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Can a Stalled Train to Las Vegas Speed Housing Construction in California?

An investment group failed to sell $2.4 billion in bonds to finance the Brightline West high-speed rail project. Housing advocates hope those funds can help ease the state’s home shortage. 

A rendering of the Sango Court Apartments, a transit-oriented housing development in Milpitas, California, that could benefit from private activity bonds once allocated to the Brightline West rail project. 

A rendering of the Sango Court Apartments, a transit-oriented housing development in Milpitas, California, that could benefit from private activity bonds once allocated to the Brightline West rail project. 

Rendering: Resources for Community Development

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It was a big, ambitious plan promising jobs and pollution relief in a car-choked California: a high-speed all-electric passenger train linking Las Vegas to a Mojave Desert town, and ultimately Los Angeles.

To get the $8.4 billion Brightline West venture moving, global investment firm Fortress Investment Group wanted low-cost financing: specifically, $600 million of California’s precious private activity bonds. Because of federal rules boosting rail, the company could leverage that amount four times to $2.4 billion of bonds, which are meant for ventures for the public interest that are capped annually in each state by the federal government.