California High-Speed Rail: Highest Burn Rate Ever

Taxpayers in California and around the nation have a new reason to pull the plug on the Golden State’s high-speed rail project. In order to meet its virtually impossible timeline, the project will have to spend $3.5 million per day, seven days a week, over the next five years, a spending rate that will easily make California high-speed rail the costliest per-diem transportation project in the history of the United States. 

Ralph Vartabedian explains in the Los Angeles Times that in order to meet a federally mandated September 2017 deadline for completion of the (also federally mandated) Fresno-Bakersfield leg, Sacramento, which is currently struggling to close a $16 billion budget deficit, would have to issue 120 permits through multiple regulatory agencies, buy about 1,100 parcels of land, work through lawsuits by local farmers and assemble a team of contractors with large workforces. 

And that’s if everything goes according to plan. Says the Times

If the rail authority runs into technical problems, legal disputes, permit delays or political roadblocks, it could end up building less track and potentially leave an uncompleted project, according to warnings contained in its own business plan. If the project blows past the federal deadline, for example, the flow of money could be stopped. And the scramble to meet that deadline could lead to construction problems and drive up costs.

Rail officials acknowledge that their plans are aggressive but describe them as not unprecedented, pointing to the fast construction pace of the new Bay Bridge in Oakland and the Alameda Corridor freight rail line in Los Angeles.

But state reports show the $6.5-billion Bay Bridge will have an average spending or "burn rate" of $1.8 million per day when it is completed in 2013, less than half what the rail authority is planning. The Alameda Corridor also had a similar $1.8 million per day burn rate by its completion in April 2002, much less than planned for the bullet train even when adjusted for inflation.

The hurried project to improve I-15 in Salt Lake City before the 2002 Olympics, known in the construction industry as one of the fastest well-executed work packages, spent $1.6 million per day, according to John Njord, executive director of the Utah Department of Transportation.

"That was a burn rate like we have never seen before," he said, which was on schedule only because of careful planning. The California effort would more than double that pace.

Vartabedian deserves credit for his unflinching reporting on the California High-Speed Rail Authority’s ongoing collapse. (This un-Times-like honesty has notably not filtered down to the paper’s editorial board.) But even in a 340-line story that details how private contractors are walking away from the project (thanks in large parts to the state’s plan to offload schedule and cost risks onto contractors), it’s impossible to list all the evidence that the continuing brouhaha over the bullet train is just kabuki for a project that is in all practical senses already dead. 

Among other things, it is unlikely that the state can even issue the bonded debt voters approved for the project back in 2008. Those bonds by law can only cover capital costs for a train that will be able to operate without subsidies – a condition that Fresno-Bakersfield clearly does not fulfill. 

In fact, meeting the federal deadline may be the least of the project’s problems. The California High Speed Rail Authority (CHSRA) was originally required to break ground on the project by September of this year in order to qualify for $3.5 billion in ARRA stimulus funds. But that deadline went away when the state bowed to pressure from Transportation Secretary Ray LaHood to start the project with the Central Valley alignment. As the CHSRA’s former spokeswoman explained earlier this year – just before joining an exodus of top-level employees from the sinking project – that deadline was only a placeholder meant to “memorialize” the September 2017 completion deadline. By the time that 2017 date approaches, the federal funds will have been disbursed (in the unlikely event the project is under active construction). 

Gov. Jerry Brown’s “May revise” budgets only $705,000 to create seven positions at Caltrans “to work with the High‑Speed Rail Authority…to improve service on Northern California intercity rail lines.” The rest would have to come from a new bond issue, which has now become politically toxic. And the other reasons to stop the runaway train keep piling up, as I wrote in January

substantial majority of Californians oppose the bullet-train in its current form.  

That’s a remarkable turnaround in a state where 53 percent of voters approved $9.95 billion in high-speed rail bonds during the high-turnout 2008 election. It seems like just a month ago that the California High-Speed Rail Authority (CHSRA) was an object of wonder for its reality-distorting public relations influence and political strength. Now even the left-leaning media treat with scorn the CHSRA and its plan to make a non-operational Bakersfield-Fresno run the great project’s first phase. 

Meanwhile, the CHSRA’s CEO and board chairman have both fled the collapsing project, in a move that neither the Brown nor the Obama Administration appears to have seen coming. The authority is in a dispute with its former PR firm, which was unable to distract public attention from the glaring truth that since 2008 the estimated cost of the project has more than doubled, from around $40 billion to $98.5 billion. (The suspiciously steep increase in projected costs has prompted calls for a new referendum on railway debt, on the grounds that the voters were hoodwinked the first time around.) The authority’s own peer review group and the Legislative Analyst’s Office have strongly recommended delaying and rethinking the project. A larger percentage of voters would now vote No on HSR bonds than voted for them in 2008. 

All of the conditions described above are still in effect.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • WarrenT||

    Thomas Friedman will be a contestant on Jeopardy this Friday so set your mocking guns to kill!

    http://www.jeopardy.com/

  • Paul.||

    I lost on Jeopardy...baybay...

    ooooooohh ooooooooohhhhhhhhh

  • Archduke PantsFan||

  • DJF||

    They don't know yet what exact route this train will take

    They don't know where the stations will be or their size and design

    They don't know how much will be at grade level, elevated or below ground

    They don't know what equipment they will buy nor where they will buy it from.

    They don't know how long construction will take

    They don't know what interest rates will be when they borrow the money

    Yet somehow they know what it will cost.

  • ||

    That sounds pretty good if you have Barry White sing it.

  • wareagle||

    and they mandated that it will happen.

  • Brutus||

    "Don't know what I want, but I know how to get it"

    Johnny Rotten, "Anarchy in the UK"

  • ||

    Hey, trains! Chugga Chugga Chugga Chugga Chugga choo choo! Fuck trains. Right in the neck.

