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High-Speed Rail Project Linked to Sen. Reid on Verge of Landing $4.9B Fed Loan

DesertXpress, a privately held company with links to Senate Majority Leader Harry Reid (D-NV), is spearheading a high-speed rail project aimed at connecting tourists from Southern California to Las Vegas and says it needs a $4.9 billion federal loan to do it.

Along with Sen. Reid, the project is being advanced by casino developer and contractor Anthony Marnell II, who heads Marnell Companies, the majority shareholder in DesertXpress; project consultant Sig Rogich, a Republican adviser to two presidential campaigns who founded Nevada’s most influential lobbying and advertising company; and Canadian transportation giant Bombardier, a DesertXpress strategic adviser that wants to supply its rail cars.

But how, exactly, is Sen. Reid attached to the project?

Sen. Reid initially backed a rival project that planned to use magnetic power to reach Orange County, but he jumped ship shortly after Rogich became co-chair of Republicans for Reid, a Nevada group with ties to the gambling industry that helped Reid win re-election in 2010.

The senator‘s office disputes any connection between his flip and Rogich’s involvement in the campaign. Spokeswoman Kristen Orthman says Reid’s decision was based on the viability of DesertXpress, while the other project languished.

High Speed Rail Project Linked to Sen. Reid on Verge of Landing $4.9B Fed Loan

This Jan. 25, 2012, photo shows the site of a proposed station for the DesertXpress high-speed rail line to Las Vegas, background, at the end of the Dale Evans Parkway exit from Interstate 15, on the far outskirts of the Mojave Desert city of Victorville, Calif. (Photo: Reed Saxon/AP)

Marnell, another member of Republicans for Reid, is president of one of several companies under the DesertXpress corporate banner. He and his son, M Resort, Spa and Casino President Anthony Marnell III, are also investors.

Federal records show the elder Marnell has donated at least $15,000 to political committees connected to Reid since 2010, including a $5,000 donation in May to the senator’s Searchlight Leadership Fund.

Furthermore, DesertXpress has spent at least $270,000 since 2006 lobbying at the House, Senate, and federal offices, according to the Associated Press.

Other investors include North Dakota businessman Gary Tharaldson, who donated $10,000 to a Reid committee in March, and transportation expert Tom Stone, who organized DesertXpress with partner CEO Andrew Mack in 2005.

Simply put, several of the major backers behind the DesertXpress project have either directly campaigned for or financially contributed to Sen. Harry Reid — the most powerful man in support of the project.

The 150 mph train could act as something of a lifeline to an area that has been hit particularly hard by the recession. However, because there are some issues with the plan, the loan could also end up being a waste of money.

Take, for instance, the fact that the project hinges entirely on the idea that Californians are willing to drive approximately 100 miles from the Los Angeles area to board a train bound for Las Vegas.

“It’s insanity,” says Thomas Finkbiner of the Intermodal Transportation Institute at the University of Denver. “People won’t drive to a train to go someplace. If you are going to drive, why not drive all the way and leave when you want?”

Then there’s the fact that the Federal Railroad Administration (FRA) – which is considering awarding what would be, by far, the largest loan of its type – doesn’t believe the methods used to gauge how many people will ride the train are accurate, which means revenue projections are hazy (at best).

Construction cost projections have soared to as much as $6.5 billion, not including interest on the loan. Some fear taxpayer subsidies are inevitable.

And although Sen. Reid and other supporters point to research that shows “80,000 new jobs” will be created, FRA documents show virtually all those would be temporary — no more than 722 would be permanent.

High Speed Rail Project Linked to Sen. Reid on Verge of Landing $4.9B Fed Loan

This photo Jan. 25, 2012, photo shows the site of a proposed station for the DesertXpress high-speed rail line to Las Vegas, foreground, with Interstate 15 in the background, on the far outskirts of Victorville, Calif., the Mojave Desert city on the route from Los Angeles to Las Vegas, (Photo: Reed Saxon/AP)

A decision on the loan is not expected until mid-year, but the company has spent some $30 million sharpening its plan and refining ridership projections.

The low-interest loan would be about three times the combined amount the FRA loaned 32 other projects through the Railroad Rehabilitation & Improvement Financing program since its inception in 2002. Transportation Secretary Ray LaHood has publicly blessed the train — it means jobs, he says — and it has already cleared several regulatory hurdles in Washington.

The Associated Press contributed to this report.

