'Worst-case scenario has happened' for California bullet train
It was never a question whether the planned high-speed rail system connecting Los Angeles and San Francisco would be a boondoggle. Given the history of government infrastructure projects, massive cost overruns and long delays were to be expected.
But I don't even think the fiercest critics of the project expected things to get this bad.
The price of the California bullet train project jumped sharply Friday when the state rail authority announced that the cost of connecting Los Angeles to San Francisco would be $77.3 billion and could rise as high as $98.1 billion – an uptick of at least $13 billion from estimates two years ago.
The rail authority also said the earliest trains could operate on a partial system between San Francisco and Bakersfield would be 2029 – four years later than the previous projection. The full system would not begin operating until 2033.
That first 114-mile leg from nowhere to nothing is the easy part. The project will eventually have to tunnel through two mountain ranges.
The new estimates will force California's leadership to double down on its political and financial commitments if it wants to see the system completed, against a backdrop of rising costs, years of delays, strident litigation and backlashes in communities where homes, businesses, farms and environmental preserves will have to give up land to the rail's right-of-way.
The rail authority's previous business plan made the case that it had just enough money in hand to build an initial operating system that could carry passengers and generate revenues, which would potentially attract private investors to help finance completion of the system. The new business plan implicitly makes clear that higher costs and uncertain funding leave it short of that critical goal.
The rail authority has wrestled with a more than $40-billion funding gap for the full system, which would increase further under the new cost estimates. It is still counting on the Legislature to amend the state's greenhouse gas auction system so that the system could borrow against future fees through 2050, but even with that benefit the project faces a financial shortfall that only partnerships with the federal government and private investors could plug, said rail authority chief executive Brian Kelly.
Guess where the money from that $40-billion "funding gap" (more like a chasm) will come from. You guessed it: federal tax revenues.
A spokesman for Gov. Jerry Brown, who since the 1980s has championed high-speed rail, said the disclosures do not change the strong support he expressed in his recent State of the State address, when he said: "I make no bones about it. I like trains and I like high-speed trains even better."
The projection for completing the full Los Angeles-San Francisco system by 2033 assumes that somehow the project gets fully funded. Even then it is extremely ambitious given the engineering challenge of building across the San Gabriel and Tehachapi mountains and the developed stretch from Santa Clarita to downtown Los Angeles, as well as more than one mile under urban San Francisco – all in just four years after the initial system starts operating.
So the governor likes to play with trains. He also loves to play with other people's money. Perhaps he could be a little less ambitious and buy an old Lionel train set on eBay. He'd have loads of fun running his choo-choo all over the governor's mansion.
The plan is obvious: spend so much money on the project that the feds will be forced to bail it out or see tens of billions of dollars go to waste. Scrapping the plan now would be admitting that this white elephant is based on faulty planning, faulty logic, and faulty numbers.
Governor Moonbeam likes to play with trains, so that's not going to happen.