Wednesday, January 4, 2012

When it comes to High-Speed Rail, the Democrats are doing the wrong thing.

This is one of several dozen articles in papers around California and across the nation.  They all picked up on the CHSRA peer review committee report calling for HSR termination in California due to the lack of a funding plan.  That's an oversimplified explanation but it gets the gist right. The review panel recommended no further funding from the state legislature, which controls the rail authority's purse. The report criticized the rail authority's business and financial plans as inadequate to continue to pour more money into an open-ended project.

I'm bringing you one example of all these articles, below, because we have come to a split on the path to HSR construction beginning in our state either during the end of 2012 or beginning of 2013.  I'll explain.

But first, I should comment that this review panel, which the legislation required to be formed immediately, took several years to assemble and make functional.  And this panel is still not fully constituted, being shy two members.  

Their job is oversight and reporting to the Legislature. An earlier report from this group was also highly critical.  At first, the CHSRA Board attempted to co-op this group to serve their own purposes.  That effort, obviously, failed.  And now, the peer review group has agreed with several earlier reports from the State Legislative Analysts' Office that the project should be shut down.

As you know, this HSR project falls pretty much along Party lines; the Dems. want it; the Repubs. don't.  They each have their rationale for their positions.  Neither side has much of an interest in the fact that this would be a super-expensive luxury train for the affluent, if indeed it is ever built, or that it will be financial burden on the state forever, or that there is no way in hell it can ever be paid for.  

Neither side cares a lot about transit problems and how to solve them, since this train is not considered so much a part of the state's transportation and transit problems and possible solutions. Those have not been studied or published in reports other than the promotional verbiage that emanates from HSR beneficiaries.  

Sidebar comment: Did you know that Siemens, a leading HSR manufacturer in Germany, has sponsored a number of reports about how critical HSR is to our economy? A much quoted US Mayors' Conference Report was bought and paid for by Siemens. Aren't you as shocked to learn this as I am?  You don't suppose that Siemens considers the US a potential market for its products, do you?

The project continues to be not much more than a marketing sales package, pushed by the CHSRA on the consumer market of California citizens who have now made it clear that they don't want this train or the costs associated with it. 

So, what's this all about and why are we at a crossroads?  Because even though this California project has been roundly analyzed and criticized for a number of years by a number of professionals and government agencies, the push to make it happen continues relentlessly from Governor Jerry Brown and from the State Legislature. The facts are not going to get in their way. 

You would think that, given all this adverse information, it would be in the public interest to pull the plug and stop the money hemorrhaging.  But, no, the Governor and Legislature have their eyes on one goal, and one goal only, the nearly $4 billion in free money from the FRA that has been promised to the CHSRA if they start construction in the Central Valley next year. 

Actually, given than most of this funding comes from the ARRA stimulus fund legislation, shouldn't there be a much greater hurry to spend these dollars to create jobs and stimulate the economy?  Apparently, that's not the case.  "Jobs" are only the rhetorical package in which these dollars have been wrapped. 

All of which is to say that the Governor and Legislature's eagerness for this multi-billion political pork package over-rides any and all other considerations.  They have chosen their path and will continue with a hugely misbegotten project that rationally should have never been put on the ballot in the first place.

Now would have been the time for the Legislature and Governor to say, we appointed this peer review committee to tell us the truth.  They did and we must listen.  We choose to terminate this project.  Instead, they are plowing ahead in pursuit of the federal dollars available with disparaging and dismissive words for THEIR review panel. 

Our elected Democratic officials, both national and state, will harbor no facts, no truths, no reason in their pursuit of these dollars.  They believe that their political careers are riding upon them. 

The fact that it is now obvious to everyone that this project is a fraud and a scam; that it cannot be paid for and will not be paid for; that it will be profoundly harmful to the Central Valley. . . . .is immaterial to our Governor and our Democratic elected officials. 

I consider it a tragic choice.

