The Brightline Saga
How a privately owned Florida passenger railway received billions in taxpayer dollars, pretended to be a highway, dismisses safety concerns, and still became a media darling
What is a Brightline?
“So you're saying the Brightline rail project is a highway, that's your sworn testimony?”
That was a real question that was asked on 19 April 2018 by Mark Meadows, a US Representative. He was grilling Grover Burthey, Deputy Assistant Secretary for Policy in the US Department of Transportation (DOT) during a hearing before the Subcommittee on Government Operations. Brightline was under fire for accessing government sponsored Private Activity Bonds by claiming that the corridor they run their passenger rail service in was a highway. Since the project did not qualify as a high speed railway, the only type of passenger rail project eligible for the bonds, the company had to get a little creative.
For the record, Burthey went on to say, under oath, that under the statute that guided the DOT’s evaluation of the application, the Brightline project fit the definition of a highway.
In most cases, it would be a massive scandal if a multi-billion dollar project had done this. But it received almost no attention at all, and was far from the only questionable tactic used by the project that started out life as All Aboard Florida.
There is little doubt that Brightline is unique and ambitious. The company claims to be the first new private intercity railway in over 100 years, according to press materials and in the prospectus it submitted when it was first looking to issue an IPO. The Brightline marketing and brand identity is completely different than that of Amtrak, or any public transport marketing in the US for that matter. Its trains and stations are modern, and while it has already linked Miami with Fort Lauderdale and West Palm Beach the line will be extended to Orlando (International Airport), and eventually, perhaps, to Disney World and Tampa, along with an undetermined number of infill stations along the way (though at the present time there will be at least 2 more stations added).
This shows the extent of Brightline’s current ambitions. When first proposed there were also plans for the line to head all the up the coast to Jacksonville, in a corridor owned by Florida East Coast Railway. This may still happen but it seems to have been put on the back burner in recent years as it is rarely discussed, besides the Jacksonville press wondering what is going on with the project. Image by Brightline from Florida Today.
Below the polished veneer, and a general media love in for the railway, there are a slew of serious questions and concerns. In early 2020 Brightline was named the deadliest railway in the US due to the number of people that were killed at its crossings. There is its claim to be a purely private endeavour which isn’t just a slight exaggeration, it is absolutely false. Brightline has antagonized communities along its route, and resisted regulations and calls for safety enhancements at every step of the way. There is its tenuous, sometimes hostile, relationship with local, taxpayer funded public transport. And it’s business model actually seems far more reliant on real estate gains than it does on the passenger rail service.
Choosing Florida, a state with minimal rail service, and past governments who have turned down federal funding for high speed projects in the past, might seem like an odd choice. As it turns out though, it is the perfect place for them to have tested this new, rather questionable model, for building passenger rail.
A rather dull and boring origin story:
Brightline, originally known as All Aboard Florida (AAF), seems to have been conceived in boardrooms and exclusive private country clubs in the poshest Florida neighborhoods. It was started as a joint venture between a Coral Gables real estate development company and the Florida East Coast Railway (FECR), both of which have been in existence for close to 100 years.
The pitch was simple. Add passenger rail service to FECR’s freight line from Miami to Cocoa (a city roughly half way between Miami and Jacksonville along the eastern coast), and build a new line from Cocoa to Orlando International Airport to connect to the two major destinations together. Then add some stops in between, along with buying, developing, and selling land near the stations.
In the early 2010’s, when the then AAF proposal first started to become public, it was well known that property values would increase when high quality, rapid public transit was added in their vicinity. It was a key part of the transit oriented development that had been growing for well over a decade. So the strategy made sense, especially for places like Fort Lauderdale or West Palm Beach, which were within commuting range of Miami (for those that could afford the ticket price of course).
The mixture of railways and real estate is not a new concept. In the early 1900’s electric streetcars/interurban railways and streetcar lines were constructed to reach far flung land beyond the edge of major cities. For those who wanted a suburban life, but still be able to commute into the city in a reasonable amount of time, the new lines made it possible, and reshaped cities in the process.
In Canada, early railways had built massive, exceedingly fancy hotels next to their train stations as an additional source of revenue, and as destinations in themselves (such as the resort hotels in Banff or Jasper), with passengers buying train tickets to get there. In the 1960’s and 70’s CN was selling many of its centrally located railway lands, and even proposed a massive redevelopment project on the Toronto waterfront that was, up until the Portlands/Waterfront redevelopment project that started in the 2010’s, the largest urban renewal project ever to be pitched in Canada. And of course, the Canadian railways were used to colonize already settled land in the west, and even used to transport troops to slaughter Metis people in 1885 when they had the audacity to stand up for themselves. In the North American context, railways have quite often existed alongside other business endeavours, as opposed to being stand alone ventures.
The idea of building a modern passenger rail service in Florida was not new. In fact up until 16 February 2011, there had been a proposal for a high speed line in Florida, with the initial service running from Tampa Bay to Orlando. There was even $2.4 billion in Federal funds available for the project. But Rick Scott, the Governor of Florida at the time, canceled the entirety of the HSR project outright.
It was within that context a little over a year later, in March 2012, that All Aboard Florida would be officially unveiled to the public. It trumpeted several advantages over the previous project. It was going to be cheaper, just USD1 billion for the line from Miami to Orlando. But in many ways the price tag should have been irrelevant. It was going to be privately funded, and the only reason to throw around the low cost of the project was to paint previous, publicly developed and funded, plans as inefficient and further proof of governments being incompetent compared to private enterprise. It is not hard to find articles and editorials online that use Brightline as an example of why the future of passenger rail is private. While early reaction isn’t easy to find, it largely seems to praise the project, with more critical responses being a slow build up in the years to come.
It didn’t take long for the cost of the project to rise. By December 2012 the price tag being floated in public had risen to $1.5 billion and by September 2013 the cost had once again jumped to $2.5 billion. This would not be the last time the cost increased and was very much an early sign of the challenges the project was going to face.
Unpacking the structure and funding of Brightline
Although it was the early 2010’s that All Aboard Florida had its coming out party, the projects origin goes back at least few years earlier. In 2007 Fortress Investment Group purchased Florida East Coast Industries for USD3.5 billion. Almost immediately the company was broken up into 4 operating units covering rights-of-way management, real estate and logistics services. But the Florida East Coast Railway, which was part of FECI, was separated into its own independent business. Before this was done an agreement was put in place that gave FECI exclusive rights to run passenger rail service on the FECR corridor.
Florida East Coast Industries would go on to create All Aboard Florida (which would become Brightline). All Aboard Florida would also have holding companies attached to it which would initially cover operations, management, as well as individual holding companies for its real estate investments directly related to the rail service in Brevard County, Space Coast County, and the Jacksonville Segment. The dispatching company taking care of both passenger and freight trains would be co-owned by FECI and FECR. If that all sounds a bit convoluted, it is. The key point here is that the structure creates close to a dozen different operating units, a deliberate strategy that has consequences down the road.
Funding would be a very bumpy road. In 2014 Fortress had only invested USD345 million into AAF, though this amount would increase between then and sometime in 2016. In the prospectus that was released in February 2019 a line item shows that in 2016 the parent company (Fortress) had increased its contribution to USD1.129 billion towards AAF’s equity. How much more they may have contributed beyond that is unknown as financial details have been limited.
The next major investment appears to have come from CanAm Capital, a firm who specializes in EB5 Visas, which allows those interested in visas, green cards, or citizenship to make substantial investments in American businesses in exchange for speedier access to those immigration services. This amounted to a total of USD350 million. In June of 2014 AAF also sold USD405 million in private high risk bonds which carried a 12% interest rate. This was not ideal, but necessary in order to raise enough money for them to start construction
It also seems likely that Brightline was able to secure financing, in the form of a loan, from Siemens for the purchases of the first 5 train sets that they ordered. Despite looking through all the publicly available corporate documents and contracts, an exact amount, or terms of the agreement, could not be determined. However it is easy to see why Siemens would be receptive to that arrangement as this was an opportunity to market their new Charger train sets to the North American market. It seems to have worked extremely well as both VIA and Amtrak have placed orders in subsequent years for at least 115 train sets, with options that could increase that number to 261 sets, which would result in USD8 - 10 billion in orders for Siemens.
