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Talgo: If train leaves state, so will company (UPDATE)

A representative from Talgo said late Thursday the Spanish train set maker may be forced to leave Milwaukee if the high-speed rail project is killed. (File photo)

A representative from Talgo said late Thursday the Spanish train set maker may be forced to leave Milwaukee if the high-speed rail project is killed. (File photo)

By Marie Rohde

Milwaukee Mayor Tom Barrett said that if Wisconsin does not use the $810 million in federal stimulus money to build a high-speed train system the money should be used to offset the federal deficit.

Meanwhile, representatives from Talgo Inc., the Spanish company that chose Milwaukee as its site in the U.S. for building and maintaining high-speed trains, said the company may be forced to shut down its Milwaukee operation if the high-speed rail project is killed.

“We were hoping to stay in Wisconsin and we were expecting our business to grow,” said Nora Friend, a Talgo spokeswoman. “But once the order for the Oregon trains are done, we would have to shut down the facility. I don’t think that’s what the new governor wants.”

The trains to fulfill an order from Oregon are to be completed by the spring of 2012. Talgo recently hired 40 workers and expects to eventually employ 125, she said.

Milwaukee Mayor Tom Barrett holds a press conference Thursday in Milwaukee to respond to a work stoppage on the high-speed rail project. (Staff photo by Kevin Harnack)

Milwaukee Mayor Tom Barrett holds a press conference Thursday in Milwaukee to respond to a work stoppage on the high-speed rail project. (Staff photo by Kevin Harnack)

Barrett, meanwhile, said he did not want to have the stimulus money committed to Wisconsin’s project go to another state.

“I do not want to see that money spent for high speed rail in Florida or Illinois,” said Barrett. “Florida got $2.3 billion for the high speed rail that will cost $3.7 billion. I am sure that they would be happy to get $810 million from us.”

The local Talgo operation is located at 3533 N. 27th St., an area hard-hit by unemployment. The city made a $3 million investment in attracting Talgo to the city.

“Talgo has concerns,” said Barrett, who added that he had talked to company officials since learning of the Department of Transportation’s decision to suspend the construction contracts that have been awarded.

WisDOT released a list of eight firms affected, including HNTB of Kansas City, Mo., which was hired to do preliminary engineering and final design track segment design. Edward Kraemer & Sons, Inc., which has a contract to do work on land bridges in Jefferson County, released a statement saying it would comply with the suspension.

“We look forward to working out any details with the current and new administration,” its chief operating officer Fred Lueck said.

Barrett, the Democratic candidate for governor defeated in Tuesday’s election by Milwaukee County Executive Scott Walker, a Republican, said his comments were not political.

“I want to be clear that the election is over,” Barrett said. “But there are some real world ramifications to these actions.”

Walker has been steadfastly opposed to the high-speed rail system that was intended to connect Chicago to Milwaukee, Madison and Minneapolis. Concerns were raised when contracts for the Wisconsin leg of the system were signed over the weekend.

“It is prudent at this time to pause,” said Barrett. “This has to be a transparent process.”

Barrett said the Milwaukee city attorney’s office was exploring whether the city has any recourse in recovering damages if the rail system is killed.

Chicago badly wants to connect to Minneapolis and Barrett said a nightmare scenario would be an attempt to bypass Wisconsin to do that, something he said is unlikely.

*********************************

On Friday, U.S. Congresswoman Gwen Moore, D-Milwaukee, wrote a letter to Doyle and Walker after the decision to temporarily stop work on the high-speed rail project.

Here’s the full text of the letter:

Dear Governor Doyle and Governor-Elect Walker:

It is critical that Wisconsin continue work on the high-speed rail line from Milwaukee to Madison that will eventually connect to the Twin Cities in Minnesota.

Offering more options to connect people to their jobs is an economic win-win for our state. This is especially true for low-income people, many of whom have no viable transportation option and can’t get to where the jobs are. And as part of the vision of a nationwide high speed rail network, the economic benefits to our state will be plentiful.

In Milwaukee, Talgo will create jobs building cars for high speed rail. They will build cars for rail in Oregon, and they should be able to build rail cars to be used in Wisconsin as well. Stopping work on the project puts these jobs in great jeopardy.

This is about our future, not about our past.

