Nevada misses train of opportunity
The train has left the station, and Nevada tried but didn’t make it onboard. Instead, it’s California chugging along to create a new industry with high-paying jobs.
Earlier this month, our neighbor to the west broke ground on the nation’s first true high-speed rail system. When finished, the system will link Los Angeles, San Francisco, the Central Valley and the Inland Empire with 200 mph trains, creating an entirely new high-speed rail industry.
“The manufacturing of train sets and the establishing of maintenance facilities will mean more jobs, increased economic benefits, and allow for the possible development of a whole new high-speed rail industry here in California,” said California High-Speed Rail Authority CEO Jeff Morales in an October press release seeking to recruit train manufacturers to California.
Pay attention to that last part: The trains that will be running in California will be built in California. That could’ve been us. Why?
Because of federal “Buy America” provisions, new high-speed rail projects are required to manufacture trains and train parts right here in America. Put another way, a foreign manufacturer would need to open a U.S. production line somewhere in the United States to build trains for any domestic high-speed rail project. Since California is the first in the country to build true high-speed rail, California is making sure that the trains to service its system are built in California. What’s more, California-built high-speed trains could service new high-speed rail routes planned for Texas (between Dallas and Houston) and Florida (between Miami and Orlando). It’s the start of a new manufacturing industry in America, and it could’ve started right here in Nevada.
High-speed rail is not just another mode of transportation. It’s an economic development catalyst. If a Nevada high-speed rail project, say the XpressWest project, had started first, companies such as Alstom, AnsaldoBreda, Bombardier, Kawasaki or Siemens would have employed hundreds of Nevadans to build trains in Nevada; in short, Nevada could’ve been the capital of the high-speed rail manufacturing industry in America.
Instead, because of “Buy California” provisions, we now face the bizarre situation of major global corporations fighting with one another for the privilege to manufacture trains in a neighboring state with higher taxes and a less friendly business environment than Nevada’s.
All of this is great for California. That nascent industry is projected to employ highly paid engineers and skilled technicians who will call California home. And domestic growth in high-speed rail will accrue to California, the seat of domestic high-speed rail manufacturing.
In Nevada, many people worked very hard to get the XPressWest project off the ground, and that should not be discounted. But our own failure to invest in high-speed rail infrastructure is directly connected to a major manufacturer choosing to go elsewhere.
This is a missed opportunity to diversify our economy.
In the future, we must all do a better job of recognizing and capitalizing on these opportunities. Nevada has done a tremendous job preserving a desirable tax and operating environment for businesses; we must keep that edge while also improving what our market has to offer. Our future depends on it.
Tom R. Skancke is chief executive officer and Jonas Peterson is president and chief economic development officer of the Las Vegas Global Economic Alliance, the regional economic and community development organization for Southern Nevada.
