Tri-Rail, the commuter railroad serving three counties, is no longer facing the looming threat of a shutdown next year as it recovered access to state funding and now rolls down the track to independence with a new funding source. Without the state funds, Tri-Rail officials warned, the commuter rail system had only a little more than a year of operating life and faced a $30 million budget gap this year. Last year’s state budget cuts eliminated the $60 million documentary stamp distribution previously allocated to the Florida Rail Enterprise, which was created in 2009 to oversee, plan and fund state-owned passenger rail. Government-owned Tri-Rail runs more than 70 miles between downtown Miami and West Palm Beach. The state last year cut its minimum yearly support for Tri-Rail – which has hit a record 4.5 million annual passengers – from $42.1 million to $15 million. “The board designated me to negotiate the next multi-year contract with FDOT (the Florida Department of Transportation), so I started negotiating with FDOT, and we went to Tallahassee, and we were lobbying to get clarification on what was going to happen with the doc stamps, and to ensure that the doc stamps would include railing in,” said South Florida Regional Transportation Authority (SFRTA) chair and Miami-Dade Commissioner Raquel Regalado. “So, in the budget that was approved by the governor this year, there is $60 million that could potentially go to Tri-Rail, so we got that funding back,” she said. “We don’t know if we’re going to get all of that because there’s other people that also want that money, but we’re not in the same situation that we were last year where that was zeroed out.” Over the last several months, Ms. Regalado said, she negotiated a memorandum of understanding (MOU) – a formal, yet non-binding agreement that outlines the present intentions, roles and objectives of the parties involved – with FDOT. Under the proposed agreement, FDOT’s funding would gradually decline while SFRTA develops alternative revenue sources, including transit-oriented development, advertising and sponsorships. “Then over the last seven months, I’ve negotiated an MOU, which the board approved, and that MOU is, instead of what Tri-Rail had before, which was a 50-year plan with FDOT, what I negotiated with the secretary and the board approved, and now we’re moving forward with – the counties have their own working groups, this is just us and FDOT – is a 10-year plan where we reduce funding every year,” she said. “But unlike what happened to SunRail, what I’ve requested is for FDOT to give us assets so that we could monetize those assets on the road to independence, because we don’t have a funding source other than the state funding source and the county funding source.” “So my request has been: please help us create a funding source that is more reliable than those annual budgets, given what occurred to us last year, so what they agreed to is, and now we’re working on the details of that, that FDOT is going to lease the properties that it owns that are SFRTA stations to SFRTA for 99 and a half years, which is a fee simple, and then we’re going to build TODs (transit-oriented developments),” Ms. Regalado continued. “We’re working on the sample agreements for that. We’re going to build transit-oriented development; we can charge a fee on that transit-oriented development, and then we’re also looking at putting a TID (transportation improvement district) over the entire line to capture this funding, because right now none of the Tri-Rail stations, well, there’s two that have TODs, but the rest of the Tri-Rail stations do not pay any taxes. So if we’re able to activate them with housing and commercial, we would capture some of those taxes through a TID or a TIF (tax increment funding), and then we would then have that as recurring revenue that we can bond on.” In addition, she said, she negotiated for Tri-Rail to receive funding from sponsorships, concessions, advertising and micromobility on sites. “So we are going to be able to raise some funding with that, with those types of vehicles, and then working with the counties for them to increase their contribution to Tri-Rail. But the idea of the MOU, what it sets forth is we’re going to establish a funding rate, and then that funding rate is going to go down every year,” Ms. Regalado said. “And while that’s happening,” she added, “we’re standing up the TODs and standing up these other revenue sources to make Tri-Rail a little bit more independent, so that the burden doesn’t fall exclusively on the … county once the state stops paying for operation and maintenance.” When the proposed 10-year transition ends, she said, Tri-Rail will still be able to apply for capital money, rolling stock money, intersection safety enhancements, software and safety campaigns. “We’re still going to be able to apply to the grant process, but we’re not going to get our annual stipend for operations and maintenance from the state when the 10 years sunsets,” Ms. Regalado said. She said Tri-Rail has upgraded much of its system, though many stations still require significant improvements. She expects the planned transit-oriented developments around stations to transform those areas. A new fare collection system is also being developed to improve revenue collection at the largely open-access stations. After recently raising fares through the required statutory process, Tri-Rail plans to introduce county-based fare zones while continuing its popular $5 weekend fare, which has attracted many first-time riders. “I did add a Tri-Rail station at Little River at no cost to Tri-Rail,” Ms. Regalado said. “The $35 million is being paid by the developer as a result of that development agreement, and I am proposing at Miami-Dade County to add a Tri-Rail station to PortMiami, which would be paid half by the port, half by the airport, and that is a $33 million to $35 million station. That would be an enormous addition to our portfolio, because then Tri-Rail would go not only to the three airports but also to PortMiami.” Last week, the SFRTA board selected Dave J. Kubicek as the new executive director of Tri-Rail. “We spoke to all three candidates individually as members, and then as part of this special meeting, we gave each one five minutes for a presentation and then a QA,” Ms. Regalado said. “We tried to keep the questions the same, and then they were in different places, so they couldn’t hear each other. And then we voted, and we agreed on Dave Kubicek as our new executive director for Tri-Rail, and then the board designated me as the chairwoman to negotiate his employment agreement.” Ms. Regalado said the board hopes to have him at its August meeting. When asked about her new position as SFRTA’s chair, she said she’s “really focused on finding a path forward financially for Tri-Rail.” “I want to sign our agreement with FDOT before the end of the year,” she said. “We’ve hired a company to help me with the modeling, and I’m committed to that. We just hired the executive director, and we’re working on really solidifying our team to do this work.” “I’ve been meeting with our county partners,” she added. “We have great relationships with our county partners, and now really the challenge is the path forward. What will the next 10 years look like, and how can we ensure that Tri-Rail continues to bring commuter service and expand that commuter service?” The post Back on financial track, Tri-Rail creating a deal for the future appeared first on Miami Today. ...read more read less