We all share the same goal of creating good jobs for Wisconsinites. The election is over, and this shouldn’t be about politics. It should be about people and family-supporting jobs. Undoubtedly, building a high speed rail line creates jobs. And more jobs will come once it is operational.

Furthermore, the truth remains, if the funding isn’t used in Wisconsin for high-speed rail, the funding will not be used in Wisconsin at all. Sending this funding back is misguided and does nothing to help Wisconsin taxpayers. If anything, it sends their money away to build high-speed rail somewhere else.

As it stands today, Wisconsin gets less back from the Federal government than Wisconsinites pay in Federal taxes. Sending $810 million back to Washington only makes this worse.

Sincerely,

Gwen Moore
Member of Congress

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44 comments

  1. High Speed Rail is the way to go here and I fully support this project; ultimately, it will create thousands of good paying jobs, tremendous revenue for the state of WI, fast connections between Madison, Milwaukee, Chicago and Minneapolis. If this project is completed it will be a veritable cash cow for WI and it will tremendously lessen the total impact of cars on the road and the massive pollution that they cause.

    Walker is clearly playing politics with this project, again and again and we here in WI may ultimately simply lose the 810 Million dollars in stimulus money, given specifically for this High Speed Rail Project. Additionally, we, the state of WI, will be forced to repay the funds already expensed on this project: tentatively estimated at 3 – 4 Million dollars.

    Walker needs to take off his loin cloth, buy a real suit and somehow, actually stop posturing and grow a brain; this man will create massive unemployment, more debt and bankrupt the state!

  2. have we lost all our voice now that you did not win and walker won? can we fight? how can we fight? how can we lobby??????? what now?????

  3. Here’s the problem with the current government. Why would the Federal Government take the $810 million stilmulus money away from a state that needs money for roads and bridges to be rebuilt? Isn’t it like waiving a cookie and then taking it away because we don’t agree with how the money is being used? Wake up Obama…this is why the states turned red, to take out all the brain dead politicians in Washington and get some real people in there to do something right for the state and country. Oh yeah, you made a mistake alright Obama…you should listen to the people instead of ramrodding every idea thru the system without thinking it through. (high speed rail) whose legacy is this for? If you really want high speed rail check out the Japanese rail system…now THATS high speed. Not a glorified Amtrak train that maybe go up to 65 mph. Bru ha ha…who are we kidding here?

    The country will wait if the result shows it was done right. Am I wrong about this?

  4. When you are wrong about basic facts (65 mph?), it is tough o take anything else you say seriously.

    Misinformation like the stuff you have obviously been fed and are repeating is the reason you can’t trust all the plebs to make a correct/informed decision on important topics. Like I’ve always said, the problem with a democracy is that everybody gets a vote.

  5. “Why would the Federal Government take the $810 million stilmulus money away from a state that needs money for roads and bridges to be rebuilt? Isn’t it like waiving a cookie and then taking it away because we don’t agree with how the money is being used? ” Actually, that is incorrect and highlights one of the biggest problems we have in our governmental system. Most people don’t have a clue how our government is run.
    Money allocated by congress for a specific thing can not simply be “reallocated’ for a project that a person or state would prefer to use the money for. Allocated money must be spent for the intended purpose or returned to the Federal Government. So, we have a choice, use the money for the rail system, or loose it to another state, along with all the jobs that we’d get from Talgo building the trains for all of the rest of the country, ~ 4500 jobs to build the system itself and future incoming business due to increased access. We have become short sighted, closed minded, and well quite literally show a lack of education in how our government works. Pollyanna isn’t going to wave a magic wand for us we need to wake up to the reality of what our life will be like if we don’t start planning further than our own nose.

  6. How do you know the Feds wont reallocate the funds ? Nobody has yet tried and in case you were sleeping Tuesday, a new group of people will soon be seated.

    Notice the rail advocates all carry this Obama arrogance, thats why the Dems were tossed out like trash, they are above us all, they will think for us,right down to the toys in a happy meal, leave it to them and the government will raise your children as well so people have no personal responsibility.

    What about Talgo refusing to hire blacks and seniors? the left press wont look into that story. If this is what they bring to the state let them go, we dont need backward thinking like this. Why not let companies bid on building the trains not just handing over a contract behind closed doors.
    .

