille, and Brussels. HS1 was developed initially as a public-private partnership in which a private consortium began building the rail line. However, midway through con- struction, the partnership collapsed and was taken over by the British Department for Transport, which created a shell corporation, HS1 Limited, to complete construction and © DAO-HUI CHEN/CREATIVE COMMONS begin operating the rail line. HS1 Limited opened the unused capacity of the route to the Javelin high-speed commuter rail service from a number of cities in Kent, providing London’s southeastern suburbs with im- proved access to the city. HS1 is also nego- tiating with Deutsche Bahn to provide high- speed trains from Germany with direct access into St. Pancras. Following the completion of HS1 and allocating risk, and accurately projecting Taiwan’s high-speed the successful initiation of Eurostar and construction costs and ridership. trains deliver passengers Javelin services, HS1 Limited conducted In 1997, the government of Taiwan to its major cities. a tender offer for a private consortium to entered into a 35-year DBFOM concession enter into a 30-year lease to operate and for the high-speed rail line and a 50-year maintain the rail corridor. In 2010 Borealis concession to development the land around Infrastructure and the Ontario Teachers its stations with the Taiwan High-Speed Pension Fund signed a $3.8 billion contract Rail Corporation (Shima 2007). Several to operate and maintain the HS1 corridor, years after it was originally scheduled to returning approximately one-third of the open, the corporation finally completed total construction cost to the British Trea- construction of the line in 2007, with a sury (HS1 Limited 2011). Those funds are north-south track running along the west now being used for other transportation coast of the island to connect the country’s needs in Britain (Railway Technology 2011). two largest cities, Taipei and Kaohsiung. Profits to the concessionaire are derived Plagued by lengthy delays and cost from farebox revenues from Eurostar, other overruns, the corporation amassed enor- passenger services, and track access charges mous amounts of debt (Ho 2004). Once in to other rail lines, including high-speed operation, the service failed to meet overly freight. These revenues cover the operations optimistic ridership projections and accu- and maintenance costs. mulated operating losses. Eventually, the corporation was unable to repay the loans it Taiwan High-Speed Rail had encumbered to build the line. In 2009, The case of Taiwan High-Speed Rail the Taiwanese government intervened, re- exemplifies certain risks of using public- financed the corporation’s debt, restructured private partnerships to build high-speed rail the board of directors, and effectively took and demonstrates the importance of choos- over the corporation’s franchise (Huang ing an appropriate private partner, properly 2009; Railway Gazette International 2009).
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DTP projected a total capital cost of $2.1 billion, which was $300 million less than the RTD’s capital budget estimate. This low cost estimate was one factor in DTP’s selec- tion as the concessionaire. While a significant amount of risk is shifted to DTP, strong funding support is still required from multi- ple government entities. The project will depend on a contribution of about $777 million from RTD, funded in part by a voter-approved 0.4 percent sales tax in the multiple municipalities served by the tran- sit system. RTD is also anticipating a $1 billion grant award from the Federal Transit
© ISTOCKPHOTO/FRANK ROMEO Administration (Regional Transportation District 2010). Denver is financing its Eagle P3 Project, Denver, Colorado FasTracks regional trans- This current U.S. example of a public- Vancouver’s Canada Line portation plan with a private partnership for funding rail transit This case exemplifies a rail transit project mix of federal, local, and private funding sources. includes the creation of three commuter rail that has completed construction and success- lines to be added to Denver’s FasTrack sys- fully entered the operations phase. It is a tem—a regional network of light rail and partnership between the federal, provincial, bus rapid transit lines. The Eagle P3 Project and city governments, the Vancouver Air- operates under an agreement between the port Authority, and the private partner, government authority, the Regional Trans- InTransitBC, which is a joint venture com- portation District (RTD), and a private con- pany owned by three Canadian corporations. cessionaire, Denver Transit Partners (DTP). Built in anticipation of the 2010 Winter DTP is a consortium of investment, con- Olympics, the line connects downtown struction, and engineering firms created Vancouver to the Vancouver Airport and especially for this partnership. The conces- the nearby city of Richmond. The 16 sion agreement requires DTP to design, build, stations and 12 miles of track are part of finance, operate, and maintain the three TransLink, the regional transportation new commuter lines, which will have 36 authority and public transportation system. miles of track and 15 stations. Canada Line Rapid Transit Inc. (CLCO) DTP completed the