By Noel T. Braymer
The California Legislature finally passed a transportation bill which will fund repairs for much of the aging roads around California. With a combination of increased fuel taxes and vehicle registration fees as much as $52 billion dollars is expected to be raise over the next 10 years. Of this $7 Billion is planned to be spent on improved transit which should include rail projects. A pleasant surprise in the push to pass this transportation bill is an agreement to set aside $400 million dollars to help fund extending Altamont Corridor Express (ACE) rail service between San Jose and Stockton to first Modesto and Ceres no latter than 2023 and to Merced no latter than 2027. This would include 6 round trips between Merced and San Jose on ACE. This proposal has been in the works for years, but has been held back due to lack of funding. A major benefit of the expanded service will be to open affordable housing to employees working in Silicon Valley. This will spur economic growth in the upper San Joaquin Valley which could use it.
Another factor in favor of extending ACE to Merced, is it will create a feeder service connecting future California High Speed Rail at Merced to the upper San Joaquin Valley. April was also a good month this year for California High Speed Rail. The California Appeals Court upheld that California’s Cap and Trade charges were fees and not taxes as claimed in a lawsuit against it. If Cap and Trade was a tax, it would require a two thirds vote in the Legislature to be used to discourage businesses to pollute. With this ruling, much of the uncertainty of the future of the Cap And Trade program in California has been lifted. Current legislation for California’s Cap and Trade runs out in 2020. This ruling will make it more likely that the Cap and Trade program will be renewed beyond 2020. A quarter of the Cap and Trade income is dedicated to High Speed Rail. This money will be critical in funding the $20 billion dollars needed to open the first service by 2025 between the San Joaquin Valley and San Jose.
Another milestone was the announcement in April of 5 international consortia have applied for the contract to be the California High Speed Rail Early Train Operator. Of the 5 individual bidder for this contract not to exceed $30 billion dollars were business consortium based in China, Germany, Italy, Spain and Britain. Oddly consortia from Japan and France were not included. The role for the winner of this contract is to advise on the final design and construction of the first segment of passenger service. They will also have a major role in designing the service and marketing of the initial operation of California High Speed Rail. While award of this contract doesn’t guarantee that the winner will be the final operator of California’s High Speed Rail service, it will give the winner of this contract a clear advantage to be the future operator. The will be plenty of incentive for the winner of this contract to propose the most efficient and profitable service possible. This is because the future operator of California High Speed Rail will be bidding to pay the State of California for the right to run High Speed Rail service at a profit so they can make money.
The California High Speed Rail Authority is also busy now finishing all of the Environmental Impact Reports by next year for Phase 1 service between Anaheim and San Francisco. This will make it easier to start construction for the second leg from Madera to San Jose and to attract investors for later phases of the project to San Francisco and Southern California. Recent news reports with officials in southern Los Angeles County towns have remarked than relations between the cities and the High Speed Rail Authority have greatly improved over the last 7 years. This improved level of cooperation and communications is making the planning much easier to finish. At the same time construction in the San Joaquin Valley is continuing with the laying of rail soon to begin. Construction appears to be on track for completion by 2019 between Madrea and northern Kern County.