  7. Faye, yes, you are incorrect on two things. Obama didn’t create the stimulus bill, Congress did. Secondly, the stimulus money Wisconsin was given from the Congress was specifically appropriated for rail, regardless if anyone thinks the rail is high-speed or not, it was appropriated for rail.

    Lastly, not not kid ourselves, we all know that the roads need to be repaired as well as bridges and everyone around the state, as least I have had to endure road construction throughout Southeastern Wisconsin, that other stimulus money that was appropriated for fixing roads and bridges were being put to good use.

    Now, let’s get the rail completed from Chicago to Madison so that in the future it can be extended to Minneapolis. This isn’t about a rail line between Milwaukee and Madison. This is an extension of the existing line from Chicago as part of a whole Midwestern rail system. To say it’s all about Wisconsin would be very narrow-minded indeed.This will bring Chicago businessman and women from the Chicagoland area into Wisconsin. In addition to getting the $810MM in stimulus to have the extension built, it creates jobs.

    We also need to keep in mind that it was Republican Tommy Thompson that got the ball rolling to build rail in Wisconsin. Additionally, there have been several Republicans from other states that have been telling Wisconsin Republicans not to ruin the rail extension from Chicago to Madison because it creates jobs as well as roads needing less repair because less cars will be traveling on them.

    Wisconsin continues to lose jobs to neighboring Illinois (Chicago metro area) because their infrastructure is better all around. Chicago has a better freeway system. If you look, the freeway system that was designed for Milwaukee has never been completed. We are missing the downtown loop, the Hwy 16 connection from Oconomowoc all the way to downtown, the bypass from Waukesha south then cutover east towards the airport, the freeway connection from Hwy 41/45 in Germantown near Mequon Rd to Brookfield/Waukesha area, Hwy 145 stopping in the middle of the city instead of connecting to Hwy 41 by Miller Park as it was intended that would have then cut east to downtown, Hwy 41 at Miller Park connection south to I-894, and an east-west freeway on the northside. No one talks about this, but our legislators needs to look at our freeway system, finish it so we aren’t all crowded on the few freeways we actually have which would cut down on wear and tear on the existing freeways (I-94, I-894, I-43 and the state Hwys 41, 45 and 16).

    Then, we need a streetcar/lightrail system for Milwaukee so that businesses come to city of Milwaukee and their employees can take the cheaper alternative of streetcar/lightrail to work instead of bearing the costs of driving like buying gas and paying for parking (if they work downtown). The extension from Chicago to Madison will allow business persons from Milwaukee’s southside and downtown as well as suburbanites to take Amtrak to Madison to work and vice-versa.

    We need to look at the bigger picture and do what needs to be done to get more jobs into Wisconsin. This involves better infrastructure all around and not just roads.

  8. It won’t take long for Scott to prove once again that he absolutely does not care about inner city minorities, job creation, the state’s infrstructure or what is good for the State of Wisconsin. A leoprad doesn’t change his spots he just hides in the bushes until he can attack the unsuspecting or in this case the uninformed. But wait, he’ll find a way to blame all of this on the legislative bodies, Dem or Repub, just like he did for 8 yrs in Milwaukee Co. I hope inner city folks; especially church leaders, who voted for and/or encouraged their membership to vote for him are happy about this news…just goes to show it doesn’t matter what you promise people because they’ll buy into it instead of listening to people who have the facts or check the facts themselves. They would rather listen to a lie than search out the truth. However, as is Scott’s style if there is enough negative feedback directed at him, he’ll change his mind and blame it on his staff as usual!

  9. Troy: past precedent. If a state doesn’t spend money allocated within a given program for a given project, USDOT will pull that money back and reallocate it elsewhere…that’s the way they’ve done business for years now. That a new group of people will soon be seated has nothing to do with it.

    Nevermind that this was money specifically appropriated by Congress for high speed rail. It’d take an Act of Congress for Wisconsin to be able to keep that money to use for roads, and I highly doubt that’ll happen.