contract with RTD was established as a wholly owned subsidiary in 2010 for a six-year design-build phase of TransLink to serve as the government to be followed by a 30-year concession of entity of this partnership under a 35-year operations and maintenance. It requires ap- concession agreement. InTransitBC was proximately $450 million in private financing paid by CLCO based on milestones in the from DTP, which will be paid back by RTD construction process, and continues to through construction and service milestone receive performance-based operating pay- payments. Construction is scheduled be- ments. The agreement involved a detailed tween 2012 and 2015, and the three new risk allocation: CLCO assumed responsibil- rail lines should be operational by 2016 ity for right-of-way acquisition and utilities (Podkul 2010). relocation; InTransitBC assumed the risk
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of construction costs and systems perfor- InTransitBC raised the equity from its three mance; and both partners shared risks such shareholder companies and arranged debt as ridership and revenue, environmental financing secured over a 28-year term from and regulatory approvals, and inflation its lenders (Cummings 2010). during operational periods (Cummings 2010). The project was completed in August SUMMARY 2009, three months ahead of schedule, and A sustainable funding strategy, including has exceeded its original target ridership reliable federal commitments, is needed to projections (Luba 2010). put the HSIPR Program on a firm footing Like Denver’s Eagle P3 Project, the and inspire confidence among states and Canada Line received both private financ- the private sector. This strategy can make ing and dedicated government funding. use of a variety of public and private InTransitBC raised a total of $720 million financing tools that leverage net revenue for its capital contribution, compared to $450 streams generated by high-speed rail million raised by the Canadian government, operations. When approaching public- The Canada Line light rail in Vancouver, British $435 million by the British Columbia pro- private partnerships, a proper allocation Columbia, was built vincial government, $300 million by the Air- of risk among the parties is critical to a and financed through a port Authority, $334 million by TransLink, successful project. successful public-private and $29 million by the City of Vancouver. partnership. © ISTOCKPHOTO/KATHRYN HATASHITA-LEE
TODOROVICH, SCHNED & LANE O HIGH-SPEED RAIL 53 ...... CHAPTER 7 Recommendations for High-Speed Rail in the United States © YOAV HAGLER
Curving tracks he United States is in a position framework to achieve the potential benefits on the Northeast to learn from many countries that of Core Express high-speed rail. Building Corridor’s have planned, built, and operated on that act, an expanded federal role is approach to Philadelphia, high-speed rail systems over the needed to plan, prioritize, and commit to Tpast four decades. Their experiences, investments in high-speed rail and overcome Pennsylvania, require trains coupled with an analysis of the potential the challenges of managing multistate capi- to slow down. benefits of high-speed rail for U.S. travel tal programs and operations. Rather than behaviors, land use patterns, and urban wait for states to submit applications for fed- and regional economies, contribute to the eral funding for high-speed rail, the federal following policy recommendations. government should identify corridors with the greatest chance of meeting its goals and STRENGTHEN THE FEDERAL work with the states to secure rights-of-way POLICY AND MANAGEMENT for implementation. FRAMEWORK The Passenger Rail Investment Improve- PRIORITIZE CORRIDORS THAT ment Act (PRIIA) is well-suited to support MEET INVESTMENT CRITERIA incremental investments in conventional Federal decision makers should prioritize passenger rail corridors, but it does not high-speed rail investments in corridors that provide a sufficient policy or management exhibit regional characteristics that contribute
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to ridership demand, including population will not necessarily induce development, density, employment concentrations, transit it can contribute to the success of a larger connections, existing airline markets, and urban redevelopment plan that includes congestion on parallel road corridors. collateral investments and policies. Federal planners should analyze both the benefits expected to be generated in specific FOCUS ON THE NORTHEAST corridors and the cost estimates for construc- CORRIDOR AND CALIFORNIA tion and ongoing operations. The respective The Northeast Corridor and California roles of high-speed Core Express corridors offer the best opportunities for initial high- and conventional Regional and Emerging/ speed rail service, but management and Feeder routes need to be clarified, with financing challenges remain. well-defined objectives for each type of In the Northeast, it may be desirable rail service. to separate the corridor’s operations and infrastructure functions in order to attract ESTABLISH NEW MECHANISMS private capital and create a single-purpose FOR CORRIDOR MANAGEMENT entity capable of carrying