Want a passenger choo-choo in the Triangle? Maybe the private sector is the way to go

Recent changes in Wake County government leadership are likely to revive interest in taxpayer-funded passenger rail in the Triangle. But if passenger rail makes sense, why not look to the private sector as the driving force? Stephen Smith writes in the latest print edition of National Review about the return of private passenger rail to Florida.

[N]early half a century after the Florida East Coast Railway stopped carrying passengers, its owners think the business might once again be profitable. The storied FEC shocked the world of railroading when its parent company announced in 2012 that it intended to start a private passenger-rail service between Miami and Orlando, with long-term designs on Tampa and Jacksonville.

With vanishingly few government favors, All Aboard Florida, as the project is known, will test whether private passenger rail can return to the United States — in Florida but also in Texas, California, and perhaps one day the Northeast Corridor — mirroring the trend toward privatization in Europe and Japan. If successful, it will also make Miami a leader in conservative urbanism. The city already has fairly laissez-faire zoning policies and a thoroughly Republican political establishment. Add to this, in a few years, a privately run intercity passenger-rail service, heir to a company with a daring capitalist legacy, with a station in the heart of the city and ambitions for development that can be likened only to the New York Central Railroad’s Grand Central Terminal in Manhattan. …

… Still, the challenges facing All Aboard Florida are formidable. Large infrastructure projects, public and private, are often subject to cost overruns. The estimated capital cost of All Aboard Florida is $2.5 billion (including $1.5 billion for the tracks and related infrastructure, and another billion for things such as rolling stock and stations) — even aside from any real-estate development.

But if successful, the project could usher in a new wave of private investment in rail in the United States. An entity linked to the Central Japan Railway Company is planning a high-speed rail line, called the Texas Central Railway, that will run between Houston and Dallas–Fort Worth. That project has much higher hurdles to jump — it will have to be built from scratch — but the success of All Aboard Florida would aid the Texas Central in attracting investors. (It also helps that Houston has no zoning code, offering opportunities for the railroad to make money through real estate and a fast-growing pool of potential riders.)

The California High Speed Rail Authority similarly intends to attract private capital to build and operate its line, but it has shut down attempts by at least one private operator to straighten out the route between Los Angeles and San Francisco. Instead, the Authority opted for a circuitous tour of California that includes, among other things, a detour through the Mojave Desert.

All Aboard Florida, by contrast, will have only four stops: Miami, West Palm Beach, Fort Lauderdale, and Orlando International Airport. “Because it was designed by businesspeople and not by politicians, it doesn’t have stops every 20 miles,” says Reason Foundation’s Robert Poole.

The developments in Florida and Texas mirror recent global trends in rail toward a return to private operation and ownership.