  10. I’m writing from Normal, Illinois. If Wisconisn doesn’t need highspeed rail, we’ll take the money and build, build and build some more. The people of Wisconsin should take note that a new rail route from Chicago to Iowa City via the Quad Cities of Illinois and Iowa was approved barely two weeks ago. It’s possible that Wisconsin could be bypassed by building a rail line straight to Minnesota and the Twin Cities from Iowa. Ultimately, this would connect Chicago to Minneapolis, leaving just a stump line to Milwaukee. The “highspeed rail” that is being built as I write this, from Chicago to St. Louis is not and won’t be 220mph., only speed up to 110mph. But, the entire rail corridor has enough right of way for a second track (since one track was torn out during the 1960’s). My point is, in the future these rail corridors Madison too Milwaukee included would be upgraded to higher speed in the future. I think it’s sad that Wisconsin can’t see this. The Town of Normal is building a new Station for this new style of rail travel, one that incorporates city busses, taxis and Greyhound, Trailway’s etc… Joliet just anounced a new station for their city a month ago. I just think Wisconsin is making a big mistake. Thanks

  11. I agree with Eddy. I am an Illinoisan living in Freeport. We have funds allocated for a separate Chicago-to-Dubuque line called the Blackhawk. We are extremely excited to be better connected to downtown Chicago (avoiding traffic and parking headaches) and Dubuque (avoiding the two-lane US 20 between Freeport and Galena.

    I was excited about Wisconsin until you guys elected a class-A idiot. You guys are going backwards all right. Good luck though.

  12. When are people gonna pull their heads out of the sand and wake up! The future is now Scott Walker, and I’m ashamed of my fellow Wisconsinites that voted for you. I want the train. I’m tired of hearing how we can’t afford it. Build it and it will pay for itself twenty-fold…..Not to be rude, but when I think of republicans the word republicants comes to mind. If Wisconsin is “open for business” then bring us the jobs and all the business that will come with it…..I think the racists are a bit afraid of who might come to their town. Just my thoughts.

  13. The train is a farce. Commuter trains are great for urban areas. No so much to cross rural Wisconsin. Look no further than Amtrak to see how passenger rail is a non sustainable venture for routes such as the one proposed. Charging passengers $37 for a trip that costs $95+ is no way to run a railroad.

    Having an average speed of 59mph is hardly “High Speed”.

    If you do not want to drive, take the Badger Bus for $20. (No $810 million + $7 million in annual maintenance required).

    If Talgo leaves, all I can say is Adios.

    Lets have a little fiscal responsibility here.

  14. It’s not just a commuter train, genius. The improvements to the freight system will attract enough businesses and jobs to more than offset the relatively puny $7.5 million per year. (Psst… that means it will “make” money… that’s fiscally responsible). Any additional tourism or “civilian” traffic will be just an added bonus.

    And can you please show me where the highway system and airports make a profit? (I’ll save you some time… they don’t… they “lose” enormous amounts of money) Based on your logic, we should have NO infrastructure.

  15. Never should have happened……kill this financial beast and kill it now.

  16. With all due respect to the Sausage King of Chicago, the grant application is for Passenger Rail. While an improved track is a nice benefit for freight, it is not the purpose of the project. Freight yards will not be added as part of the project.

    Given I-94 garners 100,000 + users per day, the cost per user is WAY less than the proposed “not-so-high speed rail”.

    I will grant you all this passenger rail leading to Chicago is great for Chicago. Coincidence??

  17. Like we covered above the funding is for passenger rail only not freight rail and not highways. Let me guess the Chicago line stops right at the sausage store.

    Everyone is aware that in order to haul freight or run at high speeds the entire rail system would be scrapped and a new one installed, the system is not capable of any future upgrade without starting from the ground up again. Will the sausage king fairy be granting us this money also?

    The only one that wants this is state employees and lobbyists so they can ride the rails like the big boys do out east, not to mention at a reduced rate. Go play choo choo with your own money.

  18. Irwin Fletcher says: “The train is a farce. Commuter trains are great for urban areas. No so much to cross rural Wisconsin. Look no further than Amtrak to see how passenger rail is a non sustainable venture for routes such as the one proposed. Charging passengers $37 for a trip that costs $95+ is no way to run a railroad.”

    Yes, let’s go look at Amtrak to see how well it actually works! While we do that, please keep in mind that the population of Madison is 223,389, the pop of Milwaukee is 573,358, and Chicago is 2,833,321. And of course there are people in small towns and cities in between all those points.

