#HSR: California high-speed rail boondoggle lowers revenue projections

April 15, 2014
Boondoggle

Boondoggle

Can someone please just shoot this project and put it out of our misery?

In a new business plan submitted to state legislators last week, the California High-Speed Rail Authority offered lower revenue projections than it had two years before, predicting that revenue will be “5 percent lower than originally projected by 2025 and 10 percent lower by 2040,” according to a report by Sacramento’s KCRA.com.

So, let’s see. Costs are higher than projected (pace the HSRA), the train won’t be as fast as projected, even Democrats are breaking with Governor Jerry Brown over the project, and now revenues, which are supposed to pay back the billions we’re borrowing for this thing, won’t meet initial projections.

Explain to me just why Brown deserves reelection? I’m waiting… smiley well I'm waiting

RELATED: Past posts on Uncle Jerry’s high-speed choo-choo.


#HSR: Jerry Brown’s high-speed choo-choo not so high-speed

March 28, 2014
Boondoggle

Boondoggle

Via The American Interest, the LA Times reports that California’s high-speed rail project may not be able to meet its promised travel times — shocker!

Regularly scheduled service on California’s bullet train system will not meet anticipated trip times of two hours and 40 minutes between Los Angeles and San Francisco, and are likely to take nearly a half-hour longer, a state Senate committee was told Thursday.

The faster trips were held out to voters in 2008 when they approved $9 billion in borrowing to help pay for the project. Since then, a series of political compromises and planning changes designed to keep the $68-billion line moving ahead have created slower track zones in urban areas.

But Louis Thompson, chairman of the High-Speed Rail Peer Review Group, a state-sanctioned panel of outside experts, testified that “real world engineering issues” will cause schedules for regular service to exceed the target of two hours and 40 minutes. The state might be able to demonstrate a train that could make the trip that fast, but not on scheduled service, he told lawmakers. If public demand for the service supports additional investments, travel times could be improved after the currently planned system is built, he said.

Critics of the project have long disputed whether travel times between the Bay Area and Los Angeles will meet the mark of two hours and 40 minutes. Projected trip times for the bullet train are a point of contention in a court fight that could block the state’s access to the voter-approved bond funds.

So we have huge cost overruns, property seized to make way for the train, and now the revelation that it won’t even be all that “high-speed.” Genius. Future generations of dictionaries will include the California high-speed rail authority’s logo in their definition of “boondoggle.”

The puzzling thing is, neither the bullet train fiasco, the ongoing corruption saga, nor the fact that the state is bleeding jobs and businesses is making a dent in Governor Brown and the Democratic Party’s control over the state. But then it becomes not so puzzling when you think about it. As the author at TAI writes:

While Democrats face some internal wrangling over the project, it’s the state’s total absence of an organized political opposition that helps keep ideas like the high speed train alive. As a BuzzFeed article points out, Brown is not suffering in the polls whatsoever from his beloved project—a boondoggle that a majority of Californians now oppose. Similarly, the Golden State’s status as nation-wide leader in job losses isn’t expected to affect the Democrats’ legislative supermajority. In the last three months, three Democratic state senators have been convicted (1) on federal corruption charges including voter fraud, perjury, bribes in exchange for legislation, and weapons and drug trafficking to pay off campaign debts. That’s a list that would make Boss Tweed blush, but it doesn’t seem to be hurting the Democrats’ dominance in Sacramento.

It’s the job of the opposition to oppose, yet the California Republican Party is limp. As I wrote to friends the other day after the Leland Yee scandal broke:

“Which isn’t to excuse the CRP for being flaccid. Last night, several of us on Twitter were ripping them for being milquetoast in the wake of the Leland Yee scandal (and Wright and Calderon). The Republican Party in California is already a rump; why not make some noise, go on offense, and demand to know why the Democratic Party tolerates corruption in its ranks? Call press conferences, get ads out, get all candidates on the same message. Run on a populist clean government and prosperity platform.  We really have nothing to lose and we might peel off enough voters to make a difference.”

Otherwise, we’re just leaving the state to the people running it into the ground.

Footnote:
(1) Actually, one convicted and two indicted. The error has been pointed out at TAI in the comments section.

(Crossposted at Sister Toldjah)


California: Jerry Brown’s high-speed payoff? #HSR

January 30, 2014
Boondoggle

Uncle Jerry’s High-Speed Boondoggle

Oh, no. This doesn’t look bad at all. First the Tutor-Perini (1) construction company, whom we’ve met before, wins a huge contract to build California’s high-speed rail, even though their record is… not the best. Then, after two defeats in state courts that put the whole project in jeopardy, Brown demands the state supreme court take the cases and overturn them — NOW!!! (2)

And what came between the lower courts’ decisions and Brown’s running to the supreme court? Why, a maximum contribution to Brown’s reelection campaign.

From Tutor-Perini:

The timing of the campaign contribution doesn’t sit well with the state Legislature’s leading critic of the $68 billion high-speed rail project.

