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High-speed rail price tag drops by $30 billion in new plan

Original post made on Apr 4, 2012

California's proposed high-speed rail system would extend from the Central Valley to the Los Angeles Basin within the next decade and would cost $30 billion less than previous estimates indicated under a new business plan that the agency charged with building the system released this morning, April 2.

Read the full story here Web Link posted Tuesday, April 3, 2012, 8:08 AM

Comments (9)

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Posted by TAK
a resident of Oak Hill
on Apr 4, 2012 at 8:37 am

If they really wanted to address California's mobility needs the rail line would start in the SF & LA areas and end out of the state. That seems to be the travel plan of anyone with good sense and a little money.

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Posted by Bob
a resident of Another Pleasanton neighborhood
on Apr 4, 2012 at 11:07 am

I actually support a high-speed rail system. However, I think the rail authority organization has gotten so far out of hand that it may not be salvageable. The rail authority has taken on a life of its own ambitions and ideals, and no longer represents the views and approval of the voters. If I recall correctly, the voters in mid 2008 approved this project with a $9.9B bond. The project estimated cost was about $20B. The Federal government was going to contribute another $10B for the project. By November 2011, without any rail actually being laid, the rail authority increased the estimated cost to nearly $100B. And now, in April 2012, they announce their greatest achievement, a 30% reduction of projected cost. However, the great achievement appears to have been reached by simply changing their plans and not building the project that the voters originally approved. And on top of that, the new plan is still more than $48B over the original projected cost. I'm sorry but I see this as completely unacceptable. I realize that this project has been dragging along, due in part to multiple objections by multiple groups, thereby increasing project costs by at least the rate of inflation. However, I note to myself that since the economic meltdown at the end of 2008, inflation has played an insignificant part, if any, with increasing across the board costs. There are a couple of exceptions such as gasoline. And if $48B in gasoline is the problem, well, one can easily see the fallacy of that excuse. Therefore one might conclude that the actual cost of the project was either withheld or hidden, or was completely unknown and comes as a surprise. If the former is true, and the real costs were not stated to the voters (perhaps just overlooked or misplaced, or the infamous alternate way of not disclosing the whole truth, "To Be Determined at a Later Date"), then the vote would have been based upon a misrepresentation. Therefore the project must be resubmitted to the voters for their approval with the true projected costs and known issues. If the latter is true, and the cost reality of the project is a surprise, then one would conclude that the project organization and promoters were incompetent or simply incapable of anticipating real world conditions. Here again the real cost of the project was not stated to the voters. And here again the project must be resubmitted for approval. Lastly, with their latest announcement, the rail authority has decided not to implement the high-speed rail project that was approved by the voters. Instead they plan to implement their own plan for a hybrid rail system. If this is their final decision, then I believe their existence and authority to proceed has been revoked. Since the rail authority will not be performing the functions and tasks authorized by the voters, they can not legally function nor spend tax dollars to achieve their own goals.

This project needs to go back to the voters for approval. Leaving this group in place, without seeking voter approval is in essence raising taxes upon the people without their vote. If the rail authority continues to spend California tax collections for a project plan that has not been authorized and whose actual cost has not been approved, then the rail authority has just raised taxes. The rail authority, not our representatives have just raised taxes. Continuing without a vote means the expenses will continue to be paid, either with bond money (paid from taxes upon the people) or from another taxing source within the state, which means that some other department or need of the people will go wanting. I want to reconsider this project, this spending plan.

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Posted by Sam
a resident of Oak Hill
on Apr 4, 2012 at 11:14 am

I don't recall ever seeing any details concerning the type of high-speed rail envisioned here. Are they planning to hire Japanese Shinkansen companies to build a high-speed rail system here? Or is the plan to get a European TGV-type system? Or is the plan to have American companies design and build a high-speed rail system?

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Posted by aResident
a resident of Amador Estates
on Apr 4, 2012 at 9:10 pm

Most likely Chinese companies will bid on and win to build it just like they did for the east span of the Bay Bridge!

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Posted by Some Dude
a resident of Amberwood/Wood Meadows
on Apr 5, 2012 at 5:18 am

Didn't Tim Hunt just post a snarky rant claiming that this project is $23 billion OVER budget, not $30 billion UNDER? That's a Santorum-sized deviation from reality!

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Posted by Kathleen Ruegsegger
a resident of Vintage Hills
on Apr 5, 2012 at 10:43 am

"The blended approach, which places a greater emphasis on improving existing infrastructure than the four-track design, is expected shave more than 30 percent off the $98.5 billion price tag cited in the November plan. The new document pegs the cost of the San Francisco-to-Los Angeles system at $68.4 billion. That figure remains significantly higher than the $40 billion price tag presented to state voters in 2008, however.

"Even with the lower cost estimate, funding remains a major wildcard. California voters had approved a $9.95 billion bond for the proposed system when they passed Proposition 1A in 2008.

"The rail authority hopes to build the system through a combination of bond funding, federal grants, local contributions and private investments. So far, the system has received about $3 billion in grants from the federal government."

Seems $10 billion plus $3 billion leaves you looking for $55 billion in "contributions and private investments."

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Posted by Chuck W.
a resident of Another Pleasanton neighborhood
on Apr 5, 2012 at 5:21 pm

WHY are writers, including Tim Hunt, acting SURPRISED about where we stand on the so-called High-speed rail project? And whether it is $1B over budget, or $30B is almost irrelevant -- it is NOT what the voters of CA voted for way back when. How can we be surprised when we keep doing the same uninformed, sometimes stupid, things, and then expect different results? That's NOT how life works! This is exactly how Democrat politicians (read: Gov. Moonbeam) have been handling the $$$ issues for years! And, of course, 2012 IS an election year, and Jerry is TOTALLY beholden to the unions and the far left of the Dem part in our Legislature. HE may not be up for re-election just yet, but his cronies, backers and IDEAS are!!
We NEED TO STOP ALL PLANNING,STUDIES, JAW-BONING, AND EXPENDITURES ON THIS SUBJECT AND RIGHT NOW!!! #2: Get our books balanced. I.E, SPENDING CANNOT EXCEED INCOME FOR DAILY NEEDS. Then, we can open some dialogue on the subject (if there is still anyone interested...) AND START OVER FROM SCRATCH!!! bUT, AS WE STAND TODAY, THIS IS NOTHING BUT ANOTHER RAT-HOLE FOR OUR MONEY & MUST BE STOPPED! And, I grew up in a "railroad" town, and love trains. But, NOT this mess~~ THIS REALLY HAS NOTHING TO DO WITH "TRAINS"!!

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Posted by Kathy
a resident of Pleasanton Middle School
on Apr 5, 2012 at 10:17 pm

It's cheaper to put truck containers on airplanes.

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Posted by Good Reason to Vote Down New Taxes
a resident of Beratlis Place
on Jul 16, 2012 at 2:31 pm

The best thing about this squandering of taxpayer $$$, is that it might provide the kind of emotional appeal to convince voters to vote down all of the Democrats' taxes on the November ballot. If California can come up with the $$ for HSR, the normal 3x cost overruns, and the ongoing operational subsidies and special expenses, then it should be no problem to dig into the infinitely-deep same source of cash to pay for education (well OK, to pay for staff and schools), keeping our parks open, etc. All we have to do is to restructure all of our schools so that they are considered part of the High Speed rail project. Voila! Problem solved.

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