For the first time, Governor-elect Scott Walker is raising the possibility he could support spending $810 million in federal funds on train service - just not the train service for which it was allocated.

It's a potentially significant change for a politician who has insisted that all of the federal stimulus money should be redirected from high-speed rail to Wisconsin highways - a position flatly rejected by federal and state officials.

Rail supporters still want the federal dollars spent on their intended purpose: a planned high-speed rail line from Milwaukee to Madison. More than 200 people rallied Monday outside the Talgo Inc. train plant to urge Walker to relent.

Walker, the Milwaukee County executive, has repeatedly vowed to block construction of that line. He reiterated that position Sunday in an interview with Mike Gousha on "UpFront" on WISN-TV (Channel 12).

In that interview, Walker said using the money for highways is still his preference, but that he and his staff also had "looked at options relative to rail." He specifically mentioned Amtrak's existing Milwaukee-to-Chicago Hiawatha line and the long-distance Empire Builder, which runs from Chicago to the Pacific Northwest by way of Milwaukee, the Twin Cities and several Wisconsin communities.

Unlike his Republican primary opponent, former U.S. Rep. Mark Neumann, Walker has backed continued state support for the Hiawatha, which runs seven round trips daily from downtown Milwaukee to downtown Chicago, with stops in between at Mitchell International Airport, Sturtevant and Glenview, Ill. The line carried 741,781 passengers last year and is strongly supported by the business community.

Redirecting the stimulus money from high-speed rail to highways would take an act of Congress, which is currently controlled by Democrats. Walker said last week that he would not press for a decision on the funding shift until after he takes office in January, when his fellow Republicans will take control of the House. But the U.S. Senate and White House will remain in Democratic hands, and Rep. Tom Petri, a Fond du Lac Republican, has said it's not politically realistic to believe the money can be moved to highways.

Walker's transition team and the state Department of Transportation did not return calls seeking further comment. A U.S. Department of Transportation spokeswoman declined to comment.

The Milwaukee-to-Madison line would operate as an extension of the Hiawatha and eventually could become part of a larger Chicago-to-Twin Cities route and a Midwestern network of fast, frequent trains. Plans call for service to start in 2013, with six round trips daily at a top speed of 79 mph, rising to a top speed of 110 mph in 2015.

Talgo rally

At the Talgo plant on Milwaukee's north side, demonstrators chanted "Trains mean jobs!" and "Talgo yes! Walker no!" And representatives from a broad range of organizations, from labor and social justice groups to religious and political leaders, stressed the project's importance as a catalyst for redevelopment of the city's former Tower Automotive site and the creation of new jobs, especially in Milwaukee's central city.

"Talgo represents a resurrection for many people in this state, and especially in this city," the Rev. Ken Wheeler, pastor of Cross Lutheran Church and a member of the Milwaukee Inner-City Congregations Allied for Hope, told the crowd.

"I remind you that you are not just the governor of a select few, the wealthy and those who live outside of the city," Wheeler said of Walker. "Don't do what is expedient. Do what is right."

Spanish-owned Talgo moved to the Tower site after winning contracts to build two trains for the Hiawatha and two for Oregon. By next year, it expects to have 125 people working on those jobs.

The company also had hoped to build the additional trains that would be needed if the Hiawatha was extended to Madison. But with Walker pledging to block the extension, Illinois Gov. Pat Quinn is wooing Talgo, and a Talgo spokeswoman has said her company would seriously consider moving to Illinois or elsewhere after fulfilling its current orders in spring 2012.

Rally organizers said Walker's decision could cost the state nearly 15,000 jobs - a third of those for construction and the rest permanent - and render Wisconsin a laughing stock across the country. The claim of almost 10,000 permanent jobs is based on a 2006 study with so many assumptions that PolitiFact Wisconsin ruled it "barely true."

"Let's be responsible. This is just not the time to be chasing jobs away," said Phil Neuenfeldt, president of the Wisconsin State AFL-CIO.

Operating costs

As part of the Hiawatha, the Milwaukee-to-Madison leg would be what Amtrak calls "corridor service," with the state picking up a chunk of the operating costs. After subtracting fare revenue, the route would cost $7.5 million a year to operate - a major reason for Walker's opposition. But state transportation officials say federal aid could cover up to 90% of that cost, as it does on the Hiawatha, leaving $750,000 a year for state taxpayers.

By contrast, states pay nothing for long-distance routes like the Empire Builder, which offers one round trip daily and stops in Columbus, Portage, Wisconsin Dells, Tomah and La Crosse as well as Milwaukee.

When the Midwest regional rail network was being mapped out in the 1990s, then-Gov. Tommy G. Thompson and other backers said starting with a new Milwaukee-to-Madison route would provide more "bang for the buck" than first upgrading the current Hiawatha route to 110 mph service, which they said would take more money and more time. Long-term plans still call for speeding up the Milwaukee-to-Chicago leg.

The federal stimulus money was awarded in a competitive process, with dozens of projects nationwide vying for $8 billion. Wisconsin won more than 10% of the cash after submitting a detailed application, built on years of studies, in coordination with other Midwestern projects that also received funding.

Moving the Wisconsin allocation to rail projects that were not considered in the review process could draw objections from other states with projects that either didn't get funded or didn't get all the money they requested. Also, the stimulus money was supposed to go to "shovel-ready" projects that could put people to work soon, and federally required studies could take months or years.

Quinn and New York Governor-elect Andrew Cuomo are already seeking Wisconsin's $810 million and more than $400 million allocated for a planned 79-mph Ohio line that Governor-elect John Kasich has promised to kill.

Of the $810 million for the Milwaukee-to-Madison route, some $70 million would be used for projects that would be needed anyway for the Hiawatha, and Wisconsin received another $12 million for Hiawatha upgrades. Outgoing Democratic Gov. Jim Doyle has said Walker's stance would jeopardize funding for those projects. Federal transportation officials have declined to comment on Doyle's statements.

Illinois also helps pay for the Hiawatha's operating costs and recently received $3.7 million in federal money for Hiawatha bridge upgrades. Federal officials haven't said Walker's stand would imperil that grant, and no one from the federal or Wisconsin governments has discussed shifting Wisconsin's high-speed rail allocation into Hiawatha improvements, said Guy Tridgell, a spokesman for the Illinois Department of Transportation.