Gov. Scott Rejects Rail Project Despite No Risk To Taxpayers

February 25, 2011 5:24 pm ET — Kate Conway

Gov. Rick Scott

Last week, Gov. Rick Scott (R-Fl) rejected a proposal to develop high-speed rail between Orlando and Tampa despite bipartisan support and the offer of billions of federal dollars to aid in construction. Relying on a study from the libertarian Reason Foundation, which some have criticized as "inaccurate," Scott declared that the risks to Florida taxpayers were too high.

On Wednesday, both Republican and Democratic Florida lawmakers keen on providing the state with infrastructure developments — and the jobs that come with that — presented Scott with an alternative. Florida's state and local governments would be relieved of all financial risk in the rail project by the creation of a "non-recourse entity" that would effectively privatize the operation.

[B]ullet train backers began working feverishly to craft an alternative, to get around Scott's insistence that the state not be financially liable in any regard. They continued to hold onto a shred of hope that Scott would come around, saying it would create thousands of jobs.

The plan, calling for local governments to take over the project, was submitted to Scott on Wednesday after meetings between the governor's office, federal transportation officials and representatives from local governments including Tampa, Orlando, Lakeland and Miami.

This new partnership would be considered a "non-recourse entity," which is the key piece of the proposal. It means that if the project goes bust, in no way would the state or local governments be held liable for construction or operating cost overruns. The new entity would oversee the design, building and operation of the rail system, which would effectively be privatized, with the private company bearing all risks for construction and operating cost overruns.

But Scott re-rejected high-speed rail, claiming "there's nothing new" despite the fact that under the new proposal all costs and liability for rail would be passed on to whichever private entity won the bid. His remarkable short-sightedness garnered the criticism of Republicans and Democrats alike.

Fortunately for Floridians, all hope is not lost. The Orlando Sentinel reports that a lawsuit may be filed against Scott "contending he has overstepped his authority by killing the train." Additionally, U.S. Transportation Secretary Ray LaHood has granted Scott a one-week extension on the high-speed rail decision, saying, "I feel we owe it to the people of Florida, who have been working to bring high speed rail to their state for the last 20 years, to go the extra mile."