Comments (116)

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  • Whats up with that
    Posted on March 26, 2012 at 4:02pm

    Loans are supposed to be paid back…Where is all the TARP money that was paid back?…Why didn’t the deficit go down when it was paid back?…Harry made Obama run for President, he begged him…Guess now it’s time for payback…I guess they figure it’s now or never because they way things are going, they know Obama will never get re-elected…

    Report Post » Whats up with that  
    • Baddoggy
      Posted on March 26, 2012 at 4:53pm

      This is THEFT…Plain and simple. Put the people who put this together in prison when it fails.

      Report Post » Baddoggy  
    • Jaycen
      Posted on March 26, 2012 at 5:45pm

      If this is such a spectacular idea, why do they need the taxpayers to foot the bill? Why can’t this idea stand on its own merit?

      Aren’t casino owners sitting on a mint? I’d think all the casino owners would pony up a pretty penny to make sure people from a major population center could quickly and easily gain access to the casinos.

      Report Post » Jaycen  
    • pavepaws
      Posted on March 26, 2012 at 6:38pm

      As with the Canadian pipeline, aren’t there environmental issues?

      Report Post »  
    • closetotheedge
      Posted on March 26, 2012 at 9:03pm

      Leave it to Reid and cronies to pad each others pockets with another win-win for them and we get Barneyed. And then Obama to build the pipeline from Oklahoma down to the gulf refineries.But what about the northern pipeline..They will move it by train and ironically that RxR is owned by one of his major big money donors like Soros’ ,not sure yet who it is. But as Oba has been pandering to his agenda 21 UN mandate we are getting barneyed with all our freedoms swept deep underfoot.They all need to be charged with treason and hung without warrents.Crimes followed his Administration into office and still they are commiting federal crimes again‘st the Constitution and the oath to uphold our system of gov’.A christian is considered a ‘Radical domestic terror group along with the Tea Party and others who want them out of office. NDDA,out goes freedom.Stand up people.While we still have time and a voice. A Christian Patriot and lover of our country. God Bless

      Report Post »  
    • cuinsong
      Posted on March 27, 2012 at 2:03am

      They just keep braking the law but it don’t seem to mater!
      Besides its not Harry’s fault anyway!
      So what’s the big deal?
      And the band played on “What’s Wrong With This Song” http://www.reverbnation.com/play_now/song_9134749

      Report Post » cuinsong  
    • Ruler4You
      Posted on March 27, 2012 at 4:32pm

      I guarantee Reid has adjoining property, probably in a ‘holding’ company or trust or some “disconnected” entity. Or he has IPO rights or something. He makes millions off the deal some how or this wouldn’t be on the radar at all.

      Report Post » Ruler4You  
  • Arshloch
    Posted on March 26, 2012 at 3:57pm

    Marvelous ! Combine a Chicago thug and a cheap Vegas shyster and you get instant destruction of the environment and a deeper debt crisis.

    Report Post » Arshloch  
  • Arbroath7
    Posted on March 26, 2012 at 3:57pm

    From the article, “This photo Jan. 25, 2012, photo shows the site of a proposed station for the DesertXpress high-speed rail line to Las Vegas, foreground, with Interstate 15 in the background, on the far outskirts of Victorville, Calif., the Mojave Desert city on the route from Los Angeles to Las Vegas.” NO ONE is going to drive from down town LA all the way up to Victorville, almost a third of the way to Vegas! Crony capitalism at its worst!! Reid MUST GO!!!

    Report Post » Arbroath7  
    • Mikev5
      Posted on March 26, 2012 at 4:35pm

      Well I lived in Southern Cal and I can tell you people drive all that way all the time the distance doesn’t stop them one bit. But here is my Beef I think there is a train going to Vegas now it’s just not super-fast so this is a scam in my opinion. Also this could Kill all the road side stops a lot of these places would go belly up if this happens all you are doing is steeling business from one person and giving it to the big company’s because all these roadside stops are usually small businesses.

      Report Post » Mikev5  
    • Glock31
      Posted on March 26, 2012 at 4:42pm

      i agree. i have lived in both LA and in San Bernardino. i would have never done that. the drive to vegas isn’t bad at all. why stop halfway to get on a train? it’s stupid

      Report Post » Glock31  
  • girlnurse
    Posted on March 26, 2012 at 3:54pm

    So we the Sheeple work our butts off and give it all back to the feds, states, and Vegas or some other Indian casino….wait I thought we were broke?…yea talk about giving more money to the “fat cats”. I thought Oblamma wants to help the poor and middle class?…yea he wants to help us right out of all our money!

