"Mr. Gorbachev, tear down this train"? (Photo by Flickr user, kaffeeeinstein)

Transportation

Has the Texas Central Bullet Train Gone Off the Rails?

Some skeptics fear ridership projections are too bullish and tax payers may be left bailing out the project. But are they right to worry?

It’s been a busy year for the much-anticipated Texas bullet train. The project emerged as a contentious issue in the state legislative session leading to legislation that intends to protect tax payers from any potential cost of the project. Houston officially signed on in support of the high-speed rail line, and contractors have been hired to design and build the rail link.

The project, however, is still drawing skepticism. Travis Korson, a senior fellow with Frontiers of Freedom, a conservative Washington think tank, believes the numbers don’t pencil out Texas’ bullet train. In a column for the The Hill , he argues that a growing budget and inflated ridership projects suggest the privately funded rail project may not be profitable: 

Investors are probably starting to feel the same way and the few that have provided the 1 percent of capital raised to date may soon be looking to cut ties. Delays surrounding the environmental impact study have already put the project years behind schedule. Proposed construction costs have ballooned from $10 billion to $16 billion and the project is yet to break ground.

Overly optimistic ridership estimates also call into question the long-term viability of the project, should it ever secure the necessary funding to complete construction. Estimates from Texas Central Partner predict a ridership of 5 million annually by 2025 (up from earlier estimates of 4 million annual riders by 2035) and a whopping 10 million riders by 2050.

Where do those numbers come from? Texas Central Partners, the firm behind the rail project, estimates that about 14 million people travel between Houston and Dallas, and they hope  to capture about 36 percent of that traffic by 2025. Korson finds this overly optimistic and makes a comparison to Amtrak’s high-ish speed Acela line, which travels between Washington D.C. and Boston and accounts for about 2 percent of all passenger traffic in the high-density northeast corridor. Can the bullet train capture more ridership share than Amtrak enjoys in the Northeast? Korson doesn’t believe so, and he argues that the rail project’s finances will eventually unravel, if it ever gets built in the first place.

But is he right? According to a study conducted by the high-speed rail company, Texans are enthusiastic about the possibility of another option for commuting between Dallas and Houston besides air and auto, and 71 percent of frequent travelers — the ones who know how inconvenience the short flight or the grueling drive can be — say they would “probably or definitely” use the bullet train. If the bullet train can convert a portion of those eager-future riders into actual passengers, it should be okay.

However, the larger challenge for the rail project in terms of appealing to riders is solving the question of what happens to riders once they arrive in their destination city. Dallas answers that question by locating the terminal near downtown where riders can connect to public transit. But what if a Houston businesswoman has a meeting with Toyota? Will taking the bullet train only to be forced with wrestling with a commute up to Plano undo the convenience of the high-speed rail link? And what about Houston? The sprawling city plans to place its high-speed rail terminal on the outskirts of the city on the city’s ring road. Will taking the high-speed rail, then, necessitate renting a car once riders reach their destination?

These questions place the planning of the high-speed rail project within a broader process of rethinking land use and transportation systems. The success of the high-speed rail line is contingent on the ability of Dallas and Houston to address other transportation shortcomings. If that kind of planning and investment in complementary infrastructure doesn’t happen, then Korson’s doom-and-gloom prediction that ridership numbers won’t flesh out may have some merit.

But in his fear over the bullet train turning into a boondoggle and leaving tax payers on the hook for bailing it out, Korson misses this the broader question of urban sustainability. The question shouldn’t be whether or not high-speed rail will work in in the state. Rather, the question should be what can Texas do to make sure it works. High-speed rail, improved public transit, and a better approach to land-use are the kinds of projects Texas must get right in order for the state to remain competitive in the future.

 

Comments

  • Los_Politico

    How will the Houston woman get to her meeting at Toyota? Uber. Just like she would if she arrived at DAL or DFW.

    • Donovan Maretick

      It sounds pretty straight forward but given the station is being placed on one of their investors land sitting in the most congested part of Houston on 290 by the old Northwest mall area. This is the ultimate hurry up and wait!