out an ambitious A successful national high-speed rail pro- high-speed rail plan. A Northeast Corridor gram requires the involvement of entities infrastructure corporation would design, capable of planning, financing, building, build, and maintain tracks, stations, dis- and operating multistate corridors. Federal patching, and other systems, while one legislation should be developed to enable or more train operators would pay track the creation of publicly chartered infra- access fees to operate intercity high-speed structure corporations capable of entering trains once the new line is built. into public-private partnerships for corri- The infrastructure corporation could dors that span multiple states and even enter into long-term lease arrangements binational territories. for portions of the right-of-way, and public- private partnership agreements could be PLAN FOR MAXIMUM LAND developed for major pieces of infrastruc- DEVELOPMENT BENEFITS ture, such as tunnels and bridges. Finally, To reap the greatest benefits, high-speed rail the infrastructure corporation could con- investments should be coupled with policies tract with Amtrak and private operators that encourage land development around to provide competing high-speed intercity rail stations. Careful planning must be un- and high-speed commuter services in the dertaken for track alignment, station location, corridor, offering travelers a range of and connections with other transportation price-points and services. modes. In general, well-connected stations in center-city locations, when coupled with SECURE ADEQUATE AND other investments, offer the greatest potential RELIABLE FUNDING for urban revitalization. While passage of the American Recovery Peripheral station locations should be and Reinvestment Act in 2009 marked a avoided, as they are rarely successful in new period of federal funding for high- maximizing transportation and other land speed and passenger rail, the elimination development benefits and may have nega- of funds for the HSIPR Program in the tive impacts on center-city station areas. FY 2011 budget underscores the need for Although high-speed rail service by itself a sustainable revenue source to ensure
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long-term success. Such a commitment entirely—such as an upstream oil tax or will not be possible with unpredictable VMT fee. appropriations, which have ranged widely A national infrastructure bank could from $8 billion in 2009 to negative $400 provide loans, grants, and credit assistance million in 2011. for transportation projects at a regional or The need to find a long-term solution for national scale, covering large upfront costs the nation’s transportation funding presents while encouraging collaboration among the opportunity to address existing surface state, local, and private investors. Two exist- transportation needs and high-speed and ing federal loan programs for transporta- passenger rail at the same time. When Con- tion, TIFIA and RRIF, could be expanded gress addresses the current shortfall in trans- for financing high-speed rail, and new pro- portation funding, it should also dedicate grams such as Build America Bonds and funding for passenger rail, such as by raising other qualified tax credit bonds could the gas tax by 15 cents and directing several attract a wide range of private investors. cents to rail, or considering new approaches
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ABOUT THE AUTHORS ACKNOWLEDGMENTS Petra Todorovich is director of America 2050, a national The authors wish to acknowledge a number of urban planning initiative to develop an infrastructure and growth individuals who contributed research, writing, and strategy for the United States. Since 2001 she has worked analysis to the report, and others who provided at Regional Plan Association in New York City, where America invaluable input and editing for earlier drafts. 2050 is based. She regularly convenes and facilitates America Robert D. Yaro, president of Regional Plan Asso- 2050 workshops and seminars with its joint venture partner, ciation (RPA), has inspired his staff and countless the Lincoln Institute of Land Policy. She has written articles others with a vision of high-speed rail’s transfor- on transportation and infrastructure policy and is a frequent mative impact on the American economy and speaker on transportation, megaregions, and national planning landscape. We thank Bob for drafting sections topics. Todorovich is also assistant visiting professor at the of chapter 5 about the Northeast Corridor and Pratt Institute Graduate Center for Planning and the Environ- providing valuable input on the entire report. ment and a member of the Board of Advisors of the Eno Transportation Foundation. She received a B.A. from Vassar Armando Carbonell, chair of the Department of College and a Masters in City and Regional Planning from Planning and Urban Form at the Lincoln Institute the Bloustein School of Planning and Public Policy at Rutgers of Land Policy, helped conceive this project with University. Contact: [email protected] the staff of RPA and collaborated with us to structure the topics and recommendations. Daniel Schned is an associate planner for America 2050 at Regional