“Let’s connect the dots,” said Senator Andy Vidak, R-Hanford, who has introduced a package of legislation “aimed at driving a stake through the heart” of the state’s bullet train. “The HSR Authority’s apparent bid-rigging lands this company a $1 billion contract, then this company gives Brown a max campaign contribution, and then Brown sues to bail the company out?”

“In farm country, this is called ‘you scratch my back, I’ll scratch yours,’” Vidak said.

If Michelle Malkin ever writes a second edition of “Culture of Corruption,” I have a suggested new chapter for her, titled “California’s High-Speed Rip-Off.”

PS: Yeah, I tweeted this article a few minutes ago, but it has me so ticked off, I had to write about it. Garbage like this is one of the poisoned fruits of decades of one-party rule.

Footnote:
(1) The principal owner of which is Senator Diane Feinstein’s husband, let us not forget. Apparently not true any longer, Blume having divested himself of Tutor-Perini stock around October, 2005. (h/t Brock Winstead)
(2) Where he was rebuffed, I’m happy to say. Even the governor doesn’t get to jump the line.

(Crossposted at Sister Toldjah)


California: Governor Brown panicking over High-Speed Rail? Updated.

January 8, 2014
Boondoggle

Boondoggle

From The Sacramento Bee’s Dan Walters. It looks like Governor Brown, faced with recent legal defeats for his “Train to Nowhere,” may be starting to panic:

Jerry Brown may be getting desperate about keeping the state’s increasingly unpopular – not to mention financially and legally challenged – bullet train project alive.

Faced with a judge’s insistence that the project follow the law about having its financial ducks lined up, Gov. Brown is now poised to shift money from the state’s “cap-and-trade” fees on greenhouse-gas emissions into the bullet train.

Brown, it’s been reported in The Bee and elsewhere, will propose in his 2014-15 budget that a portion of the fees being extracted from California business be committed to the bullet train.

Problem is, the money my fellow Californians allocated (1) to fight global warming climate change the evil demon threatening Gaea is “hardwired” by statute; the court may not accept that as a funding source sufficient to let construction go forward. Even if it does, the legislature, whose dominant leftist faction gets a lot of donation money from environmentalist groups, may not agree to reallocate the funds. But, if they do, and if the judge accepts this as a legal source of funds for Jerry’s Choo-Choo, it may still set up the mother of all Blue-on-Blue battles in Sacramento as environmentalist groups and their voters will likely raise an unholy stink over any money being diverted from their religious crusade.

And, when that happens, I’m doubling my popcorn order. smiley popcorn

Footnote:
(1) Passed in a fit of  “It’s for the environment! It must be good!!” Look, I live in a beautiful state and consider myself a conservationist (But not an environmentalist. I don’t join cults.), but passing a crippling new tax to fight a problem that does not exist was stupid and self-destructive for the state. Unfortunately, that’s what you get when an electorate votes with less consideration of the issues than they give to buying a head of lettuce.

UPDATE: There is no way I’m taking Moe Lane’s bet. That’s a sucker’s bet if I ever saw one.

(Crossposted at Sister Toldjah)


CA High-Speed Rail Fail: Judge derails Gov. Brown’s choo-choo?

November 26, 2013
"Train wreck"

“Train wreck”

Darn Judge Michael Kenny and his concern for the law! Doesn’t he know he’s standing in the way of the future?

A Sacramento judge put the brakes on California’s plans to build a bullet train after dual rulings Monday blocked the sale of $8 billion in bonds and ordered the rail authority to rewrite its funding plans for the huge project.

Sacramento County Superior Court Judge Michael Kenny ruled that there was “no evidence in the record” to support the California High-Speed Rail Authority’s request in March to sell the bonds from Proposition 1A, a $10 billion measure approved by voters in 2008 that allowed the bullet train project to move ahead.

In a separate but related case, the judge sided with the Kings County Board of Supervisors and two homeowners who sued the rail agency, saying it had failed to detail how the project will be financed, as legally required, before seeking bond money to begin construction.

The judge’s rulings leave the future of the $68 billion project in question. The state has been trying to get the first 130-mile segment in the Central Valley built using $3.24 billion in federal funds and $2.61 billion in Prop. 1A bond money. The rail authority has already signed a construction contract to build the first 29 miles of track from Madera to Fresno.

The judge rejected opponents’ calls for that contract to be rescinded.

The judge’s ruling seems a reasonable one, as he sticks to the question of CHSRA’s authority to sell bonds (1); the contract is a separate matter and, if the State can’t raise the money to pay for it, also moot.

Naturally, this ruling is going to get appealed by proponents of this boondoggle all the way to the State Supreme Court, if need be. Let’s hope they uphold Judge Kenny’s ruling; then maybe we can escape from this fiasco having wasted only $600 million.

