Brightline said to be nearing Chapter 11 bankruptcy as it seeks to restructure $1.1B debt

STUART, Fla. (CBS12) — Brightline, south Florida’s high speed rail system is said to be on the verge of declaring bankruptcy.

According to some media reports, Brightline is approaching Chapter 11 bankruptcy.

“Sometimes, Chapter 11 can help keep a company reorganize, get back on their feet,” said Keith Singer, a financial advisor in South Florida.

Singer explains filing for Chapter 11 bankruptcy does not mean Brightline goes out of business. So rail service may not be interrupted by this. At least for now.

“By doing a Chapter 11, you basically don’t have to pay everyone what you owe them, and the court will, the bankruptcy trustee will make a plan, how to pay everyone as much as they can, while keeping the company afloat,” Singer said.

According to Bloomberg, Brightline is close to filing a Chapter 11 bankruptcy petition to restructure an estimated $1.1 billion in corporate debt.

Martin County has been attempting to get a Brightline rail station for years, so that instead of merely passing through, Brightline trains would stop there and riders could provide a boost to Stuart’s downtown businesses.

One County Commissioner says she still feels Martin County should try to get a Brightline station.

“If they’re struggling why would the county want to continue to pursue that?” we asked Sarah Heard, Martin County Commissioner, District 4. “I think that struggle will have to be fixed before we’d continue to partner with them. We will have to have confidence in their ability to provide the service,” Heard said.

“Do you think now that they’re on the verge of declaring bankruptcy means it would be less likely that Martin County could get a Brightline station here?” we asked Blake Capps, Martin County Commissioner, District 3. “I don’t think that particular matter would affect it greatly, because I think another company will move in and continue service,” Capps said.

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Chapter 11 bankruptcy means Brightline would try to restructure its debts while it continues to operate.

Commissioner Capps says it would cost about $80 million to build a Brightline station in Martin County. He says whether Martin County could get federal grants to cover that cost is still not certain. He says they can apply again for federal grants in October 2027.

We have reached out to Brightline for comment and we’re waiting for their response.