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Joe Guzzardi High-speed rail plan is a risk California can’t afford

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Joe Guzzardi

Posted: Saturday, April 7, 2012 12:00 am | Updated: 10:51 am, Wed Jan 30, 2013.

The chaos engulfing California's proposed bullet train may have reached an intensity that will doom the project before it starts.

In yet another revision of cost estimates and planning, the California High-Speed Rail Authority this week announced a cost reduction from $98 to $68 billion that would be achieved by connecting the train's route to existing lines on the outskirts of Los Angeles and the Bay Area. The first segment would be expanded to 300 miles, connecting Merced in the San Joaquin Valley to the San Fernando Valley within 10 years. The original 2008 plan included a 130-mile portion from Madera to Bakersfield with a total cost calculated at $33 billion.

The widely fluctuating cost estimates, in $30 billion multiples, alarm some legislators who are already nervous about the project's magnitude. Gov. Jerry Brown is expected to ask the Legislature to appropriate funding before the June 15 budget deadline.

Californians, who are doubtful about the rail's feasibility and who would have to absorb the fiscal brunt of failure, view Gov. Brown's last minute cost reductions skeptically. Critics are working hard to force a new vote on the train, which polls indicate would be handily defeated.

One reason that voters have so little confidence is that rail advocates would have to pull off a masterpiece of intricate planning to make the bullet train successful. There's a big difference between the drawing board and reality. In theory, job growth and other economic benefits logically follow an integrated transportation system. But success would require a well-designed combination of station location, links to other transportation systems and supportive land-use and zoning policies to make rail stations a catalyst for economic stimulus.

The High-Speed Rail Peer Review Group has called the train "an immense financial risk" and refused to recommend that the state legislature sell the initial $2.7 billion in bonds. If construction doesn't start by Sept. 30, California will lose $3.3 billion in federal funding.

Even with the lower cost estimate, the total funding remains a wild card. California voters approved a $9.95 billion bond for the proposed system when they passed Proposition 1A in 2008.

Where will the balance come from? The current plan is contingent on receiving billions more from a doubtful Congress, fees from an untested cap-and-trade system that is central to California's effort to reduce greenhouse gas emissions, and unnamed private investors supposedly eager to jump aboard and risk their own money once construction begins.

California's distressed state budget will have to allot more than $700 million each year to repay billions of dollars that officials plan to borrow to build the first phase of the proposed bullet train, according to the non-partisan California State Legislative Analyst's office.

The repayment projection includes principal and interest on the already approved $9.95 billion. Because of higher borrowing rates, the interest total is higher than earlier and doesn't include millions already being paid annually on $500 million in debt incurred during the initial planning process.

Whatever the final cost will be, the rail is the largest capitol project in California's history. California is flat broke and suffers from chronic deficits, looming tax increases and relentless social services cuts and is in no position to roll the dice on the bullet train. The rail would also have devastating, irreversible effects on the state's environment, encourage further unsustainable population growth and have no guarantee of ridership.

The decentralized cities located throughout California's car-addicted society makes the bullet train a high risk gamble the state can't afford to take.

Joe Guzzardi is a Los Angeles native who retired from the Lodi Unified School District in 2008. Send him mail at guzzjoe@yahoo.com.

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17 comments:

  • Patrick W Maple posted at 11:27 am on Wed, Apr 11, 2012.

    Pat Maple Posts: 1805

    Faaaaaaaaaaaaaddddddddddddddddeeeeeeeeeeeeeeedddddddddddddddddd oooooooooouuuuuuuuuuuuuuuuttttttttttttttttt when the numbers didn't lie? Toooooooo hard to counter???

     
  • Patrick W Maple posted at 7:41 am on Mon, Apr 9, 2012.

    Pat Maple Posts: 1805

    DB: Exactly...who would ride it? Why would they? How far would they? For what purposes? Maybe they are going to high-speed goats from field to field.

     
  • Darrell Baumbach posted at 5:05 pm on Sun, Apr 8, 2012.

    Darrell Baumbach Posts: 9403

    CONTINUED...


    The pace of China's high-speed rail expansion slowed sharply in 2011.

    Concerns about HSR safety, high ticket prices, low ridership, financial sustainability of high speed rail projects and environmental impact have drawn greater scrutiny from the Chinese press.Top operational speed of HSR trains on lines previously operating at 350 km/h were lowered to 300 km/h and those running at 250 km/h were lowered to 200 km/h. By late summer 2011, state banks began to cut back lending to railway construction projects. By October 2011, work had halted on 10,000 km of track under construction due to shortage of funding.In late October and early November 2011, the Ministry of Railways raised 250 billion RMB in debt and loans, and construction resumed on a number of lines
    http://en.wikipedia.org/wiki/High-speed_rail_in_China

     
  • Darrell Baumbach posted at 5:04 pm on Sun, Apr 8, 2012.