As far as private financing goes, that appears to be the extent of it for Brightline. For the remainder, and majority, of their funding, they would need to rely on government issued bonds, and various taxpayer funded subsidies and contributions.
AAF’s first kick at the can for public money came in 2013. They applied for a Railroad Rehabilitation and Improvement Financing (RRIF) loan through the Federal Railroad Administration (FRA). They were requesting USD1.75 billion and the process involved them conducting an environmental impact study (EIS). But in 2014 AAF began to change course and instead sought out USD1.75 billion in Private Activity Bonds (PABs). They would ultimately receive that amount, split among two bonds worth USD600 million and USD1.15 billion respectively. PABs are problematic for a number of reasons which will be explored in detail later on.
Brightline does not appear to be done with PABs either. On 8 December 2021 the Florida Development Finance Corp, the conduit issuer for the deal, gave tentative approval to Brightline for an additional USD1 billion PAB. This will bring the total amount of PAB funding to USD2.75 billion and seems to have been, in part, precipitated by continually rising costs associated with its construction of the West Palm Beach to Orlando line.
Rising costs and delays
Delays are not unusual for infrastructure projects so in that regard Brightline is not unique. When initially announced in March 2012 the company was claiming the line from Miami to Orlando would be ready for 2014. The first section from Ft Lauderdale to West Palm Beach opened 13 January 2018 . The next phase from West Palm Beach to Orlando is not scheduled to open until sometime in 2023, while the extension from Orlando to Disney, which was at one point scheduled for 2023, has been pushed back to at least 2026, though even that timeline is highly unlikely at this point.
The cost of the project has also risen over the years. In early 2021 the number most often used in media articles was USD4.2 billion. And with Brightline’s recent interest in acquiring another USD1 billion in private activity bonds, along with additional escalations in costs, this puts the price tag of the project at somewhere in the USD5.5 - 6 billion range. A far cry from the lean project that was first announced.
Everything that has been discussed so far is critical to understanding the real Brightline. But it’s also equally important to understand the version of Brightline that they have marketed to the public. The reason the company’s failures have been able to be glossed over is very much due to the success it has had in charming the media, and the public at large.
Brightline, a train for the Instagram age
One of the challenges that Amtrak and VIA Rail Canada have faced is how to adapt their marketing and brand for the digital age. Amtrak was formed in 1971, and VIA in 1977, during a time where media was television, radio, newspapers, and magazines. The agencies would exist for roughly two decades before the World Wide Web was created, and over 3 decades before social media came onto the scene. To its credit VIA has, since late 2018, done a complete overhaul of its brand identity and marketing, covering every single aspects of its media, organization, and even its trains, which has helped it become much more modern (an article was previously published on this site that goes into great detail about the evolution of VIA’s brand and identity). And in recent weeks Amtrak actually entered the social media trolling game by live-streaming a rail line that the freight operated claimed to be “too busy” for passenger rail service.
Brightline however was conceived of in the early 2010’s, and when it was launched in 2018, Instagram, Twitter, and Facebook had been around 7 to 13 years. It didn’t have to adapt to a new media landscape, it was born in the midst of it and could be whatever the all new marketing department wanted it to be. Their image was going to be bright, modern, fashionable and something that would excite well to do, mobile young people as well as business travellers.
This is the essence of what Brightline is trying to sell. It isn’t just a train. It’s a place where social media posts happen. Image from Brightline via Twitter.
There is little doubt that Brightline’s marketing and brand identity have been its biggest success. While some very early renderings showed the then AAF service using less than flashy trains, there doesn’t seem to have been much consideration given to raiding the scrap yards of other agencies to find bargain basement deals. By September 2014 they had already selected Siemens to build an all new, modern, fleet of trains for the service. Not only would they look great but it also meant they would be fitted with fully accessible washrooms, modern seating, along with outlets and charging ports that weren’t DIY’d in. There are operational reasons why new trains are a better choice (lower maintenance costs, more fuel efficient engines, etc), but for Brightline the image of its service was going to be everything, and that started with the trains themselves.
From the start the Brightline trains were modern, well styled, and featured bright, bold colours. The nose cone on the front was intentional, as they wanted the trains to look like high speed trains, even if in reality they were not. Image via GoBrightline Twitter account.
In a 14 October 2021 article in the Orlando Sentinel, CEO Micheal Reininger talks about their requirements for the new trains. “We worked really hard to develop a solution that made the train look like you would imagine a high-speed passenger train should look like….The nose cone is a central signature of the train for us.” The train also had skirts added to the underside, to hide as many of the mechanical elements as possible. The seats are made by a company called Clerprem, who also makes seats for Lamborghini, Ferrari and other luxury auto-makers. Making it “look” like a high speed train has paid dividends. The media very often refers to Brightline as high speed trains, even though it is quite a bit different than the image of TGVs or Shinkansens the moniker may initially conjure up in peoples minds.
The interiors of the first batch of Brightline trains. Bright. Spacious. Room for bicycles. It was a winning recipe. Images by Brightline via Curbed Miami.
The stations, with the exception of the Orlando International Airport Intermodal terminal that Brightline will use, were designed by Skidmore, Owings & Merrill, a well known Chicage based architecture firm, in conjunction with Zyscovich Architects, who have been tasked with developing the urban planning for around the stations. There is a distinct design used across the stations so that when you have seen one Brightline station, it will be easy to pick out the rest. They have avoided a retro, kitsch, back to the olden’ days of railroading look, opting for something more modern, with plenty of amenities like food courts, coffee shops, and what not.
Exterior view of the Fort Lauderale Brightline station. The V shape used for columns and the exterior are a common theme across all the stations. They more closely resemble a small airport terminal than the typical image of a railway station. Image by Patrickhamiltonbrightline via Wikipedia.
Design firm Rockwell Group was responsible for the station interiors, and the development of the Brightline brand identity. The stations interiors are contemporary, spacious, and comfortable, if social media feedback is any indication. The interiors adopt the same vibrant feel of the brands marketing, where they can. And from the perspective of creating a complete Brightline experience, from booking on the app, to waiting at the station, and taking the train, they have absolutely succeeded.
A number of interior views of Miami Central station. The top left is of a children’s play area, the top right is a small coffee shop/cafe, and the bottom image is of one of the waiting areas. Images by Brightline via Curbed Miami.
When it comes to its advertising campaigns Brightline uses vibrant, bold colours, and a modern, sometimes South Beach Miami, style. It has paired up with the Miami Fashion Week, the Miami Heat basketball team, and brands such as Lily Pulitzer to target young, hip, well to do fashionistas and socialites as well as the traditional business market trains and airlines target. Interestingly, Brightline has not hired an ad agency, and instead does all of its marketing and on going branding in house, unlike VIA who uses Montreal based Cossette.
For its cross promotion with Lilly Pulitzer Brightline mostly just posted photos of good looking people in front of the trains branded livery. Image from Brightline via Twitter.
While Brightline may not use sex appeal in the same ways a 1980’s beer ad, or even a 1970’s CN commercial, does there is little denying they actively push that boundary. There is definitely a discussion to be had around whether this is a positive, neutral, or negative aspect of their advertising. A proper look it at is well beyond the scope of this article, though it is important to at least recognize that this is something the company does.
The only marketing hiccup Brightline faced was when they announced an ill-fated partnership with Virgin, which was going to lead to the service being rebranded from Brightline to Virgin Trains USA. A lounge was redone in Virgin branding, and some red lighting was used outside its Miami Central Station. But it never went any further than that, which is likely for the best as the Virgin branding was far less interesting. The deal went beyond licensing rights and would have involved some sort of an investment. But the partnership collapsed, which has since lead to a lot of legal wrangling between the two companies.
The few instances in which Virgin branding was used at Brightline stations. It is utterly boring and would have stripped away the elements of the Brightline brand that were actually interesting and effective. Left image via Brightline. Right image via Miami In Focus.
Brightline is a passenger rail service for the Instagram age. And it might be one of the few aspects that other passenger services in North America, be they intercity or regional, should take a real look at. But that is where the platitudes end.
How much of Brightline has actually been publicly funded?
Brightline was to be an antidote to Amtrak’s publicly funded bureaucratic bumbling or California’s disastrous, and expensive, high speed rail project. It was going to be free enterprise and capitalisms chance to show everyone how a passenger railway should be done. But the carefully crafted Brightline image is only skin deep. And one if it’s most important selling points, being privately funded, really struggles to hold up under any kind of scrutiny.
