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Originally Posted by Standpoor
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I don't understand how previous plans make this less of a subsidy. Most of that would have been paid for by the feds. Its not like OIA was looking to expand without HSR but under the FEC's plans OIA will have to bear the financial burden with no guarantee that they will see a return. More to the point, OIA does not know if FEC will be profitable but is being asked to take on a large amount of the risk. Basically FEC is asking OIA to pay for something that marginally benefits the airport but that is essential to FEC's plans. Its good business for FEC, have others pay for your project and minimize risk but it definitely is a subsidy because There is no way around it. Now the question is whether the subsidy is net beneficial for OIA.
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OIA has been talking about building that south terminal since I was in high school and I'm 35 now. There's nothing stopping them from scaling it back or simply running a shuttle bus out there short term. In addition, the State's Sunrail commuter rail system is supposed to tie into this as well. Sunrail will be operational by 2015, with or without FEC. No way, FEC should be paying 100% of the cost for OIA's long term wet dream. Also, as airlines continue to consolidate at Central Florida's six international airports, this connection definitely benefits OIA long term. To get things going, if OIA doesn't want to pay for the taj mahal in its current configuration, all of these entities should build a temporary surface lot and connect it to OIA's main terminal with a shuttle bus.
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And the same goes for OOCEA. Why give free land to a company that is going to directly compete with you. The first priority should be to the bond holders and if FEC undercuts the tollway, then that would put the authority's financial position at risk. The 2011 annual report lists OOCEA's revenue bonds at $2.7 billion dollars. What effect will giving free land have on the bottom line? Will the new right of way be on the State's tax rolls? Basically, FEC wants as much as it can get from the people of the State of Florida without reverting to a direct infusion of money or loan guarantees. Now the question becomes whether or not the people of Florida think it is in their best interest to go along with the plan.
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The last question is the easiest. Yes, the good chunk believe its in Florida's best interest to have FECI move forward with their project. We've been waiting for something like this for a few decades and even voted to have a 100% state subsidized version in 2000. As for OOCEA, this should be nothing new. The HSR plan we've talked about for the last 20 years was going to utilize the same ROW. However, FECI should be more beneficial to OOCEA. The State plan would have included a stop at Cocoa. This one won't. Also, the FECI thing is about land development. Flagler is a major industrial/commercial developer in this state and having them focus on developing along the Beach Line probably has OOCEA doing back flips behind closed doors. With 40 miles of undeveloped property to play around with between Port Canaveral and OIA, both OOCEA and FECI seem to be sitting pretty. That's a lot of land for future industrial/commercial/residential development, which means increased vehicle trips, which equals increased toll revenue.
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I have no problem with private rail plans but it seems that private players rarely gauge the complexity of projects and the time necessary to actually implement large scale passenger works. I have always thought that this was too large of a project for FEC/Fortress, they simply are not big enough to commit $1 billion dollars buying and building an HSR line. However, as time goes on, their plan becomes clearer and relies on others to fill in the gaps. If they can get this project complete it will be an amazing business deal. If they get it done in the time frame they set forth, it will be a miracle.
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To be honest, I don't see any of the obstacles mentioned above as huge. If anything, it sounds like a typical part of the negotiation process. I'm sure, you'll see these ironed out with some compromises and the project will continue to move forward. There's too much money to be made for FECI, OIA and OOCEA for them to kill it.