Development of a high-speed rail line took another leap forward Wednesday when a California committee approved $300 million in tax-exempt private activity bonds to help finance the Virgin Trains USA proposal to link Las Vegas with Victorville, California.
Virgin is seeking $800 million in bonding authority to issue $2.4 billion in debt, about half the amount the company needs to finance train sets and the 185 miles of dual tracks along the Interstate 15 corridor.
Virgin has proposed seeking $600 million in bonding authority from California and $200 million from Nevada.
The $300 million in bonds approved by a committee led by California Treasurer Fiona Ma was the first step of the process. The committee will consider another $300 million next year.
In Nevada, two $100 million requests are expected to be made of the Nevada Department of Business and Industry, which is expected to consider the first half of that in a meeting as early as November.
With that authorization, Virgin Trains would become eligible for federal grant funding in what amounts to a 4-to-1 match.
The train line linking Las Vegas with Victorville is the first phase of a plan to develop high-speed rail between Las Vegas and Union Station in downtown Los Angeles. The second phase would add about 50 miles of track between Victorville and Palmdale, where the line would join the California High-Speed Rail system.
Ma was sold on the Virgin rail proposal after riding the company’s trains in South Florida in July. The system, formerly known as Brightline, has been in operation since the start of the year between Miami and Fort Lauderdale and West Palm Beach and is expanding to Orlando.
Brightline bought out the California and Nevada system from XpressWest last year, then partnered with Richard Branson’s Virgin Trains with a bid to expand high-speed rail in Florida, California and Nevada.
Branson has taken greater interest in Southern Nevada in recent months with his plan of acquiring the Hard Rock Hotel and converting it to Virgin Hotels Las Vegas by the end of 2020.
Bob O’Malley, Virgin Trains’ vice president of government affairs, said in May that the Las Vegas-to-Southern California project would generate $1.98 billion in economic impact, create more than 1,000 construction jobs, transport 5.5 million visitors to Las Vegas annually, remove 4.5 million cars from Interstate 15 annually and create $14 million in environmental benefits per year.