As noted earlier, it didn’t take long before the All Aboard Florida project was looking to dip into the public coffers. After a false start trying to secure funding via a Railroad Rehabilitation and Improvement Financing (RRIF) loan through the Federal Railroad Administration the company would eventually find its groove. Since then there have been four primary ways that public money has been funnelled into the project.
The first is through direct contributions, be it from a city or federal government agency. This is pretty straightforward “we will give you public money for your private endeavour”. This is not uncommon and it can, sometimes, be a valid use of taxpayer funds. Listed below are the known cases in which this has, or is planning, to happen.
The Orlando Brightline Station (aka the Orlando International Airport Intermodal Terminal): While this project is part of a larger OIA upgrade project, the USD221 million station had USD159 million in grants from the FDOT, and USD52 million in loans. Brightline itself only paid USD10 million towards the project, and will pay USD2.8 million/year in rent once operations begin, along with a per-passenger fee to the airport authority.
Miami Central Station: Local governments in Miami-Dade County paid for USD43 million of the USD70 million dollar project, with Brightline covering the remainder.
Miami Aventura Station: Once again Miami-Dade County provided public funding for this station. The total was USD76 million which included USD57.4 for construction, and the balance going towards land acquisition, with the ownership of that land handed over to Brightline.
Boca Raton Station: The cost of the station and parking garage is USD46 million, of which the City of Boca Raton will pay USD9.9 million towards the parking garage, along with a USD16.3 million US DOT grant that will go towards the cost of the station.
Port of Miami Station: The station itself is estimated to cost USD15.4 million with Miami-Dade covering at least USD5.2 million of that cost. More public funding could be demanded if cost of the station increases from the surprisingly low figure of USD15.4 million.
Bridge replacement in St. Lucie: A single tracked rail bridge over a busy waterway (and one of the few single tracked sections to remain on the line from Miami to Orlando) is in need of replacement, to the tune of USD100 million. In order for Brightline to undertake the project, Stuart and Martin counties are having to seek out state or federal funds for a certain portion of the project. The two city councils have approved pursuing the grants and the amount of public will likely range from USD66 - 100 million.
FRA Funding for 13 rural at grade crossings in parts of St. Lucie and Palm Beach Counties. Total amount was USD2.3 million
The second method is part of the rather complex agreement made between Brightline and the Central Florida Expressway Authority (CFX), who are responsible for a number of toll roads, including State Road 528, which is where the line from Cocoa to Orlando International Airport will be built. To say the deal with CFX is challenging to decipher would be putting it mildly.
To begin with, there have been some payments made to CFX. Brightline (then AAF) made two one time payments to CFX (then Orlando-Orange Expressway Authority), according to page 61 of documents issued relating to the CFX’s USD425 million Series 2016B Bond issue (FYI…this link will download the entire 510 page PDF). The first was for the purchase of an easement in which AAF would be operating in for USD31,737,187 and the second was a payment for anticipated revenue loss due to people shifting to Brightline which amounted to USD4,003,848 (more on that gem later). In Dec 2015 a piece of property was purchased by AAF, at a cost of USD1.4 million to fill in a final gap in the right-of-way corridor it will be building its rail line on. And there is also a yearly lease paid to FDOT of USD275,000
The flip side is that there have also been several transactions and projects undertaken by CFX where Brightline does not appear to have made a direct financial contribution.
In Aug 2013, as part of the pre-lease agreement between All Aboard Florida and Orlando-Orange Expressway Authority (the precursor to CFX), a USD12 million strip of property next to the Beachline was purchased by OOEA.
According the CFX site, land south of the State Road 528 corridor has been purchased that could be used for a multi-modal corridor that could link the Orlando International Airport with Florida’s East Coast (this would be applicable to an extension to Walt Disney World and onward to Tampa).
There were upgrades to the interchanges of SR528 and Innovation Drive., along with SR528 and Dallas Boulevard, that were actually undertaken by the Central Florida Expressway Authority (CFX). According to Google Earth imagery each project was underway by at least June 2017 and November 2019 respectively. They are both part of CFX’s planned works, and both centre around grade separation work that will benefit Brightline. The Innovation Way project is listed at USD62 million while there is no individual price attached to the Dallas Boulevard project (though with just one grade separation it is like around USD20 million). Thus far none of the litany of documents consulted, be they bond issue, lease agreements, CFX, or Brightline documents have indicated that these projects are receiving compensation from Brightline, despite them having an immediate benefit to their project.
This put the total known Brightline contribution into the State Road 528 corridor at USD37,141,035 while the total gain in terms of CFX funded projects and projects that benefit the current Brightline build out are at least USD94 million, plus an additional land purchase that will benefit the Orlando to Tampa link.
There is a lot more to the Brightline and toll road authority deal than just money. It actually has a massive impact on the future of Brightline and its ability to expand service, let alone for anyone else to come in and operate. The power that CFX yields over the future of passenger rail in Florida is quite substantial which is why they will come up again later.
May we have some commuter lines to run our service over, please
Brightline’s third, and most recent, tactic is perhaps its most clever to date. Having to build additional track in an existing corridor is expensive. Having to build an all new corridor even more so. So what if someone else built the track you needed? Then you could simply run your trains on the line, and pay for the space you needed without spending the money and taking the financial risk yourself. Brightline is pulling this trick not once, but twice.
For years Miami-Dade has wanted to get some sort of commuter rail service onto the FECR line (the one that Brightline uses). While Tri-Rail, the agency that runs the existing commuter service, operates on a line that is just east of the FECR corridor, it is less than ideal as it runs closer to the edge of the more urban, built up areas, as opposed to right through them. When Brightline entered the scene this started to change the nature of potential commuter rail plans. By November 2020 talks were well underway to have Brightline operate a commuter rail service in the FECR corridor.
In early 2022 the first signs that an arrangement was moving forward emerged. In February Brightline announced, in an investors report, that it had sold the commuter access rights in the corridor to a Brightline affiliate company for USD245 million. The exact relationship of that company to Brightline and FECI is not known, and that does make a difference as to whether this was closer to an actual sale of the access rights, or simply shifting money around on balance sheets. In March Miami-Dade transportation officials approved a USD345 million, 21.8 km (13.6 mile) plan to create 5 new commuter stations, along with track work and other necessary projects, for a Brightline run commuter service from Miami Central to the upcoming Aventura Brightline station.
Of that USD345 million, half will come from Miami-Dade County, with one quarter from Florida DOT, and the remainder coming from funds allocated by the Miami Area SMART Plan, which funds various public transport projects across the region. There is also a USD16 million annual cost to operate and maintain that phase of the commuter service and cover the access fee to the tracks that would be paid to FECR, which if a 2020 article is any indication, will be covered by Miami-Dade, not Brightline.
In any of the information published to date, it does not appear that Brightline is contributing anything to the capital cost of this project. In addition, the extra track infrastructure that will be built is going to benefit Brightline’s intercity services as it will allow much more flexibility with its operating patterns, and reduce delays that could result from accidents or mechanical issues. There are also plans being formulated to extend the Brightline run commuter service, and associated infrastructure investments, 43km north of Aventura Station into Broward County.
The commuter rail investment in Miami-Dade and beyond isn’t mission critical. Brightline can still operate as it does today without it. If you want to give them the benefit of the doubt you could call it a “publicly funded freebie” or a “thanks for being awesome Brightline” bonus. However, the proposed Sunshine Corridor is much different in that it is an absolute requirement for it’s plans to extend service to Disney World, and then onward to Tampa.
At just 26.7 km (16.7 miles) in length, this one section of track has been the most contentious part of the Brightline project to date. Even relative to the Brightline project as a whole, the saga over trying to connect Orlando Airport with a stop on the Disney compound has been an absolute shit show. The battle has involved Brightline, Disney, Universal Studios, Sun Rail, CFX, FDOT, Orange County, the Orlando Airport Authority, and various community and homeowner groups.
The incredibly long back story and drama is going to be skipped, instead picking up in March 2021 when Brightline unveiled the cost for two proposed routes. The first would run parallel to State Road 417 and cost USD1.03 billion, and the second would use part of the State Road 528 corridor, cost USD2.1 billion, involve numerous private properties, and require the cooperation of Sun Rail. This resulted in many people having many opinions, though more people preferred the second option because it was more useful to local residents and also served Universal Studios.
