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Houston-to-Dallas Bullet Train May Run Huge Deficits, Study Warns

Houston-to-Dallas Bullet Train May Run Huge Deficits, Study Warns
Photo of the N700 bullet train, courtesy of JR Central

President Donald Trump has said he wants high-speed rail lines to finally become a reality in Texas, but so far that has been a pipe dream.

Now, Texas Central Partners has been working to remedy that with its plan to construct a 240-mile Houston-to-Dallas bullet train, but the process has been slow going. A new study is also claiming that it may also cost a lot more to get the controversial bullet train line up and running.

For one thing, there's the simple matter of how much the rail line will cost and who will actually pay for it. Despite Texas Central's many reassurances since starting the project a few years ago that it would not require any taxpayer dollars, a new report from the Reason Foundation is calling that promise into question.

According to the report, issued in February, it looks as if the bullet train line could cost taxpayers $21.5 billion and could run at a $537 million deficit for the first 40 years of operation.

In other words, the rail line is going to cost a lot of money to build, and then it will likely cost even more to keep the rail line running, according to the report.

And it doesn't stop there.

The study, "Texas High Speed Rail: Caution Ahead," by Baruch Feigenbaum, the assistant director of transportation policy at the Reason Foundation, is thorough in poking holes in Texas Central's big dream by taking a hard look at what it will actually take to build the 240-mile Houston-to-Dallas bullet train and make it a success. It examines ridership trends, the cost of actually building this high-speed rail line and other factors in the 65-page report.

Getting these trains built is expensive and tricky. All the other plans for high-speed lines in Texas have featured public and private partnerships, and all of them have failed at least in part for that reason, the report notes. Texas Central has insisted from the start that it has no intention of asking for public funding, but the firm has since indicated it is going to try for Railroad Rehabilitation and Investment Financing loans, which are indeed federally funded taxpayer subsidies.

On top of this, Texas Central has yet to release a business plan or to cough up any verifiable, objective data to back up the cost estimates and the number of riders expected to ride these trains if and when they are running.

The report also checks into the reality of building high-speed rail lines in this day and age. As of right now, only two high-speed rail lines actually turn a profit — the Tokyo-to-Osaka line in Japan and the Paris-to-Lyon line in France. All the other high-speed rail lines in Europe and Asia break even at best or lose money.

And that's not the only hole in the plan. The Reason Foundation report finds that bullet trains are most likely to do well in places that are densely populated, the high-density residential and commercial areas, which is not how one would describe Houston or Dallas.

These rail lines also do well in places with lots of public transportation, where the airports are located in out-of-the-way, inconvenient places and where people don't really own cars. Houston and Dallas fail to qualify on all counts. In fact, the two cities have among the highest rates of car ownership in the United States.

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Ultimately, the study concludes that "high-speed rail has no chance of succeeding in Texas, absent a dramatic change in land use and transit patterns."

Texas Central took that news about as well as could be expected, issuing a scathing statement on the study that called it “deeply flawed and rife with uninformed biases about how Texans travel,” according to the Houston Business Journal.

“The report offers no original research on the Texas market, and instead relies largely on an outdated state government report that explicitly warns against using it to analyze any single corridor,” the statement goes on to claim, before doubling down and insisting that Texas Central offered the people conducting the study access to the "verifiable, objective data" that the Reason Foundation says Texas Central is lacking, a.k.a. its own data.

No word yet on whether the folks at Reason took Texas Central up on their offer.

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