Since 2013, the state has paid at least $42 million a year to run a South Florida railroad.
Now, Florida officials have hit upon a better way to run a railroad: Let three South Florida counties pay for it.
In a stunning setback after the fiscal year began July 1, the Florida Department of Transportation cut the money it pays to maintain and operate 80 miles of track for Amtrak passenger trains, CSX freight trains and the Tri-Rail South Florida commuter service.
Instead of $42.1 million, the minimum set in state law, FDOT says it needs to pay only $15 million. But the gap is even greater as the state had been prepared to pay $62 million this year.
If the counties don’t step up to fill the gap or state lawmakers force FDOT to reconsider, the agency that the state set up to run the railroad in the 1980s, the South Florida Regional Transportation Authority, will cease to exist in July 2027.
It’s not just subsidizing the commuter rail system that links Palm Beach, Broward and Miami-Dade counties, but, rather, paying to operate and maintain the rail line, which the state owns, SFRTA Chairperson and Palm Beach County Commissioner Marci Woodward said.
“This is equivalent to them saying, ‘We run a bus on I-95 so, well, now you have to pay for the maintenance of I-95,’” Woodward said at an Aug. 26 Palm Beach County Commission workshop.
‘An existential crisis’
The counties, already worried about the state’s insistence that they contribute more than $4.2 million a year, are not eager to take ownership of the tracks, which the state bought in 1988 to relieve congestion during an early phase of Interstate 95 widening.
But the counties want Tri-Rail to continue to offer an alternative to Interstate 95 and ultimately shift to the coastal FEC Railway tracks, reaching more downtowns and allowing for expansion into northern Palm Beach County.
Tri-Rail, which starts in Miami, ends at Mangonia Park, one stop north of West Palm Beach. The tracks curve west from there and for years Tri-Rail has planned a station at the VA Medical Center in Riviera Beach, plans that can’t go forward under the current money crunch.
From mid-2024 to June, Tri-Rail provided a record 4.57 million rides. But fares account for just $15 million of the agency’s overall $150 million budget, which includes capital.
The death of SFRTA likely would spell the end for Tri-Rail as well.
“We are in the middle of an existential crisis,” SFRTA board member and Miami-Dade Commissioner Raquel Regalado said at an Aug. 22 SFRTA board meeting.
Eliminating Tri-Rail would force more drivers onto roads that require hundreds of millions in state and federal subsidies to maintain, SFRTA members are quick to say.
It’s unclear how the state would fulfill its contracts to provide safe and operational rails for Amtrak and CSX if SFRTA is dissolved. It’s also unclear how much Amtrak and CSX pay the state to run the railroad, as even SFRTA doesn’t have access to contracts considered proprietary.
The amount Amtrak and CSX pay, however, likely is less than $15 million, the amount the state is offering this year to pay for the rail line, said SFRTA Executive Director David Dech, a former CSX executive.
Tri-Rail expected $62 million this year
The cost of dispatching trains and operating and maintaining rails and stations is $49 million a year, money that doesn’t pay for running Tri-Rail, SFRTA officials say.
Since 2013, the state has made good on its statutory obligation to provide $42.1 million a year to run the railroad. This year, the state payment topped $60 million and Tri-Rail had penciled in $62 million for the budget year that began July 1.
So far, it has received nothing.
In the extended legislative session that ended June 16, lawmakers dumped revenue from real estate documentary stamps, the source of the SFRTA subsidy, into the state’s general fund, allowing it to be used on any state expense.
FDOT officials insisted that without that money, it could reduce its subsidy to $15 million, telling SFRTA’s attorney, Teresa Moore, that they viewed the statute as a one-time obligation, not perpetual.
Moore told the SFRTA board in July that she found the statute to be clear that FDOT “shall” transfer the $42.1 million every year.
“Notwithstanding any other provision of law to the contrary,” the statute says, “… the department shall transfer annually from the State Transportation Trust Fund to the South Florida Regional Transportation Authority … $15 million … for operations, maintenance and dispatch; and … $27.1 million for operating assistance, track maintenance and contract maintenance.”
The money to the trust fund came from doc stamps, but removing the source doesn’t end the state’s obligation, Moore told the SFRTA board.
FDOT presses counties to up the ante
South Florida leaders were blindsided by the state’s decision. Even Tri-Rail’s lobbyists had no idea the change had been adopted in the state budget, they said.
In his only public comments to explain the state’s position, FDOT District 4 Secretary Steve Braun, who heads the Fort Lauderdale-Palm Beach FDOT region, suggested the state’s surprise decision is aimed at getting the counties to contribute more than $4.2 million per county per year.
“Candidly, the counties have really been pretty stagnant in their contributions, much less than the department,” he said. “The state contribution has continued to grow and has been, historically, way more than even that $42 million (topping $60 million).”
