Land acquisition for a proposed $30-billion high-speed railroad between Houston and Dallas can continue after the Supreme Court of Texas said that the company developing the project has eminent domain authority.

Justice Debra Lehrmann found in a June 24 opinion that the entities behind the Texas Central Railroad have that authority under the state transportation code—upholding an appeals court decision that had overturned a lower court’s earlier ruling.

Four other justices joined Lehrmann, but three dissented and one did not participate in the decision. 

“We agree with the court of appeals that the entities have eminent-domain power as interurban electric railway companies and need not address whether they also qualify as railroad companies,” Lehrmann wrote in the court’s opinion.

The original lawsuit was filed by Leon County landowner James Miles, who wanted to block Texas Central from surveying on his land for the project. A potential route for the 236-mile railroad would bisect his 600-acre parcel with a 100-ft-wide right-of-way. 

Attorneys for Miles had argued that the entities behind Texas Central did not count as a railroad company or as an interurban electric railway because the developer had not yet owned any track, stations or rolling stock, and only had a fraction of needed financing. 

However, Texas Central pointed to hundreds of option contracts to purchase land it had executed, its move to hire high-speed rail consultants and construction contractors and the permits it had obtained for the project to show that it was a railroad company, or at least an interurban electric railway company—a corporation chartered to conduct and operate an electric railway between two municipalities.

Those types of companies have the authority to use eminent domain in Texas under the state transportation code.

“We are appreciative to the Texas Supreme Court for their time and consideration of this important issue as we continue work on this innovative high-speed passenger train rail,” Texas Central said in a statement. 

Blake Beckham, an attorney representing Miles in the case, says the opposition will continue fighting the plan before the state Surface Transportation Board and with a federal lawsuit challenging environmental impact study findings. Also, he questioned Texas Central’s financial situation and its ability to move forward with the plans.

“We know they don’t have any money,” Beckham says. “I can’t imagine the only thing keeping them from raising money was this case.”

Lehrmann noted in the opinion that the sole issue at question was whether the two private entities behind the project have the power of eminent domain, and not the merits of the plan itself. 

“The case involves the interpretation of statutes relating to eminent domain; it does not ask us to opine about whether high-speed rail between Houston and Dallas is a good idea or whether the benefits of the proposed rail service outweigh its detriments,” the justice wrote.

A Texas Central spokesperson did not say what would come next for the company, but it has recently seen top leadership turnover. As ENR previously reported, its president and CEO, Carlos Aguilar, announced his exit in a June 12 LinkedIn post, and Richard Lawless, who had been chairman emeritus of Texas Central’s board of directors, said the board had disbanded within the past month. 

Texas Central now is being managed by Michael Bui, a consultant who specializes in financial advising and corporate restructuring. In a June 21 court filing, an attorney for the developer wrote that the company “remains open for business under its new management, is continuing to seek further investment, and is moving forward with the development of this high-speed train.”