(The Center Square) – The Los Angeles-Las Vegas private rail project has earned the ability to issue another $2.5 billion in tax-free public activity bonds, the federal government announced this week.
The approval brings the project’s total government-supported funding to approximately $6.5 billion, or more than half the project’s estimated cost.
The 218-mile Brightline project is projected to cost $12 billion, take 11.1 million passengers on one-way trips each year, and be completed by the 2028 Los Angeles Olympics. Brightline built and operates the only privately-owned, privately-operated intercity passenger railroad in the U.S., connecting Miami to Orlando.
The U.S. Department of Transportation is authorized by Congress to help building projects issue $30 billion of private activity bonds each year. DOT private activity bonds, such as those to be issued by Brightline, earn tax-free interest and tend to receive lower interest rates due to the association with the government’s credibility.