ON JULY 6, 2016 WE PUBLISHED AN ARTICLE ABOUT CHINESE INVESTMENT IN “ALL ABOARD FLORIDA,” AS OPPOSED WHAT NOWS SEEMS TO BE TO “BRIGHTLINE.” WE THINK BRIGHTLINE MUST BE THE NEW NAME FOR THE TRAINS, NOT THE PROJECT. WHO’S WHO?
What we wrote was that according to All Aboard Florida Project – EB5 Visa Program, referred to in a 32963 issue written by a columnist as potential Chinese funding for their $ 1.75 billion in Private Activity Bonds, the CanAm Florida Regional Center (CARFC) already purchased through the EB5 program on behalf of All Aboard Florida affiliate AAF Mezzanine Holdings, LLC , $300 million of EB-5 capital of the $405 million high yield bonds issued on behalf of Chinese investors.
Its not that Chinese will be a “potential investor” but they are “already invested” in All Aboard Florida, by buying $ 300 million of their $ 405,000 high yield bond sales in 20014.
This article stirred up fun reader chatter we want to share with you.
.July 1, 2015 AT 5:14 PM
The Chinese manufacture and sell high speed trains. Certainly, they have an interest in All Aboard Florida.
July 3, 2016 AT 1:45 PM
My responses are two:
1 So what? Why is it important WHERE the money comes from?
2. If this article’s author and/or McNulty had put as much effort into analyzing objector assumptions (complaints), they’d have learned a long time ago that claims of traffic congestion, reduced safety, quality-of-life reductions, etc., etc., are complete rubbish not supported by a rational view of facts. Ten years ago at the height of the real estate boom, far more rail traffic (in terms of total length of daily trains combined) passed through the Treasure Coast than anything that will be seen after AAF is operational. The widened canal will have little net impact on FEC’s total rail haulage aside from a more balanced southbound/northbound haulage.
In short, rather than drilling into such detail of a meaningless non-issue as where the private funding originates (one could argue it originated in the US because that is where most Chinese money is made), this article’s author and/or McNulty would better serve readers by taking a rational look at the specious claims of objectors, none of which are supportable.
The anti-AAF movement is motivated by fear and fueled by fiction.
PUBLISHER REPLY ON 7/26/2016
My issue is that All Aboard Florida can’t sell its bonds to conventional investors in the United States and has no choice but market itself to Chinese investors with green card and citizenship incentives.
For example, with respect to U.S. investors, on October 12, 2015 Darrell Preston reported in Bloomberg that All Aboard Florida “Faces Skeptical Investors” with respect to its sale of $ 1.75 billion in private activity bonds.
“We looked at it, but we are not going to be participating,” said Lyle Fitterer, managing director in Menomonee Falls, Wisconsin, for Wells Capital Management, which holds $38 billion of municipal securities. “It came down to a credit decision.”
Jim Colby, who manages about $1.6 billion of high-yield municipals at Van Eck Global in New York, said the deal didn’t draw his interest.
“It was not priced to demand,” Colby said. “That is about all I will say.”
You should read the February 25, 2016 report written by John Friedman of Brown University on the financial viability of the All Aboard Florida passenger train.
JULY 4, 2016 AT 4:57 PM
Fiction? Here are some facts:
2010 – 2014 FEC is in the top 5 most unsafe railroads in the county (All crossing events, crossing fatalities, crossing injuries) and often ranked 1 or 2 because of the large number of crossings
2012: Congressman Mica announces AAF and says “fast track environmental approvals” (his chief of staff is now Rusty Roberts of AAF)
2012: Husein Cumber, Fortress LNG head, meets with Gov. Scott’s staff, set up by Hollingsworth, ex-Fortress employee
2013: Southeast Regional Cargo 2040 report: “AAF will double FEC freight Capacity”
2013: Industry publications – millions going into FL ports and rail to handle Panamax vessels
2014: FEC CEO Hertwig tells Asian conference “FEC sees doubling even tripling of market share at Port of Miami” (looking for investors?)
