The High-Speed Rail Project in California rolls on, seemingly invincible and equipped with a teflon shield, despite an incredible long list of independent sources that have significant issues with the project. Among them most recently, the State Auditor has said that the project is becoming increasingly risky because the lack of funding available to build the system.
The High Speed Rail Authority (HSRA) continues despite the fact numerous cities and pubic entities have voiced their displeasure by voting they did not want high-speed rail in their communities in past months. These cities and communities include many central valley cities such as: Bakersfield, Chowchilla, Corcoran, Wasco and the Board of Supervisors of Tulare and Kings County; and just last week, Madera. Why? Because of devastating effects on their cities, their residents, improper route planning, inadequate environmental practices and poorly done outreach, (i.e. not the two way kind). http://www.hanfordsentinel.com/news/local/corcoran-anti-rail-campaign-hopes-to-go-viral/article_56ebb318-478b-11e1-839a-001871e3ce6c.html
Apparently these objections were not enough to prevent the release of $77,594,000 million in the last month. The funds were quietly released without a vote by the legislature - - in other words, business as usual. It’s legal and just the way it’s done. The Authority was required to answer questions in accordance with AB 115. After the submission of various documents & reports by the Authority and a sixty day review period, voila, the money was released. No vote needed. There are major questions as to the quality of their responses but Chairman of the Joint Budget Committee, Senator Mark Leno who had the power to stop it, didn’t. This money is primarily for the administrative costs and the consulting expenses in other words to keep the project operating.
Here is a sample of the questions that have been raised the HSRA has yet to adequately answer.
(a) [Provide] a complete legal analysis of the revenue guarantee or other mechanisms to reduce the operator's risk that the authority indicates it would provide to the operator. To mitigate risk, the authority shall provide an analysis of the revenue contribution to the project from the private operator with and without a revenue guarantee or other mechanism to reduce the operator's risk. The authority shall discuss alternative financing approaches to make up for any lost revenue in the case of no revenue guarantee or other mechanisms to reduce the operator's risk.
(b) [Provide] a financial plan update with alternative funding scenarios. To mitigate risk, the authority shall report on alternative funding options if no significant federal funds are received and no revenue guarantee or other mechanisms to reduce the operator's risk are allowable. The plan shall also include construction alternatives for a constrained funding environment, including what investments would be made and construction completed if the non-bond resources only equal bond funding.
(c) [Provide] a public outreach plan for the Bakersfield to Los Angeles segment.
(d) [Provide] a formal response and full analysis of the April 18, 2011, joint statement on California high-speed rail by congressional and state officials. See Blended Ideas from Peninsula elected officials
(e) [Provide] a formal response and full analysis of the issues raised in the May 10, 2011, report by the Legislative Analyst entitled "High-Speed Rail Is at a Critical Juncture."http://www.lao.ca.gov/reports/2011/trns/high_speed_rail/high_speed_rail_051011.aspx
The Authorities responses to these questions thus far can be found in this article. http://www.examiner.com/transportation-policy-in-san-francisco/authority-s-views-on-revenue-ridership-the-capital-gap
The auditor’s report also addresses the lack of information for many of these key questions regarding financing, alternative plans, subsidy, ridership which led them to the conclusion that the project is increasingly risky for the state. See article with full links to the state auditor’s full report. Auditor Report SummaryIn addition to the Auditor’s comments, the Independent Peer Review Groups’ Funding Plan Findings showed major flaws in the finances.
Another examination of financial problems in the business plan called, “12 Misleading Statements,” speaks to the heart of many of the questions that the Authority had to respond to. These California men, Alain Enthoven, William Grindley, William Warren, Michael Brownrigg and Alan Bushell have worked in private industry, have extensive financial and business consulting backgrounds and have written extensively on the flawed financial aspects of the project. http://cc-hsr.org/assets/pdf/12misleadingstatements.pdf
The fundamental question here is: were the Authority’s answers in both the formal response and in the business plan good enough to release $77 million dollars and to keep this “gravy train a-rolling? Read their answers. Decide. Let your representatives know how you feel about continuing to fund high-speed rail.
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