A $4bn scheme to build a rail line between Orlando and West Palm Beach moved a step closer after Virgin Trains USA succeeded in placing bonds for $1.75bn. The "private activity bonds", underwritten by Morgan Stanley and purchased by 67 investors, will give the company sufficient funds to begin work on the extension to its service in Miami, Fort Lauderdale and West Palm Beach.
Virgin Trains USA, formerly Brightline, intends to lay 274km of track between the South Terminal of Orlando International Airport to Florida’s existing East Coast Railway, with stations in Tampa and Disney World.
Wes Edens, the chairman of Virgin Trains USA, said: "Connecting Miami and Orlando makes tremendous business sense, but even more, it provides a public benefit to the State of Florida, including thousands of jobs that will keep the state economically competitive for decades."
Virgin estimates that the line will create more than 10,000 jobs and generate more than $650m in federal, state and local tax revenue. Work on the project will now "begin imminently".
Brightline, which describes itself as America’s only private train operator, rebranded as Virgin Trains USA after the UK-based company bought a minority stake in November. Brightline is controlled by the Fortress Investment Group, a listed equity firm co-founded by Edens that controls about $70bn in funds.
As well as the Florida line, Virgin plans to build a line between Las Vegas and Victorville in southern California following its takeover of the XpressWest company in September of last year.
Image: A Brightline train at Fort Lauderdale station (Patrick Hamilton/CC BY-SA 4.0)
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Sadly, Virgin is NOT a privately funded higher speed rail – it is using tax-free Private Activity Bonds and other taxpayer funding to build this boondoggle. The US Treasury will not receive millions of dollars it would normally receive and could use on any number of programs for citizens. Also, four counties along the route from West Palm to the Orlando airport (where 32 trains per day will go 110 mph through over 150 at-grade crossings, non-stop!) will have to cover millions in road retro fit with the addition of a second track and increased safety equipment and pay for maintenance of the equipment forever. This will be a nightmare for thousands of people living on the Space and Treasure Coasts. Lawsuits are still in the courts.