Brightline exec tells Congress better cooperation is needed | Videos

An ongoing 4½-year struggle to secure environmental permits needed for All Aboard Florida's Brightline passenger-rail service has "sharpened" Michael Reininger's insights into how government and business could work together more efficiently, the railroad executive told a congressional hearing Thursday.

Reininger — former All Aboard Florida CEO and now executive director of Florida East Coast Industries, Brightline's parent company — testified before the House Transportation and Infrastructure Committee along with other rail-industry leaders, to discuss intercity passenger railroad development. 

Speaking on behalf of the private sector — other leaders were from Amtrak and the Federal Railroad Administration — Reininger described his experiences building the Miami-to-Orlando passenger railroad, which is to begin limited service this fall.

He emphasized the importance of reducing uncertainty.

Private development, especially "pioneering efforts, such as (All Aboard Florida)," need a predictable system with streamlined regulations, Reininger said.

"While there is ample equity — such as ours — ready to invest in transportation, the lack of precedent of new systems, coupled with uncertain permitting, have limited the availability of the appropriate debt needed to complete the capital equation," Reininger said.

"Our own experiences with expanding our business into its second phase, an incremental investment of $2 billion, clearly demonstrates these points," Reininger added, referring to the company's  frustrations with financing and extending Brightline's phase 2, from West Palm Beach, through the Treasure Coast and Space Coast and on to Orlando International Airport.

The $3.1 billion railroad over the past three years has struggled to finalize its preferred financing plans for phase 2.

Both a $1.6 billion federal loan application and $600 million of private-activity bonds remain in limbo. The company repeatedly has said it can finance phase 2 without the loan or bonds, though on Thursday, Reininger expressed hope in still selling the tax-free bonds.

Currently, tax-free bonds are unnecessarily "opaque and complex," but "easily" could be fixed, according to Reininger.

Removing ambiguity from private-activity bonds would provide the private sector "the kind of efficient debt needed to incent investment," Reininger said.

Asked by Rep. Daniel Webster, R-FL, about his biggest frustration with the federal government, Reininger spoke about the financial toll caused by long government delays, which, he said, extend project time frames and cause complications that waste money,

Halfway through the three-hour hearing, Rep. Brian Mast, R-Palm City — who represents parts of the Treasure Coast and is an opponent of Brightline — grilled Reininger about All Aboard Florida's financing and transparency, and, in particular, whether Brightline is an entirely privately funded business, as it claims.

Brightline is to begin limited South Florida service this fall with expansion to Orlando still several years away.