Irrelevant and False Objections to SunRail

After several years of attempting to obstruct SunRail, including a January 2009 effort to use her position on our city commission to terminate Winter Park’s commuter rail agreement with Orange County, Commissioner Dillaha has put her objections in writing. Her April 29, 2010 letter to the citizens of Winter Park contained the following objections, the italicized text numbered 1 through 9 below. My response follows each objection.

Dillaha: 1)      A weak and vague ability for the city to “opt-out” of the agreement beyond one 60-day window within 99 years.

The statement above is false. The “opt out” is available after seven years of fare paying service if a funding source is not available to defray costs. As a business matter the current “opt out” language creates the opportunity to renegotiate the entire agreement with the county after seven years of commercial service and related experience, or to walk away from SunRail if there is no funding source, or if the city is not satisfied with a funding source that may be in place or offered.

The first seven years of operating and maintenance costs are being paid by the Florida Department of Transportation (FDOT).

Given the practical realities associated with the existing “opt out” language Ms. Dillaha’s other objections are irrelevant as the city’s financial exposure is protected. However, in the interest of addressing all of her concerns I discuss items 2 through 9 below.

Dillaha: 2)      No voice or say in the annual operating and maintenance deficits (which grow rapidly every year) to be paid to Orange County.  This is taxation without representation.  I thought those days ended 200 years ago.

The statements above are overstated and false. Winter Park is a member of the Technical Advisory Committee that helps guide SunRail policy. Winter Park’s possible share of SunRail operating and maintenance costs is not taxation and I have not seen any projections that such costs will “grow rapidly every year.”

Dillaha: 3)      There is no set formula to determine Winter Park’s share of costs.

The statement above is false. Section 4.01(A) of the Interlocal Governance Agreement defines and details methods of calculating the variables used to apportion operating and maintenance costs. The 2007 cost estimates clearly note that operating and maintenance costs are allocated based on the Share of Average of Total and Peak Boardings by station as calculated according to the Master agreements.

Dillaha: 4)      There is no right to terminate or end the agreement should the station have adverse impacts, not live up to expectations and / or no longer be able to be funded.

The statements above are unrealistic and inaccurate. Should Orange County have the right to increase Winter Park costs when the station proves to have positive impacts? Should Winter Park have the right to close the station if it does not live up to Ms. Dillaha’s expectations, whose expectations? Our choice was to commit to participate in SunRail or bear the full impact of the trains coming through Winter Park without stopping.

The only issue Winter Park needs to consider going forward is management of the financial exposure and the current “opt out” language gives us the leverage to successfully negotiate with the county based on realities existing after seven years of operating experience, including ongoing funding, or “opt out.”

Dillaha: 5)      The hands of future commissioners cannot, by law, be bound to continue funding annual operating and maintenance deficits.

The statement above is false. The city attorney has noted that the city commission has the authority, just as the counties have done, to covenant to appropriate non-ad valorem funds to support ongoing SunRail operating and maintenance costs. There is no basis for Orange County to object to such an amendment to the existing agreement.

(Ad valorem revenues are also known as property tax revenues. Non-ad valorem revenue is all other revenues such as utility taxes and fees which constituted 55% of Winter Park’s 2009 total General Fund revenues.)

Dillaha: 6)      Unknown liabilities for accidents and injuries caused by CSX negligence and / or the commuter rail trains.

The statement above is meaningless. Liabilities for accidents and injuries are always unknown and always covered by insurance. The Master agreements between the counties already require $200 million in liability insurance per occurrence and a $5 million self insured deductible, which amounts and form may be adjusted from time to time.

Dillaha: 7)      A referendum of the voters is required, per Florida Constitution, for use of ad valorem revenue for projects exceeding more than 12 months.  While you were asked if the city may use city land and may use city funds to construct a station, you were not asked the most critical question:  may the city use ad valorem revenue (your property taxes) for 99 years to fund operating and maintenance deficits of a mass transit system.

The statements above are irrelevant.

• The city commission has the authority to appropriate non-ad valorem revenues to pay the city’s share of operating and maintenance costs without a vote of the electorate.
• Expected costs related to operating and maintaining the Winter Park station as part of the commuter rail system were included in the city brochure mailed city wide in connection with the March 2007 referendum. That is, citizens voted for a station with the best available information about the commuter rail system operating and maintenance costs related to that station.
• The city commission was not and is not required to ask the voters to approve commuter rail system operating and maintenance costs.
• FDOT will be paying all operating and maintenance costs for the first seven years of fare paying service after which the city has an “opt out” right. Therefore, the city may never be obligated to pay operating and maintenance costs of a mass transit system, but does have the opportunity to negotiate based on actual experience at that time.

Dillaha: 8)      No other county on the proposed commuter rail line is requiring it’s cities to pay annual operating and maintenance costs.  I do not think it is fair that Winter Park is expected to pay, and pay twice, do you?

The statements above are irrelevant. Winter Park will only pay if we chose to do so at the end of the initial seven year period. Winter Park can “opt out” if there is no funding source or a funding source we consider insufficient to adequately defray costs, we can work to negotiate a different deal, or pay the operating and maintenance costs under the existing agreement. We can make these judgments at that time based on seven years of experience.

The discussion should be about the value of having a station, not worrying about whether another county has a county-wide funding source before Orange County has one. This discussion will be ongoing based on real world experience through the first seven years of fare paying service as the “opt out” period approaches.

Dillaha: 9)      No language that ensures Winter Park taxpayers are not on the hook for $3 Million or more to build the station if the promised federal money does not materialize.

The statement above is false. The city has the right to terminate the agreement if State or Federal funds sufficient to construct the Winter Park station are not made available by a certain date. If circumstances change where Winter Park is required to pay for the station in order to participate in the SunRail system I would endorse termination of the existing agreement and so would everybody else.

Conclusion:

We can participate in fear mongering, argue the legal details, the financial details, and the risks, as well as proffer irrelevant and false arguments but the real issues remain.

• SunRail is going to happen with or without Winter Park and if we chose to listen only to Ms. Dillaha the trains will be passing through Winter Park and never stop (for 99 years), subjecting us to the full impact of commuter rail while never reaping any of the benefits.
• Winter Park’s financial exposure is protected by the existing “opt out” right.
• The benefits and opportunities of Winter Park’s participation in the SunRail system far outweigh the costs and risks.

I urge you to contact our city commission members prior to the May 24, 2010 meeting with this message:

We call for an end to the obstruction and a beginning to the cooperation needed to make our SunRail station a reality, and a social and financial success for Winter Park.

The Winter Park Mayor and Commissioners can be reached at:

Mayor Ken Bradley – KBradley@cityofwinterpark.org
Commissioner Carolyn Cooper – CCooper@cityofwinterpark.org
Commissioner Phil Anderson – PAnderson@cityofwinterpark.org
Commissioner Tom McMacken – TMcMacken@cityofwinterpark.org
Commissioner Beth Dillaha – BDillaha@cityofwinterpark.org

Pete Weldon
700 Via Lombardy
Winter Park, FL 32789