Trusting Politicians.

 

Though the project below is happening in Vermont I think it shows how and why and idea or application for high-speed rail and the capital corridor will not be successful in New Hampshire.

About eight months ago I heard a press release from Vermont Congressman Peter Welsh in it he announced a $54 million dollar federal grant award that would be used to upgrade the New England Central Railroad (NECR) between St. Albans, Vermont and its southern terminus of New London, Connecticut. I actually believed this lawyer turned politician.

There hasn’t been any major work done on this railroad since the early 1970s when it was owned by the Central Vermont Railway (CV); itself an appendage of the Government of Canada. The line has been a continual money loser, even with the subsidized Amtrak Vermonter service on it and in the early 1990s the line was sold to a  U.S. railroad investment portfolio called RailTex. In 2007 most of the RailTex portfolio including the NECR was sold to a New York and London based investment group and hedge fund called Fortress Investments. I haven’t seen any official financial statements from Fortress by my own analysis leads me to believe that this railroad line is a break-even proposition at best; my railroad sources indicate that because of the economy freight movements between the U.S. and Canada are down and Vermont Governor Douglas wants to reduce the state subsidy given to Amtrak.

The NECR is a strategic link of commerce between the U.S. and Canada and with some capital investment this line could be valuable in economic development and creating jobs. This is why I was excited at the statements of Rep. Peter Welsh. So it’s eight months later, the notes of the Vermont Rail Council state that no rail has been ordered, no contracts awarded and as I understand it no information from Washington, D.C. I know the lead time for delivery of railroad steel is 12-14 months, materials including ties and rail plates can be as long as six months; this is in addition to finding a contractor that could come in and do this work including all the welding.

Rep. Peter Welsh had a press conference in White River Junction stating that this project would move forward. I don’t think it is. I’m also very skeptical as to how long a global hedge fund is going to stay in the railroad business if they don’t see some type of meaningful return at least within the next 2-3 years.

So what does this have to do with New Hampshire? The politicians on this side of the river are doing almost the same thing as Rep. Welsh. Press releases, strategic ideas and the definition of reality vs. idealism. Except unlike Vermont I don’t believe them. New Hampshire has a long standing history of not making capital investments in railroads, a significant history of not working with nearby states on railroad policy and a significant history of not supporting national railroad interests like the National Railroad Passenger Corporation which is commonly known as Amtrak.

The New Hampshire press releases need to stop, they’re misleading and not an accurate representation of what is going to happen in the future.