Fast forward to April 2022 and a tenuous coalition had been formed among warring factions which came up with a new proposal, dubbed “The Sunshine Corridor”. Essentially it is a modified version of the more popular of the two previous route options, except with more utilization of Sun Rail’s tracks, and a connecting line so that they can provide local commuter service to the airport themselves.
Because Sun Rail is a public transport agency and there is the USD1.2 trillion infrastructure package just waiting to be used, they would be responsible for getting the funding and building the 26.7 km line, and Brightline would simply lease track space from them after the fact.
With applications for funding due in Summer 2022 the outcome of this strategy will probably not be known until sometime in 2023, though it is likely to be successful. This also leaves the lingering question of whether they will attempt some sort of a similar strategy for the Disney World to Tampa section of the line. In February 2022 negotiations were completed between Brightline and FDOT for access to part of the I-4 right of way, so that potential plot twist could be revealed in the coming year.
When a railroad is also a highway
The fourth source of public money, and the largest, so far, comes as a result of Brightline using tax exempt Private Activity Bonds. The use of bonds to fund public infrastructure is not uncommon, and may well be the standard way in which those projects are financed in the US. However tax exempt PABs have some key differences from the bonds that are usually issued.
The underlying purpose is still the same, to invest in a project that has some perceived public good, even if it is being done by a private company. Backing by the municipality or state in which the project is taking place in is still required, however the financial risk is assumed by the private company. The tax exempt status means that the income from interest is exempt from federal, and more often than not state, taxation. So for example a tax-exempt bond with a 6% interest rate would ultimately result in the same amount of income to an investor as a taxable bond at 8%. That makes them great for private companies looking for cheaper financing, however they come at a cost for the state and federal governments that issue them.
In August 2014, Brightline (then AAF) applied for USD1.75 billion in private activity bonds through the Federal Department of Transportation under Title 23 to support Phase 1 and 2 of a planned network to Orlando. The rules under which funds or PABs would be issued were clearly spelled out. Though Title 23 primarily relates to highways, there was an allowance for high speed passenger rail projects whose speed is 150mph or greater. Brightline’s top speed was going to be 125mph, hence it did not qualify.
However, in 2011 the federal government spent USD9 million in order to upgrade some of the rail crossings on the Brightline rail corridor that was, at the time, only used by FECR freight trains, and was prior to Brightline (then AAF) even being registered as a company. Because of that one small project, Brightline (no doubt with a gaggle of lawyers) took that to mean the corridor qualified as a highway, which meant that it could apply for PABs under Title 23. In December 2017 Brightline was issued USD600 million in PABs through the federal DOT for phase 1 of its project, and later in that same month it would receive USD1.15 billion for phase 2.
Objections escalated quickly and on 19 April 2018, just 4 months after the PABs had been issued, a hearing before the Subcommittee on Government operations had been called to examine the use of the “tax-exempt bonds for All Aboard Florida’s Brightline passenger rail system”. Aside from the admission by DOT official Mr Burthey that the Brightline rail project “fits the definition [of a highway] under the statute”, thus justifying their support of the application, there were questions about the cost of private activity bonds to taxpayers.
According to a consultant hired by Citizens Against Rail Expansion (CARE FL) the cost of the USD1.75 billion in PABs to taxpayers would be around USD600 million for the first 10 years of the bonds issuance. According to the testimony of Brightline President and COO Patrick Goddard, the amount would be around USD250 million. Later during the hearing it was noted by Mr Reingold that a District Court judge, a more impartial body, found that over a 10 year timeframe the amount was somewhere in the range of USD370 - 600 million. The latter figure is likely the most accurate estimate.
Given that in Dec 2021 Brightline took the first steps toward issuing an additional USD 1 billion in tax-exempt bonds, this could put the total amount of PABs issued at USD 2.75 billion, which would be a potential taxpayer cost of USD 392 million according to Brightline’s numbers, or between USD 581 million to 942 million, according to numbers given by the District Court judge, and CARE FL’s consultant.
What were the consequences for Brightline and the federal DOT allowing the PABs to be issued under the guise of Brightline being a highway? Zero. No one lost their job. There was no media fallout for Brightline. There was a petition brought forward by Indian County versus the federal DOT to review the decision to issue the PABs (there was a lot of local opposition to the Brightline project so this was another avenue to fight against it). But on 5 October 2020 the US Supreme Court denied review of the project, squashing their legal battle against them. The wheels kept turning, and Brightline kept their money.
If the only concern with Brightline was just some run of the mill grifting of public money that would be one thing. But that is far from the only problem.
Brightline, building the VIA Rail of the 1990’s, today
Not all roads are equal, with differences between the design and construction of a freeway versus a suburban arterial, being fairly obvious. But because people tend to have a much more limited experience with rail infrastructure, it might be much less obvious that not all rail lines are the same. Despite media, private enterprise cheerleaders, and Brightline fanboys often referring to the project as high speed rail, it is anything but that. And the ultimate design of the Brightline infrastructure has very real impacts on the overall value and scalability of the project, and even more importantly, and tragically, very serious consequences for the safety its operations.
It is worth taking a moment to understand exactly what Brightline’s infrastructure will look like.
There are two distinct sections of the project. The first is from Miami Central to Cocoa, a stretch of roughly 340km, or 212 miles. Before Brightline entered the picture, the entirety of this section had been a single track freight line, though the majority of it had been double tracked in the past. Now it will once again be double tracked, save some sections were there are single track bridges that need to be replaced. The full length of this section is also shared by the freight railroad operations. There are no dedicated freight or passenger tracks. They run in a mixed use system.
A Brightline train running down a section of the corridor that has not yet been upgraded. This is a pretty typical view of how the rail line looked prior to Brightline adding a second track to support their operations. Image via WFTV ABC 9
For the first 140km of this section it runs through built up, suburban, and sometimes urban, areas. There is no break in this pattern either. It is the kind of continuous “urban” corridor that many people in the 1960’s thought would be standard up and down the full length east coast. The line doesn’t actually see a hint of natural landscape until about 140km after departing Miami Central when it briefly goes through Johnathon Dickson State Park. Below you can see Google Earth images of the typical environment the line runs through.
For the first 140km of the line it is surrounded, on both sides, by various residential, commercial, and industrial development. This means it also cross well over a hundred roads, many of which are incredibly busy suburban arterials. Image from Google Earth.
One of the biggest challenges facing not just the first 140km of line, but the entire section between Miami and Cocoa, are the number of level crossings. For those who might not be familiar with that term it is when you drive, walk, or bike, directly across the tracks. On busy roads or paths this will mean lights and gates, while in rural areas or for private crossings, it might simply be a sign.
On the left are lights and a gate that protect the rail crossing when a train is coming. On the right is a rural crossing where a cross hatch and stop sign are the only protective measures used. Gates and lights obviously provide a lot more safety, but on busy roads, even those are sometimes insufficient. Image taken by the author.
The second distinct section of the line is from Cocoa to the Orlando International Airport Brightline terminal, which is around 60 km, or 40 miles. This is an entirely new alignment that will be in the State Road 528 right of way, and will be fully grade separated (so no level crossings). There are going to be no freight trains using this alignment and when it is first opened it will largely be a single track line (with the necessary sidings), though it has been built to accommodate double tracking in the future. Neither of these two sections is electrified, nor are there any plans to do so.
A view of the corridor near the Orlando International Airport. The most important aspect of this section of track is that every roadway goes under, or over, the railway, thus eliminating level crossings. Image by Brightline from Mass Transit Magazine.
In isolation, none of that means very much. Is that good? Bad? About average? As it turns out there is a rough North American equivalent, which has been around for decades, to help offer some context. It is the infrastructure VIA Rail uses to run its current Toronto to Ottawa service.
Miami to Orlando is a slightly shorter trip, 401 km versus the 449km from Toronto to Ottawa. However, they both have two distinct sections of mixed rail traffic, with the Miami to Cocoa section being 341 km long, and the Toronto to Brockville section being 338 km long, and then their own dedicated track, with Brightline’s being 60 km in length, while the VIA line from Brockville to Ottawa hits 111 km in length. So it’s not exact, but it’s reasonably close.
