Sunday, November 6, 2011

Start the High-Speed Rail Project over? It should never have started at all.

Well, I agree with half of the recommendations captured in the headline of the article, below.  Yes, by all means dismantle the grossly incompetent, highly politicized CHSRA Board, and dismiss the entire staff while you're at it.  Great start. 

But, "start over"?  Not so much.

By now, there are far more articles hostile to the rail authority than are for it.  And, there seem to be far more such articles on both sides of the argument.  That, alone, is amazing, given the dramatic turn-around. 

And what they are saying, more or less, is that with this new, so-called, business plan (why a business plan?  It's not a business.) it has become totally clear and unambiguous that this is a doomed project. That is to say, that by their own admission, this project cannot be made to work in the real world.  It began as a dream, concept and "vision" and as such was vague, elusive, and mostly promotional rhetoric; a two-dimensional picture, like a stage set. More than one article has rejected calling this business plan as such, calling it a marketing or promotional document, full of advocacy rhetoric.

But as reality and the numbers have come forward with frequent iterations, the CHSRA project certainly looks like the impossible dream.  The costs have gone sky-high and everyone now knows that whatever number they give us now -- $100 billion -- is not the end.  They will need much more beyond that.  

At the same time, the rail authority admits that it will not get even a fraction of that money in the near future and is merely hoping that the federal government and the private sector will become more generous later this or the next decade. Even so, they acknowledge the scant likelihood of this happening. Now is the time to ask, why go on?

Then there are those pesky ridership numbers which are bent, pushed and remolded over and over, like Play-Dough.  This time they provide us with three versions, low, middle and high, none plausible. And ticket prices are also fluctuating like the stock-market.  Nothing here is real. All is fabricated in order to convince California that "the show much go on."  And, this while the audience is fleeing the theatre, so to speak.

The rail authority, and the micro-managing FRA, are constructing route plans and construction start sites that make no HSR sense whatsoever for California. The planning is a political exercise, not a railroad one. We, the people of California, are regarded as a blank Sim-City screen, to be shaped and molded as if the terrain is completely blank. 

The intent is to build the first sections on the cheap in order to get their feet on the ground.  That plan has already left the station since even these early 130 miles of bare, electric-less tracks-to-be will cost far more than they intended.  And, rest assured, prices will continue to spike upward.

Now, the major impetus comes from the Governor pushing this project, the consequence of his having put two new advocates on the Board who are responsible for all these changes.  So now Jerry Brown is stuck with it, despite everyone knowing that this will be an immense financial burden for a state that can ill afford it.  The Governor is in the unenviable position of having to slash school spending (in a state that is near the bottom of school performance in the US) while continuing to support what is broadly perceived as a major, useless boondoggle.

The best news from all this, (or the worst, depending on your viewpoint), pertains to the per-mile costs, a metric that can be universally applied.  The California estimate is now up to as much as $145 million per mile that, the article tells us, is three times as much as rail construction in Europe.  This discrepancy reflects the American penchant for getting all the bells and whistles on any project. Parsimony is so un-American.  I strongly suspect that $145 million per mile is not the final figure.  Wait until they get into the mountains north and south of the Central Valley.  Oh, wait; they don't have the money to go beyond the 130 meager miles in the Valley. The rail authority acknowledges that they may never get beyond those 130 miles of $145 million per mile tracks, usable only by Amtrak.  (So, why even start?)

Finally, the argument made in the article concludes that it is (only) the rail authority that is at fault; that all the problems of this impending high-speed rail project disaster can be laid at their feet.  While that may be true, it doesn't go far enough. The basic need for such a train to be built by anyone, good or bad,  has not been demonstrated other than by the hucksters who so aggressively promote this train for their own personal opportunities and benefits.

Of all the problems and needs within this state and within the United States, moving people around swiftly on rail between cities hasn't been on anyone's priority list.  The rail industry -- to be the biggest benefactor of this exercise -- would have us believe this is the most critical project in the state's history, and the industry has the political cronys to promote this as a new and important government project. And this, while our existing infrastructure repair, maintenance and upgrade needs are so vast, apparent and neglected.

This project is one element symptomatic of a world turned upside down.

