A feasibility study by Burk-Kleinpeter Inc. and HDR Engineering emphasizes the economic and social benefits of the proposed high-speed rail linking New Orleans to Baton Rouge. Currently under revision, the final report is due March 16.
With an estimated 78% probability of having a positive return on investment, the study claims that the value creation offsets the project’s costs. However, a Baton Rouge news site reports that Louisiana would bear the burden of $11 million to $14 million in annual subsidies. These costs are too high for a state already facing large deficits.
The BR-NO rail has been debated for years, but the controversy heated up when the state turned down stimulus money that would have funded its creation. While Bobby Jindal rejects the plan due to its high costs, Cato Institute scholar Randal O’Toole concentrates on the project’s hidden negative impacts.
In a Pelican Institute publication, O’Toole argues that the new high-speed rails will be “an expensive slippery slope” leading to higher costs for Louisiana taxpayers. The project would not relieve overall traffic congestion, and only few Louisiana residents will use the new trains. In other words, the possible economic benefits from new rails line will be greatly offset by high maintenance costs and low customer usage.
O’Toole believes that Louisiana should not build new rail lines; it should instead spend the federal stimulus money on safety measures by improving signaling and crossing gates on existing lines.