Across the full length of each service the number of crossings (be they level or grade separated) are roughly the same, with the VIA service having 347 crossings, versus 366 for Brightline. The big difference is when it comes to how many of those are grade separated, of which VIA has 134, while Brightline has 35. But there is more behind those numbers. For the most urban part of the VIA network, that being from Toronto Union Station to Oshawa, 47 of the 56 crossings are grade separated, and with GO’s modernization of the Lakeshore line, at least 3, and as many as 6, of the level crossings on that section will be grade separated. Through the first 58km of the Brightline network, there are 10 grade separations, the majority of which are through Miami International Airport property, and under freeways.
Even beyond the most urban parts of each network, there are far more grade separations on the VIA network, in particular through towns and cities. And among level crossings, 63 of the 213 level crossings across the VIA line are farm or private crossings, meaning there are likely no more than a dozen crossings a day, and in some cases, maybe only a handful each week. In stark contrast, the majority of the grade separated crossings on the Brightline network are on the all new alignment from Cocoa to Orlando. Though it crosses a number of busy highways and freeways, it doesn’t run through any built up areas.
The above chart breaks down the composition of grade separated and level crossings for each of the various sections of the Brightline Miami to Orlando, and VIA’s Toronto to Ottawa, services. Chart by the author.
If you haven’t checked out reading the last half dozen paragraphs then just hang in there a bit more, this is going somewhere. In North America, lines that have level crossings automatically have their top speed restricted to 177km/h (110mph), no matter how straight it is, how great the track is, and no matter how many gates and bells are in place to guard those crossings. However, on sections of a rail line where there are enough continuous grade separated crossings, trains can run faster than that. In practice that means a standard, reasonably straight line with modern diesel passenger train equipment can reach speeds of 200km/h, or 125 mph. Once you try to push speeds beyond that you need the kind of massive infrastructure projects that are seen when building high speed, electric, rail lines capable of speeds 300km/h or more.
View of a European high speed line with a German high speed train operating on it. These lines need to be relatively straight, and completely isolated from their surroundings. Everything must be grade separated, including any allowances for farm equipment or animals to cross and they must be fenced in to protect from any human or animal intrusions onto the corridor. These high speed lines are the creme de la creme of passenger rail service, but are also the most expensive to build. Image by Xrispixels via Flickr.
With the infrastructure that VIA uses there are not enough sections of track, outside of the built up GTA region, with uninterrupted grade separation for them to operate trains above 177km/h. In practice, the actual top speeds have been around 150 - 160km/h in large part because of the state of the equipment and the need to upgrade sections of track to go above that threshold.
Brightline of course has the “ooh la la” factor of being able to say that it’s trains will run at speeds up to 200km/h. From a marketing perspective, in a North American context, this is an absolute coup. And given that it has to build an all new right of way in order to be able to connect Orlando with its east coast mainline, why wouldn’t you go the extra mile and build infrastructure that allows you to make that claim.
But the section of track in which Brightline can actually push its trains to 200km/h is relatively short. Over 60km the time trains save by running at 200km/h versus 177km/h is only around 3 minutes.
Despite Brightline having a small section where trains can travel at 200km/h, the overall design of the line means that it is not much faster than the current Toronto to Ottawa VIA service. As it stands the travel time for Miami to Orlando service will be around 3h15, which over 401km means an average travel time of 123km/h. The average travel time for Ottawa to Toronto service is around 4h15, over a distance of 449km, which means an average travel time of 105.6km/h. That means that if the Brightline service was done at the same average speed as VIA’s it would do the Miami to Orlando trip in 3h48.
At first glance it would seem like a 33 minute time savings is not too bad. But there are some important differences. While 2 of 10 daily weekday trains from Ottawa to Toronto make just two stops, the rest make anywhere for 4 - 11 stops. And the average time has actually slipped over the past few decades, owing to busier freight traffic, the need to split trains in Brockville, and aging equipment. With the new trains that VIA have started to take delivery of, some work on the dedicated track it owns, and if it were able to reduce trains to the 2 - 4 stops the Brightline service will do, travel times could be noticeably reduced. In addition, the 3h15 travel time for Brightline is based on two stops in between Miami and Fort Lauderdale. When Aventura and Boca Raton open, this will add 4 to 5 more minutes to the total travel time. The difference in travel times between the two lines could ultimately be rather small as each of the services evolves.
The end result is that what Brightline has created is only a fraction better than the VIA rail network that has existed since the 1990’s. And for anyone who taken VIA Rail over the years, that is a pretty rubbish standard to be at. But there is one aspect in which Brightline clearly has the competition beat. They can offer a slightly higher frequency, and standard departure times, owing to the lower amount of freight track, and having partial control of the dispatching company. That is certainly a plus. But achieving those times and frequencies, on the infrastructure that it uses, has serious consequences.
A network designed to kill
In 2018 and 2019, its first two years of operation, more than 40 people were killed in the Brightline corridor. Even with the service being shuttered for much of 2020 and 2021, as of February 2022 the total had increased to 57 deaths. There is no publicly available number on the number of non-fatal accidents involving trains and people on foot, on bike, or in a car, but google searches show there is no shortage of those stories either.
Brightline’s record wasn’t just bad, it was actually the worst of any rail operator in the US. The reason for this has already been discussed, and that is the large number of level crossings through highly built up suburban and urban areas, along with the speed the trains operate through some of those sections. Just the sheer volume of traffic, even if those drivers are among the very best, means that accidents are going to be inevitable.
After the report was released, Brightline conducted an internal study which claimed that 75% of those deaths were from suicide or drugs. This was quite a deviation from the national average which puts railway deaths by drugs or suicide at 30%. In response to the report the Brightline CEO also went on to rail against possible regulations that might require them to address safety concerns, like fences, saying that any regulations could impact their bottom line and jeopardize the future of the company.
Brightline’s communications and marketing team appear to have been successful. As just one example an 18 November 2021 article from a local CBS affiliate in Florida repeated the claim that 75% of the deaths were from drugs or suicide, without mentioning the contradiction with the national average, and without mentioning that this was the number Brightline themselves came up with. In fact this stat appears in most of the recent articles talking about the deaths by Brightline trains. This includes reports which talk about Brightline contributing to suicide prevention programs, though there is no indication of how much they are actually contributing to those types of programs.
The deaths have not gone un-noticed since that report. On 25 January 2022 the Miami Herald published a feature length article that details perhaps better than anyone so far, the safety record of Brightline. It includes interviews with family members of those who have been killed, and outlines the many reasons why this problem exists. But it also ends with a quote from Gus Ubaldi, an airport and railroad engineering expert at Pennsylvania-based Robson Forensic that sums up the attitude many people have towards the deaths. “How much are you willing to pay as a taxpayer to put up more fencing or improve a grade crossing for the small number of people too stupid to care about their own lives?” It shows just how much Brightline has won the PR battle. People will rail against the use of taxpayer money to save “stupid people”, but also defend the company when it says it can’t be responsible for safety upgrades because it will jeopardize their financial viability.
There is a cruel indifference towards the deaths that is on par with police agencies telling pedestrians to be aware of cars even when it is clearly the fault of the driver for finding their way onto a sidewalk, or blowing through a red light. A lot of people do care about the deaths, but a lot of people don’t, especially among organizations or individuals who are simply interested in seeing more trains.
Brightline is not for poor, working class, or even much of the middle class
That kind of callous attitude does not emerge out of thin air. It is evolves out of a more benign indifference towards people.
An article in the Orlando Sentinel summed up the Brightline philosophy best “Overall, the company cares less about providing utilitarian transit for the mass and more about first- and business-class experience that happens to occur on steel wheels”. Even the headline for the article is telling of the companies philosophy “Brightline revamp intercity rail with speedy nose, elegant seats, no coach class”.