Plan Association, where he has focused on researching Justin Bland, master of city and regional plan- and planning for dedicated high-speed rail and improvements to ning graduate from Pratt Institute and an intern conventional passenger rail in the Northeast Corridor. He coor- with America 2050, researched and drafted dinates the Business Alliance for Northeast Mobility, a coalition sections of chapter 2 and all of chapter 6. Andrew of more than 30 of the Northeast’s leading business and civic Turco, research associate at RPA, helped to research groups that was established to promote improved transportation and write chapter 4. Cecilia Ribalaygua of Cantabria links in the Northeast Megaregion. Schned is also a part-time University, Spain and HSR Urban Strategies, pro- lecturer at the Edward J. Bloustein School of Planning and Public vided valuable input and source materials for the Policy at Rutgers University. He received a B.A. from Macalester case studies discussed in chapter 4. Jeff Ferzoco, College, and a Masters in City and Regional Planning and creative and technology director at RPA, and Ben a Certificate in GIS from Rutgers University. Contact: Oldenburg, research associate at RPA, designed [email protected] the figures credited as prepared by the authors. We also thank those who reviewed drafts of Robert Lane is senior fellow for urban design at Regional the report and provided their valuable feedback, Plan Association and a founding principal of Plan & Process including: Gregory K. Ingram, president and CEO LLP. His current and recent work focuses on the relationships of Lincoln Institute; Matt Rao, research associate between transit, land use, and urban design, with emphasis at RPA; and Peter Gertler, senior vice president on public participation and communication through visual tech- of HNTB Corporation. Finally, we thank Ann LeRoyer niques. He is currently modeling the urban design impacts of at Lincoln Institute for her skillful editing of this alternative routes for high-speed rail in the Northeast Corridor. report. Over the last ten years, Lane has completed three major inde- pendent research projects funded by the National Endowment We also acknowledge the Rockefeller Foundation for the Arts, the New York State Council on the Arts, and the and the Surdna Foundation, both of which have German Marshall Fund. This work has been exhibited at provided funding support for America 2050’s high- the Municipal Art Society and has been published in OCULUS, speed rail research and stakeholder engagement Progressive Architecture, Places, and the Harvard Architecture since 2009. That ongoing work has also informed Review. Lane was a Loeb Fellow at the Harvard Graduate School this report. of Design during the 2008–2009 academic year, and he previ- ously worked as an associate at Kohn Pedersen Fox Architects, PC. He received his B.A. from Cornell University and Masters of Architecture from Columbia University. Contact: [email protected]
60 POLICY FOCUS REPORT O LINCOLN INSTITUTE OF LAND POLICY ABOUT THE LINCOLN INSTITUTE OF LAND POLICY Ordering Information www.lincolninst.edu To download a free copy of this report or to order copies of the printed report, visit The Lincoln Institute of Land Policy is a leading resource for key www.lincolninst.edu and search by author or title. issues concerning the use, regulation, and taxation of land. Providing For additional information on discounted high-quality education and research, the Institute strives to improve prices for bookstores, multiple-copy orders, public dialogue and decisions about land policy. As a private operating and shipping and handling costs, send your foundation whose origins date to 1946, the Institute seeks to inform inquiry to [email protected]. decision making through education, research, policy evaluation, demonstration projects, and the dissemination of information, policy analysis, and data through our publications, Web site, and other Production Credits media. By bringing together scholars, practitioners, public officials, PROJECT MANAGER & EDITOR policy makers, journalists, and citizens, the Lincoln Institute integrates Ann LeRoyer theory and practice and provides a nonpartisan forum for multidisci- DESIGN & PRODUCTION plinary perspectives on public policy concerning land, both in the DG Communications/NonprofitDesign.com United States and internationally. PRINTING Recycled Paper Printing, Boston ABOUT AMERICA 2050 www.america2050.org
America 2050 is a national planning initiative to develop a framework 92% for America’s future development in the face of rapid population growth, Cert no. SCS-COC-001366 demographic change, and infrastructure needs in the twenty-first century. A major focus of America 2050 is the emergence of mega- regions—large networks of metropolitan areas where most of the population growth by mid-century will take place—and how to organize governance, infrastructure, and land use planning at this new urban scale. A project of Regional Plan Association, America 2050 is working to shape and support the new federal High-Speed Intercity Passenger Rail Program because of high-speed rail’s potential to realize the economic promise of megaregions and act as a transformative investment for America’s future growth.
