ALL ABOARD PROMISES BIG IMPACT, BUT WILL IT DELIVER?

Publish Date: 
Monday, August 24, 2015 - 10:30am

The promised financial impact of the All Aboard Florida train is large: $6.4 billion infused into the state's economy by 2023, $2.4 billion in pay, benefits and taxes for labor through 2021 and 10,000 construction jobs each year through 2017.

But how real are those numbers, which are coming from a report commissioned by the Coral Gables-based train company?

Economic impact studies are "layer cakes of uncertainty," said Sean Snaith, an economist at the University of Central Florida who has authored a few of his own.

But Snaith was not being overly critical. He predicted the $2.5 billion project linking Orlando International Airport with South Florida would end up being a plus financially for the state.

How much is the question.

"The markets will weigh in on whether this is a success or not," he said.

The impact report, written by Washington Economics Groups, Inc. of Coral Gables, says its numbers do not include any development induced by the train, only that directly planned by All Aboard Florida.

In Orange County, it predicted an impact of more than $560 million by 2021 that would include the airport station, a nearby maintenance facility and jobs related to construction and operations.

Train executives declined to comment because they are in a "quiet period" preceding the expected sale of $1.75 billion private activity bonds by month's end.

That money will go a long way toward paying for the construction of three stations in South Florida, plus the purchase of five train sets and tracks along a 235-mile corridor running from Miami to Orlando International.

All Aboard Florida expects to start running between West Palm Beach, Fort Lauderdale and Miami early in 2017 and to the airport by late 2017.

Much of the economic development will occur in South Florida because the stations are located in urban areas. Orlando's stop – paid for by a $213 million state grant – is at the publicly owned airport far from the city core.

The key to All Aboard Florida spawning development in Orlando is getting a connection with the SunRail commuter train at the airport, said Bruce Stephenson, a professor of environmental studies and sustainable urbanism at Rollins College.

"That's going to be the kicker," he said, adding that SunRail would bring All Aboard Florida riders to and from a 31.5 mile corridor north of the airport.

SunRail has spurred the construction of more than 1,000 apartments during its first year of operation and more complexes are planned.

Mekael Teshone, an economist who studies Florida for the PNC Bank in Pittsburgh, said "it's really tough to say what the (All Aboard Florida) impact will be dollar for dollar." But he added that connecting major cities with rail will undoubtedly aid the economy.

And while some have questioned whether people would be willing to pay an average one-way ticket price of $90 between Orlando and Miami, Teshone said, "I think it has a shot." The trip would consume about three hours, or a half-hour less than motorists driving on Florida's Turnpike.

An All Aboard Florida ridership study concluded the trains would carry more than 5 million passengers in 2020, which is considered the first "mature" year of operations. Tickets in 2020 are supposed to bring in more than $290 million, according to the study.

Along with fares, All Aboard Florida is counting heavily on development around the three South Florida stations, which are under construction. Plans call for apartments, office space, retail shops and restaurants.

Opposition to the train is concentrated on the Treasure Coast, including St. Lucie, Martin and Indian River counties. Critics say the trains will harm the quality of life in towns along its path by tying up traffic at numerous crossings.

Economic studies are one way to rebut criticism and build public support by highlighting the anticipated benefits, said Aubrey Jewett, a political science professor at UCF.

"Historically," he said, "reports like this tend to be overly optimistic. That's just a fact of life."