Wisconsin
taxpayers are getting a bailout from the rest of the nation as the federal
government just paid the state $14.6 million as reimbursement for costs sunk
into the high speed rail contracting process the current Governor, Scott Walker
campaigned against and terminated once he was elected. That payment from
Washington D.C. won’t make up for all the lost Wisconsin taxpayer dollars going
down the drain because of the Walker administration policy reversal, however.
Under
Governor Jim Doyle, Wisconsin won a federal grant of $810 million to build a
stretch of 110 m.p.h. high speed rail line between Milwaukee and Madison, and
trains to run on the line, as a part of a proposed high speed upgrade of the
Chicago to Minneapolis Empire Builder Amtrak route. When Governor Walker pulled
out of that deal, the feds clawed back all but $2 million of the $801 million
grant, but Wisconsin had already spent $9 million of the money, and was on the
hook for another $5 million in cancellation fees and breach of contract claims
by consultants and other private interests involved in the project. While the
federal payment of $14.6 million covers those sunk costs, there are going to be
other significant cancellation expenses Wisconsin taxpayers will have to pay
for all by themselves.
The
state has contracted with Spanish train builder Talgo to pay $71.8 million for high
speed rail cars to run on the high speed Milwaukee to Madison line, and Talgo
is already building and testing the cars in a factory it set up in Milwaukee
expressly for that purpose. Wisconsin Transportation Secretary Mark Gottlieb
says he has no use for those trains now, and he has canceled a $5.8 million per
year maintenance contract with Talgo to keep the useless trains running. He is
also backing out of a deal for state construction of a $63 million maintenance
facility Talgo was to use in fulfilling the upkeep obligations. Talgo is
threatening a lawsuit over these cancellations, and meanwhile continuing to
test the now useless trains for delivery.
The
$810 million federal grant Governor Walker turned down would have paid all
these costs, but now Wisconsin is exposed to these liabilities all by itself.
Walker’s “money saving” decision to squash high speed rail development in his
state may cost a lot more than he says it was going to save.
