Truth & context about 3C rail is biggest victim in an election year
FOR IMMEDIATE RELEASE — September 14, 2010
Contact:
Ken Prendergast
All Aboard Ohio Executive Director
(216) 288-4883
kenprendergast@allaboardohio.org
Five months ago, the State Controlling Board voted to approve using 100 percent federal funds for final engineering of an introductory level of passenger rail service in the 3C Corridor – the Midwest's busiest intercity travel corridor (according to USDOT Bureau of Transportation Statistics).
That engineering work, negotiations with freight railroads and bid scopes for prospective passenger rail operators would get answers that the project's critics have been asking. Instead, a Republican Ohio Senator now wants the Ohio Attorney General's office to stop the engineering, claiming a vote by the State Controlling Board to advance the engineering work violated state law.
"That legal and proper vote was five months ago," said All Aboard Ohio President Bill Hutchison. "Now, less than two months before the gubernatorial election, the opposition floats this? Are they afraid that their false and misleading arguments will be nullified by the engineering study? They should be afraid. What is gained by not doing this study? It doesn't save the state treasury any money. The money has to be used for a rail project somewhere whether Ohio uses it or not."
Ohio's so-called fiscal conservatives claim that this will save the state $17 million per year in 3C's operating cost – six years from now. All but $3.4 million of that much discussed $17 million operating cost will be covered at the federal level for the first three years the line operates. That amounts to annual per-capita cost of 29 cents. The full $17 million cost would not have to be covered until 2016 and even that amounts to only $1.60 annually per-capita. That's the cost of buying everyone in Ohio one cup of coffee per year. Meanwhile highway subsidies in Ohio are $105 per-capita (source: Federal Highway Administration).
The 3C trains will generate large benefits that will more than offset this cost:
w $6.1 million to $7.3 million per year – Ohio sales tax revenues from increased consumer activity
w $5 million to $10 million per year – Annual budget offsets from state employees using 3C trains
w $0.25 million to $0.6 million per year – Ohio income tax revenues from direct 3C jobs.
w $1.2 million to $10.4 million per year – Ohio income tax revenues from 3C spin-off jobs.
w $21.2 million to $42.4 million per year – Savings from moving more freight from 3C roads to 3C rails.
w Total benefits to the state from 3C project: $33.75 million to $70.7 million per year.
All Aboard Ohio's fiscal analysis of 3C used a variety of data sets, including the U.S. Department of Commerce, Federal Railroad Administration, Ohio Department of Administrative Services, consumer surplus economic impact model, U.S. Census, Amtrak and the freight railroads.
Ironically, while so-called fiscal conservatives regardless of party worry about the $17 million operating cost for 3C trains, they haven't uttered so much as a peep about worsening highway subsidies. Consider:
w There is bipartisan support for hauling heavier steel shipments by truck but no support for increasing fees on trucks to pay for the damage they will do to Ohio's roads: highway subsidy of $50 million per year.
w There is bipartisan support for increasing truck weights to haul Ohio-based agricultural products but no increase in weight-distance fees to offset the damage to Ohio's roads: highway subsidy of $45 million per year.
w Republicans want to eliminate the late fee on driver's license renewals without coming up with a way to replace the annual loss to Ohio's budget: cost to Ohio of $30 million per year.
w Budget hawks are silent on ODOT's seven-year increase in costs to operate/maintain/support the added highway infrastructure planned/underway (including $9.2 billion in new highway infrastructure in 3C alone!) without an identified way to pay those operating costs: cost to Ohio of $3.3 billion over seven years (or $471 million per year).
So how does $17 million per year risk bankrupting the state? Of course it won't. The critics are hoping the media simply reiterates sound bites. This is an important issue, one that deserves full review and exhaustive analysis by the media. We encourage them to verify all data from both sides before redistributing it.
Nor does the opposition offer any context for what Ohio is pursuing because it would show Ohio is being fiscally prudent. All states started with a modest rail service and enhanced it; each time ridership grew. Of the 17 most densely populated states, only Hawaii and Ohio do not provide any state financial support for passenger trains. Hawaii is an island with no railroads, but Ohio is literally the "hole in the donut" with major states around us supporting trains. Why is Ohio the odd-man out? Are we that much smarter than our colleague states?
"It's time Ohio started acting like the nation's ninth-most densely populated state in the nation with the Midwest's busiest intercity travel corridor, not the remote island it pretends to be," Hutchison said.
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