2014: Fortress announces construction of 2 LNG plants in Florida
2014: AAF website shows eventual growth to JAX and Tampa
2015: Fortress founder, Wes Edens invests $75 million of his own money in Florida LNG plant
2015: DOE approves Fortress LNG plants can transport LNG to FL ports by rail or road (includes Tampa port)
2015: Fortress strategic plan – LNG exports to South America and Asia – multi $Billion market annually
2015 – 2016: Multiple times in the past 12 months crossings have been closed to cars because of equipment failure or derailment of FEC – it has delayed EMS teams.
2015: FRA calls out AAF for reducing safety upgrades for IRC crossings – to save money(?)
2016: Fortress LNG announces contract to supply Jamaica with LNG
2016: Cong. Posey announces the AAF consulting firm that did the ridership and profit projections has been disbarred by 2 international banking firms and a principle was convicted of fraud.
It is obvious that forcing 21st century technology and rail traffic onto 19th century infrastructure is a bad idea, regardless of what the companies are doing to improve the tracks. It is even more obvious that FEC has a need for double capacity and rail to Tampa and AAF is the means to that end. 50+ trains per day, many going 100 mph, and many carrying Haz Mat is a far cry from past rail traffic on the route. Lastly, AAF used a shady outfit to do its business projections because it needed to make the project look profitable. All the while, Fortress knows it can lose millions on AAF and make out like a bandit on FEC and LNG. Any reasonable person can see this is a dangerous gamble and Fortress puts profit over lives!
JULY 9, 2016 AT 12:31 PM
You are long on a conspiracy theory and short on common sense.
You assemble a litany of “facts” most of which are either irrelevant or misleading.
Then you concludes with a non-sequitur summation.
Nobody is “forcing” 21st-century technology into 19th-century infrastructure. Don’t you actually READ any of the information about the massive upgrades of the FEC rail line to be performed by and a the expense of AAF? Evidently not.
To the best of my knowledge, AAF is the ONLY railroad “in the county”, so it would be the safest and most unsafe at the same time. And, even if you meant to write “country”, the point is meaningless if not in context with the nature of the statistics. For example, suppose there were 9 students in a class and their numerical “grades” were 99, 97, 96, 94, 93, 85, 80, 72, and 68. A grade of 90 or higher rates an “A” letter grade. If Susan were the student with a grade of 93, she would warrant an “A” grade. But she would also be in the “top 5” of the worst students in the class. Context is everything. Lacking context, Susan’s claim is meaningless.
Evidently, You haven’t figured out that Fortress could “make out like a bandit on FEC and LNG” with or without AAF. The two are mutually exclusive in terms of rail needs and profitability. It is deceptive to try to mix the two.
The “50+ trains per day” is fiction. According to FEC schedule information readily available to anyone, the current maximum number of daily trains through IRC ranges from 7 to 11, depending on the day of the week. Add to that 32 much shorter, faster AAF trains (equivalent in crossing closure time to 10 FEC trains), and the number of trains per day range from 39 to 43. Using the equivalent number of FEC trains (in terms of crossing delays), road closures will be the equivalent of 17 to 21 current FEC trains. In 2006, 24 FEC trains per day operated, creating more closure time than will AAF + FEC in 2018.
Higher speeds mean shorter times through crossings. Higher speeds require improvements to rail, better maintenance, and improved crossing safety measures (by law) — meaning a safer railroad.
As typical for objector complains about AAF, you arguments are erroneous, misleading, or irrelevant in terms of the impact on county residents.
Fearmongering is always the refuge of those who have no legitimate arguments to put forth.
JULY 9, 2016 AT 12:53 PM
You guys lost me when you loaded the comments with acronyms. I recently returned from China, where they have constructed thousands of miles of high speed railroads. In Florida, they bicker over a line from Miami to Orlando.
JULY 9, 2016 AT 7:05 PM
AAF = All Aboard Florida (aka, Brightline) an intercity express passenger rail project to serve the Miami to Orlando corridor via Florida East Cost Railroad (FEC or FECR) freight rail corridor between Miami and Cocoa with a new passenger train only extension from Cocoa to Orlando Intl. Airport (new intermodal terminal).
IRC = Indian River County
LNG = Liquified Natural Gas
DOE = Department of Energy
FRA = Federal Railroad Administration
Hope that helps.
