California Judge Sends High-Speed Rail Plan Careening Backward Into the Station
State not allowed to spend bond money until the plan comes into compliance with authorizing ballot initiative
California's High-Speed Rail Authority (CHSRA) can't even spin this one: A state judge in Sacramento, in two separate rulings, has taken the business plans for the state's bullet train outside, tossed them in a rusty barrel behind the courthouse, and set them on fire. As Reason has repeatedly noted across several years, the CHSRA's runaway rail plan was wildly different, more expensive, and simply not in compliance with what was approved by voters in a ballot initiative in 2008. Today Judge Michael Kenny agreed with opponents that the state could not push forward with its plans as they are. From the Associated Press:
Judge Michael Kenny rejected a request from the California High-Speed Rail Authority to sell $8 billion of the $10 billion in bonds approved by voters in 2008, saying there was no evidence it was "necessary and desirable" to start selling the bonds when a committee of state officials met last March.
He said the committee was supposed to act as "the ultimate `keeper of the checkbook'" for taxpayers, but instead relied on a request from the high-speed rail authority to start selling bonds as sufficient evidence to proceed.
In a separate lawsuit, Kenny ordered the rail authority to redo its $68 billion funding plan before continuing construction, a process that could take months or years. He had previously ruled that the authority abused its discretion by approving a funding plan that did not comply with the requirements of the law. The judge said the state failed to identify "sources of funds that were more than merely theoretically possible."
Proposition 1A, which voters approved in 2008, required the rail authority to specify the source of the funding for the first operable segment of the high-speed rail line—a 300 mile stretch—and have all the necessary environmental clearances in place. Kenny had said the agency did not comply with either mandate in approving the start of construction from Madera to Fresno, about 30 miles.
Technically and politically, the ruling doesn't kill the plan, but the blow is pretty devastating. The state does not have the money to build a full 300-mile stretch of the $68 billion boondoggle. Despite blinkered claims by progressive that California's economy is recovering, it is wallowing in huge amounts of debt, unfunded state pension liabilities, and rapidly expanding health care costs. And there's little sign of additional federal subsidies coming unless the Democrats win the day in 2014 and take back the House.
Nevertheless, CHSRA is trying to act like they expected a judge to order them to start the process over the whole time:
"Like all transformative projects, we understand that there will be many challenges that will be addressed as we go forward in building the nation's first high-speed rail system," authority board Chairman Dan Richard said in a written statement.
Going backward instead is quite the challenge to your efforts to go forward.