Sunday, July 24, 2011

San Francisco's major newspaper becomes more critical of High-Speed Rail

This article comes from the front page of the  San Francisco Chronicle, Sunday, today.  Is it, as the headline says, the California HSR project's "moment of truth?"

Less than a year ago, The Chronicle wouldn't touch a critically written piece with a ten foot 'poll.'  San Francisco is dedicated to having this train and the Chron. reflected that.  But now, with a cascade of revelations of mismanagement and manipulation of the public by the rail authority in all the press all over the country, the Chron. has taken a far more critical posture itself and the editorial team is to be commended for that.  

We haven't had a lot of truth so far from the rail authority and we won't be getting any more in the future.  That's not how they operate.  They never state 'true facts'; they market whatever it is they are presently doing or intend to do.  They create a new taxonomy of phrases to justify their activities, especially of those that are in violation of the requirements of the authorizing legislation, AB3034, and Proposition 1A. 

I have interspersed some comments within this article, and I want to call your attention to the last quotation from Alain Enthoven, Emeritus Professor of Economics from the Stanford Business School.  

He sees the realities of this project "through a glass clearly."

"It's a huge risk and probably will lose a lot of money," he said. "In our current fiscal straits, both federal and state, we just don't have the money to spend on that, especially when we're cutting high-priority health and social services for poor kids and education. I'd hate to see cutbacks to universities, which are so important to our future economic growth and the welfare of society."

California's bullet train plans' moment of truth
Carolyn Lochhead, Chronicle Washington Bureau
Sunday, July 24, 2011

Washington --
California's futuristic plans for 220-mph bullet trains linking the Bay Area with Los Angeles and beyond are facing a moment of truth.

Prospects for a $19 billion federal infusion - covering more than 40 percent of a $43 billion system that would be the nation's largest single investment in transportation infrastructure in decades - dim each day as Washington scrambles madly for trillions of dollars in savings to raise the national debt ceiling. [The $43 billion cost projection is what the CHSRA says.  Their own numbers, however, total up to over $67 billion.]

If completed, California's system would be the first truly high-speed-rail network in the United States. Bullet trains would race down the San Joaquin Valley, linking Sacramento to San Diego and tying into the Peninsula that links San Francisco and San Jose.

More than $250 million has been spent so far, but the real money will kick in with the scheduled start of construction between Bakersfield and Fresno in 2012, which is estimated to cost $5.5 billion. [Actually, it's more than half a billion dollars that has already been spent.]

House Republicans want to kill the entire venture. They zeroed out all funds for high-speed rail in their budget and voted last week to redirect rail funds, including $368 million for California, to flood-control projects in Missouri.

Feasibility questioned
At the same time, a string of highly critical reports from outside panels have questioned the project's feasibility.

This month, a panel charged with reviewing the California project warned that it lacks a viable business plan and urged a reassessment of cost, ridership estimates, anticipated funding and risks before committing the state to billions of dollars that it does not have.

"Our plan is to move forward, but obviously we are keeping a very close watch on the situation in Washington," said Gil Duran, spokesman for Gov. Jerry Brown. "It's not something we can do alone."

Duran acknowledged that the federal commitment is part of a "very complicated picture with a lot of political battles putting pressure on our ability to move forward." But he emphasized that there is "no project, no issue, no department where there are not treacherous conditions right now as far as federal support is concerned due to the shenanigans in Washington."  [Of course, Gil Duran, go ahead and blame this disaster in the making on Washington.  Ignore the endless stream of critical reports about the CHSRA (an extension of the Governor's office) and its plans emanating from numerous State government agencies.]

Critics said it is time to pull the plug.

Future federal funding of the magnitude California is counting on is "a pipe dream," said Robert Poole, director of transportation policy for the libertarian Reason Foundation in Los Angeles. "That's just an astonishingly large amount of money given the federal budget deficit situation."

Poole noted that President Obama's call for a $53 billion, six-year investment in high-speed rail identified no funding source. [ That's not idle speculation or an opinion.  That's an empirical fact.]

Acknowledging that California's project is at risk, San Francisco Mayor Ed Lee joined the mayors of Los Angeles, San Jose, Sacramento and Fresno last month in a blistering defense of California's plans, saying no one knew in the 1950s where the money would come for the Interstate Highway System, but it was built nonetheless. [That claim is repeated frequently but is untrue.  The Federal Highway Trust Fund and other legislation were created expressly for this purpose. (See DOT documentation, below) And, it has military value at the time.]

