Friday, February 25, 2011

Court May Decide Whether Florida Gets High Speed Rail

Rejection of High Speed Rail Undermines
Florida Rail Enterprise Act

The Florida Rail Enterprise Act, as amended by the Florida legislature and signed into law by former Governor Crist, binds Governor Scott.  Section 341.822 leaves no discretion to the Governor by stating, "The enterprise shall locate, plan, design, finance, construct, maintain, own, operate, administer, and manage the high-speed rail system in this state."  Further, section 341.839 states that "none of the powers granted to the enterprise...are subject to the supervision or require the approval or consent of  any...official." 

Article IV, Section 1 of the Florida Constitution states, "The governor shall take care that the laws be faithfully executed...."  A Governor does not have discretion to choose to enforce only those laws he favors.  The Governor cannot, within his constitutional duties, take deliberate steps to deprive the Florida Rail Enterprise of funding or of right-of-way for high speed rail. 

As noted in the update to the post below, the Governor is facing the prospect of a lawsuit by lawmakers for acting beyond his constitutional authority by rejecting the Federal government's high speed rail funding. 

An alternative to the Florida Rail Enterprise is an interlocal agency formed initially by the cities of Orlando, Tampa, Lakeland, and Miami.  (The interlocal agency would require legislative approval pursuant to Florida Statutes § 341.8225(1)). The cities' proposal states in part (my emphasis):

I. A. Neither the State of Florida nor any of its departments, agencies or affiliates shall have any liability whatsoever for the costs, fees, expenses or general liability associated with the design, planning, construction, operation or maintenance of the Project. The State and State entities shall have no liability for: (i) the costs of construction, including any cost overruns (“Cost Overruns”); (ii) operating cost shortfalls for the operation of the system for the first thirty (30) years of its operation (“Operating Shortfalls”); and (iii) any obligation to pay back to the funding source or any other lender, any money provided for the Project, due to the failure of the performance conditions to be met in full (“Refund Payments”).
I. D. The Entity shall be non-recourse as to its members and the State of Florida. No other public agency will be liable for the costs of completing the Project or any Cost Overruns, Operating Shortfalls or Refund Payments.  All such costs, fees and expenses and general liability of Cost Overruns and Operating Shortfalls shall be passed on to and guaranteed by the winning bidder selected from a concourse of bidders from the private sector to complete the Project (hereinafter “Vendor”) pursuant to a Request for Qualification (“RFQ”) process. USDOT shall waive any right to Refund Payments. The Entity will be responsible to disburse the funds provided to it through the grant and subgrant agreements for the purpose of completing the Project, all as provided herein and any documents executed in furtherance hereof (“Project Documents”).

I. F. The Entity shall obtain appropriate assurances from the Vendor of its ability to guarantee complete construction of the Project including a surety bond, letter of credit or other form of reasonably acceptable financial guarantees, or whatever other assurances, pledges and guarantees deemed necessary to the satisfaction of the FDOT and USDOT, as same shall be incorporated into the bid documents (“Bid Documents”), regarding the capacity of the Vendor to complete the Project in a lien free and liability free manner and to guarantee funding of any Operating Shortfalls.

IV. B. The Project Vendor shall also provide a guarantee, indemnification and if necessary, financial assurances to the reasonable satisfaction of FDOT and USDOT that it will be able to cover any such Cost Overruns, Operating Shortfalls or Payment Refunds.
The notion that the language above leaves Florida taxpayers are "on the hook" is nonsense.  Conservatives favor shifting appropriate government responsibilities closer to the people--from the Federal level, to the States, and ultimately to local government.  The proposed interlocal agency would further that aim.   Conservatives do not support one branch of the government usurping the constitutional authority of another. This partially explains public criticism of Governor Scott from within the GOP and the threat he faces of a lawsuit by lawmakers.