LETTER FROM DWIGHT CRANE TO FDFC OPPOSING ALL ABOARD FLORIDA PRIVATE ACTIVITY BONDS

Publish Date: 
Friday, May 8, 2015 - 2:15pm

 PROTEST IN PERSON ON MAY 28TH - MORE INFO HERE: http://bit.ly/1KrfpyI

Dear Sir/Madam:

All Aboard Florida (AAF) proposes to develop track and acquire equipment so that it can run 16 hourly high speed passenger trains each direction between Orlando and Miami daily. Based on their proposal to run a high-speed passenger train, AAF is requesting your approval for a private activity bond issue. I recommend against approval.

An important question for your consideration: Is this is a viable proposal? Will AAF be successful in attracting enough passengers to justify frequent high speed train service between Orlando and southeast Florida? I believe the data on current travel between Orlando and southeast Florida suggests it will not. I say this in spite of the fact I am a believer in the need for an expansion of high speed train service in the United States, but the capacity should be added where there is a sufficient need, either currently or within a reasonable planning horizon.

When assessing the viability of AAF’s proposed high speed trains, travel between Boston and New York City provides a useful point of comparison. This is a 215 mile route, about the same distance as the 235 miles between Orlando and Miami. Amtrak currently runs 19 trains daily from Boston to New York, 10 of which are high speed Acela Express trains. The Acela trains have 5 passenger cars with a total seating capacity of 304 passengers per train or 3,040 seats per day. The remaining 9 trains vary in length depending on projected demand, but they typically carry a larger seating capacity. Adding their seats to the daily passenger capacity would bring the average total capacity to a range of 7,500 to 8,000 seats per day.

FAA Planned Capacity

It appears that the 16 daily trains planned by AAF would provide daily seating capacity on Orlando-Miami runs of about 7,600 seats, a capacity that is roughly comparable to that available on the Boston-New York route. To explain my estimate, AAF reports that its trains would be about 900 feet long. This is about 235 feet longer than the Acela trains, providing enough length for an additional 3 passenger cars. If AAF passenger cars are configured about the same as Acela cars, the estimated capacity would be about 475 passengers per train, or a total of 7,600 for 16 trains. It is hard to imagine, though, that the number of passengers traveling between Orlando and southeast Florida would require the same seating capacity as the heavily traveled Boston-New York route. The Boston-New York route is part of the “northeast corridor,” one of the most, if not the most, heavily traveled corridors in the country, serving several major metropolitan areas from Boston to Washington, D.C.

Attracting Passengers from Flights

Much of the passenger growth on the Boston-New York Acela Express route resulted from airline passengers who shifted over to the trains. As ridership on Acela Express trains grew, seats provided on airlines declined. Amtrak reported that Acela Express trains accounted for 54% of the combined air and train travel between these two cities in recent years.

Presumably AAF could have comparable success in attracting market share from flights between Orlando and southeast Florida. However, this would not result in very many passengers. Based on current flight schedules from Orlando to Ft. Lauderdale and Orlando to Miami, there are only 2,330 flight seats available each day from Orlando to southeast Florida. Assuming that these flights, on average, operate at 75% of capacity and that the AAF express trains were able to capture 54% of this market, the shift to trains would provide about 945 daily passengers, enough to fill only two of the proposed trains.

Attracting Passengers from Cars

AAF is clearly counting on a substantial number of automobile drivers deciding to use the high speed train. I don’t have data on the number of cars driven between Orlando and southeastern Florida, but we can think through how a family might decide whether to drive or take a train. First, the total time required from starting point to destination point would be approximately the same. AAF reports that the train ride would be just under 3 hours, but there would also be the travel time required to get to and from each train station, for example, from the train station at Orlando airport to Disney World. The Google maps website estimates the driving time, without traffic, between Miami and Disney World is 3hrs and 18 minutes. With morning traffic, this morning at 8:15am, the estimated driving time was 3hrs and 36 minutes time from Miami to Disney World, comparable to the total time required for the train trip.

Second, with regard to cost, taking the train is likely to cost more than driving to your destination, particularly if more than one person is traveling in the car. If a family owned their own car, the incremental cost of driving from Miami to Disney World would be the cost of gas and tolls. The cost of taking the express train would be the cost of tickets plus the cost of getting to and from the train station. AAF has not indicated their pricing yet, except to say it would be competitive with alternatives. Recent airline fares between Orlando and Miami were about $240, so this might be an upper limit. Another point of comparison is provided by current Acela Express fares for Boston-New York that range from low $100s to about $200, depending on time of day. Some families would find the comfort of train travel worth an extra cost, but it is hard to see a massive shift from cars to the train when traveling from Miami to Orlando.

It seems very clear that the only way to reach the advertised plan of 16 high-speed daily trains per day between Orlando and Miami is if something dramatic happens to cause a substantial growth in passenger traffic. Both cities are important commercial centers and the economic link between the two cities will grow over time. But, the advertised plan of 16 daily trains each direction calls for a passenger demand roughly equal to that of the “northeast corridor.” How likely is growth of this magnitude?

I have heard or read critics of the AAF proposal who claim that the goal of the investment is really real estate development not passenger travel, or that it is really laying track for growth in freight traffic rather than passenger service. I don’t know if either of these scenarios is correct, but the challenge of making the passenger train service succeed does raise these kinds of questions. The advertised high speed train service is part of the argument for approval of a private activity bond.

As you review the AAF proposal, I believe you should consider the strong likelihood that the planned passenger service will not succeed as proposed. I recommend that you not approve the AAF proposal.

Sincerely yours,

Dwight B. Crane