This strategy has hardly been kept secret. Brightline President Mike Reininger said in an interview “Our approach is pretty different from that of other transport-only services where traditionally they target ridership at the lowest cost possible. We view this more as a hospitality product than as public transport. We are targeting revenue rather than riders, looking for the optimal revenue profile.” Reininger went on to say “We only need to capture a small percentage of the travel market – single-digit penetration gets us to profitability,”. More on that single digit comment in a moment…
You can see this throughout most aspects of Brightline’s marketing and operations. At its core, it seems to have adopted a similar strategy to that of VIA Rail. When Montreal ad agency Cossette was launching the Love The Way campaign for VIA in late 2018 part of its strategy was to create 3 traveller personas…business, adult leisure, and youth, with marketing being tailored to each group. Brightline’s ads feature, and target, the same groups, but with each having substantially more style, money, and a openly gregarious lifestyle (especially the ads targeted towards the younger demographic with people that more closely resemble fashionistas and Instagram influencers rather than generic, suburban, Canadian kids).
In their current batch of stations there are no waiting areas that resemble what you would traditionally see in a train station. Even the Smart class passengers (the cheaper of the two classes), have comfy seats, carpeting, USB and power sockets next to all of them, etc, with the Select (ie business class) passengers getting all that, plus free snacks and booze. For anyone who has ever flown Porter Airlines in Canada, this model will look very familiar.
Then there is its focus on putting stations in only the poshest of neighborhoods, or serving destinations that are key tourist attractions. Lets be clear, there is nothing wrong with wanting to capture people taking cruises, or travellers who are coming to Florida primarily to go to Disney World. France sends it beloved TGV to Disneyland Paris because its good business for them. And many airports around the world are integrating rail service into their terminals, replicating (or half-assed trying to replicate) Amsterdam’s Schipol Airport which was at the vanguard of integrating passenger rail into local and international transportation networks.
But with Brightline there is a blatant disregard for large parts of the population that it does not deem important for its business goals. One clear example is the fact the train goes to the airport in Orlando, but does not serve any part of the city itself (not even the suburbs, let alone a more central areas). Then there is the case of the Treasure Coast, a collection of 3 counties (Indian River, St. Lucie, and Martin) which is home to 647,000 people as of the 2020 Census, with counties seeing growth rates between 8.3% - 18.5%. As mentioned earlier these were the counties that were fighting the project because they will see an increased number of trains using the corridor, along with the associated safety concerns, without the benefit of even a single stop. None of the 3 counties are particularly poor either.
Map taken from a House Commerce Committee Presentation which shows the per capita income of the counties in Florida. Even though Indian County is in the highest per capita income bracket, it is still not getting a Brightline station. Image from the Florida Legislature Office of Economic and Demographic Research.
Meanwhile, the wealthy community of Boca Ration, located between Fort Lauderdale and West Palm Beach was able to get an infill station in part because “the train service wasn't readily accessible to residents of southern Palm Beach County and northern Broward County. Passengers were forced to drive 20 miles north or south to board the train.”. That’s right. Those poor souls had to drive a whole 20 miles so it is clear why they absolutely needed a station of their own. Being able to use local taxpayer funds and drum up FDOT funding so that Brightline did not have to pay the full cost of the station certainly helped out too.
Any publicly funded agency that simply passed by 647,000 people would be, rightly, evicerated by taxpayers at large for failing to provide service to such a large population of people. But doing that is in tune with Brightline’s strategy. Previously it was mentioned that the companies President said their market penetration would be in the single digits, and when he said single digits, he meant it. In fact it will actually be on the lower side of those numbers. According to the SEC prospectus for its failed Virgin IPO, with the ridership projections used at the time, a number that they claimed will get them to profitability, they will only capture 2.3% of the travel market that their service reaches (9.6 million of the 413 million trips that take place in the Miami to Orlando corridor).
There is Brightline’s relationship with public transport. In some instances, such as the case with Miami Central, it is clear what Brightline thinks of transit. When Miami Central was built it was designed to accommodate future Tri-Rail service to the station, but around mid-December 2021 it was discovered that platform issues would not allow current Tri-Rail trains to use the station. A key part of the reason they were able to get taxpayer money for the project was because of this provision to help bring the existing Tri-Rail line to a more central location (when discussions about fair uses of public money for private projects arise, that would be an instance where you could make a valid argument in favour of it). After the mistake was discovered, Brightline initially suggested just buying new trains that would fit, which has sparked what will no doubt be an ongoing battle between Brightline and the public agency.
In other instances, the dismissiveness of public transport is a bit murkier, and it is hard to tell if Brightline is simply reacting to pre-existing conditions and attitudes, or if they are aiding in further degrading the image of publicly funded transit. Brightline has said that it is working on creating an integrated payment option for transit for Miami-Dade Transit, Broward County Transit, and Palm Tran. But when it comes to what it has actually implemented in terms of options for getting to and from their stations, you get the private transit service known as Brightline+, which consists of hourly shared shuttles, private rides in Teslas (aka taxis), and even bikes.
And then there is the now cancelled Wave streetcar line in Fort Lauderdale, and the subsequent replacement for it. Many years in the making, it was suddenly cancelled in May 2018 after higher than expected bids for construction proved to be the final straw. The 4.5km (2.8 mile) project that was going to cost at least USD147 million and since the city had the right to cancel the contract if bids exceeded USD142.5 million, they did.. Stepping in to fill its place is…the Boring Company with a proposed Las Olas Loop that would go from the Brightline station to the beach. The cost of a trip, per person, is estimated to be between USD5 - 8, which puts it at 2-3 times the cost of normal transit service. The cost of the project, which is not known, is estimated around USD10 - 15 billion per mile, not including stations, and though the Boring Company will initially pay for it, the city will have to pay back the full costs.
Brightline was or is not directly involved in either of the projects, nor has it publicly come out for or against them. In this regard they are not trying to directly influence any decisions on local transit. But the existence of Brightline, of a “privately funded”, privately operated, elite public transport option that is counter to Amtrak, serves as a catalyst for private options to be taken seriously in the local transit space. It doesn’t matter that the true financial viability of Brightline won’t be know until the end of this decade, at best. In the eyes of media and the public, it is already a success and serves as a proof of concept. This will have very real consequences on the growth of accessible, affordable transit options that are designed for all people, not just for some.
Brightline has never hidden the fact that their service is only for a select group of people. The numbers, their actions, and continued statements, highlight that fact with an unashamed, and blunt, honesty. But even their politically palatable version of public transport has run into road blocks from a seemingly unlikely place.
Toll roads show their power as they fight to protect their domain
One of the stranger parts of the Brightline saga has been their relationship with the Central Florida Expressway Authority (CFX), once know as the Orlando-Orange Expressway Authority (OOEA). While Brightline has made it’s fair share of questionable decisions, it’s decisions when CFX was involved may have been a case of “accept our terms or you get nothing”, given the power the toll authority possesses.
On the surface it seems like it is an ideal relationship. After all Brightline was able to build in the State Road 528 right of way in order to bring rail service off of the Florida East Coast Railway mainline in the Cocoa, to the Orlando International Airport. How bad could it be if they were actually allowed to build something?
The agreement was approved by the OOEA in October 2013 however it would take a few years for all of the specifics to be worked out. It is commonly stated that in Dec 2015 AAF signed a lease agreement with OOEA for USD1.4 million. That is not correct. In fact the USD1.4 million was a payment that AAF made so that a property could be purchased that would fill in the last gap of the right-of-way needed, both by AAF and the Expressway Authority, as was discussed earlier.
Once the final lease agreement was released it raised a few eyebrows over some of its more restrictive clauses. The most reported on, at least initially, was the one that stated “AAF shall not use the Property to provide freight transportation services or for commuter rail services (which for the purposes of this Agreement shall mean passenger rail service between points within a single county).”
However, other clauses were equally concerning. One of them stated that Brightline must have approval from CFX or else “no expansion, additional stops or depots may be added and no intercity passenger rail service may be expanded by AAF as described above…”. This wasn’t just for service within counties. This was for any additional service, full stop. Conditions that must be met are conducting studies to determine how many cars may be taken off of the toll road, and then determining a compensation to CFX for lost revenues. This agreement was put in place when there were only 4 stations planned; Miami, Ft Lauderdale, West Palm Beach, and Orlando. And at the time it was in Brightline’s (then AAF) best interest to simply ram through any deal they could in order to get the line built out to Orlando.
But this now means that even if they really wanted to build a new station in the Treasure Coast region (which they are still not keen on), they would have to get approval from CFX first, and then pay them a yearly, or one time, fee to cover the perceived loss in revenue. Likewise, the potential for that corridor to do double offering as some sort of commuter service within the Orlando region (in the way the West Palm Beach to Miami section serves a limited commuter role today, and will become a full fledged commuter corridor in the future), is also off the table.