  • PapayaSF||

    But what about the people who need to get between Fresno and Bakersfield very quickly, but are afraid to fly?? Libertarians are so heartless.

  • fish||

    Absolute bullshit! As a libertarian I heartily endorsed the ground level commuter cannon! A device that requires no airport, no rails, just giant leather arresting devices...mitts if you will... at either end of the travelers journey!

  • fried wylie||

    NIMBY'd: leather production is like, bad for the environment, or cruel to animals, man

  • fish||

    But so stylish!

  • TheZeitgeist||

    Scorpio-style ballista using carbon nanotube wires would not only work, but get some kind of tax credit for sequestering the carbon.

    Greener than any train by far. Silly socialists, swing for the fences!

  • Pro Libertate||

    If they just had one guy burn dollar bills, could he burn them as quickly?

  • Paul.||

    Uhh, no. California has thousands of "guys" burning dollar bills. Why would one guy be able to compete with that level of government efficiency?

  • 0x90||

    You could save up for a few days and then invest in a really nice furnace.

  • fried wylie||

    a US dollar bill weighs approx 1gram according to wikipedia.

    $3.5million in $1s would weigh approx 7700lbs. Using, say, a snow shovel, with each load weighing approx 30lbs, is only about 257 shovel loads. With an 8hr work day, you'd only have to move a shovelfull about every 2mins.

  • Paul.||

    I dunno, there's a lot of water across that bay. I see some aqua-centric eminent domain on this one.

  • Paul.||

    *sigh* reply to comment below. Meh, too far.

  • wef||

    Sucker born every minute. In California even faster.

    Looting: The Economic Underworld of Bankruptcy for Profit

    Akerlof and Romer

    Here:

    http://www.jstor.org/discover/.....6172927973

    Or here:

    http://papers.ssrn.com/sol3/pa....._id=227162

  • Paul.||

    buy about 1,100 parcels of land, work through lawsuits by local farmers and assemble a team of contractors with large workforces.

    How many parcels of land have to be purchased for the bay bridge?

  • fried wylie||

    if they still haven't purchased all the land for the bay bridge, that doesn't bode well for this project.

  • Fist of Etiquette||

    ...a spending rate that will easily make California high-speed rail the costliest per-diem transportation project in the history of the United States.

    Costlier than the space shuttle?

  • fried wylie||

    you just wrote the system's Official Motto.

    "Welcome aboard California High-Speed Rail, Costlier Than The Space Shuttle. Enjoy the ride!"

  • Zombie Jimbo||

    Let's see, at $20 hour +50% for benefits (no Davis Bacon) For 3.5 million a day they could field an army of almost 5000 workers working around the clock for 5 years. Assuming .5 m^3 per man hour using hand tools, they could shovel out a trench 8 meters wide, 2 meters deep and 6650 km long.

    Can we have a high speed canal instead?

  • Zombie Jimbo||

    Joe Biden could be the chief gondolier.

  • fried wylie||

    great, now I'm obsessed with what a high-speed gondola would entail.

  • Brutus||

    Ooo! High-speed rickshaw!

  • Xenocles||

    Funny thing is that I just got yelled at today because my burn rate was too low.

  • DoubleIPA||

    You should probably keep that between you and your dealer.

  • ||

    So when's the Assembly planning to officially declare the People's Democratic Jamahiriya of California? Empty, useless transportation projects are really fantastic, especially for putting on commemorative stamps, if you're a pinko hellhole!

  • Sevo||

    "pointing to the fast construction pace of the new Bay Bridge in Oakland"

    The bridge was damaged to the point of replacement in an earthquake in 1989. It is not complete as of May, 2012. It required resolution of no eminent domain issues.
    Let's be generous and say it really hasn't been quite 23 years (so far).
    Now, WHAT?!

  • Sevo||

    Oh, and the cost?
    The squirrels aren't going to let me copy and paste; suffice to say that by 2010, a $7Bn budget somehow ended up at $11Bn. And this using *CHINESE STEEL*! (our jerbs!)
    http://blog.oregonlive.com/com.....-budg.html
    And it's not done yet. Anyone want odds on 2:1?

  • mr lizard||

    I've seen chinese steel. It's fine for anything that will never be exposed to saltwater.

  • Sevo||

    "I've seen chinese steel. It's fine for anything that will never be exposed to saltwater."

    Gonna disagree.
    Posting as a buyer of goods from China, you can get 'cheap and worth it' if you please. You can also get the opposite. And since US-made steel is pretty much gone, who you gonna call?
    You can blame the EPA or the unions for the lack of US steel, but it doesn't make a lot of sense to maintain plants costing $X/sq. ft. for emission controls or to employ folks demanding $Y/hour to do the same as those happy to do the same for less than $Y/hour.

  • TheZeitgeist||

    Wan Chai looked pretty stout when I was there few weeks ago. So did Central. Big mo'fo buildings in HK.

  • mr lizard||

    And I've observed rotten pipes on ship seawater systems built in the last 7 years. This is a significant flooding risk, and so with my tail on the line I'm a bit biased.

  • Spoonman.||

    Private investors plan high-speed rail in Texas - with no government funding

    I highly doubt it'll work, but with no government funding, best of luck to them.

  • Ralph Wylie||

    We Californians really need this! We are ONLY 16 billion dollars over budget and bankrupt. Bring on the High Speed Choo-Choo to Vegas. Governor Moonbeam will be conducting.

GET REASON MAGAZINE

Get Reason's print or digital edition before it’s posted online

  • Video Game Nation: How gaming is making America freer – and more fun.
  • Matt Welch: How the left turned against free speech.
  • Nothing Left to Cut? Congress can’t live within their means.
  • And much more.

SUBSCRIBE

advertisement