Tuesday, June 7, 2011

High-Speed Rail in California; A Politician's Dream

This is about California state politics and the high-speed rail project. Tim Cavanough gets most of this right.  I'm a fan of sarcasm so he's talking to me. It's a good read and helps to understand the realities behind this or that route and about the money.  It's about the money; where it's going to come from, or not.  How it's going to get spent, or not.

California HSR has some unique features.  The state voters passed a bond issue in '08 that provides $9 billion in muni bond funds for the train if matched by other funds. Also, with Florida out of the picture, California remains the last "hope" for a 200 mph train in the US. Couple that with the $3 billion coming from the ARRA Stimulus funds and other DOT sources for this project -- to be matched by the bond money -- and the California rail authority has around $6 billion to pour into this project.

That means, they intend to lay track in Central Valley farm land for about 100 miles. The FRA requires them to do that in order to get their money.  It's not the middle of 'nowhere.' However it is in a low population region of California, mostly agricultural land. Why is this a problem? There is no further funding in sight. Not federal, not private investment.  The state is in debt up to its ears.  Why in hell would you start such a project?  They are supposed to build it so it's useful given that it may not be completed.  Amtrak doesn't need it; they can't run high-speed trains on it, so what's it for? Useful by whom?

Doesn't matter.  This is not a game of railroads; it's a game of politics; that is, getting and spending federal and state dollars.  Those who control the money, have lots of friends thereby. It gets people elected or re-elected. It provides endless first class junkets.  It's enormously useful for exchanging "favors."  The waste, fraud and abuse as well as outright corruption potential factor is very high; the temptations with billions of dollars at stake can hardly be measured. 

There are a number of issues hanging in the air; legality is one of them.  Will everything that's done be legal?  A lot of people (including me) don't think so. There will be lawsuits.  There will be protest marches and rallies opposing all the HSR shenanigans.

One big factor will be the "subsidy" issues discussed in the article.  The rail authority will wiggle around somehow to get out from under that constraint. They are building a train that can't and won't operate without subsidies.  Lawyers will get involved.  Therefore, they shouldn't start.  So, it's already a big problem right out of the box.

Most of my neighbors and colleagues, perhaps not as cynical as I, still believe that things can be negotiated, accommodated, and worked out with the rail authority "so that nobody gets hurt!"  Fuggedaboudit!  My neighbors don't appreciate the ruthless determination of those seeking the control of billions of dollars.  

I'm not advocating blood in the streets, but in order to stop this reckless and feckless train wreck, there must be far more confrontation and the will, even to the point of civil disobedience, to terminate this project.  When push comes to shove hasn't happened yet; but it will.

I'll give you one, admittedly unlikely, thing that can happen.  Each and every village, town and city through which the train intends to pass CAN prevent that from happening. They only have to vote, agree and resolve. That, of course, requires that all these population centers really understand what they are in for, and it ain't pretty. Many still don't.  Many are managed by politicians who see great personal reward in this project.  And that's a pity.
High-Speed Rail: Dead and Loving It
Tim Cavanaugh | June 7, 2011

All of California owes a debt to Fiona Ma. The San Francisco-based speaker of the State Assembly, an implacable foe of rubber ducks and recorded music, has scored an unintentional victory as one of the major authors of Proposition 1A, the state’s 2008 high-speed rail bond initiative. Thanks to the wording of the law, the California High Speed Rail project now may die a quiet death. 

Last Wednesday, the California Senate voted to place the California High Speed Rail Authority (CHSRA, which is currently a standalone agency) under the authority of the state’s Business, Transportation and Housing Agency. On Friday, the state Assembly passed a bill that would demote the CHSRA to an “advisory body” while shifting control of the project to a “Department of High-Speed Trains.” 

The creation of a brand new bureaucracy is ominous. But these complementary legislative moves, by a Democratic legislature under a Democratic governor, have all the characteristics of a face-saving admission that the Golden State’s high-speed rail project – the last best hope of President Obama and Transportation Secretary Ray Lahood – is either dead or in a persistent vegetative state. 

