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Politics

Florida Train Heist: Robbing Peter to Pay Paul on SunRail

July 25, 2011 - 6:00pm

Doubts about "stable" revenue sources are dogging the SunRail commuter train before it even has a locomotive. Tax increases or further cuts in social services appear to be the only way Central Florida governments will be able to satisfy federal funding requirements.

Last week, in a sign of current and future hard times, Orange County commissioners voted to close a foster-care facility in the poor neighborhood of Pine Hills for budget reasons.

"The sad truth is that foster children cannot afford lobbyists and lawyers like the special interests who live off the taxpayers have. SunRail had an estimated 200 lobbyists working on the project, many at taxpayer expense," said Matthew Falconer, a former candidate for Orange County mayor and relentless SunRail critic.

Orange County residents -- along with those in neighboring Seminole, Volusia and Osceola counties -- are on the line for funding SunRail after the state's initial seven-year financial commitment ends. Start-up costs are estimated at $1.2 billion, with hundreds of millions more in operational expenses in future years.

Florida Department of Transportation Secretary Ananth Prasad stipulated in a Full Funding Grant Agreement with Washington that a long-term "dependable and stable" revenue stream was in place for the 61-mile line. But subsequent statements from local officials paint a far less rosy picture.

"There is no political will in place [for tax hikes]," Orange County Mayor Teresa Jacobs was quoted as saying in the Orlando Sentinel, though she added: "That will not always be the case."

Officials say the three most likely ways to underwrite SunRail's operating deficits and expanded Lynx bus service are increasing or setting aside existing portions of the local gas tax, increasing the local sales tax or adding a $2 surcharge to local car rentals.

State Sen. Paula Dockery, an outspoken opponent of SunRail, said, "To my knowledge, the locals' dedicated and stable funding source has not been identified anywhere. When I asked to question the local governments under oath in the Senate Transportation Appropriations Committee, my request was denied."

But, eventually, large cash infusions will have to come from somewhere because fare-box revenues are expected to cover only a small fraction of SunRail's costs going forward.

"Based on comparable rail systems, I project SunRail will lose an average of $60 million a year for the first 30 years. Local governments are on the hook for the last 23 years and not a single penny of the $1.38 billion obligation is accounted for today," Falconer said.

"Future elected officials will be forced to raise taxes and further weaken our small-business economy. Of course, the proponents of SunRail knew this all along and have deceived the taxpayers of Florida."

Dockery says she has been working on a list of questions for officials, including how FDOT can hold locals accountable if they don't have to identify their funding.

The Lakeland Republican maintains that SunRail should never have been approved by Gov. Rick Scott until:

  • Locals proved they had a dedicated and dependable source of funding.
  • A public referendum was held in each of the four counties and Orlando to pass a funding source.

Until and unless each of these conditions is fulfilled, Dockery says, "It is absolutely true that the state and therefore all Florida taxpayers are on the hook for SunRail, despite any 'political speak' to the contrary."

Whichever way they turn, local officials face financial roadblocks and stiff citizen resistance in pursuing SunRail subsidies.

Dockery calls a funding referendum a sure loser. "It won't happen. Voters will defeat it and elected officials know that," she says.

Indeed, the Sentinel reported that proposed sales-tax hikes were rejected by local voters last November, and state legislators have balked at allowing a referendum on the rental-car surcharge.

Voters appear equally suspicious of any plan that would siphon gasoline taxes to pay for mass transit -- a diversion that would simply mean less money for road improvements.

One tea party activist, who declined to be identified by name, was even more downbeat.

"I refuse to believe in the economic climate we currently face that there can be a full and stable source of any type -- especially the federal government," he observed.

Beth Dillaha, head of the opposition group Veto SunRail, thinks SunRail's corporate backers ought to put their money where their mouths are.

"Where are the developers who should be stepping up to the plate?" she asks.

Quoting a bemused investor when shown Merrill Lynch's yacht at the New York Yacht Club many years ago: "Where are the customers' yachts?"

During a "no-bailout" tour of the four Central Florida counties prior to Scott's announcement, FDOT Secretary Prasad declared, Be assured, I will hold the local officials and the private businesses to their commitments to make SunRail succeed.

Whether that inoculates the state from future financial liability remains debatable. But there is consensus on at least one point: The federal government is committed to covering just $300 million of a project estimated to run $2.6 billion.

In a bit of an understatement, Osceola County Commissioner Brandon Arrington told the Sentinel earlier this month, "We're going to have to find a funding source to make [SunRail] work."

--

Contact Kenric Ward at kward@sunshinestatenews.com or at (772) 559-4719.

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