      • jo

        Agree. There are TONS of other more convenient (and safer–have you been to the Northwest Mall area lately?!) places here in Houston that they could place the station. This boondoggle lines the pocket of the investor and nothing more.

      • BenderTheMagnificent

        In this scenario, the rider is arriving in Dallas from Houston.

        • jo

          Yes, but they have to get ON the train in Houston don’t they? The point is to illustrate the boondoggles rife throughout this entire deal. The Houston station where the passengers will be boarding to GET to Dallas is in a rundown part of town, torn up with construction already, at a station that is will built sold to THSR on property currently owned by an investor.

          • BenderTheMagnificent

            Ok, but that is a different issue than what Los_Politicos was discussing, which was that all business travelers have to contend with traveling from a transit hub to their final destination, so it is a non-issue.

            As far as the Houston station location issue, the Federal Railway Administration made the decision to keep the line out of the CBD due to the effect on the Heights Blvd Esplanade and Cottage Grove Park that construction would cause. Not ideal, but that’s the reality of the situation (http://www.khou.com/news/houston-texas-central-move-forward-on-high-speed-rail-effort/465247767)

            Regarding your final point; yes, of course a private entity that is using private funds to build a rail line across Texas will buy the property in Houston to build its station. That’s the whole point of this being a privately funded project. Looking at the current proposed alignment and Harris County tax records, much of the land near the proposed station(s) are owned by the State of Texas. However, it would make a lot of sense from an investment POV to build a station on land owned by an investor. But if you have information about THSR investors owning the land for the proposed station, then please cite your source.

          • Donovan Maretick

            If you attended any of Texas Central’s meetings regarding why it doesn’t go downtown was due to cost restrictions. They can’t afford to. You can also look and see that the Draft Environmental Statement is a delayed and is a farce. They are only investigating one route coming into Houston in which Texas Central chose. Would you want to have a private company draw a line on a map and impact your home? All of us land and home owners have asked repeatedly for the ridership calculations and have been denied because they are a private company. We ask how many track miles do you have under options contracts and they state they will only give us parcels which is meaningless. This is nothing but smoke and mirrors. If a private company wishes to use eminent domain, then the public should have the right to scrutinize it. Should us little guys have protection from a large private foreign backed private company with deep pockets? Why do I get letters threatening to sue me to survey my land when no government entity has given them eminent domain? This is no different than me walking into a bank and threatening the cashier to give me the money or I shoot while holding my hand in my pocket pretending to have a gun. They would throw me in prison, who holds Texas Central accountable for their actions?

          • BenderTheMagnificent

            If you attend those meetings and you don’t know the answer to why Texas Central has not been granted eminent domain, then you are either uninformed or truly disingenuous. You have my sympathy for any adverse effect to your property and its value; you truly do. And if Texas Central is acting unethically or illegally, then they should have to answer for it. But you cannot pretend that Texans Against High Speed Rail haven’t been equally culpable in their campaign of disinformation and obfuscation.

          • Donovan Maretick

            I am only here to speak on my behalf. I have never been political before but now my life savings are at risk and I will fight with everything I can to save it. I know that Texas Central claims they are a railroad and an electric railway under the transportation code. This fact was argued in court under the House case and they did not decide whether they are a railroad or not. The law shows that they did not meet these requirements but we both know that this needs to be settled in a court of law. Until then, they should not be threatening people to sell or lose it through condemnation. I can give you many testimonials to this fact.

          • xoviat

            Of course they are a railroad. Of course lawyers will spend thousands of dollars in court trying to twist the meaning of the English language and they will almost certainly fail.

  • tested123

    This has been a ridiculous project from the outset, but it has turned moreso as the bullet-train technology has become outdated. Simple math says this will not work. Texas Central does not have anything like the $10-$15 bllion it will take to build this project. If they borrowed that money, it would push the cost to ride up so high that it would not be competitive with air travel. You can bet the potential investors are figuring this out.

