By Noel T. Braymer
The only thing certain about any plan: is it is subject to change. Currently there is money available to build 119 miles of High Speed Railroad in the San Joaquin Valley between Wasco and Madera with station sites at Hanford and Fresno. The next step planned is to build a maintenance facility and the first trainsets to use the new 119 miles High Speed Railroad to test the trainsets, new railroad and train people how to run a High Speed Rail service. After construction is completed on the first 119 mile in 2019, the plan is to extend and finish construction past Madera to Merced as well as to Gilroy and San Jose.
Ever since work got underway on the California High Speed Rail project, there has been opposition to it and constant predictions by its opponents of its impending doom. This is not unusual for such a large, expensive project with major impacts on many people. Quite often the criticism is less than objective. One headline stood out in Bloomberg View “California Hits the Brakes on High Speed Rail Fiasco” dated June 28, 2016. Well the headline was very misleading since the California High Rail Project has not been canceled. The opinion article was written by an associate of the Reason Foundation, which is funded by the Oil industry and has opposed most forms of public transportation for years. What does the Reason foundation want? Underground toll roads to relieve traffic congestion. Have toll roads made money? Not from tolls; but from government bail outs when these toll roads usually go bankrupt.
Despite prediction from its critics, the California High Speed Rail Authority hasn’t raised its cost estimates for the project since 2012. In 2012 the California High Speed Rail Authority rewrote its 2012 draft of its business plan to get the approval of the oversight group of experts appointed by the Legislature. As part of this more contingency spending was added to the business plan to avoid future cost increases. This raised the Phase 1 segment (520 miles San Francisco-Anaheim) costs from $30 Billion dollars to over $68 billion dollars. In 2016 the updated business plan lowered the projected price for Phase 1 construction to $64 billion dollars. This was because all of the construction contracts bids to date have come in lower than predicted by California High Speed Rail Authority engineers. The project continues to stay under budget as construction continues. The $64 Billion figure is based on projected costs with inflation in 2029 dollars. In 2016 dollars the cost is more like $58 billion dollars. This is well below estimates from the Federal Railroad Administration for costs to build 200 mile per hour High Speed Rail for 453 miles between Washington, New York and Boston for $120 billion dollars.
The projected cost for finishing the Initial Operating Segment (IOS) which is now between Wasco and San Jose is roughly $21 to 22 billion dollars. The California High Speed Rail Authority would like an additional $ 2.9 billion dollars to extend service on day one from Wasco to Bakersfield and from San Jose to San Francisco. This would greatly improve ridership and revenues. The goal of California High Speed Rail is to have trains operate at a profit. Like most High Speed Rail services, operators will bid to win the franchise and pay the State for the right to make money. This is not as hard as it sounds. For example the Pacific Surfliner Trains already recovers 75% of its costs between San Luis Obispo and San Diego. This number percentage be expected to rise as ridership increases and service efficiency improves. Long distance rail passenger service in general operate at a profit around the world in major markets. The High Speed Railroad will belong to the State of California which will be responsible for its maintenance much like it is for the state’s freeways and highways. There have never been plans to make money from the High Speed Railroad in California any more than the State trying to make money on freeways and highways. What will make money and stimulate the State economy will be development centered around the High Speed Rail stations.
Between now and 2024 when the IOS is planned to open there are uncertainties about future funding. This is common with any major project. Much of the future California High Speed Rail Project funding is expected in the near future to be with revenue from the State’s Cap and Trade program. The issue with this is income from Cap and Trade is difficult to predict. The State Legislature is expected to work on a new transportation funding bill first thing in 2017. With the Democrats now having supper majorities again in both houses after this year’s elections, progress is expected in raising more funding for transportation in 2017. The California voters gave a clear message with the many local sale tax measures for improved transportation that were approved in 2016 that they want and will pay for better transportation. With both houses of Congress and the White House controlled by Republicans, this likely doesn’t bode well for California getting much new Federal funding for High Speed Rail.
How does this compare to other major transportation projects in California? I can remember growing up in the 1960’s reading about the need for a Wilshire Subway from downtown Los Angeles to West Los Angeles. The now Purple Line got as far west as Western Ave in 1996. Construction of extending the Purple Line to the eastern border of Beverly Hills is underway and expected to open by 2021. With the passage of Measure M, the plan now is to start construction to Westwood by 2018 and open service by 2024 and not 2036 as was planned. The railroads never wanted a stub end Union Station in Los Angeles. Even in 1980 when several of the station tracks had been pulled out at Los Angeles Union Station there were people at RailPAC planning construction of run-through tracks and protecting the south end of the station from construction that would block future run through tracks. Now construction is planned at Union Station by 2018 for run through tracks and a new underground concourse. This includes platforms and tracks for High Speed Rail.The original plan for BART was for service to Marin County over the Golden Gate Bridge and lines on both sides of the bay between San Jose, Oakland and San Francisco. No word when BART will get to Marin County, but it will soon get to San Jose from the East Bay side. Shortly after the San Diego Trolley opened in 1981, there were plans to extend it to the University City area near UCSD which is the largest traffic center in San Diego County. The Trolley has controlled the rail right of way in the City of San Diego since the 1990’s which the Trolley will share with Amtrak and Coaster Train tracks north of Old Town and south of University City. Construction is now only starting in 2016 to build this extension of the Blue line from the Mexican border to downtown to past Old Town and to University City.
One thing is certain, it gets harder to kill a project the more cement for it is in the ground. Everything is on track to finish the first 119 miles of High Speed Railroad by 2019. There is money to build most of the IOS after 2019. The more construction, the more support in the San Joaquin Valley for finishing the project which is already giving the Valley a well needed economic stimulus. A major milestone for the California High Speed Rail project is by 2018 all of the environmental planning and permits are planned to be taken care of. This is part of the process to attract investors. Investors want to see that projects are ready to go before writing any checks. As part of the 119 mile High Speed Rail San Joaquin Valley test track an operator for the new High Speed Rail service will be chosen to oversee the final work for the yards and operation of the project, There are several operators who are interested in running passenger trains in the market between Northern and Southern California which is one of the heaviest traveled in the world. There will be plenty of interest from other countries to get involved in California High Speed Rail once the IOS is almost finished.