Viewpoints: Dismantle High-Speed Rail Authority and start over
Special to The Bee

For my organization and others who hoped to see a California high-speed rail line built in the next decade, the High-Speed Rail Authority has been a great disappointment. Instead of delivering a fundable plan with private industry support, clear benefits and low risk, the agency intends to break its promises to taxpayers and gamble $98 billion on a political pork barrel no private investors will touch.

Why not acknowledge California's fiscal constraints and propose something realistic?

For example, it should cost only $7 billion to fill the Bakersfield-to-San Fernando gap in California's rail network, but the agency doesn't want to do anything that simple. Despite $12 billion in resources, the High-Speed Rail Authority proposes to begin only a Bakersfield-to-Chowchilla line, which it admits cannot generate any revenue.

The "new and improved" business plan still fails to answer legislative critics who have been asking the authority for three years how it would find private funds for an operable segment. Even more seriously, there is a threat that the authority will try to press ahead with construction of a vastly overpriced line with the public bearing all the risk.

A successful California plan would efficiently connect areas of high population while avoiding high-speed running through populated areas. The agency has failed to achieve either of these goals and stirs up trouble wherever it goes. The agency's obtuse idea to invade cities with 125-mph to 220-mph elevated trains lowered property values and made powerful enemies statewide. Its insensitivity to locals managed to unite venture capitalists on the San Francisco Peninsula, Latinos in Los Angeles and Kern counties, farmers in the Central Valley and anti-tax activists in opposition.

The High-Speed Rail Authority has spent more than $800 million of public funding over the past 14 years and hasn't produced a single mile of service or lined up a single private investor. The agency has set back the cause of high-speed rail nationally, and made itself a poster child for government incompetence.

Gov. Jerry Brown's unquestioning support of the destructive agency, upon release of its new plan, may be the final fatal blow to the controversial project. The $98 billion price tag for the project ballooned 300 percent from the $32 billion promised voters in 2008, and reveals that the governor's new team never reined in the engineers. Most of the price escalation was not increased unit costs, but new capital added in the past two years, including $14 billion in new elevated structures and $10 billion in tunnels since the 2009 business plan.

Costs per mile for the basic Bay Area to Los Angeles line are now $125 million to $145 million, triple typical European costs. Why is Europe so much cheaper? Tracks there are built on solid ground for safety reasons, with less than 2 percent of track mileage elevated. Another difference is that European operators and financial backers demand cost-effective projects. Here, magical thinking seems to have trumped sharp-eyed financial analysis.

Brown has promised a reform, and his team claims that the new plan is based on a new model and more conservative ridership assumptions. Sadly, this is not the case. For example, the starter line between Merced and San Fernando cited by the business plan as the most feasible option depends upon attracting more daily boardings in Merced (14,400) than Amtrak has in New York City. That doesn't seem possible or conservative. Merced traffic also constitutes three-quarters of all Central Valley ridership on that alternative, a clear signal that the ridership model is still broken.

The agency itself admits that neither Eurostar, nor the Paris-Belgium Thalys, nor Spain's Madrid-Seville AVE produced more than 7 million annual trips within a decade despite serving European capitals. Actual 10th-year increases in French traffic produced by high-speed rail were 5.3 million annual rides on TGV-Southeast and 6.7 million on TGV-Atlantique, due to pre-existing traffic.

Compared with five European startups ranging from 5.3 million to 7 million new rides after a decade, the High-Speed Rail Authority's 10th-year projection of 100 million new rides is flatly ridiculous.

The California Rail Foundation fervently believes high-speed rail must be part of California's future. We are equally convinced that the High-Speed Rail Authority is incapable of delivering a viable project. The time has come to shut down this agency and seek competitive proposals from private industry.

Instead of letting bureaucrats design a fantasy project based on a wish for $98 billion, a better formula, one followed by Texas and Florida, is to ask successful high-speed rail operating companies to demonstrate what could be built, matching the existing $12 billion of public funding with private capital.

Railroad operating companies are much more capable than public agencies of convincing banks and investors that their projects are financially sound. The project might not be so vast as what is currently proposed, but it is far likelier to actually provide service within our lifetimes.

© Copyright The Sacramento Bee. All rights reserved.

Richard Tolmach, president of the California Rail Foundation, has had a 35-year career in passenger rail, including service development, startup planning and marketing for the three Amtrak California corridors.
Read more articles by Richard Tolmach

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