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 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 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.

Comments

 +   Like this comment
Posted by Political Insider
a resident of Old Mountain View
on Aug 10, 2011 at 2:31 pm

Public projects like this are a huge waste of money because they fail the test of financial sustainability.

With the recent China disaster, proponents can no longer claim no deaths from HSR.


 +   Like this comment
Posted by Steve
a resident of Sylvan Park
on Aug 10, 2011 at 4:14 pm

First, the news that ridership estimates may have been exaggerated, now there likely will be cost overruns. It's reassuring to know that some things will always remain constant.


 +   Like this comment
Posted by Rodger
a resident of Sylvan Park
on Aug 10, 2011 at 5:42 pm

It's been clear for some time to many that this project was way oversold as far as riders were concerned and way under sold as far as cost were concerned. As time goes reality sets in and now it's clear to most people that the costs will end up at $80B or more and the money to build it will never happen. I have a little bit of disgust for the people that sold this project as a bond issue of around $9B. Let's cancel this project before any more money is wasted.


 +   Like this comment
Posted by iToldYouSo
a resident of Blossom Valley
on Aug 10, 2011 at 10:40 pm

not you specifically, but all my HSR-dreamer friends with visions of a 200mph bullet train connecting all parts of California. I told them before the election that the cost would be an order of magnitude more than the bond measure, the federal funds would not come through (or be much smaller than anticipated), the ridership projections were too rosy, the peninsula communities would file lawsuits to stop it and that a vote in favor of HSR was simply a vote for spending a few billion on environmental studies and lawsuits until we came to the realization we could not afford it. Looking more and more to be the case.


 +   Like this comment
Posted by Irony
a resident of Old Mountain View
on Aug 11, 2011 at 7:24 am

And let's not forget how much time, energy and money the Mountain View City Council wasted studying this bundle of lie.


 +   Like this comment
Posted by Hardin
a resident of Cuesta Park
on Aug 11, 2011 at 9:05 am

Though not in favor of HSR as a mass transit project, I do think that even a portion of the money that has been dedicated to it would be better invested in local mass transit projects.

Concentrated funds used for smaller/regional, lower risk projects that address local transit problems is the better way to go. By concentrating where we have a high density of people, cars, and businesses, we get more bang for the buck with mass transit improvements.

And not all this money should be spent on mass transit alone, but on the infrastructure that will promote mass transit adoption, like city planning that encourages the development of high density housing and businesses close to mass transit hubs, to allow people to live as locally as possible, and minimize the use of cars.

Let's remember that like it or not, the US is a culture based around the automobile. To change that culture is going to require steady investments that will transition us to a less car-centric society. The idea that a Hail-Mary effort like the HSR is going to solve our car problems is naive at best.

Of course this is all cart before the horse, California needs to get its fiscal house in order, before it even considers spending any large sums of money.


 +   Like this comment
Posted by Mike
a resident of another community
on Aug 11, 2011 at 7:36 pm

High speed rail is another expense that Congress will cut. Good riddance.


 +   Like this comment
Posted by InvestInYourFuture
a resident of Whisman Station
on Aug 24, 2011 at 3:26 pm

I am as hardcore of a car guy as they come: I own a high performance vehicle that I track regularly, am involved in a car club and I only buy manual transmissions. Essentially you will be hard pressed to find a more pro-car person than me. However, I cannot for the life of me comprehend people that are against investing more money in public transit. You think that the HSR costs are high? What are the comparable costs of maintaining and sustaining highways to support expected population growths?

HSR is not a luxury. It is not a pet project. It is a MUST-investment to bring California out of the 1800s when it comes to its rail system. To the detractors of HSR: Have you ever had the pleasure and convenience of using the french TGV as opposite to the nightmare of going to the airport? We are falling behind every major economy in terms of infrastructure investment: the Chinese, Japanese, Koreans, French and German have HSR... As oil price increases, we cannot afford to be left behind.


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