Picking up Speed

If the recent flurry of activity is anything to go by, the US is showing more determination than ever to bring high-speed rail to its shores. Steer Davies Gleave recounts the progress that has been made since last year.

The Obama administration has continued to provide support to the US High-Speed Intercity Passenger Rail (HSIPR) Program that it announced in April 2009. Following the announcement of $8 billion in funding available for HSIPR projects under the American Recovery and Reinvestment Act (ARRA), the President on January 28 2010 announced the distribution of these funds to several high-speed and intercity passenger rail corridors across the country.

A significant portion of the grants went toward developing new, large-scale high-speed rail programs including the California ($2.34 billion) and Tampa-Orlando ($1.25 billion) HSR corridors. Other major recipients included the Chicago-St. Louis-Kansas City corridor ($1.13 billion), the Minneapolis/St. Paul-Madison-Milwaukee-Chicago corridor ($823 million), the Charlotte-Raleigh-Richmond-Washington, D.C. corridor ($620 million), the Eugene-Portland-Seattle-Vancouver, B.C. corridor ($598 million), the Northeast Region ($485 million), the Cleveland-Columbus-Dayton-Cincinnati corridor ($400 million) and the Pontiac-Detroit-Chicago corridor ($244 million). The focus of these other projects is on making incremental to significant improvements to existing intercity passenger rail services in these corridors. The grants will enable these projects to progress to their next phase of development, but in most cases do not provide sufficient funding to complete the project.

As a continuation of this support for intercity passenger rail development, in June 2010 the Federal Railroad Administration (FRA) announced an additional $2.5 billion in high-speed rail grants. FRA has allocated at least $2.125 billion of this grant to continue the development of high-speed intercity passenger rail corridors. Another $245 million was made available for individual construction projects within a corridor. There is a 20% non-federal matching requirement for these funds, both of which came from the FY 2010 USDOT appropriations bill. Applications for these latest funds were due to FRA by August 6, 2010.

Moreover, earlier this spring FRA made available $50 million in planning funds and approximately $65 million in construction funds, both appropriated under the FY 2010 DOT appropriations bill. FRA accepted applications for these grants through May 19, 2010. The planning funds will provide states with an opportunity to complete the prerequisite work needed to submit applications for future construction grant funds. The planning and the construction grants have non-federal matching requirements of 20% and 50%, respectively. FRA will have announced the recipients of all these new grants by the first week of October this year.

During this time, FRA has published increasingly specific guidance regarding application requirements and procedures to compete for HSIPR funding. As a followup to the interim guidance published last year, FRA on July 1, 2010 released new guidance with additional details. However, FRA is continuing to work on an evolving guidance document, anticipated to be published later this year, as part of the process of establishing a long-term development framework for the HSIPR program. This document will provide detailed guidance on “each stage of the project development process (from planning and design through construction and operation), as well as provide substantial technical assistance on the processes and documentation needed for successful project development and delivery.”

As part of the FY2011 appropriations bill, the House recently approved $1.4 billion to expand and improve intercity passenger rail and develop a national high-speed rail system. The appropriation is $400 million more than the initial request, but more than $1 billion less than the $2.5 billion that the HSIPR program received in FY2010. There is also talk about authorizing $50 billion from general government revenues for HSR development as part of USDOT’s next surface transportation bill. In addition, President Obama recently announced a $50 billion infrastructure plan that calls for expanding and improving railways, roads, and runways. This plan, if passed, is expected to include significant funding for the HSIPR program.

Steer Davies Gleave’s Boston team, working with the company’s HSR experts in London and other offices, is currently involved in many of the HSIPR projects in the US. We are on several teams that have recently been selected for the program management and general planning services contracts for high-speed and intercity passenger rail projects across the US.