Friday, August 14, 2015

Learning to Pay Our Way



In July, I attended an international gathering of passenger rail experts from forty-two countries. I was impressed by how many countries that aren't in the top-tier of world economies are investing a lot of resources in enhanced and high speed passenger rail projects. Certainly, very few of the 42 rank anywhere close to the United States or Canada in economic power, yet they have found the will and the money to build what we in North America have deemed "too expensive".
North American skeptics often claim that our countries are too large and our population too spread out to make passenger trains an effective means of transportation. Like many myths, there is a grain of truth in this. What is ignored is that there are many regions in North America with size and density very similar to regions in other parts of the world where passenger rail service works very well.
However, the trends in this hemisphere are not looking as bad as they were a few years ago.
While the United States and Canada still have many political leaders who are skeptical of the economic benefits of passenger rail service, I am encouraged by signs of progress. The key seems to be demonstrating models of private investment that are profitable. The two leading examples are Florida East Coast's Miami to Orlando 110 MPH project, funded through long-term real estate holdings and, as of last week, permission to sell tax-free bonds; and the privately funded Texas Central Railway, working with Central Japan Railway to build 205 MPH service Dallas to Houston. (There are links to more info at the end of this post.)
Texas Central plans to use Japanese Series 700i Shinkensen rolling stock.

Of course, it will take time to demonstrate the success of these projects. And during that time, I believe it is critical that we learn what we can from the economic and engineering experience of Europe and Asia. We must not let our pride in past accomplishments lead us to stumble along making the mistakes others have made and learned from.
Plenary Session at UIC High Speed Rail 2015 Conference, Tokyo
With that goal in mind, I have taken the initiative and reached out to researchers in Japan, to set up a communication channel by which North Americans can explore options that have failed, as well as those that have worked. So far, I have received a positive response from Dr. Fumio Kurosaki, Senior Researcher at the Institute of Transportation Economics, Tokyo.

Why start with Japan? For a couple of reasons. First, because that's where the international gathering of rail experts took place, giving me a chance to meet quite a few Japanese rail researchers, in engineering as well as in economics. But also because I was impressed by the amount of energy the Japanese rail community has been putting in to research, and because I experienced the evidence of their success while touring the country by rail.

Sapporo Airport Express
Right now in the United States, more serious attention is being given to expanding our transportation options through rail. States like Virginia, North Carolina, Illinois, and Minnesota have allocated considerable resources to passenger rail expansion.

North Carolina state-supported regional passenger service
Here in Michigan, "the Auto State", there are four projects under serious consideration: regional service Detroit to Holland, and Traverse City to Ann Arbor; commuter service Detroit to Ann Arbor, and Howell to Ann Arbor.
The economic model of these projects, however, has been based on the hope of government funding. This puts a huge hurdle in their path to success, given today's legislative mood. While commuter service will probably always be government funded (given the heavy - and popular - government subsidies to highway travel), regional services have the potential to be profitable, if they are done right.
I believe the key is to explore with business leaders and investors in North America how to "do it right". European and Asian rail service is far ahead of ours in economic independence, particularly in Japan, where almost all intercity rail service is privately funded. But here in North America, we cannot adopt the models of Europe and Asia without modification, because we have a different railroad ownership structure and different governing laws.
My goal in launching this project is to facilitate the exploration process. How can we, in North America, take best practices of Europe and Asia and adapt them to our situation? How can we move toward an American railway ownership and legal structure that rewards private enterprise in passenger service? This is not a short-term effort to find a "quick fix" because there aren't any. Rather, it is a long-term effort with the goal of opening dialog between North America and the best minds in railroading around the world, as demonstrated by the evidence of financial and engineering success.
I'll give you more details shortly - and I promise this time it won't be two years!

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