He urged the counties to offer more money to make the state’s continued investment more palatable to FDOT Secretary Jared Perdue.
“If not the entire gap, what is a contribution that seems to be fair to provide service?” Braun asked.
He also said, however, “We fully support commuter rail being part of this region’s transportation solutions, and that’s why we are really committed to trying to work with all parties on a plan forward.”
The counties have been meeting both with FDOT and without. At the Palm Beach County Commission Aug. 26 workshop, Deputy County Administrator Todd Bonlarron said they were talking about contributing more but had not hit on a number.
Dech, the SFRTA director, added that he believes the state is waiting for the counties to make the next move.
“They’re standing firm on this $15 million, waiting for an answer from the counties,” he told Palm Beach County commissioners.
State push began decades ago
The state’s complaint about the counties’ contribution echoes a refrain dating back decades.
In 2006, after the state talked about shifting more Tri-Rail costs to Miami-Dade, Broward and Palm Beach counties, the counties persuaded the Legislature to pass a $2 tax on rental cars to fill the gap. Then-Gov. Jeb Bush vetoed the bill.
The next year, FDOT agreed to contribute toll money collected on I-95 express lanes, a commitment never fulfilled, SFRTA board members said.
By 2009, the state agreed to commit annually to support Tri-Rail, passing the statute that became effective in 2013 spelling out the state’s $42.1 million a year commitment.
The only exception came in 2017 when a new law gave the two sides until 2019 to come up with an alternative source of money. The failure to do so, SFRTA argues, did not end the state’s $42 million pledge.
Savings from major cutbacks negligible
When COVID hit, SFRTA accepted federal assistance that is only now running out, leaving a budget shortfall expected to hit $90 million in three years. That news, in March, caused concerns in all three counties.
In July, after it learned of the state budget decision, the 10-member SFRTA governing board held an emergency session. While Moore, the board’s lawyer, assured the board they had a strong case if they wanted to sue, the board instead agreed to look at ways to cut costs to show the state they were serious about cooperating.
But some cuts just didn’t add up, Dech said. For instance, eliminating all of Tri-Rail’s administrative staff would buy the rail line an additional six weeks, he said.
Cutting weekend trains would save $3.6 million and inconvenience 13,000 riders while saving only enough to add eight and a half days to SFRTA’s existence, he said.
“We’re not going to save ourselves into prosperity. This is about finding alternative means of funding,” he said.
He reminded the board that SFRTA is required to operate 50 trains a day as a condition of federal grants that paid to build a second set of tracks along the former CSX line in the 1990s. It also agreed to run 26 trains a day to Miami Central Station as part of a grant deal.
PBC commissioners balk at running railroad
Owning the tracks and Tri-Rail’s 19 stations would give the counties more freedom to raise revenues through concessions and nearby development. It would let them cut costs, perhaps shutting down the expensive elevators and pedestrian bridges required by the state to move people over the tracks, instead of across them at ground level.
But most Palm Beach County commissioners drew the line at the counties filling the $30 million gap to run the railroad.
“I’m absoutely not in favor of funding this after this conversation,” Commissioner Sara Baxter said at the Aug. 26 workshop. “This is a no-win for the taxpayers. This is a no-win for this county in the name of trying to keep Tri-Rail, which I think is an important use for some individuals but not to the tune of $30 million and potentially more going forward into the future. That’s atrocious.”
Woodward, the SFRTA chair, explained that the counties thought they would have more time to figure out how to contribute more toward the subsidy.
For the rest of this year, SFRTA will make up the shortfall with reserves. That gives the agency time to revisit the subsidy in the next legislative session, which begins in January. State House Speaker Daniel Lopez, a Miami Republican, has privately expressed interest in trying to recapture the state money, SFRTA officials have said.
“Either it will be fixed or it won’t,” Woodward said.
Referring to what she’s heard from all three counties, she added: “We are not in favor of paying for the operation and maintenance of the line. They own it. That’s the deal. That’s their responsibility. Anything beyond this is a major renegotiation and I don’t think we want to own the rail.”
Under one scenario, if the state reduces its payment to $49 million a year, the counties would have to increase their contribution to just $6.7 million each, from $4.2 million, she said.
But even that may be a hard sell in the face of state efforts to rein in county spending through Florida DOGE audits and a push to eliminate property taxes.
“I don’t know where this money is supposed to come from,” County Mayor Maria Marino said. “If there’s no property taxes, there is no money to do this.
“If I’m picking a fight right now — I know no one wants to pick a fight with the state — but we can’t keep paying for these things with unfunded mandates. This would be an unfunded mandate for us.”
This story was originally published by Stet News Palm Beach, a WLRN News partner.
