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WHAT ARE THE REAL COSTS, VALUE OF HIGH-SPEED RAIL? With impacts including a shrinking number of vehicles and less road congestion currently being ignored when the fi nancial feasibility of projects is being studied, a new economic value added model must be used to illustrate the total realizable benefi ts that can be obtained. >BY BROOKS BENTZ L LONG-TERM TRANSPORTATION challenges have impelled a number of governments around the world to em- bark on investment in high-speed rail (HSR) networks. In the U.S., HSR has been debated for a number of years, but the high costs involved have dom- inated the debate. This, coupled with a lack of understanding of the true value proposition and the related long-term issues surrounding domestic transpor- tation is slowing much of the invest- ment needed for projects to proceed. To create a better understanding of the wider impact of HSR, including funding concerns, a new fi nancing formula is needed. Looking at the situ- ation through the same lenses as we have used in the past fails to take into account the wider economic impact HSR can have. We need a new view, a fi nancial calculus, which embraces a broader economic footprint than the historical "Farebox Model" that tries, unsuccessfully, to cover the cost of these large-scale systems from farebox revenue. Crucially, this new formula could attract private capital to HSR by clearly presenting the total realizable benefi ts that can be obtained. INVESTMENT NEEDED Congress has set out its two-year transportation spending plan for the U.S. Passed June 29 this year and signed into law by President Obama on July 6, the Moving Ahead for Prog- ress in the 21st Century (MAP-21) surface transportation program has been hailed as a successful conclusion 74 < mETRO mAGAZINE SEPTEMBER • OCTOBER 2012 to over three years of political debate and is part of the economic regenera- tion and job creation program. The bill consolidates nearly 100 programs, providing states with more spending fl exibility. MAP-21 authorizes $101 billion of funding from the High- way Trust Fund over the next two fi s- cal years (FY2013 and 2014). The U.S. Department of Transportation (U.S. DOT) will make $17 billion available immediately.1 To help mobilize quali- fi ed, large-scale projects, $1.7 billion will go to the Transportation Infrastruc- ture Finance and Innovation Act (TI- FIA) Loan program through 2014.2 But, the future of the industry still needs to be addressed because there is no clear sustainable revenue stream to fund the aging and increasingly con- metro-magazine.com