    Report Post » girlnurse  
  • 13th Imam
    Posted on March 26, 2012 at 3:53pm

    What part of the link should Harry be??

    I’d prefer he was part of the track bed. 4 Ft under would suit me fine.

    Report Post » 13th Imam  
    • HisStoryUn
      Posted on March 26, 2012 at 4:15pm

      Harry should be the [missing] link, but he just simply won’t go away!

      The voters of Nevada have proven time and again they like their stuff more than they love their country.

      Report Post » HisStoryUn  
    • jonnyroyal
      Posted on March 26, 2012 at 4:40pm

      HISTORYUN, Please know that NOT all Nevadans voted for Harry Ried. There are many of us in the rural parts of the State where we make our living in the Ranching and Mining industry not by serving the multitudes of lost souls in Vegas. We do not believe that this “High Speed Rail” project will amount to anything other than another tax burden on the hard working people of Nevada and another few Million in Harry Ried’s bank account.

      Report Post » jonnyroyal  
    • 13th Imam
      Posted on March 26, 2012 at 4:43pm

      History, what mfg. is that sailboat?

      Report Post » 13th Imam  
    • MN NICE
      Posted on March 26, 2012 at 4:46pm

      I‘m thinkin more like 6’ to 9′… And he should be screwed in so he doesn’t work his way out…

      Report Post » MN NICE  
    • Gill O-Teen
      Posted on March 27, 2012 at 11:20am

      I prefer tied to the tracks with a train a-comin’

      Report Post »  
  • Hawaii_Conservative
    Posted on March 26, 2012 at 3:49pm

    At least it is going somewhere. The one they are building in Honolulu costing 5.3 billion, conservatively, goes nowhere. Look into it, it is heavy funded by the Feds.

    Report Post » Hawaii_Conservative  
  • riseandshine
    Posted on March 26, 2012 at 3:45pm

    Naa…we’re not slipping into a fascist system.

    Report Post » riseandshine  
    • Hollywood
      Posted on March 26, 2012 at 4:01pm

      Ya gotta admit that Mussolini was reknowned for having the trains run on time. Take a look at old Mussolman with his stuck out jaw,and swagger,and tell me Obama is not him incarnate!

      Report Post » Hollywood  
    • riseandshine
      Posted on March 26, 2012 at 4:34pm

      Part Mussolini and part Lenin.

      Report Post » riseandshine  
    • getourcountryback
      Posted on March 27, 2012 at 9:43am

      And all thug. A Chicago marxist solicalist non christian. What a combo to have in the White House. I detest this POS.

      Report Post »  
  • steveh931
    Posted on March 26, 2012 at 3:42pm

    Why would major backers of DesertXpress want government revenue for a private company. There is nothing right about this and all those that approve any funds for any company are tyrants and thieves. The Federal Government is closed for business boys, find a group of private investors and hope the citizens of California and Nevada approve your right to the land this project will consume. If your DesertXpress crosses Federal Land it will cost you dearly, how’s 15.6 Trillion sound?

    Report Post » steveh931  
  • 65Mustang
    Posted on March 26, 2012 at 3:41pm

    Reid is being reimbursed for being Obama’s good little foot soldier in the Senate.

    Report Post »  
  • progressiveslayer
    Posted on March 26, 2012 at 3:40pm

    Keep burnin our money pigs and soon we’ll all be destitute,of course that’s the plan,make everybody ‘equal’ equally poor a Marxist utopia.Bunch of communist heathen pigs spending us into oblivion and central planning never works it’s very consistent,it fails every time,you can burn in hell all of you communist pigs.

    Report Post » progressiveslayer  
    • Exrepublisheep
      Posted on March 26, 2012 at 3:53pm

      Rolaids.

      Report Post » Exrepublisheep  
    • carolinaconservative
      Posted on March 26, 2012 at 5:19pm

      Rolaids? Hell my heart can’t take much more of this! I’ll soon be on the heart transplant list that Cheney just got off of. That is, if Obummer care will allow a 58 year old a new heart!

      Report Post » carolinaconservative  
    • Lt_Scrounge
      Posted on March 26, 2012 at 8:38pm

      R O L A I D S? That’s not how I learned to spell reload.

      Report Post »  
    • EP46
      Posted on March 27, 2012 at 5:50am

      Yes…but that is the plan and barry is running behind in the assignments he was given when he was annointed…she has to SPEED up ……………..

