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High Speed Rail on Track to Reap Hefty Funds, But Faces Hurdles

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A “palpable excitement” — that’s how the investigative arm of Congress describes the aura created by the allocation of federal funds for new high speed rail service in the U.S under last year’s Recovery Act. But this buzz and an unprecedented gush of federal investment will carry efforts to establish intercity passenger rail service only so far.

The Government Accountability Office, or GAO, notes in a new report that the success of this “difficult, multiyear effort” will hinge on a host of other factors, including the availability of state and federal funds “to build and operate systems that go far beyond the funds provided by the Recovery Act,” the ability of states to work together on interstate lines, and the cooperation of private railroads.

The challenge of building infrastructure across state lines has cropped up for greentech efforts beyond the transportation sector. For example, despite widespread recognition that the U.S. power grid is overdue for an upgrade, transmission lines are in many cases being built at a slow pace partly because of issues with conflicting state regulations.

According to the GAO, 37 states and the District of Columbia submitted 259 applications requesting a total of around $57 billion under the $8 billion in stimulus funds made available for new passenger rail corridors or improvements to existing rail service. Earlier this year the Federal Railroad Administration announced plans to award the $8 billion to 62 projects in 23 states, plus the District of Columbia.

In total, federal appropriations for high-speed intercity passenger rail has grown to $10.5 billion for the 2010 fiscal year, up from $120 million in the two previous fiscal years combined, according to the GAO report.

Administering these programs will require the FRA to undergo a massive transformation, writes the GAO, shifting from an organization focused primarily on safety to an entity “that can make multibillion dollar investment choices while simultaneously carrying out its safety mission.”

It’s not just states that have perked up at the prospect of federal funds for these transportation projects. The GAO also predicts that federal funds may provide a “catalyst” for many high-speed passenger rail projects and notes that, “Passenger rail operators and suppliers from around the world are showing interest in making and operating high speed passenger trains for a possible emerging U.S. market.” (Software giants like IBM and Accenture are among the companies that could find opportunities in that market, helping to automate system management to improve efficiency.)

The GAO looked to state passenger rail projects for lessons that can be applied to upcoming initiatives, but when it comes to overseas players in the high-speed rail space, China (slated to spend an estimated $300 billion to build out a 75,000-mile high-speed rail network by 2020) is becoming the 800-pound gorilla. According to a recent report from the Center for American Progress, Chinese rail companies now have 940 registered patents, and in just over a decade it has made the “move from being an importer of high-speed rail technology and operational know-how to being an exporter.”

Photo courtesy IBM

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One Response to “High Speed Rail on Track to Reap Hefty Funds, But Faces Hurdles”

  1. Ronald

    The key to this is not trains, it’s rails. Freight trains beat the **** out of rails, ties, and railbeds. High-speed passenger rail needs its own rails. That’s how it’s done in Europe, China, Japan, in fact everywhere except the US. Sharing rail lines in this context Just Doesn’t Work.