Branstad wary of funding Iowa City-Chicago rail route, for now

Gov. Terry Branstad remains skeptical of the potential for a passenger-rail line connecting Iowa City and the Quad Cities to Chicago and signaled that he won't include funding in the budget he unveils today.

In particular, the governor doesn't want to lock the state into an ongoing subsidy of the line that is included in a $230 million federal passenger-rail grant to Iowa and Illinois.

“I think that would be a terrible mistake to get into (a subsidy), especially considering the difficult financial situation we're facing,” he said Wednesday.

The federal government in the fall allocated $230 million of the project's $310 million total cost, leaving Iowa and Illinois to cover the balance.

Illinois has committed $45 million toward the route's Chicago-Moline leg. The Iowa Legislature appropriated $11.5 million for planning and design work through 2012, but House Republicans have made that spending a budget-cutting target.

Branstad indicated he won't address participating in that grant in his budget message.

“I guess my feeling is that we have a very limited amount of resources available right now, so what we're going to be able to do is pretty limited,” he said. “I don't think we have any money in the budget in the next biennium for this project.”

He didn't rule out participating, however, because the state's $20 million commitment isn't needed until nearer the 2015 target date for service to begin.

Nancy Quellhorst, president and CEO of the Iowa City Area Chamber of Commerce, took at least some comfort from that, although she didn't want to say much before Branstad's official announcement.

“We're pleased that, unlike Wisconsin and Ohio, our governor is still considering rail,” said Quellhorst, whose group has led the campaign for the project.

Beyond that, “it puts us at an awkward position to speak before the Governor's Office,” Quellhorst said.

While he sees a direct link between highway transportation improvements and jobs, Branstad is skeptical that the line will create many jobs once the construction is completed. He also questions whether ridership in a rural state will justify the cost of state participation.

“This might make it easier for some people to get to college or travel to Chicago,” he said, but he doubts many people will commute from Iowa to jobs in Chicago or vice versa.

The Gazette's Steve Gravelle contributed to this report.