    While they’ve been fussing with this, the hyperloop technology popped up and is now all the rage. Is it expensive? Sure. But, it is probably not as expensive as the bullet train and avoids some of the land use issues that are dogging the folks at Texas Central. It would be better to ditch the above-ground bullet train and focus on a hyperloop instead and see if that’s a better alternative.

    • carter

      hyperloop is a terrible idea, you would be vomiting after taking trips under this kind of strain to your body. high speed rail is proven to work, japan and asia have phenomenal train systems

      • tested123

        That makes no difference. It’s pretty clear they can’t build the high speed train. They are investigating the hyperloop technology, which is very new. It’s likely that neither will be built. I’m just tired of seeing the local media treat Texas Central like they’re about to turn dirt and start building. It. Will. Never. Happen.

      • Donovan Maretick

        And everyone of them in the world are heavily subsidized by the government. During the last legislative session a bill was passed that said no state money. If they go after federal money like they plan and don’t pay the money back which they won’t, then The federal taxpayers have to foot the bill. Since the Japan Bank will be the biggest debt holders, they will seize the land and own a 240 mile stretch between Dallas and Houston mostly obtained through eminent domain. Do some research this is a Land grab

        • BenderTheMagnificent
        • BenderTheMagnificent

          Donovan, I understand that you have a personal vested interest since your property would be affected. I cannot argue with that fact and can understand why you would be opposed. If you don’t want a rail line through your land because of potential value loss, then that is fair. You have my sympathy, but you come off as disingenuous when you speak of doing research but then spout misinformation to suit your cause.

          Your assertion that “every [high speed rail] in the world are heavily subsidized by the government” is incorrect. In fact, Japan is well-known for operating the most profitable private railways in the world with few if any subsidies. And Central Japan Railway, the partner with Texas Central Railway, is the most profitable. Their net income in FY17 was $3.36B (http://english.jr-central.co.jp/company/ir/brief-announcement/2017/_pdf/2017_08.pdf)

          A simple Google search will yield a plethora of articles and studies on the profitability of Japanese rail companies and the success of their rail system. But there is no 1:1 comparison between countries and cultures. However, there is a need for change in our transportation system and partnering with the guys who have the best track record for execution and profit seems like a good place to start. We have an infrastructure that is in desperate need of investment and innovation so obfuscating the issue with false information to hinder development will get us nowhere.

          • Donovan Maretick

            There is no doubt that the Tokyo to Osaka line is profitable but it serves some 5.3 billion people annually. They have the population density to support it. Name one other line that can cover not only it’s operation cost but also the construction cost and operate at a profit. Even the Tokyo Rail does not include the construction costs in its profitability calculations. No one can give you that information. Also did you realize that JR group used to be Japan National Railway Company but when it went 23 trillion dollars in debt in 1987, it was privatized into six companies to carry on the railway service. Please find my reference below:https://www.quora.com/How-is-the-Japanese-Shinkansen-bullet-train-different-from-Chinese-high-speed-bullet-trains

          • BenderTheMagnificent

            I don’t know what you mean by “Tokyo Rail”. Do you mean the Tokyo Subway or the Tokyo Metro or? Either way, sifting through the fiscal reports of those corporations seems like a waste of time since you have not offered any evidence to the contrary, just your opinion stated as fact. It seems like you are once again trying to distract from the main issue which is the discussion of a single route between two major metro areas in single state.

            I am familiar with the history of the JR Group. I am also familiar with how much more efficient and profitable the Japanese rail sector has become in the 30 years since privatization. So is your point that a privately funded and operated rail company would be more efficient and profitable than say, a bloated single carrier that relies heavily on government subsidies? It’s too bad there’s no parallels of that here.

            Also that Quora link you posted is to a study of high speed rail in China. You do realize that is not the same as Japan, right? Did you also realize that the conclusion of that study is that HSR would have a positive impact on the U.S., both economically and environmentally?

