Proposition 1A: Safe, Reliable High-Speed Passenger Train Bond Act. - recommend No
Update: Look to the comments for an ongoing debate about the pros and cons of this proposition. I am going to stay with my "No" recommendation.
As the legislative analyst's summary tells us, the state of California created the California High-Speed Rail Authority in 1996 to set up an intercity, 200+ mph rail system linking the major metropolitan areas of California, with a first goal of linking northern and southern California.
Delving into the actual text of the proposed legislation, we find a bond measure that would take out $9.95 billion in bonds (thanks to commentor Rafael for catching my error here), at an estimated cost of $19.4 billion over thirty years, to fund the development of high-speed rail and upgrades to local rail to link the two systems together. Specifically, the funding is broken down like so:
$950 million is dedicated to that second task, of funding "capital improvements to intercity and commuter rail lines and urban rail systems" to connect them to the projected high-speed rail system. $190 million of this goes to the state Department of Transportation, with the remainder going to local transit agencies. This latter portion comes with strings attached, namely that the local transit agency has to provide matching funds, and that it can't reduce its spending below its average spending across the 1998-2001 period. I have no idea why that period was chosen, but there you go.
The remaining roughly $9 billion (fixed, per above) goes to building the high-speed rail system itself. The assigned goal for this money is to first complete a rail line from San Francisco to Los Angeles, and then fill in routes linking Oakland and San Jose, Sacramento and Merced, Los Angeles and the Inland Empire, The Inland Empire and San Diego, and Los Angeles and Irvine. This money also comes with some strings attached. First, it can't be used for the operating costs of the rail system -- just construction. Second, it can only be used for half of those construction costs, with the other half to be acquired some other way, "including, but not limited to, federal funds, funds from revenue bonds, and local funds."
That last bit might give you some pause. What happens if the other half can't be found anywhere? Hard to say.
It's nearly impossible to evaluate something like this in free space. With that in mind, we might want to take a look at two recently created high-speed rail systems, those of Korea and Taiwan.
The Korean high-speed rail system, the KTX, connects Seoul to Daegu and to Mokpo via a branched system. Currently, it represents about 200 miles of track, not all of it fully enabled to be high speed. Although it was initially costed at about $5 billion, the system to date has ended up costing about $18 billion to build, taking 12 years to start operation. It initially had ridership issues, but that has picked up, with a concomitant drop in air and road travel. The system itself has generated $3 billion in income since its opening.
The Taiwanese high speed rail system just started operation in 2007, after about 7 years of construction. Also covering about 200 miles of track, this system has come in at about $15 billion so far. As it just opened last year, there's obviously not much to say about ridership, although there have been some concerns about production quality.
The California High-Speed Rail Authority estimated the cost to build the full California rail system at $45 billion -- so obviously they don't think they're going to cover it all in one go right now, with only $9 billion in state money and a presumptive $9 billion in matching funds from somewhere. Is $45 billion a reasonable number?
Consider that the Korean and Taiwanese systems both clocked in around the $15-18 billion range to cover 200 miles of tracks. Consider also that the San Francisco to Los Angeles line alone is 381 miles. The remaining proposed routes add another 350 miles of track, for a grand total of about 730 miles of track. If we presume to extrapolate from the Korean and Taiwanese experiences, we're looking at $54-65 billion for the full system, and $28-34 billion for the SF to LA route.
If we presume the full matching funds, it's looking suspiciously like Prop 1A will only get us from San Francisco to Paso Robles. As nice as Paso Robles is, it's only halfway to Los Angeles.
I think the imbalance between the available funds and the likely costs ultimately makes this impractical right now, especially funding it via a bond measure.
So who's putting money into the effort for or against this proposition? Well, as it happens, there are no groups putting money up against it. Major groups contributing money in support of Prop 1A include the Members Voice of the State Building Trades ($50,000), the California American Council of Engineering Companies Issues Fund ($25,000), the California Alliance for Jobs Rebuild California Committee ($200,000, and sporting a cumbersome name), the Association of California High Speed Trains ($24,000), and the Californians for Safe & Reliable High Speed Rail ($54,000). A number of architecture, construction, and engineering firms also contributed in the tens of thousands of dollars range. Contributors there include companies like HDR, HNTB, Systra, Alstom, Hatch Mott MacDonald, and Parsons Brinckerhoff Americas. Nothing especially shocking in either set of contributors.
You can read the full list of people putting money into supporting Prop 1A here.
You can read the full text of Prop 1A here.
You can read my reviews and recommendations for the other propositions by clicking here.
Comments (5)
1) Prop 1A would authorize $9.95 billion in bonds, of which $9 billion is reserved for HSR and $950 million shared between Amtrak California, BART, Metrolink, Caltrain, NCTD and ACE. I'm not sure where you $8 billion figure came from.
Both components are eligible for federal funding, though there is zero chance of securing that unless California voters put some skin in the game first. Note that there is currently broad bipartisan support for passenger rail, as evidenced by the passage of the $13 billion Amtrak re-authoriation and high speed rail law by the House.
That said, your $30+ billion estimate of construction costs for the SF-Anaheim "spine" is consistent with CHSRA's own. The state will therefore have to convince both the federal government and private investors to match not just prop 1A but also the $2-3 billion expected from the cities and counties served (mostly for stations and environs).
