Wednesday, April 13, 2011

Mismanagement of High-Speed Rail Funds at the Federal Level

". . .the administration has been cloudy in its funding decisions.”

“The rationale for the administration’s awards of billions of dollars under a failed high-speed rail program remains shrouded in mystery,”

Well, that sums it up pretty well.  How were the ARRA stimulus funds awards distributed?  Why did California receive so much?  We can easily guess at the reasons for this "cloudy mystery."

We've covered this topic previously.  In the article below, we read that the Government Accountability Office has taken the FRA to task for mismanaging the award process for high-speed rail.  No surprise there.  

Before those $8 billion in ARRA Stimulus funds became available, the FRA was mostly regulatory in its operations and, needless to say, spent most of their time on freight rail issues.  I say that because passenger rail operations in the US -- mostly Amtrak -- are not a very big part of US railroading.

Anyhow, along come these $8 billion and the job is assigned to the FRA, which, never having done so,  is ill-equipped to conduct an award process.

It now shows.  In government, you pretty much do what you're told, and Szabo, chief FRA Administrator, probably did the best that he could with this assignment.

Szabo's problem was compounded by the fact that this entire federal high-speed rail exercise is far less about trains than it is about political pork and distributing these earmark dollars to "worthy" recipients in "deserving" states and congressional districts. And that's why it's clouded or shrouded in mystery!

Did I mention that Szabo is from Illinois, also home of Obama, Rahm Emanuel (who was responsible for sticking the $8 billion for HSR into the legislation at the last minute), and Ray LaHood, the Secretary of the Department of Transportation?  And that Illinois continues to receive funding for what they are calling HSR, but it really isn't HSR (it's less than a 100 mph train)?

As everyone knows by now, the California High-Speed Rail Authority has been beset by mismanagement from the beginning. They are continuously being criticized and reprimanded by overseeing state government agencies for failure to perform as required. 

All of which is to say that the track-record of high-speed rail in the United States is a sorry affair at every level.  The program is an invitation for "waste, fraud and abuse."  

It is clear that the Republicans are absolutely correct to shut this program down as much as they are able, regardless of their underlying reasons.

It looks like the FY2011 budget -- the last six months of it -- will eliminate HSR funding.  Unfortunately, the Republicans have not yet approached the California project by "clawing-back" or demanding a "rescission" of the existing awards made to the CHSRA.  That's what should be happening. 
Government   4/12/2011

House transportation committee members criticize Obama's stimulus grant selection process

On Monday, House Committee on Transportation and Infrastructure leaders John Mica (R-Fla.), John Duncan Jr. (R-Tenn.) and Bill Shuster (R-Pa.) called for greater transparency in the Obama administration’s process for awarding stimulus funds for high-speed and intercity passenger-rail projects and TIGER grants.

The congressmen’s comments followed the Monday release of two Government Accountability Office (GAO) reports, which concluded that the U.S. Department of Transportation (USDOT) and Federal Railroad Administration (FRA) could improve their processes for awarding grants by providing better documentation of each agencies’ decision-making.

Both reports found insufficient documentation for USDOT’s and FRA’s selections of rail projects for $8 billion in stimulus funding and $1.5 billion in Transportation Investment Generating Economic Recovery (TIGER) grants.

“The rationale for the administration’s awards of billions of dollars under a failed high-speed rail program remains shrouded in mystery,” said Mica, who chairs the transportation committee, in a prepared statement. “Billions of dollars in rejected grants have been returned by recipient states, and it is critical that there be transparency for why these projects were selected in the first place and why any future projects will be selected.”

Duncan, who chairs the House Highways and Transit Subcommittee, called on the administration, USDOT and FRA to be more open about the TIGER grant selection process.

“GAO found that the administration’s project selections for $1.5 billion TIGER stimulus grants also lacked transparency and now the president is asking for $2 billion more,” Duncan said, referring to the president’s 2012 budget proposal. “We should be given a full accounting of how stimulus funds were allocated.”

Shuster, who chairs the House Railroads Pipelines and Hazardous Materials Subcommittee, echoed those sentiments.

“We are under considerable budgetary pressure to cut spending and do more with fewer dollars,” he said. “On high-speed rail funding, the GAO report correctly suggests that the administration has been cloudy in its funding decisions.”