          • Donovan Maretick

            My apologies for some reason the quora link that I sent wasn’t the one I reviewed. Here is a recent article showing the decline in safety since privatization. My point is that Japan serves a much higher density than between Dallas and Houston and the construction costs were covered prior to privatization. I am not aware of one high speed rail that has covered both construction and operating costs. I also assume you are familiar with the Reason report which shows that this project will fail spectacularly.
            Another thing, the option contract they offered to me could not tell me if they were putting the rail on a berm or elevated and also allowed them to put in a access road from the front of my land to the back where ever they wanted to locate it. This company is not working with land owners and will not answer any questions with a straight answer. If they were more transparent I would be more open to the idea. I have ridden the Shinkansen rail in Tokyo and it was a great way to travel but is it financially feasible for Texas? Even many of our state legislators don’t believe it. One even created a calculator that reflects the cost of a ticket and profitability I urge you to look at. All three links are below.

            http://japan-press.co.jp/s/news/index_google.php?id=10506

            http://reason.org/news/show/texas-high-speed-rail-caution

            http://www.cecilbelljr.com/

        • carter

          No they are not. Tokyo and japan has the most efficient rail system in the world and it turns a profit and is not subsidized by the government. We do subsidize roads and we still have terrible sprawl and traffic and increasingly toll roads!

  • bmslaw

    Calling the Acela “high-ish speed” is ridiculous.The Acela route from Boston to Washington is approximately 457 miles, with the average journey time just under 7 hours. A train that averages 84 mph (72 mph including stops) is not high-speed. It is not high-ish speed. It’s just a regular old train with a fancy name.

    • Doug Stinson

      I live in Washington D.C. and it sounds like you need some info. The problem is not with the trains, it’s with the rails. The Acela actually CAN reach speeds of 165. However, Amtrak uses CSX tracks, i.e. shares the rails with other trains. That said, Amtrak is moving ahead for the next generation of trains the Avila, set to debut in 2021. At that time, the ‘regular’ speed will be 160. However, as track improvements continue, the trains will hit speeds of 165 to 220 mph. This is not a pipe dream, construction is continuing now. I lived in Dallas btw for 7 years. DART turned out to be a disaster. It moves about 100,000 people around a day. METRO in DC carries around 750,000 a day. My office sits on the seventh floor of a building behind Union Station, and if I look out the window I see Amtrak trains of all kinds coming as well as MD. and VA. commuter trains moving in and out constantly along with METRO trains. Dallas is a small version of Los Angeles. Population density is such that rapid transit just isn’t going to work. So say you live in McKinney, and the Texas train goes to Dallas Union Station. You’ve got on heck of a drive to McKinney with few options. Cab ? WAY to expensive, and UBER, LYFT, not much cheaper. I never felt like I was in a real city anyplace in Texas. Soon the northern suburbs of Dallas will be near the Red River. Rail is an option ? No, I don’t think so.

      • bmslaw

        You say “The problem is not with the trains, it’s with the rails. The Acela
        actually CAN reach speeds of 165. However, Amtrak uses CSX tracks, i.e.
        shares the rails with other trains.” Telling me why the Acela does not go as fast as it can just affirms what I said about its speed (or lack thereof). Even if it COULD potentially be a “high speed railroad”, as currently operated it is NOT a high speed railroad.

        Using your logic, I could tell you why DART turned out to be a “disaster” (not true, your word), but that doesn’t make the DART system any better than it is. Like the Acela, DART has the potential to be a much better system than it is,