The future spurs to San Diego and Sacramento, respectively, do not require expensive tunneling across earthquake faults. Their per-mile cost should therefore be lower than for the spine, though there will be space constraints along I-15 near Temecula.
2) The language of prop 1A explicitly prevents CHSRA from putting construction of a new segment of the network out to tender unless it has secured at least matching funds first. The segments are chosen such that each has useful endpoints.
Also consider that the cost of rejecting prop 1A is not zero. With rail off the table, a lot more roads and several new airport runways would be required just to deal with California's expected population growth. CHSRA claims this "modal alternative" would total $80 billion and keep the state's transportation sector tied to oil.
The California budget is between a rock and a hard place and will be for some time to come. However, the legislative analyst's office has concluded the general fund could (just) handle the additional burden of prop 1A without any need for additional taxes.
Therefore, I think the decision should be based on whether you think the network will actually be completed and, if it can really attract enough ridership. I'm optimistic on both counts.
Posted by rafael | September 30, 2008 07:43 AM
Posted on September 30, 2008 07:43
Also consider that the cost of rejecting prop 1A is not zero. With rail off the table, a lot more roads and several new airport runways would be required just to deal with California's expected population growth. CHSRA claims this "modal alternative" would total $80 billion and keep the state's transportation sector tied to oil.
This is, as always, a good point - the cost of added road networks and air infrastructure is never zero. People can read the CHSRA summary of their economic and environmental impact estimate here. I'm still dubious about the ability to complete the spine on budget and in a reasonable amount of time (call it a decade), and that's what causes me doubt, despite my appreciation for rail.
My eight billion figure came from my misreading of the text of the law. I'll fix that in the main post.
Posted by parakkum | September 30, 2008 10:22 AM
Posted on September 30, 2008 10:22
First let me say that Rafael is an extremely knowledgeable person on this issue; we have been sparing on the issue for months.
However, even he admits that the route chosen for the project, going through the Pacheco Pass,rather than the Altamont route is vastly inferior.
As you have posted, cost over runs are the name of the game. The latest estimate given to construct the whole system was 42 - 45 billion and that came from executive director of the project last July in testimony before the State Transportation and Housing commission.
The Authority is proposing that the voters of California pass this bond measure even though they have yet to furnish a business plan for the project. Prop 1A as drafted, demands a business plan and the Authority agreed to produce one by Sept 1st, 2008. They did not draft a plan and they do not plan to have a plan available before the Nov. election. In essence they are thumbing their nose at the State legislature and California Voters, saying "we won't do what we promised to do and agreed to do last July".
There has been a lawsuit filed against the project's EIR. The Authority for the EIR planned to use a corridor from San Jose to Gilroy which is owned by the Union Pacific Railroad. Well the Union Pacific has now told the Authority, you can't use our corridor. This will in-validate the EIR, since the route chosen was based on using that route. So even after 10 years and expenditure of about $60 million, no tracks have been laid and the proposed route will have to be changed.
The due diligence report just issued from the Reason foundation and authored by two transportation experts, Wendell Cox and Joseph Vranich, really de-bunks most of the positive arguments made to build this project. Visit www.reason.org and at least read the 8 page summary of this very important 190+ page report.
I feel certain after reading this material, you certainly will not want to change your recommendation of Voting No on Prop 1A.
morris
Posted by Morris Brown | September 30, 2008 05:28 PM
Posted on September 30, 2008 17:28
For a detailed, devastating debunking of this incredible HSR boondoggle -- a.k.a. Prop 1A -- go to the 196 page study of this issue just released in September, 2008 by the Reason Foundation:
www.reason.org/ps370/
Fortunately at this same web page you'll find a readable summation of the study.
If that's not enough, go to
www.ti.org/antiplanner/?p=515
which summarizes the reasons why high speed rail makes no sense. There are many related articles on this website.
There are so many, MANY reasons to vote down this insane measure. The fact that California is flat broke from current profligate spending and borrowing is only the latest additional reason to vote down Prop 1A.
Posted by Richard Fighters | October 6, 2008 11:13 AM
Posted on October 06, 2008 11:13
Parakkum,
Just to memorialize our IM chat:
I am voting for 1A because I believe that high speeed rail is vital to California's future. This is because as oil runs out (it's happening) air travel will become prohibitively expensive. Our economy depends on rapid North/South travel in California. Just think of all the college students and business people commuting back and forth via SouthWest. We don't have a lot of time left as oil becomes more and more scarce, so we had better do this now while we still can build it.
Thus, I think HSR is vitally important. Although the bond measure clearly will not pay for the entire system, it does mandate matching funds. Worst case scenario is that the bond measure doesn't fund enough and we don't get federal funds, and the State has no money. Then it just doesn't happen. Or , maybe we end up having to raise some other taxes to pay for it. I don't see those as necessarily bad in light of the consequences of not building out rail.
Finally, I think that HSR can help people get to work and get out of their cars. There are a lot of people who live along the rail route, and who could commute in from the Central Valley. I have spoken to people in France who make what would be long commutes very short, because of the TGV.
Posted by Tim | October 20, 2008 10:30 PM
Posted on October 20, 2008 22:30