The Federal-Aid Highway Act of 1956, coupled with the Highway Revenue Act of that same year, increased authorizations for the Federal-aid Primary and Secondary Systems, authorized significant funding of the Interstate System, and established the HTF as a mechanism for financing the accelerated highway program.67 To finance the increased authorizations, the Revenue Act increased some of the existing user taxes, established new ones, and provided that most of the revenues from these taxes should be credited to the HTF. Revenues accruing to the HTF were dedicated to the financing of Federal-aid highways. The passage of the Highway Revenue Act of 1956 also increased the political acceptability of the additions in the user taxes and provided earmarked revenues to finance the larger highway program.

"A project of this scale in the United States never gets 100 percent of its funding immediately," said Brian Stanke, co-founder and chairman of Californians for High Speed Rail, a nonprofit group that backs the plan. He cited the BART extension to San Jose, which is proceeding without full funding. "That's considered very normal and no one says the sky is falling."

$10 billion bond issue
State voters in 2008 approved a nearly $10 billion bond issue to build a high-speed rail system. The Obama administration is a big fan, allocating more than 40 percent of all available federal high-speed rail funding to California, more than any other state.

California has received $3.5 billion in federal money for its project from the 2009 stimulus and a large appropriation from the last Democratic-controlled Congress. It has also received a portion of federal high-speed-rail funds abandoned by Republican governors in Florida, Wisconsin and Ohio.

The system is counting on another $12 billion from private investors. But none have ponied up yet, partly because of uncertainty over federal funding. [That's not entirely correct either.  Private investors don't invest in money losing propositions such as this.  They want a tax-based government guarantee on a return for their investments.  We taxpayers would be on the hook, paying off the private loans forever.]

New cost estimates for the project are due to the Legislature in October.

Jeffrey Barker, deputy executive director of the California High-Speed Rail Authority, which is in charge of the project, said the project has plenty of funds on hand to start. "We're farther ahead already with our federal funding than we ever imagined we'd be," he said.  [Mostly untrue, Mr. Barker.  The initial expectation was roughly one third state, one third federal, one third private.  There was also some local funding anticipated. Those expectations no longer exist.  What Barker means is that the federal stimulus funding package was a surprise.  And, that is true.]

Supporters insist that California must build the project. The state is expected to add as many as 11 million more residents by 2025, reaching a population of 48 million.
[There is mounting evidence that this may not happen.]

 The alternatives to high-speed rail - more and expanded freeways, bigger airports and expansions of urban mass transit - will be just as costly, they argue. [Actually, they argue that these will be twice as costly, but, never mind.  If you don't build one, you must build the others - is a silly and fallacious argument.  We will build what we need to build for each of our transit modalities.  They are not inter-negating.] 

"For every two train tracks, one running north and one running south, you would have to widen a freeway by six lanes to carry the same amount of people," Barker said. "Imagine the impact that has on agricultural land, on cities, on sprawl. And still you're stranded in the Central Valley with no new transportation options."  [Since those highways already exist, their expansion impact will be negligible vs. HSR which will devastate all the property it runs through or near. No one is "stranded" in the Central Valley now.  Improved Amtrak and widened highways will improve transit in the CV without HSR. See below.]

But Rep. Devin Nunes, R-Alpaugh (Tulare County), has proposed legislation that would redirect rail money to improving Highway 99 between Sacramento and Bakersfield. Expanding Interstate 5 would also be a better investment, Reason Foundation's Poole argued, because it would be supported by gasoline tax revenues. [And that revenue source is not available for HSR, which is the central problem.]

'A huge risk'
Alain Enthoven, professor emeritus of public and private management at Stanford University and a critic of high-speed rail, predicted that the project will fail.

"It's a huge risk and probably will lose a lot of money," he said. "In our current fiscal straits, both federal and state, we just don't have the money to spend on that, especially when we're cutting high-priority health and social services for poor kids and education. I'd hate to see cutbacks to universities, which are so important to our future economic growth and the welfare of society."

E-mail Carolyn Lochhead at
This article appeared on page A - 1 of the San Francisco Chronicle

No comments: