All Aboard Florida’s Brightline trains are expected to start shuttling passengers between West Palm Beach and Fort Lauderdale next month, with service to Miami set to begin in the first quarter of 2018, according to an analysis of a $600 million bond issue the company plans to use to help pay for the project.
Once fully-operational, Brightline is expected to run 16 round-trip trains a day between West Palm Beach and Miami, leaving its three stations at hourly intervals from the early morning to the late evening, according to the Fitch Ratings analysis released Monday.
Brightline declined to comment on Fitch’s report. The company says it plans to begin introductory service by the end of the year, but has not announced a specific start date or released details about its ticket prices and train schedules.
The December start comes five months after Brightline’s original launch date, which called for service to begin this summer on the 30-minute route between downtown West Palm Beach and Fort Lauderdale. A series of issues, including ongoing signal work at rail crossings across Palm Beach County, delayed the launch of the project.
Despite the delays, officials said Tuesday a plan to create a quiet zone to silence the horns of both Brightline’s trains and other freight traffic along the Florida East Coast Railway is still on track.
Before the zone can be created, local officials must submit a “notice of establishment” to the Federal Railroad Administration. As of Tuesday afternoon, federal railroad officials said they had not received a notice for the portion of the FEC tracks that run through Palm Beach County.
Once the notice is given, the quiet zones are expected to be established within weeks, said Kim DeLaney, the director of strategic development and policy for the Treasure Coast Regional Planning Council, which is working with local governments to implement the quiet zone.
“All agencies are fully aware how much the public is looking for that relief that is provided through quiet zones,” DeLaney said.
Brightline is putting the finishing touches on a series of safety upgrades that are needed along the rail corridor before train operators can stop blowing the horns. Once that work is completed, local governments will file notices to establish the quiet zone, DeLaney said.
Brightline can’t start running its trains until those improvements are completed, DeLaney added.
“If you live along the tracks and your hope is quiet zones will be established quickly, it is great news,” DeLaney said of Brightline’s December launch. “This means quiet zones are now within just a few weeks of that service being established.”
Brightline officials have said their service stands out from other rail ventures because it will be privately owned, operated and financed. The company’s trains will run on Henry Flagler’s historic rail corridor, passing through the heart of many of South Florida’s coastal cities.
Brightline’s launch marks the first time passenger trains have run on the FEC tracks since 1968, when passenger service was discontinued following a union strike.
In its report, Fitch said there is “significant uncertainty” about the number of people who will ride Brightline’s trains. But the ratings agency noted that “strong revenue” produced by other U.S. passenger rail lines, including Amtrak’s Northeast Corridor and the California Pacific Surfliner, is a “good indication of Brightline’s potential.”
Brightline expects to make $147.6 million in revenue in 2021, but can break even with revenue of $90.6 million based on ridership of 1.6 million and average fares substantially lower than Amtrak’s Acela, which offers service from Washington, D.C. to Boston, Fitch said.
Following a two-year ramp up period, Brightline expects 2.9 million people a year to take its trains, with gross fare revenues reaching $107.3 million by 2020, Fitch said.
Revenue from other sources including parking fees and food and beverage sales are expected to total $34.4 million in 2020, representing roughly 24 percent of the company’s revenue, Fitch said.
“The service targets primarily business and leisure travellers, with commuters expected to be only approximately 10 percent of ridership,” Fitch said.
Brightline’s fares will vary depending on the time of the day and the day of the week. Fitch said the company’s proposed fares are “in line with regional Florida Amtrak fares and substantially below the Northeast Corridor’s Acela line.”
Brightline last month won approval to sell $600 million in tax-exempt bonds to help pay for the first leg of its project.
The Florida Development Finance Corp., a special financing unit authorized by the state Legislature to issue tax-exempt bonds to private entities, signed off on the sale on Oct. 27. Fitch has assigned a “BB-(EXP)” rating to the bonds.
Eventually, Brightline plans to extend its service north to Orlando. That extension has faced opposition from residents on the Treasure Coast.
Brightline unsuccessfully tried to sell $1.75 billion in tax-exempt bonds to fund its second leg between West Palm Beach and Orlando.
In an April letter to federal officials, Brightline CEO Dave Howard said the company planned to renew its push for a federal loan to help pay for the project.