Tuesday, August 9, 2011

Mike Rosenberg of the Oakland Tribune and "InsideBayArea" about skyrocketing costs for HSR

A number of issues are converging. 1.) Suddenly released major cost increases.  2.) Information about how much damage the HSR project will impose on the Central Valley.  3.) Anticipation of total cost increases well beyond what anyone had been expecting. 4.) Greater clarity about the doubtful availability of future funding from this current Congress.

It's all bad news for the California High-Speed Rail Authority and it's synergistic.  The reason for that is that there has been a constant drum-beat of bad news from the rail authority for over a year. They have been castigated repeatedly by the Legislature.  Numerous state government agencies have criticized them with some frequency.

As we've said before, they are their own worst enemies.  They have lied to the public relentlessly. The rail authority withholds information until the last minute and people become instantaneously outraged.

They hire the most expensive public relations firm they can find and fire them months later for inadequate performance and gross over-billing.  Whatever can go wrong, the rail authority has done it.

Which brings us to this point.  Congress is currently in recess.  The Congress Representatives and Senators are at home, dealing with their constituencies.  Those from California, at least the Republicans, must be getting an earful about HSR.

Congress will reconvene in mid-September to take up the national budget, including the Transportation budget re-authorization.  How do you think high-speed rail will fare in these deliberations?

High-speed rail price tag soars again, this time on pace to surpass $60 billion
By Mike Rosenberg mrosenberg@mercurynews.com

Posted: 08/09/2011 07:29:25 AM PDT
Updated: 08/09/2011 07:12:37 PM PDT

For the second time since voters approved the Golden State's massive bullet train project, the state on Tuesday raised the total price tag for the first stretch by several billion dollars -- and now the cost for the entire rail line is on pace to skyrocket to an eye-popping $60 to $80 billion or even more.

The latest estimates put the cash-strapped state even further behind in bankrolling its biggest and one of its most polarizing public works plans ever, as California struggles to secure funds from shy investors and broke governments. Still, project officials are ramping up to spend billions of dollars to break ground on the rail line in the Central Valley next year and hope to find the rest of the money to pay for the system later. It's a plan state leaders look increasingly likely to veto.

"It could be well into $60 billion, and who knows where it ends. This is really very serious and needs to stop in its tracks," said state Sen. Alan Lowenthal, D-Long Beach, chair of the Senate committee overseeing the project. "We can't just be acting as if someone's out there giving us wheelbarrows full of money and it's just coming. This is not the way we should be operating."

The California High-Speed Rail Authority's new cost estimates released Tuesday show the initial stretch of construction between Merced and Bakersfield will cost $10 to $13.9 billion depending on how it's built. Project planners had previously pegged the section at $6.8 billion.

If the cost of the entire project balloons at the same pace as the Central Valley section, the San Francisco-to-Anaheim railroad would cost between $63 and $87 billion, similar to what independent analysts have been predicting. And those figures do not include inflation, which could push the final cost toward a staggering $100 billion

When California voters approved the project in 2008, the state said it would cost $33 billion, but it soared to $43 billion a year later -- already making it the single largest public works project in the nation. Even now, the state only has about one-fourth of the money needed to fund the entire rail line and no clear plan on how to secure the rest.

"It leaves what looks like a potential tremendous burden on the California taxpayer," said Assemblyman Jerry Hill, D-San Mateo, whose Peninsula district has led the chorus of boos for the project. "We can't double our debt obligations for the high-speed rail system. That would all be done at the expense of education, and health and human services, things that people (need)."

The updated cost of the entire railroad, which will run along the Caltrain tracks in the Bay Area, won't be released until October. Planners will only say for now that the entire project will get more expensive.

Rail authority spokeswoman Rachel Wall attributed the spiraling costs to more bridges and other structures called for in newly detailed engineering plans. They've also refined the cost of buying property along the way.

So with the rest of the project undergoing similar engineering analysis, what's to stop the cost of the entire railroad from soaring at the same rate?

"I think that speculation will occur between now and October but it'd be premature to make those speculations without looking at all the variables," Wall said. "Infrastructure costing is very complex."

Elizabeth Alexis, co-founder of Palo Alto-based Californians Advocating Responsible Rail Design, tore through the rail authority's detailed engineering figures months ago and predicted the cost increase almost perfectly. The independent group, which has been following the project closely, expects the final tab to climb tens of billions of dollars once the detailed engineering is done, echoing projections from the state's Legislative Analyst's Office and the Legislature's transportation experts.

"Whether its ridership numbers, cost estimates, what have you, every time (the rail authority) comes up with a new number, they say now it's going to be a credible number," Alexis said. "It's getting a bit old. We're quite frankly quite disturbed that they wouldn't let anyone else in on the joke."

In coming months and perhaps into next year, the Legislature will consider a bill to send the project back to voters because of the continuous changes. Republicans in Sacramento and Washington have been pushing to kill the project for the past year but now a growing number of state Democrats do not want the plan to move forward without major changes.

Gov. Jerry Brown's office declined to comment Tuesday. But those who have talked to Brown -- once an ardent supporter of the plan -- say he is now torn on the project as he struggles to balance California's financial books. Brown has been meeting with project leaders lately and his wife is rumored to be involved in the discussions, too.

California has less than $13 billion in state bonds and federal grants for the project, and critics doubt the state will raise enough money even if the project's price tag stays the same

The state also faces lawsuits from Peninsula and Southern California towns to block the project, while Kings County in the Central Valley is so fed up that it has asked federal officials to intervene.
The rail authority will spend more than $6 billion to start building near Fresno by September 2012. If all goes to plan, the full 520-mile rail line would be up and running by 2020.

"(Tuesday's cost hike) doesn't take the wind out of my sails because I'm looking to the next generation and beyond," said Quentin Kopp, the retired long-time chair of the rail authority's board. "It of course enables critics to denounce the project again. Certainly it bothers me. It alarms me."

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