      Report Post »  
  • abbygirl1994
    Posted on March 26, 2012 at 3:38pm

    Like a high speed rail will help Las Vegas.. or any other city.. Whats with this guy in Las Vegas.. does he have a mental deficiency??? Freak.the country is broke!! And good ole Harry.. sold his soul to the highest bidder! I I pity you and your family! Lord help us!! Harry is spending money that America doesn’t have!

    Report Post » abbygirl1994  
    • MAMMY_NUNN
      Posted on March 26, 2012 at 6:51pm

      But with a high speed rail they can make you grow broke even faster.

      Report Post »  
  • robinakilt
    Posted on March 26, 2012 at 3:36pm

    This is a perfect example of what Republicans and Democrats have done to the capitalist system in this country. Our capitalist system has died many years ago. If ideas like this are so fantastic and PROFITABLE then why can they not find people to invest in the idea? This will be another Solyndra it is just a matter of time. Corruption + Waste = Government, now that is a formula that works better than both major parties!

    Report Post » robinakilt  
  • AJ
    Posted on March 26, 2012 at 3:34pm

    It would be real intersting to study who owns the land that would be purchased for this project. Some individual or entity would stand to made a huge profit from the sale of that land. And of course, the present owners probably wouldn’t be able to sell that desert land for any significant amount, to any other buyer in this real estate market (or even in a good real estate market!).

    Report Post »  
    • Exrepublisheep
      Posted on March 26, 2012 at 3:54pm

      True.

      Report Post » Exrepublisheep  
    • Bill Rowland
      Posted on March 27, 2012 at 4:23am

      I‘ll bet a good part of it is Federal land and they won’t have to pay for it. The Dept of Interior will give it to them.

      OMG 2012

      Report Post »  
  • anAmericanVet
    Posted on March 26, 2012 at 3:33pm

    Simple, get the Sierra Club commies to find an endangered rat that lives in that part of the desert.

    Use their own atactics against them.

    Report Post » anAmericanVet  
    • momprayn
      Posted on March 26, 2012 at 4:06pm

      No kidding! I’ve often thought of that – we need to use their tactics, call them out more that they use (all legal of course). Sick of wimpy, fearful, “pc” Repubs./Consvs. Speak now or forever lose your country !!!!

      Report Post »  
  • pwnjr
    Posted on March 26, 2012 at 3:31pm

    Maybe the reason they all need subsidies is because no many people will use it and it is a big waste of money. Nothing should be subsidied. If it can‘t stand on it’s own then it is not worth anything.

    Report Post »  
    • SgtB
      Posted on March 26, 2012 at 3:48pm

      I used to live in SoCal and I have driven to Vegas. If I had to drive all the way to Victorville to catch a train for Vegas, I’d just drive the whole way. Especially because the train tickets are still on par with the gas expense and once you are in Vegas, you’d rather have your own car to get around than to have to rely on a taxi service or foot travel. Especially if you are touristy and want to go see the damn or go to the lake.

      The only way to make rail a reality is to make cars an impossibility. Until they outlaw cars or drive the price of a gallon of over-taxed gasoline or diesel to $10, the rail will be a niche market and unsuitable to the American masses. I for one would like to ride a railroad to some far flung destination, but I don’t want to do it in a cramped and crowded amtrak car. I’d rather go on a scenic route through the mountains in an old steamer and wind up in a sleepy ski town near a lake or in a national park. But if I am going to go anywhere and just want to get there and be mobile once I get there, I’ll drive thank you.

      P.S. The last time I rode in a plane, I carried an m-16 under my seat and a CRKT knife in my pocket. I won’t fly in any plane unless I can do the same again.

      Report Post » SgtB  
  • Snowleopard {gallery of cat folks}
    Posted on March 26, 2012 at 3:29pm

    One more case of pure cronism and corruption across the board.

    Report Post » Snowleopard {gallery of cat folks}  
  • Harvey1
    Posted on March 26, 2012 at 3:28pm

    Another act by Reid That will not be challenged. This is a stupid and idea as voting for Reid! How can these socialist/communist keep giving money to their supporters, family and friends/ Just incase people forget, we are borrowing 42 per cent of each dollar we spend. So I guess it is okay because China is helping pay for it. Do any of you reading this think we will ever pay off all the debt that Odumba and his minions have made. He has spent more money that all the previous presidents before him combined. Keep electing this domestic terrorist and the USA will be the United Socialist State of Doom and Gloom.