    Now let’s go look at Portland, Maine population 63,011 with lots of small rural places between there and Boston. The Downeaster that runs between Portland & Boston saw more than 460,000 riders last year.

    Then there is the 1 year old service from Lynchburg, Virginia population 67,720. Virginia started running this train in October of 2009. They estimated a 1st year ridership of 50,000 and based upon that number, they set aside several million to subsidize the train.

    Just 6 months into operations in March and they had already met the first year goal of 50,000 riders. By July, 10 months in, they had doubled the first year estimate with more than 100,000 riders. Come August with one month still to go, they had more than 116,000 riders.

    And the best part? Despite charging as little as $29 for a one-way ticket, Virginia hasn’t spent 1 dime of the money set aside to subsidize the train. It’s actually running a $2M profit as of August.

  19. This rail project is MOST DEFINITELY going to improve freight service… It’s a FACT. To claim otherwise is simply dishonest or ignorant.. Turn off Charlie Sykes and turn on your brain.

  20. That’s great for Virginia Ahblid. We have some data from right here in the mid-west. The Hiawatha line that runs from Milwaukee to Chicago gets some 750,000 riders per year. Unfortunately, it is not profitable. It looses about 33% on each passenger. It runs at a deficit of approximately $6.5 million/year. One might think adding to the system would see some benefits from economy of scale, but not so. It is projected that the extension to Madison, while adding 340,000 riders, will increase the loss per rider to 39%. Right now we loose $ .11/rider mile. With the extention it becomes a loss of $.14/rider mile. Projected loss adding the new train will be $15.6 million/year.

    Those numbers come right out of the grant application. In other words they used those numbers to “sell” the idea. Usually when someone is selling something they use data that puts it in the best light possible. Meeting those numbers is likely optimistic.

  21. Irwin,

    If we built things that only made a profit, then we would have no airports and no roads. It’s as simple as that.

    Second, the loss per passenger mile in 2009 for the Hiawatha was 9.5 cents and that was only after Amtrak added in overhead costs. On operating costs the train actually made a small profit of $100,000 last year.

    That means that the riders covered 100% of their operating costs. Unlike drivers last year who only covered 50% of their operating costs at the Federal level.

    You’re busy counting pennies worrying about the trains while throwing hundred dollar bills that we don’t have at the highways.

    Most people here are worried about 2 things, their taxes and the National debt. Which do you think is going to impact those two things the most, the $810 Million for this train or the $34.5 Billion that the Fed spent on the highways?

    Again, you’re counting pennies while watching hundreds fly out of your wallet. This train’s operating costs might have cost you as much as $1.80 per year. The Fed just reached into your wallet last year and removed $112 for the highways. And that’s the amount before any gas taxes you may have paid when you filled up your car.

    So again, which do you think makes your taxes higher that buck eighty or the $112?

  22. “You’re busy counting pennies worrying about the trains while throwing hundred dollar bills that we don’t have at the highways.”

    EXACTLY…. and airports hemorrhage money at an even faster clip.

    You guys got duped and sold a bill of goods by idiots like Walker and Sykes and now you are having trouble admitting you are wrong…. even in the face of overwhelming information and logic. So sad.

  23. Ahblid and Abe,

    Lets do just a little math

    $34.5 Billion divided by ~43,000 miles of interstate highways = $80,000/mile to maintain interstate highways.

    It’s about 72 miles from Milwaukee to Madison, so that is about $5.7 million per year for maintenance. The the highway cannot go away as the passenger rail would not replace the service of the freeway.

    The traffic count on I-94 is approximately 100,000 cars per day. Assuming only one person per car, that is 36.5 million “passengers” per year. Take the $5.7 million road cost and divide that by 36.5 million people. That is about 15.6 cents per passenger.

    Now look at the rail. Take the $7.5 million and divide by the 360,000 expected passengers. That results in $20.83 per passenger.

    What is a bigger maintenance cost for the distance in question, 15.6 CENTS per passenger for an interstate or $20.83 DOLLARS per passenger?

    The math is not hard.