Some move like this was inevitable after last month’s report by the non-partisan Legislative Analyst’s Office, which laid out the project’s failings in such excruciating detail that at the time I called it the death of the U.S. high speed rail project. 

Clearly, the high speed rail hope isn’t quite dead yet. But the California plan, which would have seen a “train to nowhere” begin construction next year between the remote Central Valley towns of Corcoran and Borden, is in dire condition. The Corcoran-Borden route was selected by the Federal Rail Authority specifically for the relative ease with which the state could roll over rusticated local landowners who lack the resources to mount a challenge like the one that has emerged on the wealthy San Francisco peninsula. 

That isn’t working out, however, as locals along the Corcoran-Borden alignment balk at the prospect of a 150mph public transit option chugging through their almond groves. While legal challenges may not be successful, they would delay a project on which both D.C. and Sacramento had been hoping to break ground in 2012. Federal funding for the project was originally contingent on the state’s having construction underway by September of next year. That condition was nixed when California agreed to the train-to-nowhere alignment, but the feds are still in danger of missing a 2017 deadline for spending ARRA Stimulus funds. 

There’s another wrinkle. The legislature has so far gone along with the Legislative Analyst’s recommendations, and those recommendations include scrapping Corcoran-Borden altogether, which would mean the September 2012 deadline waiver goes away too. A new deal can always be struck with the federal government, but it’s unlikely to be struck quickly. 

As if that’s not enough, it turns out we won’t always have Palmdale. The original plan was for the southern leg of the HSR alignment to follow the general route of Interstate 5, but a few years ago that plan was scrapped in favor of a track going through the Mojave Desert and the Antelope Valley into Sylmar. (Sorry for the geography dump.) Now the route may be switched back to the “Grapevine” again, after a report has shown that the Antelope Valley route would require rebuilding of the California Aqueduct and/or altering a dam. 

These logistical hurdles are small potatoes, however, compared to the grueling government competition known as Da Coughing Up of Da Funds. Although California voters approved $9.9 billion in new transportation bond debt in 2008, the bond funds can’t be used for operation of the railroad, only construction. There is no credible plan for Corcoran-Borden to be a self-sufficient line. For that matter, there is no credible plan for the entire San Francisco-Sacramento-San-Diego high speed network to be self-sufficient. But even my old buddies at the L.A. Times editorial board have conceded that ridership on the train-to-nowhere leg would be “slight.” 

And it may turn out that bond funds will not be available – legally at any rate – even to build the train. Which brings us back to our debt to Fiona Ma and her Prop 1a co-authors. In the high speed rail initiative [pdf] that voters approved, Section 2704.08.(c)(2)(J) requires the plan to certify that "the planned passenger service by the authority in the corridor or usable segment thereof will not require a local, state, or federal operating subsidy." 

Even more directly, subsection (d)(2)(D) orders: "Prior to committing any proceeds of bonds...the authority shall have approved and concurrently submitted...a report or reports...indicating that...the planned passenger train service to be provided by the authority, or pursuant to its authority, will not require operating subsidy."

California will continue to trickle away general fund money on high speed rail. Since the HSR initiative got underway in 1996, the Golden State has managed to disappear a quarter of a billion dollars without laying any track. In a floor speech, Assemblywoman Diane L. Harkey (R-Dana Point) argues that even the new bureaucratic deep freeze is too good a fate for the misguided HSR project, while the serene Ma fails to keep order in the people’s chamber.

Still, better a trickle of wasted money than a torrent. Right now it is probable Californians will be spared a massive new debt issuance for a few years. And all Americans may be spared having to "invest" a few billion dollars for a train that now looks unlikely to be built.

Update: Forget everything I said. The mayors of Los Angeles, San Jose, San Francisco, Sacramento and Fresno write in a joint letter that the "second guessing" has to stop: "California and the United States need high-speed rail, so let's keep going." Who can argue with logic like that?