    Darrell Baumbach Posts: 9403

    Maybe we should take a lesson and learn from others who are consdidered the world's leaders in high speed rail. China has the advantage of low labor costs, no unions, no interference from lawyers and environmental groups, and yet, is having problems with the cost.... thei main concern, why of course financial sustainability.

    With generous funding from the Chinese government's economic stimulus program, 17,000 km (11,000 mi) of high-speed lines are now under construction. In early 2011, the HSR network was expected to reach 13,073 km (8,123 mi) by the end of the year] and 25,000 km (16,000 mi) by the end of 2015.

     
  • Patrick W Maple posted at 2:14 pm on Sun, Apr 8, 2012.

    Pat Maple Posts: 1805

    Mr Loomis: A yahoo? Because I/we believe and have shown evidence of government waste, boondoggles lack of common sense, fraud, cronyism, payoffs, bad decisions, foolishness, lies, dishonesty, deceit, stupidity, foolishness. folly, futility and insanity. Not to mention bad business decisions (again and again and again). I am supposed to believe the "rail professionsals" who stand to benefit from this carp...

    How about if you plant here the "sensible changes in alignment" or the "paring back of the project" or the fact that it will NOT benefit me...which by the way goes to prove only one thing...they don't/didn't have it right and never will.

     
  • Jim Loomis posted at 9:37 am on Sun, Apr 8, 2012.

    JimLoomis Posts: 1

    The new plan for high-speed rail, with sensible changes in alignment and the reduction in cost, is a very positive step forward. Meanwhile, the arguments put forth by opponents of California's high-speed rail project have not changed, consisting almost entirely of calling it a boondoggle and loudly branding the experienced rail professionals as stupid. ("Loud" is an essential element to the anti-rail argument.) Those who understand and support high-speed rail must persevere, because it has been proven both popular and successful everywhere else in the world for more than 30 years. (They are building a high-speed rail line in Uzbekistan, for heaven's sake!) In particular, Governor Jerry Brown is to be congratulated and admired for having the political courage in today's highly-charged partisan environment to stand firm in support of the project and against the ideologues and the yahoos.

     
  • Darrell Baumbach posted at 6:18 am on Sun, Apr 8, 2012.

    Darrell Baumbach Posts: 9403

    Ms bobin stated...Just because both Bush, Sr. and Bush, Jr. are no longer in office doesn't mean their records should be erased and we must all pretend they never existed. Or is that what you would wish?

    Ms Bobin.. can you please post who you think in this thread thinks Bush, Sr. and Bush, Jr's records should be as if it never existed. I read each post twice after reading yours, and couldn't figure out how you drew that conclusion. I thought I would assume I am slow to comprehend and give you the benefit of the doubt. I just don't get it.

     
  • Joanne Bobin posted at 9:41 pm on Sat, Apr 7, 2012.

    Joanne Bobin Posts: 4485

    "There's this infatuation with the Bush's that makes little sense to me. Since their name is put forth mostly by liberals/progressives, this makes it even more perplexing."

    Much the same can be said for Obama's name being consistently invoked by conservatives/right-wingnuts. Why should it be "perplexing" for liberals to point out the foibles of the Bush's and conservatives to do likewise in regard to Obama.

    Just because both Bush, Sr. and Bush, Jr. are no longer in office doesn't mean their records should be erased and we must all pretend they never existed. Or is that what you would wish?

     
  • Jerome Kinderman posted at 5:44 pm on Sat, Apr 7, 2012.

    Jerome R Kinderman Posts: 2316

    And just what do George Bush and his son have to do with anything being discussed here. There's this infatuation with the Bush's that makes little sense to me. Since their name is put forth mostly by liberals/progressives, this makes it even more perplexing.

     
  • Patrick W Maple posted at 3:39 pm on Sat, Apr 7, 2012.

    Pat Maple Posts: 1805

    So I ask again for WHAT reason? "In January 2012, an independent peer review panel published a report recommending the Legislature not approve issuing $2.7 billion in bonds to fund the project. The panel of experts was created by state law to help safeguard the public's interest. The report said that moving ahead on the high-speed rail project without credible sources of adequate funding represents a financial risk to California. This latest price estimate by CHSRA of US$98.5 billion also says the ultimate price could go as high as US$117.5 billion, depending on route and construction features." Maybe we should build one for freight trains too.

    The number of riders has already been exaggerated three-fold, the cost underestimated two to ten-fold, the number of jobs it will create short and long term, and no where do they talk about the infrastructure costs, maintenance, union costs or the cost for feeder lines that has been greatly exaggerated and they have even started a new bureaucracy called the CA High Speed Rail Authority...

