KPMG to develop Amtrak’s $117bn high-speed rail plan

Amtrak has tasked the consultancy with creating a financial plan identifying opportunities for public-private partnerships in the development of a 220mph high-speed rail network in the north-eastern US.

Amtrak, the US national passenger rail corporation, has chosen consultancy KPMG to develop the business and financial plan for a proposed 220-mile per hour high-speed rail line in the north-eastern US.

One of the main aims of the study is to identify which components of the proposed high-speed rail line will be suitable for private investment, Al Engel, Amtrak’s vice-president for high-speed rail, said on a conference call with reporters yesterday. Last year, Amtrak unveiled a conceptual plan for a 686-kilometre high-speed rail network linking Washington DC, New York and Boston that would cost $117 billion over 30 years. Amtrak said it plans to introduce a new conceptual plan this autumn.

Engel said yesterday that there would be many opportunities for private investment in the project. He said private investors could be involved in financing and developing stations along the line, and he also mentioned the possibility of including private investors in infrastructure development in exchange for some kind of availability payment. He explained the point of the study would be to identify “what's real and what’s imaginary,” in terms of opportunities for private investment.

He emphasised, however, that a plan to privatise the so-called Northeast Corridor, which House Transportation and Infrastructure Committee Chair John Mica, a Florida Republican, put forth recently, was unlikely to succeed.  He described the high-speed rail line as a “public benefit project” that would be too costly to be shouldered by private investors. Instead, he said he saw operating concessions, such as the 30-year lease of England’s HS1 to a consortium of Canadian pension funds, as a more viable option.

KPMG will also work with Steer Davies Gleave, real estate consultancy DWH Strategic Advisors, Sharon Greene& Associates, and TranSystems in preparing the plan.  Engel said the final report should be finished by next May.

A spokesperson for Amtrak declined to comment on the number of groups that had showed interest in developing the plan, but said that the process had been “highly competitive”. The contract for the development of the plan is worth several million dollars, Engel said yesterday.