Filing Deadline Extended
Quick Start for:

Fiscal Notes Logo

February/March 2010

JANUARY REVENUE (MILLIONS): SALES TAX: $1,661.4 OIL PRODUCTION: $84.6 NATURAL GAS: $70.0 MOTOR FUELS: $251.1 MOTOR VEHICLE SALES: $195.4 TOBACCO: $94.1

Across Texas

  • Samsung Electronics is spending $500 million on a major renovation of its chip manufacturing complex in Northeast Austin. The project has employed more than 1,000 construction workers.
  • Galveston County has begun a $102.7 million buyout program that will remove homes damaged by Hurricane Ike and convert the properties into open green space.
  • In February, Methodist Health System opened the 65,000-square-foot Methodist McKinney Hospital in McKinney, north of Dallas.
  • Allstate Insurance Co. has announced plans to open a bilingual customer information center in San Antonio that will employ 600.
  • Houston’s Griffin Partners has begun building 73,000 square feet of retail space at Nassau Bay Town Square, just south of the Johnson Space Center.
  • Kroger Co. will build a 123,000-square-foot Kroger Marketplace superstore in Mansfield, with an expected opening in summer 2011.
  • Garment companies Powers Creations of Waco and QTI of nearby Robinson are merging into QTI-Powers Inc. The new business expects to produce about 1.8 million items annually.

Switching Tracks

Can Texas Ease its Traffic  Woes with Rail?

by Gerard MacCrossan

Texas is growing fast – and growth has made traffic congestion a fact of life on our roadways.

The state’s population is rapidly approaching 25 million and will almost double in the next half-century. Existing roads can only be widened so far, and planning new ones is an expensive and controversial proposition.

So the Texas Legislature has told state transportation officials to look hard at an old solution: rail.

By the time the 2011 Legislature meets, the Texas Department of Transportation’s (TxDOT’s) new Rail Division should have a plan for how passenger and freight rail can fit in the state’s future.

“Rail is enjoying a renaissance, not only in the state of Texas but throughout the nation, as an energy-efficient way to move freight and passengers,” says Rail Division Director Bill Glavin.

Texas has more than 12,000 miles of rail lines, but today only a handful of trains here carry passengers, and those aren’t exactly rapid transit. The single daily Amtrak train between San Antonio and Austin, for instance, needs several hours to make a trip that takes 90 minutes by car.

“Rail is enjoying a renaissance as an energy-efficient way to move freight and passengers.”

—Bill Glavin, Rail Division Director,
Texas Department of Transportation

But clogged freeways may lead to better days for passenger rail.

“In the past 20 years, we’ve seen what has happened with our commutes,” Glavin says. “We have built the easy, additional capacity to relieve that congestion. We’ve got to come up with another solution to preserve the air quality and quality of life for Texas citizens.”

Today’s Passenger Rail…

Rail travel is already a daily reality for thousands in the Dallas-Fort Worth region, where the 35-mile Trinity Railway Express (TRE) diesel commuter service links Dallas with Fort Worth, and 45 miles of Dallas Area Rapid Transit (DART) electric light rail lines connect stations within the region. About 75 percent of DART and TRE’s passengers are traveling to or from work, says spokesman Morgan Lyons.

Bill Glavin,
Rail Division Director,
Texas Department of Transportation

“Ridership on light rail averages 65,000 to 70,000 on weekdays, and TRE is between 8,000 and 10,000,” he says.

Dallas Area Rapid Transit is involved in the nation’s largest light-rail construction project, doubling its track length by 2014.

Darting Across the Metroplex

DART Greenline

Dallas Area Rapid Transit started its light rail service in 1996 with an 11-mile track and has expanded several times to its current operating service on 45 miles of track. An additional 45 miles of track should be in service by 2013, doubling the number of passengers carried annually.

DART Passenger Volume, 1996 – 2009

Year Total Passengers System Length
1996* 1.29 million 11 miles
1997 7.97 million 20 miles
1998 10.94 million
1999 11.34 million
2000 11.43 million
2001 11.51 million
2002 13.73 million
Year Total Passengers System Length
2003 16.97 million 44 miles
2004 16.49 million
2005 17.48 million 45 miles
2006 18.58 million
2007 17.90 million
2008 19.40 million
2009 18.96 million

*Opened June 14, 1996.
Source: Dallas Area Rapid Transit

Taxpayers foot most of the bill for DART. In 1983, voters approved dedicating 1 cent of Dallas’ and some other area cities’ sales tax to fund the transit system, which also includes bus lines and high-occupancy highway lanes. Only 15 percent of DART’s $402 million budget for fiscal 2010 comes from rider fares, which start at $1.75 for a single ride, Lyons says.

Karen Rae,
Deputy Administrator,
Federal Railroad Administration

…And Tomorrow’s

To provide a viable alternative to air or highway travel, rail has to have a niche, Glavin says.

A formula used by European planners dictates that rail should cost half of the “premium” mode of travel and deliver at least twice the speed of the “less-desirable” mode. Using Austin to Dallas as an example, he says air would be the premium mode and road travel the less desirable option. At the right price, a two-hour trip by high-speed rail could be an attractive alternative for travelers.

Federal Railroad Administration Deputy Administrator Karen Rae told a Texas audience in January that rail has been given a higher profile in national transportation planning, thanks to the October 2008 passage of the federal Passenger Rail Infrastructure Investment Act, as well as $8 billion in federal stimulus funding reserved for high-speed rail. Speaking at the fifth annual Texas Transportation Forum in Austin, Rae said the federal government is creating a national rail plan along with a national transportation plan that addresses the needs of all transportation modes.