  24. Irwin,

    Way to dodge the hard question. We’re not talking about the cost per passenger here. Throw enough money at anything for enough years and you’ll always get that number to be nice and low. If we keep throwing $810M at rail projects every year, eventually the costs per rail rider will be lower than the costs per driver on the roads.

    We’re talking about which added more to the National Debt of this country; $810 Million for this rail project or the $34.5 Billion spent on the highways. Besides, that $34.5 Billion is only the Federal subsidy to the highways last year. The Fed actually spent $69.116 Billion, and then the states added still more to that both subsidy and what was paid for via the state fuel taxes.

    However, returning to the original issue, if you’re getting a tax bill that gives you the choice of paying $1.80 that year for rail vs. $112 for roads, I can’t imagine that you’re going to pick the bigger bill just because you happen to know that the cost per passenger for the roads is lower than it is for rail. I grant that you’re not getting that choice, but the point remains. This isn’t about cost per mile, this is about your taxes and the National debt.

  25. Ahblid,

    Your arguement is absolutely without merit. You are trying to compare something that will serve a small portion of SE Wisconsin with something that serves the entire United States. Of course something that serves 350,000,000 million people every day will have a total cost more than something that will serve about 1,000 people a day. (By the way, you are comparing construction cost of the train vs maintenance cost of the interstate, so your arguement is apples & oranges)

    The idea is that transportation provides a service, namely to move someone from point A to point B. I have shown where the maintenance alone will cost the tax base $20.83 per passenger to move a person via train from Milwaukee to Madison. It will only cost the tax base .15 to do the same via the interstate.

    By the way, the $ to build and maintain roads come out of the same fund that funds mass transit. (fuel tax). Look at it as the money coming from the same wallet. You can pull a $20 bill out and send 1 person almost all the way to Madison via train, or you can use the same $20 to send about 130 people via the interstate. Which is more cost effective?

  26. Ahblid,

    One more thing since you are so concerned about the deficit:

    Lets say as taxpayers we have a job to do, namely to move 350,000 people per year from Milwaukee to Madison. With the train it costs 350,000 x $20.83 or $7.5 million dollars. With the interstate it costs tax payers 350,000 x .15 or $52,500. Which adds more to the deficit, spending $7.5 million or $53 thousand?

  27. You are completely and intentionally ignoring the biggest component of the project… FREIGHT. Freight = jobs/economic development/tax revenue. There is currently only one line from Milwaukke to Madison and it is shot in stretches. Intentionally leaving 75% of the benfits out of your information is basically the same as lying.

  28. Abe,

    1.) Please show me where in the grant application freight is mentioned.

    2.) Freight lines and passenger lines do not like to share the same tracks. You might want to read this:

    http://www.progressivefix.com/freight-railroads-throw-a-switch-on-obama%E2%80%99s-rail-plans

    To do high speed rail right it needs to have it’s own track.

    The cost of rehabilitating an existing track for freight is a fraction of the cost of reworking the track for “high speed” passenger rail. Given freight improvements for 75 miles would not cost $810 million dollars and may have an economic benefit, I can see pursuing that. Lets take it a step further, if they Feds want to give us $800 million to spend on rail, lets spend it on the freight system. We will get :

    1.) way more than 75 miles out of it
    2.) generate an economic benefit
    3.) not be saddled with an additional $7.5 million dollar a year operations deficit

    Abe, if freight improvements are what you want, does that not make more sense?

  29. Irwin,

    Once again you forgot in your calculations that the train is all in at $7.5M, but the roads are far more expensive than the numbers that you’re using. Again, you’re only using the Federal subsidies. You’ve forgotten the State subsidies, county subsidies, and city subsidies.

    Next we don’t know for sure that it will actually cost $7.5M per year for that train. That’s based upon the ridership estimates for the train which were used to come up with the high & low numbers for the subsidies. And those numbers were much lower than 350,000; with ridership at that level, there would either need to be no subsidy for the train or at least a greatly reduced subsidy.

    The State of Virginia started a new train back in October 2009 between Lynchburg and DC. That train with a ridership of 116,000+ had already turned a profit of $2 Million 11 months into its first year of operation.

    Next, this train won’t just serve a small part of Southern Wisconsin. It will connect to Chicago right from the start, and eventually it will connect to Minneapolis/St. Paul. It is part of a National network, much like the highways are.