        • Doug Stinson

          Just checking something as pedestrian as Wikipedia, here is how High Speed Rail is defined ” In Europe the definition of a minimum speed for newly built high-speed railways is 250 km/h (155 mph); for upgraded high-speed railways it is 200 km/h (124 mph). In places where high-speed rail programs are in earlier developmental stages or where substantial speed increases are achieved by upgrading current infrastructure and/or introducing more advanced trains, lower minimum speed definitions of high-speed rail are used.” Even the regional Amtrak trains (pre-Acela) reach speeds of 125 on certain segments where the track has been upgraded. Yes, by international standards the Acela IS defined as high speed rail, and even the old regional trains that have been around for some time are. Perhaps the “lower minimum speed definitions” noted above apply, but the experts identify the system on the Northeast Corridor (NEC) as high speed. Let’s put it this way – as is, the Acela can reach speeds, and does, of 150 MPH where the track bed is suited for it. Expanding the amount of rail mileage capable of this speed is what Amtrak is doing. The NEC is unique in that it turns a profit. There is an incentive to invest in its rehabilitation. More people traveling to points from Boston to Washington and every large city between use rail than fly. Do you live on the East Coast ? Driving up I 95 from DC to NYC can easily take 4 hours. Acela makes it in about 2 hours 45 minutes. And keep in mind that is downtown to downtown. That time will continue to drop as improvements are made.

          As for DART, again I’ll use numbers from wiki, not a sophisticated source but reliable enough. And the numbers seem to be in line with data from other sources ” The DART light rail system comprises 93 miles (149.7 km) between its four lines — the Red Line, the Blue Line, the Orange Line and the Green Line. According to NCTCOG transit statistics, DART’s light rail system had a daily ridership of 109,511 average trips per weekday in October 2012.” While I’ll admit 2012 was a few years back, it appears if anything ridership has gone down since then. At a cost of over 5 billion, that is outrageous.

          The following is from the Manhattan Institute, author Aaron Renn-

          “Efficient rail transit requires dense cities with highly concentrated downtown employment centers. Yet only a limited number of cities, such as New York and Chicago, fit the bill. Most American cities are low-density, have extremely decentralized origins and destinations of employment and trips, and have development and commuting patterns based on the automobile.Low-density U.S. cities with new rail-transit systems have experienced limited ridership and single-digit transportation market share. Federal funds should be directed to rebuilding aging rail transit in cities where it already exists and where it serves a critical transportation function. In most cases, state and local governments should focus on providing transit service via traditional buses, not building new rail lines.

          Manhattan Institute 2
          Reality Check: Does America Need More Urban Rail Transit? Aaron Renn, Senior Fellow
          Key Findings
          • Apart from New York, Chicago, San Francisco, Boston, Philadelphia, and Washington, U.S. cities
          are a poor fit for rail transit. Why?
          ◆ Most cities have small central business district (CBD) employment: compare, say, Charlotte, North Carolina (63,000
          CBD employment), St. Louis (58,000), and Dallas (70,000) with New York (2 million CBD), Chicago (500,000), and
          San Francisco (300,000).4
          ◆ Most cities also have low-density populations: compare, say, Denver (4,000 residents per square mile), Dallas (3,600),
          and Charlotte (2,700) with New York5
          (28,000), San Francisco (18,400), and Boston (13,800).6
          • New rail construction has proved to be a poor investment in most cities:
          ◆ Los Angeles’s public-transit ridership has declined since 1985 despite $9 billion spent on new rail-transit lines.7
          ◆ Dallas built America’s largest light-rail network by length (90 miles),8
          at a cost of $5.5 billion;9
          but the network carries
          a mere 100,000 riders per weekday,10 a sliver of total travel in the Dallas region. ”

          Therein lies the real issue. DART is light rail, but even if it were ‘pre-metro’, or heavy rail, ridership would be low because of the nature of city planning. Washington has right around 10,000 people per sq. mile. Suburbs are far more densely populated as well. If the only way people can access rail, is by taking a bus, or driving, it becomes less efficient and far more difficult to use. It’s as if Dallas assumed “if we build it, they will come”. Well, they didn’t. For over 5 billion dollars, if you don’t consider 100,000 riders a day a failure, I don’t know how you would define it. Urban rail systems work in urban cities. Dallas is essentially a downtown ( even it is active mostly from 9-5) surrounded by essentially suburban sprawl. Even its downtown is a fraction the size of major cities’ urban core. Nearly a million people work in or near ( Rosslyn, Crystal City, NOMA, and the core of downtown DC), and many live in those areas as well. Spend money how you want. But I would hate to see the federal government spend on what is clearly a failure of a transit system.

