http://almanacnews.com/print/story/print/2011/08/17/high-speed-rail-price-tag-rises-again


Almanac

News - August 17, 2011

High-speed rail price tag rises again

by Gennady Sheyner

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 a 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. State senators 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.

Sen. 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," she said.

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 accept public comments on the newly released EIR between Aug. 15 and Sept. 28.

Go to cahighspeedrail.ca.gov for more information.

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