    Next, very little of that amount for the highways is maintenance. The bulk of the Federal money is to build new, widen, or perform major overhauls of the highways. Maintenance is the state’s obligation, just like it is for the trains. That of course invalidates your entire comparison, since you’re comparing maintenance for the trains vs. capital costs for the highways.

    I recall reading some place recently that the State spends about $300 per person on the highways. I’m not sure how much is subsidy and how much is actually paid for by the drivers via fuel, license fees, and other road related income.

    Finally, money for the highways (at least that paid for via the fuel taxes) comes out of the Highway Trust Fund. Money for subways, El’s, commuter rail, Light Rail, buses, Ferries, and such comes out of the Mass Transit Fund. The money for the Madison service came out neither of those funds.

    By the way, to answer your question, the road adds more the deficit. That’s Federal dollars being used. The train isn’t using Federal dollars to operate.

  30. http://www.dot.wisconsin.gov/projects/recovery/docs/rail-grant-8.pdf

    If you can read, you’ll see freight all over the place.

    Where is your information on the cost of just rebuilding the freight line(s) vs. also making it passenger?

  31. You are correct Abe, they address freight. However they expect ZERO increase in freight runs to/from Madison through 2030. Watertown would see a benefit. As I said, great, update the freight line.

    With regard to cost this is what I, as a civil engineer that estimates construction costs for a living, see: Far fewer operations are required to refurbish a track in place than to reconfigure sections where radii may be too tight and/or add switching to allow for a higher speed train. Signalling and crossings will also have to be addressed to provide safe conditions for a train that tops out at 110 mph. It is pretty easy to go through the estimate in the grant application and red line out items that would not be needed for a freight upgrade.

  32. Ahblid,

    With regard to your comment “Next we don’t know for sure that it will actually cost $7.5M per year for that train. That’s based upon the ridership estimates for the train which were used to come up with the high & low numbers for the subsidies. And those numbers were much lower than 350,000; with ridership at that level, there would either need to be no subsidy for the train or at least a greatly reduced subsidy”

    Your claim of no subsidies is not supported for ridership of 350,000 passengers is not supported by the the grant application. I refer you to page 16 of the grant application. Look at the right column. That represents the net change due to the proposal.

    http://www.dot.wisconsin.gov/projects/recovery/docs/rail-grant-13.pdf

    Note the “fare box recovery” line. It is important to note that this includes the Hiawatha line as well. What you will see is that for every dollar required to currently run the Hiawatha, only 66% is recovered in fares. If the extention to Madison goes in, the recovery drops to 54%!

    Please site the study that shows it will be cost neutral (or nearly so)..

  33. Irwin,

    First, I never claimed that no subsidies would be needed with 350,000. I said, “with ridership at that level, there would either need to be no subsidy for the train or at least a greatly reduced subsidy.”

    Second, I’m well aware of that document and the data contained within it. The Hiawatha’s last year carried 738,000 riders. That number will continue to increase with each passing year just on its own. Factor in the new trains and the higher speeds for that corridor, and that number should increase substantially.

    However, if we assume even a modest growth rate of 5% for each year, that would give us 900,000 riders. That leaves about 270,000 riders for the Madison to MKE segment in the plan. Therefore, 350,000 would be an improvement over that plan. And that would most certainly reduce the required estimated subsidy, if not actually eliminate it.

  34. Really?…..4000 jobs??? Where T-F— did that number come from? I think you held the zero key down a little long while typing. Even 400 would probably be a little high.
    Also, apparently the news doesn’t get to you under the rock you’re living under but state unemployment is more like 9%, and factoring those who’ve given up looking, and the under-employed is more like 13%
    By the way, you’re so concerned about Talgo being kicked to the curb, where were you when Doyle pulled the rug out from under a local, established company, Super Steel as the train builder?
    Try if you can to think big picture…a few hundred train related jobs lost, while sad, is a drop in the bucket for the overall jobs created when the state gets it’s spending in line, becomes more business-friendly, and the economy improves.
    Finally, Talgo did not ‘choose’ Milwaukee. Doyle, on his own, went to them, and on his own authority bought trains, and with no competetive bids worked out this deal with them. Meanwhile, during his spending spree in Spain, didn’t do a damn thing to keep Thomas manufacturing from leaving the state with it’s 400 jobs….how ’bout that for ‘jobs lost’.

  35. T.E.A,

    I believe that the 4,000 refers to construction jobs, which of course would not be long term jobs. But still it does get people off the unemployment line for a while.

    Regarding Super Steel, they have no high speed train plans and were not capable of building a high speed train. Super Steel was a rebuilder more than anything; officially they’re a metal fabricator. Send them old train cars and they rebuilt them; not a quality useful for new trains.

  36. Oh…OK.
    Still, I maintain my main point of contention…. 4000 jobs?! Whaaa?
    Let’s count ’em up:
    125+/- @ Talgo
    30+/- for Engineering firms etc.
    Maybe 3 or 4 General Contractors\construction companies.
    Even throw in another couple hundred, for anyone I’m forgetting in related work.

    For 70 miles of some new tracks (most will be existing), bridges, and crossings??
    4000 is ludicrous! That’s 55 new jobs per mile, or about 1000 new hires per construction firm. Even a government firm wouldn’t hire that many people for this project. An average bridge building crew consists of about 20 people. I would just like to see, whether you support or oppose this…try basing a few numbers and estimates in reality.
    If you believe this project will result in 4000 new jobs, long or short term, you must also be one of those who believes that 1 million people show up each year to watch the great circus parade? Maybe you also believe that the 810 million dollars will pay for the whole project….and maybe you even believe that it will operate at a profit.
    I guess we all have to believe in something, but for me…it’s not fairy tales.

  37. First, I’m not saying that I agree with the 4,000 number, just pointing out that it includes construction jobs, as well as permenant jobs. And it’s not just the tracks, you’ve got station work, you’ve got signaling work, a new yard that needs to be built, maintenance facilities, and probably a few other things that I’m missing.

    Second, I don’t believe for a moment that it will operate at a profit. I suppose that there is a very slight chance that it would have been as successful as the new Lynchburg service that actually is making a profit. But I think it highly unlikely. Moving people in general is not a profit making business. We subsidize our airlines, our trains, our buses, and our roads.

    On the other hand, with the overrun contigencies built into the budget, it is very likely that the entire $810M would have paid for the project.

  38. Per the grant application the strategy to deal with cost over runs is $122 million dollars of STATE bonding autority (ie issuance of more State debt). It says nothing of “contingencies built into the budget”.

    Reference

    http://www.dot.wisconsin.gov/projects/recovery/docs/rail-grant-13.pdf

    See Page 13

  39. Irwin,

    Please go look at page 29 at the link you provided. In addition to what you’ve mentioned, there is $4M in category 90 Unallocated Contingency. That’s the overall contingency.

    Now please flip to page 26 and note the second column labeled Allocated Contingency. This represents the extra dollars added to each item to deal with cost overruns. That totals to just a little over $128M on page 28.

    So all told, built into the project is $132 Million, before the State must step in with its $122M of bonding.

    After the fiasco known as the Big Dig, the Fed doesn’t allow projects to receive Federal dollars without building in a contingency for overruns.

  40. PS. Page 13 shows the project timeline, but nothing about dollars at all.

  41. Oops, Page 11.

    On one hand I am glad to see they have a contingency, but on the other hand it appears they have no idea what some of the items should cost. One does not plug in 20-30% contingency on a line item unless you have no confidence as to what it should cost.. That amount of contingency applies to about $500 million of the job.

    All in all I believe we are beating a dead (iron) horse.

  42. Irwin,

    Actually I believe, although I cannot find the reference at present, that the Fed requires either a minimum of 20% or 25% contingency in order to qualify for funding. Again, an outgrowth of the Big Dig fiasco.

    Thanks for the corrected page number! 🙂

  43. Thanks for opening the door to discussing the Super Steel deal.

    “Concrete Scott” Walker, as a member of the Wisconsin Assembly, voted in favor of the budget that created the no-bid law that was used to attract Talgo and its hundreds of jobs to Wisconsin.

    Super Steel is run by Fred Luber, who was a huge cash contributor to Scott Walker’s election.

    Scott Walker attacks the job-producing high-speed rail project in one sentence, and in the next he bemoans that his cash-cow buddy didn’t get the contract to build it.

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