By Dobora Lima
September 14, 2016
South Florida Business Journal
The Brightline train may be delayed.
All Aboard Florida, the company building the Miami-to-Orlando passenger train, is embroiled in a lawsuit that could threaten one of the project’s primary sources of capital.
An April 2015 lawsuit filed by counties on Florida’s Treasure Coast against the U.S. Department of Transportation, challenging its provisional approval of funding for Brightline, has gained traction.
According to nonprofit news outlet the Florida Bulldog, U.S. District Court Judge Christopher R. Cooper has ruled that the DOT ignored federal law when it agreed to finance $1.75 billion for Phase II of Brightline using tax-exempt private activity bonds.
Cooper said evidence brought forth by lawyers representing Martin and Indian River counties raised “legitimate questions” about All Aboard Florida’s plans for financing the ambitious project, which will cost an estimated $2.9 billion.
Private activity bonds, the judge said, are not just the “‘current financing plan for the project – it appears to be the only financing plan.” If the lawsuit tips in favor of Martin and Indian River counties, AAF will have to scramble for an alternative financing route to complete the project.
AAF spokeswoman Melissa Shuffield declined to comment on the lawsuit.
AAF is owned by parent company Florida East Coast Industries, which is held by New York-based Fortress Investment Group.