        • Doug Stinson

          The problem is not with DART, it’s with Dallas and surrounding suburbs. As long as the density remains low, DART will never work. Light rail carries significant numbers of people ONLY in cities with high density population. Light rail in those cities, San Francisco, Boston, Philadelphia, and soon D.C. augments existing commuter and heavy rail systems. “Fixing tracks” is a far more easily remedied obstacle to any kind of rail system than dealing with an urban design that encourages sprawl. The population of the city of Dallas averages 3754 people per sq. mile. https://www.opendatanetwork.com/entity/1600000US4819000/Dallas_TX/geographic.population.density?year=2016 . Per the same source, the density in D.C is 10,795. Even inner suburbs like Arlington, VA ( again the same source ), has a density of 8704 per sq. mile. The population dynamics in Dallas and surrounding suburbs are such that to reach ANY rapid transit nearly always requires driving, taking a bus, or some other mode of transportation. Unless the situation in Dallas changes, rapid transit will never work. And I will add that I see no indication that the sprawl that defines the DFW area will ever change.

  • Amy S

    Silly wabbit, since when do we let facts get in the way of something HUGE?

  • anon anon

    FWIW, DC to Boston is a (likely intentionally) poor comparison to make for trip analysis. You’re talking about a 1 hour flight versus a 7 hour train. DC to NY or NY to Boston are far more appropriate and per this study, shows a much higher trip percentage:

    https://www.citylab.com/transportation/2014/11/why-more-northeast-us-travelers-take-the-train-than-a-plane-in-2-charts/383158/

  • downtownworker

    You lose me at the question of what she does if she has a meeting at Toyota. Of course she calls Uber or rents a car. That’s what everyone does when they travel to another city for business.

  • jo

    “…and a better approach to land-use are the kinds of projects Texas must get right in order for the state to remain competitive in the future.” Yeah, spoken like someone who has ZERO vested interest in that land you speak of. The hundreds of families whose land is going to be taken from them, the devaluation of their property because of the monstrosity cutting through the middle of their property…never mind the negative affect it will have on those little peons.

    • obamaniac

      please, more hyperbole.

  • carter

    So Frontiers of Freedom gets its largest funding by far from Exxon. Shocking. I am sure this “think tank” doesnt mind us subsidizing sprawl and roads and gridlock. How about these fake “libertarians” look at all the fed tax money coming to bail out sprawling houston after harvey. This is chicken feed to compared to the federal taxpayer trough we are feeding at after disasters

  • Husein Alibhai

    Wow, this article was full of misleading incites (the acela line between boston and dc is 2% but what is it of THAT ROUTE, moron). This article…written by a non-evolving conservative? Listen, its going to happen. Change, density, pedestrianism, LIBERALS and their brethren taking over. Might as well faciliate, keep Dallas and Texas at the top, and lets get going. Get your head out of your ass. Toyota woman…um….as opposed to her flying where….DFW? 20-30 min MINIMUM…..DAL? 30+ min. EXCEPT….instead of the hassle and time of airport. Listen, for all those its affecting, unfortunately, its happened all over the country and world where natural progression happens. Evolution must happen and one must adapt despite any situations. Society benefits and thats all. Lets get going…its 2017. #yeswecan

    • Donovan Maretick

      #stopthelandgrab. If this is such a great idea, then this private company should do what every other company does and buy the land and not try to steal it from Texas citizens. No eminent domain should be allowed for this. Texas Central essentially went down and paid a small fee (<$500) and declared themselves a railroad and now have the right to seize land through eminent domain. They do not own a train or tracks and never have but yet they are a railroad with eminent domain authority. This is really a bad joke that will allow a foreign based company to use eminent domain. It is well known and advertised that their biggest investor is Japan. This must be stopped. We need to stand up for our property rights or what’s the real use of buying a home or land?