    So, HOW did JB vet anyone??? This is a public project and must be put out for bid. Are you saying he already has contractors in place?

     
  • larry scheib posted at 2:31 pm on Sat, Apr 7, 2012.

    larryscheib Posts: 3

    Fox news, perfect example. Volt is a waste of taxpayer monies. Oh wait, George Bush senior bought one for his son. I guess its not a bad car after all.

     
  • larry scheib posted at 2:27 pm on Sat, Apr 7, 2012.

    larryscheib Posts: 3

    Opposing views are great, but when those who control a media outlet choose a point of view without pointing out opposing views or when politicians use partisanship and their power and not pragmatism to push an agenda then I get offended by their views.

    I believe the one way price from LA to Sac is suppose to be around $80.00. For those who prefer HSR over flying I think it is a great price especially if the stations are located such that they don't have to worry about parking, That's one thing about HSR stations, they are lot easier to locate near populated areas whereas Airports are always such a pain to get to.

    I've seen some pretty pricey projects go in recently and under budget. Sounds like some idiiots got their hands on the "Big Dig" and Las Vegas monorail projects. Seattle bridges, light rail tunnels and rail projects have been handled quite remarkably and well within budgets. I think, thanks to Brown's vetting process, the HSR budget is very reasonable. I think the only risky part is the section connecting Bakersfield with to Burbank. I would like to hear the cost break down on it.

     
  • Patrick W Maple posted at 12:01 pm on Sat, Apr 7, 2012.

    Pat Maple Posts: 1805

    Joe: Don't you remember the old bait and switch? That is what went on during the "Big Dig" back east...$2.8B to $22.4B. TEN times the original "estimate"

    "The Big Dig -- America's Greatest Highway Robbery began as a straight report of the shenanigans, deals, hustles, boondoggles and cons of the $22 billion dollar highway tunnel construction project through Boston. The Big Dig fiasco has been running for over 20 years -- and at the rate it's going will take another 20 years to unravel.

    JB is doing nothing more than paring back the project trying to get more support for his failed administration...JB was the beginning of the downfall of CA in his first term.

    What is the difference? People forget. Ten times the FIRST lie of $33B equals $330B...I have no desire or need to travel to SCA...why should I pay for it? I am already paying enough for the gov to party on $4 shrimp and $14 cinabuns. B S

     
  • Patrick W Maple posted at 11:52 am on Sat, Apr 7, 2012.

    Pat Maple Posts: 1805

    Mr Scheib; As though liberals are the only ones with the 'right" thoughts and ideas on this boondoggle. Twenty-five years ago we carried around suitcases for just phones. WHAT is the necessity to get from one place to another at 150 mph? We can travel faster on a plane and cheaper as Mr K points out. If it is that important use Skype. Michio Kaku had it right when he stated that we still live in the neanderthal age in that we need to touch something before it is real...thus copies on paper of everything on the internet or our computers (the stuff we need that is floating around out there somewhere).

    I am still amazed that the unions are not yelling for people (those who can) to be able to work from home thus saving fuel, time, energy, insurance, injuries, feelings, family time, wear and tear and just plain brain power. Someone said humans are stupid...sometimes I believe them.

     
  • Jerome Kinderman posted at 11:07 am on Sat, Apr 7, 2012.

    Jerome R Kinderman Posts: 2316

    What I'd like to know is in the future when my grandchildren might be able to use this system, how much would it cost them to get from Sacramento to Los Angeles and then back again?

    Then compare this to projected costs for a Southwest Airlines round-trip fare.

    Keep in mind that such a system would still require TSA pat-downs and other security measures that would meet or possibly exceed the invasive procedures we've all come to enjoy prior to walking onto an airplane today.

     
  • Jerome Kinderman posted at 10:54 am on Sat, Apr 7, 2012.

    Jerome R Kinderman Posts: 2316

    Mr. Scheib, I was impressed with your first paragraph wherein you successfully highlight what you believe to be the points missed by the author of this column.

    But then for reasons unknown to me, you found it necessary to toss all that away with your sophomoric insistence that "19th century politicians and journalist should not impede its' progress." Are you the only one with a valid opinion? Or should anyone with an opposing view be blocked from the discourse simply because you don't like what they have to say?

     
  • larry scheib posted at 8:29 am on Sat, Apr 7, 2012.

    larryscheib Posts: 3

    You miss the point of the new plan. It allows for independent components to be added as money becomes available with each component being beneficial as an independent unit. If this years bond is approved then the valley connections can pay for creating a system comparable to the Acela which is self-sustaining. And as monies become available whether it be bonds, private, fed money or cap-trade then other components can be added eventually creating a full blown HSR system.

    So much for open vetting and a transparent process. People will never be happy! The point is that a great plan has been put forth and 19th century politicians and journalist should not impede its' progress.

     

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