Tuesday, April 3, 2012

California High-Speed Rail defines "Waste, Fraud and Abuse;" that is, corruption on a grand scale.

Do I have to say it again? The California high-speed rail project is fraudulent to its very core. 

It's a scam; a flim-flam on the voters.  The latest version of their business plan has almost nothing to do with what the voters were asked to vote for -- and did -- in 2008. Some journalists use the phrase "bait-and-switch."

The levels of dishonesty and lying are staggering. Every paper in the country is repeating the new business plan claim that the prior $100 billion cost has been reduced to 68 billion, or a $30 billion reduction. That's a lie.  Even the business plan toward the end,  includes something almost like the former cost. 

The so-called reduction comes from not building high-speed rail north and south of the Central Valley.  There are many disguising euphemisms for what what's going on.  The "bookends" will now be "blended systems" rather that HSR having dedicated tracks all it's own. 

It's something like buying what you believe is a luxury car for $30,000. and upon signing the contract, the dealer tells you that the real price of the car has tripled to $90,000 and that it will be a stripped-down model with a entry-level engine.  But, he tells you that car improvements will be bolted on over the life of the car.  When you complain, he says, OK I'll reduce the cost by $30,000. What he means is that he will now give you $30,000 dollars' worth of bolt-on upgrades less.  You're being flim-flammed. 

Isn't that against the law? Car dealerships that conduct their business this way are shut down. 

Also, there's a money grab to upgrade commuter rail in both the Bay Area and in the LA Basin.  That's being called "early or initial investment."  What that actually is will be to extract more bond funds from the Proposition 1A bond reserve for regional commuter rail. That, since it's not actually for high-speed rail, may not be legal.  

In many ways, none of what this business plan is offering us is legal.

In order to obtain the awarded funds from the FRA, $3.5 billion worth, they will start construction in the Central Valley and not connect to rail systems at both ends, north to the Bay Area and south into Los Angeles.  Although the new business plan will bring them closer to LA.  It's another scam. The Central Valley rail is just laying rail, not usable by high-speed trains.  

In short, as Quentin Kopp, former HSR advocate now says, this is not high-speed rail and it's not legal use of Prop. 1A funds.

The Governor, who's morality should now be in question, wants to deploy cap-and-trade funds, not yet generated, under the new law in California. That's also probably illegal since those funds aren't intended for infrastructure projects like HSR. 

As we've said with great regularity, this entire project is not actually about building anything; that is, whatever they build will be OK. It doesn't have to be completed and it doesn't have to operate.What matters is an ongoing project that will drain funds from any source, but preferably the reliable big-spender federal government. 

The point is just to get construction going and call it "building a high-speed rail system." That can go on forever. And, that will satisfy the Unions which have been pouring funds into various Democratic campaign chests to keep support going for this boondoggle.  After all, it's about the flow of money, regardless of the source, and as much as possible, regardless of the legalities. 

As we've pointed out, terms like "Initial Operating Section" are further euphemisms that mean they are not actually building a high-speed rail system, they are merely laying the "foundation" for one. How's that for bait-and-switch?

So, the train won't be able to run the required 2:40 from LA to SF; it will take more like 5 hours. It will carry far fewer passengers than promised; that's the ridership issue.  The tickets will cost $200 or more, how can they not?  The train will lose millions annually for its operations, if indeed it ever does become operational.  And, most of us won't see the operation of the train in our lifetimes.  Yes, most of us. 

What the rail authority is telling us are lies, lies, lies!!!

Published: April 2, 2012 Updated: April 3, 2012 11:58 a.m.

High speed rail's new math: $30 billion less for a train to L.A.


The California High-Speed Rail Authority on Monday unveiled a new business plan slashing $30 billion from the price tag for connecting Anaheim and San Francisco.

And retreating from a series of political missteps, the authority also vowed to connect its initial segment between Bakersfield and Fresno – the so-called "Train to Nowhere" – to the San Fernando Valley within the decade.

Just five months ago the authority was saying it would spend $98 billion to build a 220-mph train that would begin full operations around 2033.

Gov. Jerry Brown installed a new chairman, Dan Richard, after that November 2011 business plan generated a storm of criticism. Chairman Tom Umberg, a former Orange County legislator, and Chief Executive officer Roelof Van Ark, both stepped down to make way for Brown's team.

Now the commission hopes to build a high-speed link between Los Angeles and Merced, with medium-speed links to the north, in about a decade and full high-speed service by 2028. Cost: $68.4 billion to $79.7 billion.

The big savings would come in the L.A. Basin and on the San Francisco Peninsula, where the authority would help finance improvements to make existing commuter rail lines "high speed rail ready." Those improvements would come years, perhaps a decade or more, before high-speed trains do.

Take the Peninsula: The authority has been locked in litigation for years with Peninsula community groups over its plans to punch four high-speed rail tracks from San Jose to San Francisco.

Now it is saying it needs just two tracks within the existing CalTrain commuter-rail alignment. It will help pay for improvements to CalTrain quickly, rather than wait for inflation to boost costs. And high-speed rail passengers will ride on CalTrain between San Francisco and San Jose until the high-speed line is completed.

The compromise solves political and financial problems but may open entirely new financial and legal problems.
Richard Tolmach of the California Rail Foundation, a longtime critic of the authority, said he can't figure out how the agency shaved 30 percent off its costs.

The November 2011 business plan – much criticized for its $98 billion cost – clearly laid out the sources for its numbers, Tolmach said. Not this plan.

"This time, more than last time, (the plan) is a sales job," Tolmach said. "It doesn't have actual facts, but it must have 20 pictures of (rail) boosters and parades."

For example, experts estimate it will cost $1 billion per year to operate the train. The new plan estimates it will cost no more than $573 million -- $70 million less than the authority projected in November. It's unclear how this savings occurred.

Meanwhile retired Judge Quentin Kopp, former chair of the authority and, as a state senator, co-author of the bill creating the first high-speed rail study, branded the new plan "the great train robbery."

Transit advocates in Los Angeles and on the Peninsula have been trying for years to "pick the pocket" of the bullet train by urging that project funds be used for local improvements, Kopp said.

"Sharing the tracks with CalTrain here and with Metrolink and Amtrak between Los Angeles and Anaheim bars operating more than maybe two trains per hour of high speed rail," Kopp said in a phone interview. But high-speed rail revenue projections were based on operating trains every five or six minutes.

In addition, Kopp added, blended service could violate Proposition 1A. The voter-approved bond required that passengers travel between Los Angeles and San Francisco without changing trains. A blended service likely would require two transfers: in Sylmar and in San Jose.

The authority says it can pay for the entire "initial operating section" – the high-speed rail line from Merced south 300 miles to the San Fernando Valley – using a combination of $6 billion in federal funds, $9 billion from voter-approved Proposition 1A, local funds and cap-and-trade money.

The last category is money the state would get under its first-in-the-nation law restricting emissions of greenhouse gases. Brown floated the idea of using cap-and-trade money to finance high-speed-rail in a television interview last year. The business plan adopts it as a formal strategy.

The authority says the train will make money from the start. In 2022, the first year of operations, it projects a net cash flow of $35 million to $59 million, rising each year after that. By 2030 or 2031, the authority projects the train would be generating more than $1 billion annually in cash.

Contact the writer: 714-796-5030 or rcampbell@ocregister.com

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