    Report Post » Harvey1  
  • IMCHRISTIAN
    Posted on March 26, 2012 at 3:25pm

    NO MORE LOANS….NO MORE LOANS…….NO MORE LOANS.

    We are Broke……We are Broke……We are Broke

    Report Post »  
  • EqualJustice
    Posted on March 26, 2012 at 3:24pm

    This is GREAT, since high speed rail is in such demand and they always turn a profit, so tax payers won’t get soaked, right? GO HARRY….. as in GO AWAY.!!

    Report Post » EqualJustice  
  • HKS
    Posted on March 26, 2012 at 3:20pm

    Maybe we can put some oil tankers on it and get some supplies from Canada faster.

    Report Post » HKS  
  • IMCHRISTIAN
    Posted on March 26, 2012 at 3:18pm

    Tricky Dicky and now Harmful Harry

    Report Post »  
    • HKS
      Posted on March 26, 2012 at 3:44pm

      He‘ll make Ted Kennedy’s big dig look like child’s play.

      Report Post » HKS  
    • ENDTIMES2220
      Posted on March 26, 2012 at 9:34pm

      I’m a Bible Believer, “Christian” GCB That word no longer represents a biblical foundation.

      Report Post » ENDTIMES2220  
  • IndyGuy
    Posted on March 26, 2012 at 3:18pm

    And the corruption rolls on…Seems the swamp never got drained after all…

    Report Post » IndyGuy  
    • taxpro4u03
      Posted on March 27, 2012 at 12:35am

      The PEOPLE have forgotten that when they‘re up to their azz’s in alligators, the initial objective is to DRAIN THE SWAMP! The answer to the ‘hope and change’ you can believe in is to on the COLLECTIVE, at the individual level ACT like you have liberty and rights and actively begin to EXERCISE them! The Constitution isn’t DEAD – but it IS ‘suspended.’ DO YOUR HOMEWORK! This is the ‘skewed’ i.e. ‘alternate’ 2012 from Back to the Future – Am I the only one GETTING THIS? ‘Biff’ (Abe Lincoln April 24,1863 General Order 100) stole the playbook; Andy Johnson USED IT during re-deconstruction – the Corporate State ‘adopted’ their OWN constitution (looked like the republic’s) with the Act of 1871… WILSON was the last sitting president (lawfully elected under the republic’s constitution) — His 2nd term was in Corporate capacity only. RESEAT YOUR ORIGINAL JURISDICTION republic – lawful, LEGAL, and peaceful. Problem solved.

      Report Post »  
  • oldguy49
    Posted on March 26, 2012 at 3:18pm

    more B.S.

    Report Post »  
  • CatB
    Posted on March 26, 2012 at 3:15pm

    “LOAN” You mean like all those green energy companies that then went out of business and the American Taxpayer got scr*wed? Loan my a$$ … they want a GIFT! 4.9 BILLION DOLLAR GIFT! H*ll NO!

    Report Post »  
  • THX-1138
    Posted on March 26, 2012 at 3:14pm

    “There is no high-speed rail system in the world that operates without subsidies.”

    Um, I believe the phrase is, “Here’s Your Sign.”

    Report Post » THX-1138  
    • dnewton
      Posted on March 27, 2012 at 12:33am

      I think you are right about that. I have heard that France modulates prices of the train trips against the cost of airfare. When too many people are flying, they lower prices on the trains. Still they lose money but the tourist generally get a great deal compared with renting a car or other modes of travel. High speed trains will compete with the existing airline industry. Every job gained in high speed rail needs to be subtracted from the losses in the airline industry, especially the short hop trips. High speed trains are not even good competitors to airlines because an airline only needs ten thousand feet of runway on both ends of the trip. A train, high speed or other wise needs a guideway the entire trip. Eventually the cost of land and maintenance on the two modes cross over and the airplane wins. No high speed train can win in a passenger throughput per hour race with an interstate even if every car only has a driver. To and from any destination, an interstate can deliver 1500 vehicles per hour per lane. When a high speed train slows down to discharge passengers, all passengers must stop, but on a road, only those with a real need must stop while the others keep running. The only way a high speed train can compete is to become a non-stop train. Once you add in the deceleration and acceleration time to the trip plus boarding and re boarding and the TSA delays, the car does not need to go as fast to be the more efficient vehicle.

      Report Post »  
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