Gov. Rick Scott announced Wednesday that he's rejecting federal funding for high-speed rail.
"I'm not comfortable this is a project we should be doing," Scott said at a hastily called news conference in Tallahassee after a phone conversation with U.S. Transportation Secretary Ray LaHood.
Scott said he was not sure high-speed rail would bring taxpayers a return on their investment and he felt money would be better spent on state highway and seaport improvements.
The rail was intended to connect Tampa, Lakeland and Orlando.
Said LaHood: "We are extremely disappointed by Gov. Rick Scott's decision to walk away from the job-creating and economic-development benefits of high speed rail in Florida. We worked with the governor to make sure we eliminated all financial risk for the state, instead requiring private businesses competing for the project to assume cost overruns and operating expenses. It is projects like these that will help America out-build our global competitors and lay the foundation needed to win the future."
U.S. Sen. Bill Nelson, D-Fla., was called by Scott in the morning, and offered "vigorous" argument against the governor's decision.
"This is eating our seed corn," Nelson said after the call. "It's turning down 24,000 jobs, when we badly need them."
U.S. Rep. John Mica, R-Winter Park, chairs the House Transportation and Infrastructure Committee. In a statement he said, "This is a huge setback for the state of Florida, our transportation, economic development, and important tourism industry. I have urged the governor to reconsider going forward and allow the private sector to assume the risk and any future costs for the project. I made this appeal to the governor this morning. With the federal government assuming 90 percent of the cost of the project, I am disappointed the private sector will not have an opportunity to even offer innovative proposals to help finance the balance of the costs and to construct and operate this system."
U.S. Rep. Kathy Castor, a Tampa Democrat and champion of the project, said Scott should have put the project out to bid so companies could demonstrate ways to contain costs and assume any risk.
"I don't understand the governor's lack of vision for the state," she said. "I think he has a very rigid ideology that is getting in the way of job opportunities for Floridians. It's a devastating decision for jobs, for Florida and our economic future."
Florida is the third large state to reject the rail funding, joining Ohio and Wisconsin. Florida's share would have been much larger than that of the other two states, at more than $2 billion.
Scott's decision represents a major victory for the tea party movement after members met with Scott in his office for 30 minutes to discuss the issue and urged him to reject the rail money.
Scott said his decision was based on "three main economic realities." First, he said, cost overruns for the project could put Florida taxpayers on the hook for an additional $3 billion.
Second, ridership and revenue projections are historically overly optimistic, he said, and would likely result in ongoing subsidies from state taxpayers.
And finally, if the project becomes too costly for taxpayers and is shut down, the state would have to return the $2.4 billion in federal funding.
In his letter to LaHood, Scott said, "I believe that the dollars being made available for proposed high-speed rail projects are better invested in higher-yield projects like those we have discussed in past few weeks."
Those include the widening of Interstate 275 in Hillsborough County, improvements in Miami, the widening of Interstate 4 in Orange County, and improvements to Miami, Port Everglades and Jacksonville seaports.
Reacting to Scott's decision, Florida House Speaker Dean Cannon, R-Winter Park, issued this statement:
"I have not spoken to the governor regarding today's announcement, but I watched the governor's press conference. I'm encouraged that he is focusing on the practical realities of government programs and their long-term impacts. As the constitutional officer charged with carrying out transportation policy, the governor seems to have determined that at this time he cannot feasibly implement high-speed rail in Florida. I have confidence that he will bring the same level of scrutiny to other issues."