How Do You Define “Feasible”?

Democratic Party hopes to retake Congress soon have been buoyed by this week’s election. Whether it is in 2018, 2020, or later, whenever they eventually regain control, federal funding for high-speed rail and other infrastructure projects will likely be back on the table. Since the sole criterion for funding such projects in 2009 was whether they had completed an environmental impact statement, numerous states are currently working on or have recently completed such statements.

An example of the Texas Department of Transportation, which just announced that its final environmental impact statement showed that a high-speed rail line from Dallas to San Antonio was “feasible.” A conventional rail line from Oklahoma City to Dallas and a higher-speed line from San Antonio to Monterrey, Mexico were also considered feasible. This is good news for rail buffs, as it means Texas is eligible for federal funding to do more detailed studies.

Before you buy your tickets for a high-speed ride from Dallas to San Antonio, it is worth asking what the state means by “feasible.” According to table 3-4 of the alternatives analysis, the Oklahoma City-Dallas segment would cost $650 million to start up, none of which would ever be recovered from fares. In fact, fares would only cover 27 percent of operating costs. That’s feasible?

The Dallas-San Antonio high-speed rail line would do a little better, with fares covering all of its operating costs. However, it would cost well over $5 billion to build the line, and most of those costs would not be covered by fares.

For some reason, the state decided the best service between San Antonio and Monterrey would be “higher-speed rail,” meaning trains going up to 125 miles per hour (compared with 220 mph for high-speed rail), even though the capital costs would be much higher than conventional rail. Yet the alternatives found that fares on this route would cover no more than 20 percent of operating costs and, of course, would cover none of the billions of dollars needed to start it up.

Given that the state apparently believes that capital costs don’t count when determining “feasibility,” it could have just as well concluded that it would be feasible to run a high-speed trail from College Station to Nachagdoches. Heck, it would be just as feasible to run a magnetically levitated train from Amarillo to Big Bend National Park. How about a hyperloop from Brownsville to El Paso? Maybe suborbital rocket ships from Abilene to San Angelo. Why is the state so short-sighted that it isn’t considering these possibilities?

Apparently, when the state says “feasible,” it means “it is feasible for us to accept more federal subsidies for further studies.” No doubt it will also be feasible to accept federal subsidies for construction. But who is going to pay for the 70 to 80 percent of operating costs that won’t be covered by fares?

Texas Governor Greg Abbott claims to be a fiscal conservative. But why does he let his department of transportation run out of control, accepting millions in federal funds as a ramp up to accept billions in federal funds for projects that make no economic sense? It’s time for fiscal conservatives to inject a sense of reality into these rail discussions before the Democrats start putting together another trillion-dollar spending bill.

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4 thoughts on “How Do You Define “Feasible”?

  1. Henry Porter

    So true. If you’re going to run a business that costs $10,000 a day to operate, you’re going to need to find 10,000 customers who are willing to pay $1 a day for what you have to offer, or 1 customer willing to pay $10,000 a day or some other combination that results in $10,000/day in revenue. Otherwise, your business isn’t feasible.

    It’s simple, yet consultant feasibility study after consultant feasibility study misses that simple fact. Instead, transit consultants define “feasibility” as finding enough subsidies to cover the certain and predictable losses.

    In consultant-speak, as long as you can find somebody willing to throw good money at a bad investment, it’s “feasible”. Enter the United States Congress.

  2. prk166

    The proposed line to Monterey is a good example of why the private sector doesn’t do these projects on a regular basis, they consume more resources than they generate. They’re big money losers.

    In the case of the Monterrey line, I’d imagine the wonks are drooling overt their flavor of the day – passenger rail – connecting with the richest city in Mexico, a city as rich as most any in the US. It’s a 5 hour drive. A bit more than most folks want to do. But it’s only an hour flight and you can get a round trip plane ticket just as cheap as the drive, sometimes considerably less. And you save half a day of traveling.

    As other’s have pointed out, so called-high speed rail is lipstick on an antiquated industrial age technology, rail. The jet airplane in the new technology. It’s not only less expensive but you could make the round trip in far less time than the train.

    At a low level, the problem with the feasibility studies they have is similar to what Amtrak & state DOTs ran into with some of their proposed trains. They were working off numbers that did not take into account the improved bus service on the corridor.

    In this case, the US and Mexico recently ( FINALLY! ) upgraded their bilateral airline agreement. Airline were severely restricted on which routes they could fly and how much capacity they could have on the route. They’ve rolled that way back. Already a low cost Mexican carrier is flying San Antonio to Monterrey. Look for more US and Mexican airlines to join in. They’ve already been adding flights like crazy.

    https://www.vallartadaily.com/news/mexico/air-bilateral-agreement/

    A little more than a year after the operation of the bilateral air agreement between Mexico and the United States, more than 400 new routes between the two countries were authorized, Miguel Peláez, director of the General Directorate of Civil Aeronautics (DGAC), said.
    Both Mexican and foreign airlines increased their number of flights between both countries.
    “We have more requests and is a benefit for both countries and particularly for our country. It represents the opportunity for a very important exchange of all kinds,” he said.
    The bilateral air agreement allows any Mexican or American airline to transport passengers between two cities without limits on frequencies, destinations or aircraft capacity, when previously only two airlines from each country were allowed to operate between two cities.

  3. JOHN1000

    And every one of these projects creates huge debt for future generations to cover. It is very feasible that your children’s and grandchildren’s futures are being squandered by transit developers whose motto is take the money and run.

  4. CapitalistRoader

    Democratic Party hopes to retake Congress soon have been buoyed by this week’s election.

    They shouldn’t be:

    In fact, Northam’s 9 point victory margin in Virginia was not much different from Murphy’s 13 point margin in New Jersey. And both almost precisely mirrored the 2016 presidential results. Hillary Clinton carried New Jersey 55 to 41 percent; Murphy won it by 56 to 43 percent. Clinton carried Virginia 50 to 44 percent; Northam won it 54 to 45 percent. The two Democrats, lacking Clinton’s reputation for dishonesty, gained a few points she lost to third-party candidates; the two Republicans got almost exactly the same percentages as Trump.
    Michael Barone, ‘Washington Examiner, 8 Nov 2017

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