JULY 9, 2016 AT 1:07 PM
The statistics on rail accidents come directly from the Fed. Rail Administration – so they’re facts. And, ha, ha, it’s the country not the county – quick of you to catch that. In AAF’s own EIS and FEC’s own words – they are anticipating at least 24 freight trains per day. Last time I added 24 to 32 it equaled MORE than 50.
And as you know, the deception has all been on AAF’s part from the beginning. Just ask anyone who knows how they struggled to keep the two businesses apart while they operate on the very same set of tracks. Rail expansion of freight or passenger is still expansion and no one would look at the numbers of trains crossing 30 streets in our county and say that one has nothing to do with the other. You can claim the AAF trains will only stop traffic for a few minutes but 20+ 2-mile long trains per day also stopping traffic will add up quickly.
But that’s not the only deception – AAF is a pro at deceiving the public and bullying people. They’ve sued private individuals for asking to see their bond prospectus and threatened our own county attorney with bogus charges that proved to be totally deceptive as soon as FOIA request documents were finally delivered this spring.
Safer? As the previous Secretary of Transportation said in a Senate hearing on Capital Hill a few years ago when Sen. Rubio was discussing AAF and the number of grade crossings, “The only safe grade crossing is NO grade crossing.” All the safety upgrades in the world will not make AAF safe – we know that from the lack of grade crossings in all other HSR systems. Taking a 100 year old train route and putting 100 mph trains on to it is madness and everyone knows it!
I could go on, but I won’t bother boring the readers of Vero Communique any longer with your petty squabbling. They know the truth and they know the damage AAF and FEC will do to our county. There is no fear mongering going on – just common sense.
JULY 9, 2016 AT 7:26 PM
I didn’t question your SOURCE of statistics, I questioned your use of them. See my grading example.
The “anticipated” number of 24 trains per day for the EIS does not reflect the reality of the train business.
The vast proportion of FECR’s business is to supply southeast Florida (Miami to Palm Beach) with the consumer goods required to sustain that population. That is why 3 of every 4 containers hauled northbound are empty.
Unless southeast Florida has a HUGE population explosion (not anticipated in the foreseeable future) OR if there is a sudden NEW demand for shipping to or from Miami from within Florida, then the impact of the widened canal will easily be taken up northbound by filling empty containers currently traveling north.
Southbound freight should decline by the amount that now originates in Pacific nations and had to be shipped via Pacific ports capable of handling the larger ships that could not transit the old narrow canal. Those shipments to southeast Florida can no go directly by sea to be consumed in SE Florida.
Since there will be 11 other eastern ports capable of handling larger ships through the widened canal, the myth that shippers will all use Miami’s port cannot be sustained. Shippers will ship goods via the nearest port. Shipments on larger ships from Florida will be able to use either Jacksonville (after improvements are finished) or Miami. Shipments from other states will use the port most convenient. Florida’s panhandle is closer to the port in Mobile, AL.
So the anticipation of 24 daily trains does not reflect a realistic change from the current 7 to 11 through Treasure Coast communities. EIS estimates and reality are two very different things.
What is the rational argument that supports more than doubling current FECR trains through the Treasure Coast? I’ve yet to hear one other than “widened canal” which, as I’ve explained, is no argument at all.
If you have a concern about crossing safety, then understand that Amtrak reaches 90 mph on many of its national routes (including through Florida). A speed of 100 to 110 mph does not necessarily mean that every crossing will have trains operating at that speed, particularly in built-up areas. You seem unaware that higher rated track classification has the LOWEST derailment rate and the improvements AAF will make will upgrade the FECR track between Miami and Cocoa to classification 6, the highest possible and, therefore, the safest in terms of derailments.
Of course, there is always a possibility of an accident. No transport system works on the basis of zero chance of an accident. Your expectations are unrealistic.
The age of the train route has nothing to do with the quality of the improvements to be made. Crossings are inherently safe so long as people don’t try to do stupid things like beating the train by driving around gates. But improvements by AAF will make that extremely difficult if not impossible.
I do not view our exchanges as “squabbling”… I prefer “exchange of information”. I try to bring the best information available to the discussion and try to keep things in perspective.