CFX has doubled down on this in the on going negotiations with Brightline and the Florida DOT over right of way access between Orlando and Tampa. Negotiations between the company and agencies began in Nov 2018 after Brightline (then Virgin Trains) was the only company to submit a proposal for rail service on the I-4 corridor between Orlando and Tampa (earlier in 2018 they submitted an unsolicited proposal which then kicked off a formal process for other submissions).
Over that time, in part due to the pandemic, there have been numerous extensions and delays. In March 2021, when one of those extensions was issued, it was reported that a requirement Brightline needed to meet was a comprehensive study on the amount of traffic that would be diverted off the toll road, and a compensation plan for the lost revenue, for the proposed Orlando to Tampa route. Even though that was a requirement previously, it still seems to have surprised many that it was also going to be the case for this section of the line.
It has become even more complicated in recent months. A 13 September 2021 article in the Orlando Business Journal titled “CFX does not have ‘legal right’ to give State Road 417 right-of-way to Brightline’ discusses the claim made by Orlando-based Callan Law Firm PA on behalf of Hunter Creek community residents. In short, it relates to binding agreements that CFX (then OOEA) made in 1991 in order to get the right-of-way to build State Road 417, an agreement which restricted the right-of-ways use for rail purposes. This statement was countered by CFX’s own counsel via a letter to CFX’s board on 12 Aug 2021.
This is still an on-going issue, and will almost certainly be resolved by paying some sort of compensation to home owners in Hunters Creek. But it serves as an illustration of how deeply rooted CFX’s anti-rail clauses are and they could very well hinder passenger rail development in the state for decades to come, whether it is Brightline or another agency.
There is no guarantee the owners won’t bail once they have extracted their real estate gains
One of the most important, and under appreciated, aspects of public transport is the permanence those agencies are perceived to have. If you move to a part of a city because of its transit service, you know there could be small changes to service, but you don’t expect the agency to simply pack up and leave. There is no fear that a rival agency will come in and buy up a subway network. And in cases where volatility makes you question whether an agency will maintain service in the future (such as VIA in the 80’s, or Toronto in the 90’s, when massive cuts were taking place), people will simply move away from that option so that they don’t find themselves stranded in the future.
Brightline, in the eyes of FECI and Fortress, is not viewed as a unique service among its investments. A 28 August 2013 article in Florida Trend spells it out clearly. All of the business units have been separated from the start so that they can be cleanly sold off, when the moment in time comes, without any difficultly. Vincent Signorello, CEO of FECI at the time of the article, even stated “We're constantly measuring the moment in time when our capital investment should end and someone else's should begin,"
Just as its only a question of when, not if, FECI will sell off its latest real estate investment, the same is true of Brightline. Right now there are still some incredible real estate gains to be made as Brightline continues to expand and a secretive process about where it will or will not stop gives FECI a leg up on which properties will be the best to buy. But once expansion is over and real estate gains have been made, there is no need to keep the rail service, especially if it fails to be profitable.
The idea of FECI selling off its businesses isn’t a hypothetical either. On 27 March 2017 a story went out across the newswires that Fortress was planning on selling the FECR to Ferricarril Mexicano (Ferromex), a leading railway company based out of Mexico, for USD2 billion and in the week following the deal was confirmed as a USD2.1 billion deal, pending regulatory approval. An asset that was central to Brightline’s origin was gone from FECI’s portfolio. And though the co-ownership of the Florida Dispatch Company, and exclusive passenger rights remain for now, it is the first layer of the uncertainty onion being pulled back.
In the hands of FECI there is at least a semblance of understanding as to what the corporate culture or modus operandi of the company means for Brightline operations, and how it will interact with the government agencies and various members of the public. Who knows how a new owner will approach operations and its role within the public realm. And if no private buyer can be found, the state will be forced to purchase it in order to ensure the whole service isn’t shuttered. No service is resistant to unexpected changes and cultural trends that may make it more or less relevant. But Brightline in particular, will become particularly volatile when the for sale sign is inevitably placed on its doors.
Classic political and corporate corruption
One part of the Brightline saga that will not be covered is the accusations and potential for political corruption to have played a role in the project being able to move forward. There are questions about the role one of Governor Rick Scott’s aides, Adam Hollingworth, played in the decision to reject federal money for the Orlando to Tampa high speed rail project, given that he went to work for one of All Aboard Florida’s sister companies months later. CFX itself has been accussed of having a ‘culture of corruption’ on numerous occasions. In 2018 there were questions about investments Rick Scott and his wife made in a fund that has links to the Brightline project.
Those are just a few examples but the more you dig into Brightline, the more it becomes clear that old-timey political corruption has almost certainly played a role in the projects ability to move forward, be it a minor or major one. But doing the kind of detailed investigation needed to actually uncover details, and documents would be the kind of undertaking a seasoned journalist would need months to do, along with the backing of media muscle, and money. And that kind of research would be necessary to ensure any discussion around it cannot be misconstrued as gossip, or having some sort of partisan agenda. For the purpose of this article, it is sufficient to say that the heaps of accusations and known instances of potential corruption make it worth noting, and hopefully worth someone investigating in the future.
Is Brightline good value for money?
What if, despite all the shady tactics, potential corruption, and use of ill gotten taxpayer money, people didn’t care and just wanted to simply judge the project on its merits, because the ends justified the means? And that is a fair question since it seems that outside of local communities trying to fight back against Brightline, no one actually cares that this is not an as-advertised project.
Some aspects of the endeavour, such as ridership and profitability, will take 5 to 10 years of service before an assessment can be made of whether FECI succeeded in that regard. However, what is known today is what infrastructure this project is going to create, and from that an estimate of the value for money can be made. The resulting infrastructure that is being built is incredibly important as it will determine the scalability and adaptability of the network to deal with future demand.
As mentioned earlier the estimated cost of the Brightline project from Miami to Orlando is at least USD4.5billion and is likely to approach USD6 billion. This includes the costs to build stations, maintenance facilities, and purchase the train fleet.
If the final cost of the Miami to Orlando project is USD5.5 billion (lets give them the benefit of the doubt) that works out to around USD13.72 million per km, or CAD17.15 million per km. There are two Canadian projects that could be seen as comparable in many regards. The first is the Calgary to Banff rail link project. Its total cost is estimated to be CAD1.5 billion, but assuming that total costs will be closer to CAD2.5 billion, that would put the per km cost at CAD17.24 million. VIA HFR, which will link Toronto to Ottawa and then Montreal onward to Quebec City is an 850 km long project. The costs are estimated to be between CAD6-12 billion, but assuming the final costs are closer to CAD15 billion, that would give a per km cost of CAD 17.65 million per km.
One aspect of the Canadian projects could explain why they are able to do more with the essentially the same amount of money, and that is the stations. In particular on the HFR project a number of existing stations will be utilized. However, new stations will be required, and even existing stations will require some sort of modernization to deal with increased traffic. Or in the case of long dormant stations, they will need to be completely reactivated, which can sometimes be almost as much as a new station. So even this aspect might not be as cheap as it seems, while the rest, the need for new trains, new or additional maintenance facilities, remains the same.
There are some major differences between Brightline and the Canadian projects. The Calgary to Banff service will likely be single tracked (plus the necessary sidings), but a number of sections on the HFR project will almost certainly end up double tracked. Around half of the HFR route will be in a reactivated rail corridor, meaning the track and right of way will essentially be built from scratch. And while the Calgary to Banff link is proposed to be a hydrogen train (which is almost certainly not going to happen, meaning it will be diesel) the majority of the HFR project will be electrified. Owing to differences in railroad culture in Canada versus the US, there are likely to be a number of grade separation projects for both rail lines.
But the biggest difference is that both will have a dedicated track for the entire length of the projects. VIA HFR may share some sections with regional passenger rail services in Toronto or Montreal, but neither will share with freight services. That variable and uncertainty will be gone for good and both projects will be highly flexible when it comes to scaling up infrastructure.
Brightline will forever have to contend with freight traffic on the 341km section from Miami to Cocoa, which will constrain its ability to expand service. Scaling up infrastructure is also going to be much more challenging due to the inevitable escalation of accidents, and public backlash, that will come from attempting to run even more trains over a line with so many level crossings.
