Sen. Debbie Mayfield, R-Melbourne, has asked Gov. Rick Scott to call a 90-day moratorium on the involvement of Florida Development Finance Corporation (FDFC) and any of its affiliates in the financing of All Aboard Florida/Brightline because members of Congress are weighing its legality.
In a letter to Scott on Wednesday, Mayfield in essence said the continued use of taxpayer-subsidized funding may not wash at the Capitol. The U.S. House Oversight and Government Reform Subcommittee on Government Operations, she said, now is questioning whether private activity bonds (PABs) should be used to finance the passenger rail project.
Wrote Mayfield, "I am respectfully requesting you to take immediate action and direct the Florida Development Finance Corporation to not act as a conduit for AAF, or any of its affiliates, for the next ninety (90) days while this issue is being discussed and analyzed by Congress. Your action will not only protect the credibility of the FDFC but also the reputation of the State of Florida."
FDFC has been facilitating the issuance of those bonds between the U.S. Department of Transportation and the rail project's backers. AAF recently received two PAB allocations, $600,0000 for Phase I and $1.15 billion for Phase II of the proposed Miami-to-Orlando passenger project.
On April 19, members of the subcommittee, chaired by Congressman Mark Matthews, R-North Carolina, grilled USDOT Deputy Assistant Secretary for Transportation Policy Grover Burthey and Patrick Goddard, president and COO of All Aboard Florida about the use of private activity bonds to pay for the All Aboard Florida project.
Other parties giving testimony included Dylan Reingold, Indian River County attorney; Bob Crandall, CARE FL Steering Committee member and former chairman and CEO of American Airlines; and Dan Wouters, division Chief Martin County Fire Rescue. The Treasure Coast witnesses addressed issues other than the legality of the PAB allocation. They also talked about serious public safety concerns and the unfunded mandate the project places on local communities.
In fact, the financial burden AAF is imposing on counties that will have to pay for the costs of maintaining the necessary safety improvements in perpetuity was a significant part of the hearing.
In his testimony, Reingold stated, “An initial calculation performed by Indian River County estimates that these long-term maintenance costs will be $8.2 million through 2030 for our community alone -- a significant sum for our small county.”
The April 19 PABs review was made at the request of GOP Congressman Brian Mast, R-Palm City in a letter to Chairman Meadows. Mast, who has been entirely supportive of his beleaguered coastal constituency affected by the railroad's plans, said in his letter, “Brightline is continuing their deceptive business practices, seeking public financing for this expansion by claiming that their passenger rail train is actually a 'highway' because they fail to qualify for public financing under the statutory definition of high-speed rail.”
Mayfield pointed out in her Wednesday letter, "While the FDFC was created by the Florida Legislature, you as Governor appoint the board members that make the decisions.
"Recently, the FDFC has faced significant scrutiny with regard to its lack of openness and transparency," she wrote, summing up a Feb. 28 Office of Program Policy Analysis and Government Accountability (OPPAGA) report. "... This finding by OPPAGA, along with the fact the FDFC has had 11 projects default in the last four fiscal years, casts significant doubt among me and my peers in the ability of FDFC and its leadership to fulfill its responsibilities."
Mayfield asked the governor for a "prompt response."
Even U.S. Sen. Marco Rubio is questioning the propriety of All Aboard Florida's financing. In a letter Tuesday to U.S. Transportation Secretary Elaine Chao, Rubio raised the same question Mast and others on the Treasure Coast posed.
“AAF’s project has raised questions regarding whether federal financing was appropriately used." Rubio wrote. "I urge the Department of Transportation to provide clarity.”
Reach Nancy Smith at email@example.com or at 228-282-2423. Twitter: @NancyLBSmith