News

High-speed rail price tag rises again

New reports show spiking cost of two Central Valley segments of proposed rail line

California's planned high-speed rail line could cost billions more than the state's initial projections indicated, according to newly released documents from the agency spearheading the project.

The California High-Speed Rail Authority released Environmental Impact Reports for two Central Valley segments of the proposed line, which is slated to stretch from San Francisco to Los Angeles and reach speeds of 220 mph as it passes through the middle of the state.

The two reports -- covering the Fresno-to-Merced and Merced-to-Bakersfield segments, respectively -- indicate that the combined cost for the Central Valley section would be at least $10 billion and could be higher than $13 billion.

Previous estimates had the price tag for this section of the line at about $7 billion.

The revisions should come as no surprise to legislators and critics of the controversial project, for which voters approved a $9 billion bond measure in 2008. At the time, the project carried an estimated price tag of $33.6 billion. The rail authority in 2009 revised the projected price tag to $42.6 billion -- a figure that local watchdogs and state analysts claimed was still too low.

The Palo Alto-based group Californians Advocating Responsible Rail Design (CARRD) released its own projections in February, estimating the price tag at about $65 billion. The group used details from the rail authority's own plans to come up with the estimate.

In May, the state's nonpartisan Legislative Analyst's Office issued its own report largely confirming CARRD's estimate and projecting the cost of the project at about $67 billion.

"We knew the costs were in a different ballpark," said Elizabeth Alexis, co-founder of CARRD. "We wanted the authority to start talking about that ballpark sooner or later.

"A project of this size is not in the realm of financial possibilities," she added. "So you either just say no to the project or you make some changes."

Legislators have also been consistently skeptical about the rail authority's financial projections and its business plan. Sens. Joe Simitian and Alan Lowenthal have grilled rail authority officials at numerous committee meetings over the past two years and tried to get the authority to release a more realistic business plan before it could receive state funding.

Simitian's provision tying state funds to a new business plan died last year when then-Gov. Arnold Schwarzenegger struck it down with a line-item veto.

Rachel Wall, spokesperson for the rail authority, attributed the increase in the cost projection to the additional engineering work that has been performed since the original estimate was released. She said the agency has always assumed the cost estimates of a major infrastructure project such as high-speed rail would be dynamic.

"As we've done further engineering and worked further with communities to address their designs and concerns, the estimated costs have changed," Wall told the Weekly.

She said the rail authority plans to release an updated business plan in October with a revised cost estimate for the entire system. She said the authority expects the new estimate to be higher than its current $43 billion price tag.

The new concerns about high-speed rail's final price tag have not deterred state and federal officials from proceeding with the design of the new train system. This week, in fact, U.S. Transportation Secretary Ray LaHood authorized a $179 million grant to California for various rail-related improvements. The grant includes $86 million to the rail authority for construction of the Central Valley segment.

The rail authority will be accepting public comments on the newly released EIR between Aug. 15 and Sept. 28. The documents are available at the rail authority's website, www.cahighspeedrail.ca.gov.

Comments

Posted by KeithW, a resident of Atherton: West of Alameda
on Aug 10, 2011 at 1:34 pm

What a wonderful Euphemism "the agency has always assumed the cost estimates of a major infrastructure project such as high-speed rail would be dynamic." What that translates to in plain english is "We lied about the costs, sytematically underestimating them, while we lied about the ridership, sytematically over-estimating it. But we are confident we can keep the taxpayers on the hook, no matter how expensive the project becomes."

This has been the attitude of backers since day one. Are we going to continue cutting funds to schools to feed this sacred cow? Let's find a way to cut off its head NOW, before we pour more money down the drain.


Posted by Mike, a resident of another community
on Aug 10, 2011 at 1:46 pm

.....and this is news? Right now, I should say "I told you so", but, well........OK, I told you so! How anybody could have believed the nonsense spewed by the backers of this project is beyond my comprehension. Voters, you need to read beyond the headlines of the crazy initiatives. Any clear thinking person who read the context of the proposals had to recognize the scam. This is not the end of the revised estimates of the cost of the project. Once it gets beyond the point of no return, the estimates will skyrocket. STOP this project! Cut the losses NOW, rather than continue them indefinitely.


Posted by CD, a resident of Menlo Park: Felton Gables
on Aug 10, 2011 at 1:49 pm

Stop this nonsense before it starts! What a joke! PERIOD!


Posted by Morris Brown, a resident of Menlo Park: Park Forest
on Aug 10, 2011 at 4:41 pm

I have read comments like "the debate has died down because HSR will never happen is without substance."; therefore just forget about it.

Debate has not died down; just read the papers or the blogs. It is more active than ever.

The Authority has over $6 billion to spend in the Central Valley. Over $3 billion of these funds came from the Federal Government. The State legislature will fight to the end to not lose these funds, regards of how useless what they presently plan to build will be the result.

This is a high priority of the Democratic party caucus in Sacramento.

So it should be stopped and should have been stopped long ago. Right now they are spending over $700,000 each day doing studies etc. The waste is un-believable as the Authority is rushing to meet a Sept 2012 deadline to start construction, or else they will lose the Federal dollars.

The State LAO office issued a devastating report some months ago, which wanted at least to halt the present spending. Yet the legislature ignored their recommendations and has continued to fund the project.

Today the State controller came out and stated that revenues were already over $500 million short of their rosy predictions. As this trend continues, shortly triggers in the just passed State budget will start to cut away at valuable programs the State needs much more than this train.

It is more than time to get legislators like Simitian off of his stump speech of "I'm in favor of HSR being done right" and get him to vote no more funds because this project can't possible be done right.


Posted by resident, a resident of another community
on Aug 11, 2011 at 4:41 pm

Senate Majority Leader Harry Reid said Wednesday that it would be "short-sighted" to abandon high speed rail ambitions in California, even as Democratic lawmakers here show signs of concern over the multi-billion dollar project.

This is the Senate Majority Leader. Boy, no wonder we have a mess in Washington. How can these lawmakers be so out of touch. Suddenly, Republicans are making more sense than the Democrats. Never thought I'd see the day.......


Posted by POGO, a resident of Woodside: other
on Aug 11, 2011 at 5:03 pm

Neither political party has an exclusive on making no sense.


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