It is also worth nothing that within the context of the US, it may not have been possible to construct Brightline any cheaper than it has been. Public transport researcher and writer Jonathon English has written extensively about the problems that lead to American transit projects being incredibly expensive. Canadian projects are typically going to be better value for money than their American counterparts (though not without their own problems), and the Banff - Calgary rail link, and HFR projects are likely to prove that point.
As discussed previously, what Brightline is creating is only marginally better than the VIA network of the 1990’s. But for the US, this might be the best they can do, even if comparatively, it is not great. So it is somewhat subjective to say whether Brightline is actually good value for money. But there is a case to be made that this was not the best use of USD6 billion, once you also factor in the safety issues, lack of local service to many communities, and the relatively small market it will ultimately capture.
Is Brightline a bad project, or the future of intercity rail projects on North America?
It is both.
The project drips of corruption and grifting. As a demonstration of a privately funded passenger rail operation it is a failure because it has actually needed an extensive amount of public money and resources in order to be able to get to the point it has reached, and to expand even further. By the time the line reaches Disney World, there will almost certainly have been USD3 billion of public money diverted to the project, through the various mechanisms discussed. And by the time it gets to Tampa, a number in the USD4 - 5 billion range is not at all out of the question.
As a mass public transportation solution it fails because it intentionally caters to only a small percentage of the population. As an environmentally beneficial project it fails because at best it is only projected to shift 2.3% of car or airline travellers to the train. And as profitable rail operation, that is to be seen once the Orlando section opens, but there are many reasons to question whether it can actually make money.
Ultimately though, that is not how the success of the project will be judged. It is a question of whether Fortress and FECI will be able to make a profit on the entire endeavour, once real estate profits are taken into account. In March 2022 FECI sold two apartment buildings near Miami Central for over USD400 million. In 2019 FECI sold two office buildings in that same area for USD159 million. There are also plans to develop two 83 storeys on some of its downtown Miami properties, alongside smaller deals, such as the sale of two properties near its Brightline Fort Lauderdale station for USD37 million. There is still a long way to go before it recoups its full investment in Brightline, but when it comes to the real estate aspect of the project, really the most important part to FECI and Fortress since day one, it could very well be a success (with the help of taxpayer money of course).
There are already signs that momentum is growing for these kinds of “private” passenger rail projects. In the US Brightline has been developing the Xpresswest project which will connect Las Vegas with Victorville, California (about an hours drives from Los Angeles). They have already secured $200 million in Private Activity Bonds from Nevada, and $600 million in Private Activity Bonds from California. It will require the use of the Interstate 15 right of way and in order to get in to Los Angeles they need to use the publicly funded line that will be used by the California HSR project. In Las Vegas, they already own a 38 acre parcel of land which will be home to the station and future development. It is the same playbook as Florida, except they skipped over even trying to find private funding.
In the US this situation is only going to be exasperated by two key developments. The first is the California Hight Speed Rail project which has become a financial disaster. And the second is Amtrak’s tentative plans for its potential injection of USD66 billion in capital funding. Amtrak covers the whole of the US, and for political reasons the funding needs to be spread across the network. This means that aside from some targeted investments in the Northeast Corridor the funding is not going to yield any major results. It will bring perhaps once or twice a day service to new markets, and add one or two trains a day to other markets. But it is not going to be able to create anything even approaching modern which is going to lead to attacks of Amtrak squandering its money (which Forbes, as just one example, has already started doing).
The situation in Canada is a little bit different. Over the past decade both VIA Rail and Metrolinx have become increasingly sophisticated, savvy, and smart public transport agencies that have made the kind of gains in public support for their projects that seemed unlikely just a decade ago. VIA has continued to advance its HFR proposal, with around CAD563 million in Federal funding being received for planning and preparation to date, which is light years ahead of any passenger rail modernization proposal before it. Metrolinx has spent the better part of 15 years investing in targeted infrastructure projects (you can read more about it in the article that was published on this site). And today the agency is at the point where the ON-Corridor and GO Electrification project is beginning, which will radically transform the GO Train network into a modern regional, and intercity network, within the GTA, and increasingly Ontario.
But the tempered desire for these kind of private passenger rail systems in Canada is also in part due to real estate companies and developers having pretty much all of their needs met in many cities. Canadian developers and REITs have a remarkable stranglehold on politics and the economy and for the most part there is no need for them to build their own railroad because the government is taking care of that for them, be it Skytrain’s in Vancouver, or GO Trains in Toronto. Go to anywhere within a few hours of Toronto that has, or will have, a rail connection into Union Station and you will see the kind of speculative real estate free for all that is starting to form around existing and future stations (as is discussed in a previous article on this site which looks at the extraordinary amount of development taking place around Toronto and GTA GO stations).
But there are some instances in which real estate interests are not being served by publicly funded plans, and that requires those companies to get creative. This is the case with the proposed rail link from Calgary’s airport, through the cities downtown, and then onward to the tourist mecca of Banff.
Worthy of a full length article all to itself, this semi-privately funded passenger rail project has been even more effective at using a slight of hand to mask the true intent of building this service, complete with green-washing about hydrogen powered trains, and massive real estate holdings within Banff. And as an added bonus some of the long term consequences could be more disastrous than Brightline’s. Canada already knows how to bring together all the money making pieces of a Brightline style project. It just does it in a “friendlier”, less obviously capitalist, way than its cousin to the south.
But as much progress as public agencies have made in creating a product that the public at large can get behind, they are going to have to do even better. And its for a very simple reason.
Few actually care about any of the corruption, lies, equality issues, or the litany of problems that Brightline has.
It would be easy to say the public is only seeing hot people sitting in new, fancy train stations stocked with snacks and booze, while they wait to ride a modern train to a swanky weekend in Miami. That they are being seduced by the sirens song. And there is some truth to that notion. Brightline has carefully controlled its image and gotten media on board with this narrative. It is typically only niche or local publications that are actually raising concerns and investigating the project, and those have a very limited reach in the grand scheme of things (stories about the death train being an exception to that rule).
But none of what has been discussed in this article is secretive or all that difficult to find. The information is out there, in the public. Brightline might be trying to spin it at times, but there is also no campaign to actively hide what they have done. Instead there is a collective shoulder shrug towards Brightline’s shenanigans in the name of getting more trains. That is a trend that doesn’t appear to be changing either.
There are cases in which a private company is almost certainly the right choice to provide intercity rail service. Cross border service, be it between Canada and the US, or Mexico and the US, is one example. It is hard to justify why either VIA or Amtrak should be using public funds for international service, especially given that there are decades worth of domestic needs to address first.
In some regions, like Texas or Alberta, where anti-government, pro-free enterprise rhetoric is pervasive, it is hard to see how any major, publicly funded intercity rail projects are going to happen this decade, let alone today. This is why Florida was the unlikely, but logical test bed for Brightline. It was never really a project about public transport for the people, or being eco-friendly, or promoting the development of sustainable, urban cities. It was about real estate, an elitist mode of transport, and the power of free-market companies over public agencies, while happening in a place which would more than willingly use public money to keep the project going without thinking twice about the hypocrisy of it. It was a place to test out whether modern day variants of robber barons could be successful.
It shouldn’t come as a surprise that private companies are coming in and taking advantage of demand for domestic services. When there is even a push for more passenger rail service in Montana, it is clear not enough is being done. This leaves a situation which is ripe for grifting.
These kinds of publicly funded, private passenger rail companies would no doubt achieve a goal of having more trains rolling across the various landscapes of North America. And for those who are among the more well off of society, they would be a great experience and an excellent way to travel. But they come at a very real cost. Not just in terms of taxpayer money, but also accessibility, equity, and generally trying to maximize the infrastructure for the betterment of as many people as possible, as opposed to the dollar value of each rider.
Brightline has proved that rail travel doesn’t have to look outdated or boring. In other words like Amtrak. But it is also a cautionary tale which has shown that even when tied to real estate markets that are some of the hottest in North America, which offers the best chance for a private endeavour like Brightline to succeed under its given structure, it still needs public money. As the desire, and need, for modern intercity rail grows within North America, the question of whether the Brighline model is one to replicate, modify, or completely abandon, is going to become a critical one to answer.