ABOUT THE REGIONAL PLAN ASSOCIATION www.rpa.org Regional Plan Association (RPA) is America’s oldest and most distinguished independent urban research and advocacy group. RPA prepares long-range plans and policies to guide the growth and development of the New York–New Jersey–Connecticut metropolitan region. RPA also provides leadership on national infrastructure, sustainability, and competitiveness concerns. RPA enjoys broad support from the business, philanthropic, civic, and planning communities in the region and across the country. 113 Brattle Street Cambridge, MA 02138-3400 USA
Phone: 617-661-3016 or 800-LAND-USE (800-526-3873) Fax: 617-661-7235 or 800-LAND-944 (800-526-3944) Web: www.lincolninst.edu Email: [email protected] High-Speed Rail International Lessons for U.S. Policy Makers
igh-speed rail has been adopted throughout the world, and is now being planned and developed in the United States. Over the past 50 years, U.S. transportation spending has favored the development of interstate high- Hway and aviation systems. In the meantime, countries such as China, Japan, Spain, France, and Germany have been investing in modern high-speed rail systems to satisfy the travel demands of current and future generations. As the United States embarks on the High-Speed Intercity Passenger Rail Program launched in 2009, it can learn from the experiences of other countries in planning, constructing, and operating high-speed rail. Decades of international experience with high-speed rail suggests that it could create similar transportation, economic, environmental, and safety benefits in American cities and regions. While it requires high upfront investment, high- speed rail promotes economic growth by improving market access, boosting productivity of knowledge workers, expanding labor markets, and attracting visitor spending. When planned thoughtfully with complementary investments in the public realm, high-speed rail can promote urban regeneration and attract commercial development, as shown in several European examples. High-speed rail has greater operating energy efficiency than competing modes and takes up less land than highways. This report describes several funding strategies that have proven to be successful in other countries, and makes specific policy recommendations to better position the federal high-speed rail program for success.
• Strengthen the federal policy and management framework by expanding the federal role in planning and prioritizing high-speed rail corridors and working with the states to secure rights-of-way. • Prioritize corridors that meet investment criteria by clarifying the objectives and desired outcomes of the federal program and promoting investments in those corridors that exhibit the characteristics that are indicative of success. • Establish new mechanisms for corridor management by developing legislation that enables the creation of public infrastructure corporations that can operate across state and national borders and attract private investment. • Plan for maximum land development benefits by coupling high-speed rail station investments with policies that encourage land development around station areas. In general, well-connected stations in center-city locations offer the greatest potential for urban revitalization. • Focus initially on the Northeast Corridor and California, which offer the best opportunities for Core Express high- speed rail service in the United States, by addressing the management and financing challenges each region faces. • Secure adequate and reliable funding by drawing on potential federal, state, and private sources. Such sources could include increasing existing transportation-related fees (such as a portion of the gas tax or ticket surcharges), creating an infrastructure bank, forging public-private partnerships, and expanding existing credit assistance programs.
ISBN 978-1-55844-222-1
ISBN 978-1-55844-222-1 Policy Focus Report/Code PF029