Surface Transportation Board recognizes Texas high-speed line as key link in national railroad network

Plans for a 240-mile, 200 mph high-speed line between Dallas and Houston have run into a short-term delay that sets the stage for an important long-term win.

The Surface Transportation Board (STB) ruled that the project is subject to its jurisdiction, reversing a 2016 decision by the same body. The earlier decision was based on the conclusion that the STB–a federal agency with regulatory authority over interstate railroads–lacked authority over a line running solely within Texas’s borders.

In its appeal, TC argued that because its ticketing system will link into Amtrak’s system–and because the endpoint stations will allow easy transfer to Amtrak trains–the line will be a vital part of the national railroad network. The STB agreed with that argument in its decision. At the same time, it declined to waive the normal approval process for construction to begin, as TC had requested.

The ruling means that Texas Central (TC) must submit its project plans to the STB for approval. That will force a delay in groundbreaking on the project, which TC hopes to complete by the middle of the decade.

But the ruling amounts to a win for TC because the new line will be under the authority of a federal agency that has the power to exempt projects on an as-needed basis from local, state, and federal regulations. The STB also has a robust, well-established body of case law to draw on. As a result, projects under STB authority are protected from local political pressures and the whims of state legislatures.

Funding for the project remains the biggest question facing TC, which plans to build the line solely with financing from private investors and entrepreneurs. The STB noted in its ruling that estimates of the project’s cost have ranged from $10 to $30 billion, and that skeptics “have raised significant questions surrounding the financial feasibility of the proposed rail project.” TC will submit details of its financial plans as part of its STB approval process.

The ruling follows a big win for TC in May, when an appeals court found that the company is a railroad, though construction on the line has not yet started. That ruling gave TC the right of eminent domain, which will allow it to expropriate land to be used for the public’s benefit as it buys land parcels. TC has currently purchased, or has options on, roughly a third of the parcels it will need for the full line.

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