TALLAHASSEE – Florida Gov. Rick Scott canceled plans for the high-speed train line between Orlando and Tampa promoted by President Barack Obama, saying Wednesday it would cost the state too much even with $2.4 billion in federal help.
Cost overruns could put Florida on the hook for another $3 billion and once completed, there’s a good chance ridership won’t pay for the operating cost, meaning the state would have to pump more money into the line each year, Scott said.
“The truth is that this project would be far too costly to taxpayers and I believe the risk far outweighs the benefits,” the Republican governor said in a press release issued after he informed U.S. Transportation Secretary Ray LaHood of his decision.
LaHood later released a statement contradicting Scott’s assessment of the risk.
“We worked with the governor to make sure we eliminated all financial risk for the state, instead requiring private businesses competing for the project to assume cost overruns and operating expenses,” he said.
The move comes a week after Scott proposed state spending cuts of $4.6 billion in the next budget and tax and fee cuts totaling close to $2 billion as Florida grapples with the effects of the recession and continued high unemployment.
Scott said if the rail project failed, the state would have to return the money to the federal government.
“My background is in business, not politics, but you don’t have to be an economics expert to understand that if you spend more money than you take in, your business will fail,” Scott said.
A senior official for the federal Department of Transportation said Scott never raised that concern during discussions. It was an issue that could have been negotiated, said the official, who spoke on condition of anonymity because LaHood is still talking with lawmakers about how to respond to Scott’s decision.
LaHood said he was disappointed, but said other states would be happy to get Florida’s money.