To attract high-speed rail funding, Texas needs a unified rail plan supported by officials from all levels of government.

“We want to hear from states and regions,” she said. “Putting rail on a level playing field as we design the network for the future is the purpose of this new initiative.”

In fall 2009, Texas submitted a $1.8 billion “wish list” for high-speed rail stimulus funding. By far the largest project on Texas’ list was a 220 mph high-speed intercity rail connection dubbed the Texas T-Bone, which would run north-south connecting Fort Worth and San Antonio and east-west from Houston to Temple.

“If you are talking true high speed, then you are talking about completely separated, brand-new railroad,” Glavin says. “For anything faster than 110 mph, we need new lines.”

Texas didn’t get any of the $1.7 billion it requested for the T-Bone, which in any case represented only a fraction of the money needed to develop a high-speed rail infrastructure. The state did receive $4 million to fund crossing signal timing adjustments that would permit the Amtrak Heartland Flyer to increase its speed from 49 to 79 mph in Texas. (It already travels at 79 mph in Oklahoma.) Another item on Texas’ wish list, $7 million to lay additional TRE track, received funding from the fiscal 2009 federal appropriations bill.

According to state rail officials, to attract significant high-speed rail funding, Texas needs a unified rail plan supported by officials from all levels of government. Many other states, including those that received the rail stimulus funds, are far ahead of Texas in this process.

“The efforts under way by TxDOT’s Rail Division to revise the statewide Rail Plan will help better position Texas for success in future funding opportunities,” Glavin says.

Unclogging the Corridors

While it would take many years for a high-speed express line like the T-Bone to become a reality, the Lone Star Rail District (LSTAR) is being touted as a viable passenger service as early as 2013. Proponents want to use an existing Union Pacific (UP) freight route connecting San Antonio and Georgetown, with about 15 stops for commuters to hop on a train. UP freight traffic would be diverted to other rail lines still to be built.

Ross Milloy, president of the Greater Austin-San Antonio Corridor Council and LSTAR’s interim executive director, says relocating the UP line and adding passenger rail makes sense for drivers, rail passengers and freight movers alike – especially because of anticipated increases in traffic prompted by North American Free Trade Agreement (NAFTA) business.

Major Players In Freight

Three freight rail operators own most of the 12,000 miles of track in Texas and transport millions of carloads annually to and from the state.

Texas Rail Line Statistics, 2008 Union
Pacific
Burlington Northern
Santa Fe
Kansas City
Southern
Miles of Track 6,331 2,556
(plus 2,353 miles of trackage rights)
547
(plus 216 miles of trackage rights)*
Annual Payroll in Texas (In Millions) $654 $786 $29.6
Texas Employees 8,019 7,535 441
Originating Rail Cars** 1,233,444 727,202 155,868
Terminating Rail Cars*** 1,231,879 1,383,751 325,749

* Trackage rights: permission to use track owned by another line.
** Shipments originating in Texas.
*** Shipments ending in Texas.

Source: the Union Pacific, Burlington Northern Santa Fe and Kansas City Southern companies

Preserving I-35’s capacity is one of Milloy’s arguments for creating the LSTAR passenger rail line. According to him, 80 percent of Mexico’s annual $900 billion NAFTA trade with the United States and Canada comes through Texas; three-quarters of that is trucked up the Interstate 35 corridor. TxDOT studies estimate NAFTA truck miles in Texas will quintuple in the next 30 years, he says.

Milloy says the state’s Texas Rail Relocation and Improvement Fund, which received $182 million in appro- priations from the 2009 Legislature, could be used to start relocating UP’s freight operations, although he says the ultimate cost could be $1.7 billion.

“To my mind, that is a wise public investment,” Milloy says, noting that the proposed passenger corridor would pass through six of the fastest-growing cities in Texas.

LSTAR estimates that 11,000 people would ride the service daily. Milloy says a passenger rail line could increase personal income along the Interstate 35 corridor by $20 billion, and increase property values tenfold in the quarter-mile around the proposed stations.

That would help the rail district and its partners pay for the service, which would probably employ tax increment reinvestment zones to pay for infrastructure. These zones are created to repay the costs of improvements with the increased tax revenue they generate.

The first stage is conducting environmental studies and preliminary engineering on the existing and relocation routes, Milloy says.

Spokeswoman Raquel Espinoza-Williams says UP, which operates more than half of Texas’ freight lines, “has agreed with the Lone Star Rail District to study the feasibility of relocating through freight service to a new line to free up tracks for passenger rail.

“The Lone Star Rail District and its consultants are responsible for designing and locating a potential bypass to be built to Union Pacific specifications to mitigate lost capacity and utility on the existing corridor,” she says. FN

Learn more about the state of Texas’ transportation plans at keeptexasmoving.com.

Freight Rail Network
Connects Population Centers

Every day, tens of thousands of railcars travel around Texas on a track network owned largely by Union Pacific, Burlington Northern Santa Fe and Kansas City Southern.

The image is a map showing rail lines in Texas: Union Pacific, Burlington Northern Santa Fe, Kansas City Southern, Texas Pacifico Transportation Ltd.,  and other tracks. Texas Pacifico Transportation Ltd. operates track leased from the  Texas Department of Transportation. Source: Texas Department of Transportation and Texas Comptroller of Public Accounts.
Required Plug-ins