Bullet-train plan banks on Texas turning more urban, less cowboy

A$100 million bet says that thousands of Texans will abandon cars and pick-ups for a needle-nosed bullet train that zips past cattle and ranches to deliver riders from Dallas to Houston in 90 minutes — a third of the time required to drive.

The Texas Central Railway is only a virtual train, as almost all the $12 billion for the nation’s first privately financed high-speed rail line has yet to materialize, not to mention the land it would require. But there’s a real fight pitting rural, multi-generational landowners along the proposed route against newly arrived urbanites who seek faster travel between the nation’s fourth- and fifth-largest metropolitan areas.

The bullet train plan reflects the Texas credo that the private sector can do anything better than the government. California has watched the projected cost of publicly financed bullet train linking Los Angeles and San Francisco more than double the $33 billion original cost, and a private Orlandoto-Miami line in Florida struggled to sell bonds even with a tax exemption. The 394 kilometre route across the east Texas flatland, though, is rooted in the distinctive belief that passenger trains can be built and operated without direct public subsidies.

“We will not pursue federal or state grants,” vowed Tim Keith, Chief Executive Officer of Texas Central Partners LLC. “Taxpayers will never have exposure to this project.”

Texas Central is teaming with Central Japan Railway Co, which will provide the technology. So far, officials have raised $100 million from investors. The full $12 billion would come in 2017 from federal transportation loans, Japanese banks and equity investments from pension funds and others who invest in infrastructure projects. The companies may also seek to sell taxexempt private-activity bonds, which a government would issue on their behalf.

Traffic between the cities convinces the company there’s a market for high-speed rail. Southwest Airlines long ago proved it as a viable corridor, said Adie Tomer, a fellow at the Brookings Institution who specializes in transportation infrastructure.

Keith said the rail line will target business travellers and ticket prices will be competitive with air travel between Dallas and Houston. The migration to the south and urbanization of Texas build the case for rail travel with each passing year, he said.

“There’s a resurgence in the appetite for rail,” Keith said. “The road can only grow so much.”

Sceptics say a profitable, privately funded railroad that makes 60 trips daily and travels at 200 miles per hour stretches credulity. European trains are subsidised, they note. So is Amtrak, the nation’s only passenger rail service. Ultimately, critics say, one of two things will happen: Taxpayers will have to open their wallets, because Dallas and Houston politicians won’t let the line fail, or government-run Amtrak will take over.

“Their CEO says, ‘ We’ve got a great project, you’ll love it, trust us,’” said Blake Beckham, a Dallas lawyer representing dozens of landowners fighting the railway’s effort to obtain land through the government’s power to seize it as a public good. “Well, nobody else is stupid enough to build a train in Texas.”

The fight reflects fundamental changes in increasingly urbanized Texas, which at 27.5 million people trails only California in population.

“Texas is a wide-open place of pickup trucks and low population density, not a place where businessmen can ride a train and sip martinis and enjoy a shoeshine along the way,” said Kyle Workman, president of Texans Against High-Speed Rail. But the skies are not so wide and high in major cities. Houston and Dallas were the nation’s two fastest-growing metropolitan areas, with a combined 13.4 million people. Projections from the state’s demographer show Texas’s population could double by 2050.

Texas Central is teaming with Central Japan Railway Co, which will provide the technology. So far, officials have raised $100 million from investors.