Miami-Dade and Brevard county commissioners are scheduled to vote this morning on policy changes that will help All Aboard Florida pursue a portion of the $1.75 billion in tax-exempt bonds it hopes will pay for the construction of its Miami to Orlando passenger rail service.
The change in Brevard County was still being negotiated late last week between county officials and the Florida Development Finance Corporation, according to emails included with the agenda item. Sticking points included how many years All Aboard Florida will pay for crossing maintenance and whether the corporation will share its fee for acting as the conduit issuer of the bonds.
A Friday memo from Brevard County Attorney Scott Knox says the corporation is willing to pay $100,000 to the county, and assume maintenance of the county’s crossings for seven years. Brevard was seeking a 10-year reprieve.
Today’s votes will pave the way for All Aboard Florida to move forward with its $2.5 billion project. Brevard must increase a $7.5 million cap it has on allowing the corporation to issue bonds for capital projects. The proposal would increase that to no more than $375 million. Miami-Dade must increase its cap to $325 million.
Brevard’s agreement also “removes any All Aboard Florida responsibility to pay for the costs of quiet zones if federal funding is not available.”
Controversial crossing agreements that All Aboard Florida has been pushing since late December could also be part of Brevard’s deal. The agreements would add All Aboard Florida as a third-party beneficiary to the agreements between municipalities and the Florida East Coast Railway.
All Aboard Florida is seeking funding through private activity bonds to supplement or replace the $1.6 billion Federal Railroad Administration loan it had previously applied for. The bonds issued in Brevard County will be used for rail infrastructure in that county, according to the corporation.
Bill Spivey, executive director of the Florida Development Finance Corporation, said Oct. 7 in an interview with the Palm Beach Post that Palm Beach County does not need to change its agreement with the corporation to issue the private activity bonds.
Miami-Dade County is the only other county that needs to increase its bond cap.
All Aboard Florida and its opponents have been trying to get people to today’s meeting to voice their support or concerns. All Aboard Florida sent a tweet out yesterday encouraging supporters to attend, while Florida Not All Aboard advertised the meeting on its websites and pleaded for Brevard officials to deny the company’s crossing agreement proposal.
“This is the most valuable bargaining chip Brevard County has in its negotiations over costs with All Aboard Florida,” the group wrote. “Until Brevard knows all costs that will be incurred as a result of AAF’s project, it would be irresponsible to concede this critical point of leverage.”
Earlier this month, All Aboard Florida President and Chief Development Officer Michael Reininger said the bonds will allow the railroad to begin construction on the second phase of the line between West Palm Beach and Orlando more quickly than if it waited for the approval of a $1.6 billion Federal Railroad Administration loan.
Reininger thought the U.S. Department of Transportation may approve the bonds by the end of this month.
Private activity bonds are designed to encourage companies to invest in projects that are beneficial to the public and local economies.
There has been $15 billion set aside at the federal level for private activity bonds. As of Sept. 17, the US Department of Transportation has issued $4.8 billion for 13 projects. Another $5.4 billion has been allocated for seven projects. None of the projects are in Florida.
If All Aboard Florida’s $1.75 billion request is approved, it would be the highest amount allocated in the program for a single project.
Brevard County, with its mostly coastal communities such as Palm Bay, Melbourne, Cocoa Beach and Titusville, has not had the same intense opposition to All Aboard Florida that Treasure Coast communities have.
But the relationship has been testy.
In July, County Attorney Scott Knox wrote a 12-page legal analysis of All Aboard Florida and Brevard’s crossing agreements with its parent company Florida East Coast Railroad. The summary includes the suggestion that some, or all, of the decades-old crossing agreements could be void and unenforceable under the Florida Constitution.
That spurred a July 31 letter from All Aboard Florida General Counsel Myles Tobin.
“I am concerned that you have received some uninformed factual and legal advice, which has caused you to develop an analysis fraught with misinformation and tenuous conclusions,” Tobin wrote.
Information from Palm Beach Post
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