High-speed rail shouldn't be funded, report says
Wyatt Buchanan, Chronicle Sacramento Bureau
Wednesday, January 4, 2012

Sacramento --
The Legislature should refuse to authorize billions of dollars in bond spending for the first phase of California's high-speed rail project, a peer review group advising lawmakers on the rail plan concluded in a report Tuesday.

The group, commissioned under Proposition 1A to analyze for lawmakers the feasibility of building and financing the bullet train system that would connect Northern and Southern California, reiterated concerns it and others have raised about the nearly $100 billion project, including inadequate future funding.

The report recommends the Legislature not approve about $2.7 billion in bond funds, which would be matched by about $3.5 billion in federal dollars to begin building the first phase of the project in the Central Valley. Those federal dollars are contingent on that phase being finished by late 2017.

"We cannot overemphasize the fact that moving ahead on the (high-speed rail) without credible sources of adequate funding, without a definitive business model, without a strategy to maximize the independent utility and value to the state, and without the appropriate management resources, represents an immense financial risk on the part of the state of California," wrote Will Kempton, chairman of the California High-Speed Rail Peer Review Group.

Kempton is the former director of Caltrans and now leads the Orange County Transportation Authority.

Officials at the California High-Speed Rail Authority had strong negative reactions to the report, calling it a "narrow, inaccurate and superficial assessment" in a letter to lawmakers responding to the peer review.

Thomas Umberg, chairman of the rail authority board, said, "What is most unfortunate about this report is not its analytical deficiency, but that it would create a cloud over the program that threatens not only federal support but also the confidence of the private sector necessary for them to invest their dollars."

Budget question
It's not clear whether Gov. Jerry Brown will include funding in his next budget proposal for the initial stretch of track, an approximately 130-mile section from Fresno to Bakersfield. The governor is expected to release his spending plan next week. He could request the Legislature to approve the funding prior to the budget deadline of June 30, but delays into future years could put the federal funding in jeopardy.

During an end-of-the-year interview with reporters last week, Brown strongly defended the state moving forward with high-speed rail.

"I believe California is a leader. It's a leader in energy. It's a leader in medical research. It's a leader in venture capital and I'd also like to see it be the leader in high speed rail," he said. The governor went on to say, "Spain, China, Japan, France, Germany - all these countries can afford it. California, I believe, can."

Brown's spokesman, Gil Duran, said in a statement Tuesday, "The peer review report will be evaluated by the Legislature, but it does not appear to add any arguments that are new or compelling enough to suggest a change in course."

Lawmakers, who reconvene today for their annual session, will hold hearings on the high-speed rail plan over the next few months.

Robin Swanson, spokeswoman for Assembly Speaker John Pérez, D-Los Angeles, said the report was not a "game changer" in terms of whether the Legislature would approve funding for high-speed rail, but said the report would receive appropriate consideration.

"It doesn't seem to raise any new questions, but they're all valid questions that deserve to be vetted out," Swanson said.

Business plan
The peer review group raised a number of concerns, but the most significant were about how the project ultimately would be paid for and the lack of a final business plan that includes things like ridership and timing of construction for phases of the project. State voters approved nearly $10 billion in bond funding in 2008 for the project and estimates for the total cost have continued to increase, more than doubling to a current estimate of nearly $100 billion.

The federal government has dedicated $3.5 billion to the project, but the remainder has yet to be secured.

State Sen. Doug LaMalfa, R-Richvale (Butte County), has been an outspoken critic of the project and its escalating costs. He said he would submit a bill for consideration today to have another public vote on the plan, given its increased cost and more specific details on the route and other parts of the project.

He called the peer review group's report a "devastating blow" to the project and predicted that the Legislature would not fund it this year.

"I think the Legislature would see such a backlash from angry constituents around the state if they continue to push forward with spending on this," LaMalfa said.

E-mail Wyatt Buchanan at

1 comment:

TunnelTalk said...

Peer review critical of California's HSR plan @