Start with a project that is one of the largest in scope ever dreamed of in Texas. And in Texas we do dream big. Think larger than building the mega-DFW International Airport from scratch.
You would be hard-pressed to come up with another Texas-sized infrastructure project of this magnitude attempted in the last 50 years or more in the Lone Star state.
Now estimated at $24 billion dollars.
Add in working with multiple government agencies that never thought about trains running at 200 miles per hour, working with investors both domestic and overseas, lining up engineering companies, construction giants, transportation providers, designing world class rail terminals, surveying and procuring needed right-of-way, selling the private-built concept to citizens and educating lawmakers, fighting lawsuits and roadblocks from some of those citizens and lawmakers, winning those long-running court cases and then...... a pandemic strikes.
The Texas Central story is still being written through many twists and turns.
The Federal Railroad Administration's Record of Decision in 2020 gave the environmental go-ahead for the project. Last fall the FRA reviewed and approved the safety standards for the project through the final Rule of Particular Applicability and Record of Decision.
Now the focus centers on money. The $ 24 billion needed is divided into two parts. The first half, about $12 billion, would be provided through bank loans already committed. The remaining $12 billion would come through other types of mechanisms directly linked to the bipartisan Infrastructure bill that must be approved in the coming weeks.
Texas Central President Carlos Aguilar, in a recent WFAA-TV podcast, talked about how a gargantuan rail project like this can be financed. “Our target has always been loans,” Aguilar added on the podcast. “It is focused, as I said on the long-term debt that is available through, for example, the RRIF program out of the U.S. Department of Transportation. And that's what you need to build large infrastructure.”
The next part may hinge on Congress.
Texas Central maintains that it will be entirely privately funded and does not want government handouts, will not ask for a federal grant or any tax money to begin the project, Aguilar said. Instead, he explained, the bipartisan infrastructure bill now in Congress is expected to create low-interest, long-term loans for major infrastructure projects like the bullet train.
The infrastructure bill, while still going through the wrangling process in Washington and due to pass the House by September 27th, would create low-interest long term loans for projects like Texas Central. Agular said that it is one of the final steps that would bring everything together with international and domestic funding. If passed in its current form, up to $10 billion dollars would be available for true high-speed rail projects around the U.S., a first for this country but very common in most other countries around the world.
Texas Central told Railway Age magazine in July that their complicated financing work continues. "Exact timing of execution will depend on how fast the formal commitments are secured", according to the company. The railroad noted that no grants have been applied for but they are constantly evaluating financing options.
So what will a ticket to ride cost the public? There will be various pricing levels, according to the company, but the price of a walk-up last minute ticket will average about 75% of what airfare is pegged. Current airline pricing for a last-minute walk-up fare is over $200 which means the same fare for the 90 minute ride at 200 miles per hour would work out to about $150. So when will ground be broken for the 236-mile Dallas to Houston high-speed train? It's a coin-flip if dirt will be turned in 2021 or the beginning of 2022, according to CEO Aguilar. Once funding is secured, construction will start with an initial 50 miles of track from Dallas to the south which will allow tests of the new trainsets to take place. “The exact timing of execution will depend on how quickly formal commitments are secured,” Central Texas said just a few weeks ago.
All eyes are now on Washington and the infrastructure bill. Stay tuned.