High-speed rail: Skipping your town

NEW YORK (CNNMoney.com)  -- Most of the $8 billion in high-speed rail funds that President Obama awarded last month will not be used for high-speed projects, but rather to improvements designed to make existing lines faster.

Only $3.5 billion is being spent on truly high-speed rail, a sum that's not remotely close to what's needed to build a 21st century rail network. The money is going toward two projects -- one in California and the other in Florida -- that have yet to begin construction.

While the definition of high-speed rail is murky, it generally means trains that run on separate tracks from freight rail and hit speeds in excess of 150 miles per hour.

The rest of the money is being used to make improvements to existing lines that could benefit freight trains as well as passenger rail. Those efforts are designed to increase speeds to between 90 and 110 miles per hour.

Currently, most passenger trains in the United States travel at speeds lower than 80 miles per hour.

When the awards were first made, questions were immediately raised as to whether the amount of funding was adequate. After all, $8 billion is just a tiny fraction of what it would cost to build a network of high-speed trains, as envisioned by the U.S. Department of Transportation.

California's proposal alone is expected to cost in excess of $46 billion, and includes trains that could hit speeds of 220 miles per hour.

If the United States committed to build out the DOT's proposed network, the price tag would be close to $100 billion. With trains that exceed 150 miles per hour, the price could top $500 billion.

So faced with such huge numbers will the $8 billion recently awarded under stimulus just be a waste?

Supporters say to be patient, the rest of the money is coming.

"Rome wasn't built in a day," Howard Learner, executive director of the Environmental Law and Policy Center, said during an interview with Energy & Environment Television when asked about funding levels. "What you're seeing is a growing program of pieces that fit together."

High-speed rail proponents envision a multi-decade funding effort from both public and private sources to build a system serving 13 of the nation's largest metropolitan areas.

To go really fast, new railroad beds are needed that are both straight, free of slow-moving freight trains, with few if any road crossings. Cars would cross the tracks via bridges or tunnels. This is all done in the name of safety, and accounts for much of the hefty price tag.

Public funding would come mostly from the federal transportation bill -- a mammoth piece of legislation that is generally renewed every six years and funded largely by taxes on gasoline and other road-related items.

In the latest version, which Congress should consider late this year or in early 2011, supporters are asking for $50 billion out of an expected $400 to $500 billion for high-speed rail.

Private funding could come from infrastructure companies looking to operate part of the network for a profit.

"Hopefully states will step up, and the private sector will step up," said Gene Conti, secretary of North Carolina's Department of Transportation and point person on rail for the American Association of State Highway and Transportation Officials. "This is a good start on a national program that will pay great benefits."

Train supporters see rail as a cleaner way to move people in congested metro areas.

To make their case, they envision trains at least 60% full moving people into and out of revitalized city centers. Under this scenario, once the tracks are built, the trains should pay for themselves. The economic case for trains becomes even stronger if greenhouse gas laws make fossil fuels more expensive.

The rail network is designed for people making medium distance trips -- 50 to 600 miles or so. Shorter trips are still easier to do by car, and for longer trips people take a plane.

"I have no doubts that the ridership will emerge to make everything pay," said Lee Schipper, a transportation expert at the University of California, Berkeley. "Particularly if problems maintaining or expanding the nation's highways and airports drive up the costs of using roads or air."

But even getting the $50 billion more from the federal government is a long shot. The last transportation bill contained close to zero funding for high-speed rail, and with the government's debt growing by the hour, squeezing $50 billion out of Washington for trains will be a hard sell.

"I think the bill will have a hard time passing this year to begin with," said Divya Reddy, a policy analyst in Washington, D.C., at the Eurasia Group, a political risk consultancy. "It's a pretty hefty price tag."

That's good news to people who think high-speed rail is a waste of money.

Using lower estimates of ridership and the belief that the country will continue to suburbanize, critics say high-speed rail is an expensive, old technology that isn't even any cleaner than cars.

"It's the most expensive way to move passengers from A to B," said Ron Utt, a senior research fellow at the Heritage Foundation. "Of all the things the government has to do, are they really going to say 'Yeah, let's have high-speed rail.' "

As for that $8 billion in stimulus money, Utt is skeptical California or Florida will be able to raise the matching funds to get the projects done.