I’m not, however, getting my hopes up. The legislature might try to rewrite the law to allow the bond sales. This would be difficult and subject to court challenges, as the original measure approving HSR was a public ballot initiative, and changing it might require another vote, something Brown opposes because the California public has turned against the project. He wouldn’t want to risk a public rejection that would definitively kill his 1930s retro-future dream. Whichever way this goes, it’s going to be a long fight.

As they say, “stay tuned!”

Footnote:
(1) I almost wrote “”bongs.” Fitting, seeing as this is California.

(Crossposted at Sister Toldjah)


CA High-Speed Rail Fail: $600 million spent, not a mile of track laid

November 23, 2013
"Train wreck"

“Train wreck”

Because The Future! Or something:

The latest accounting by the California High-Speed Rail Authority to state lawmakers indicates that the agency has spent almost $600 million on engineering and environmental consultants — all without turning a shovelful of dirt on construction.

In the twice-a-year report (PDF) sent to legislative leaders on Friday, the agency is sticking to its estimated price tag of $68.3 billion to build its San Francisco-to-Los Angeles bullet-train line. The agency earlier this year approved a $987 million contract with a team of contractors to design and build the first 29-mile stretch of the line from Madera through Fresno.

But while contractors Tutor Perini Corp., Zachry Construction and Parsons Corp. have been given a green light for engineering and other pre-construction activities, the authority has offered no estimate of when ground may be broken .

If the name “Tutor-Perini” rings a bell, you’re not just hearing things. Tutor-Perini’s principle owner is Richard Blum. Blum has been mentioned before in this blog, and there have been allegations in the past of cronyism in the winning of government contracts by companies he’s involved with. By sheer coincidence, Blum is also the husband of Senator Diane Feinstein.

Fancy that.

But, back to the more than half-a-billion, this is money that has been spent before construction has even begun on the initial Fresno to Madera segment. The Fresno Bee article describes what we’ve gotten for our money, so far:

“The authority has made significant progress in its mission to plan, design, build and operate the nation’s first high-speed rail system as part of the statewide rail modernization program,” agency CEO Jeff Morales wrote in the report.

The report details a raft of administrative advances, including filling all of its executive management positions, developing a risk-management plan, issuing a report on greenhouse-gas emissions, and awarding the construction contracts for the Madera-Fresno stretch.

(I hope those executives got some nice chairs for that $600 million.)

There is still an environmental report –Yay! More consulting fees!– for the area around Chowchilla to be done, which is why this state version of a shovel-ready project hasn’t started. Already they’re two years behind schedule.

And the whole ball of wax (with attendant fees) has to be done for at least six other segments from San Francisco to Anaheim. Luckily, the High-Speed Rail Authority is allowed to spend up to $980 million on pre-construction “consulting contracts” through 2018. No way they’ll come asking for more public money (1). Nope. Nuh-uh.

I can’t wait to see what the costs come to once they actually start building this boondoggle.

Nice legacy ya got there, Governor.

Footnote:
(1) Funded by either public borrowing or higher taxes, of course.

(Crossposted at Sister Toldjah)


Shock and surprise: Diane Feinstein’s husband’s company lands big high-speed rail contract

April 26, 2013
"Train wreck"

“Train wreck”

Because, at nearly $35,000,000 per mile, they surely had to be the cheapest:

Out of the entire universe of those who could have won the first phase construction contract for California’s high speed rail boondoggle, who would stand out as the last person who would win it if there were no political patronage.

Put another way, who is the most likely person to win it if there is political patronage?

Both questions have the same answer: Richard Blum, the husband of California senator Diane Feinstein.

So, who won the contract? Blum, of course, as the principle owner of Tutor Perini, the lead firm in the three-firm consortium selected by the California High Speed Rail Authority.

Yes, Diane, it really does look that bad to us little people.

The group lead by Tutor Perini bid $985,000,000 to build the initial 29-mile stretch, roughly from Fresno to Madera, which doesn’t include the costs for electrification and land purchase. And, as Laer points out at Crazifornia, they started with this section because it’s the cheapest. (I can’t wait to see what the bids are to lay track through the mountain passes…)

I’m sure it’s just a coincidence that the principle owner of the company is husband to a powerful United States senator, who happens to be from the state building said rail system. I mean, it’s not as if there have been any allegations of self-dealing before.

I’m about as shocked as Louis was in Casablanca:

via Katy Grimes

UPDATE 01/30/2014: It appears Blum divested himself of Tutor-Perini stock in 2005, calling into question much of the Crazifornia article. The rail deal still stinks like a fish left out in the sun, however.

(Crossposted at Sister Toldjah)


You’re welcome, America: California’s high-speed rail will need a federal bailout

March 29, 2013
"Train wreck"

“Train wreck”

I just knew it would come to this:

When California finishes tapping out the taxpayers in its state to pay for its nonsensical high speed rail, it will ask the taxpayers of other states to chip in, according to a new Government Accountability Office report requested by House Majority Whip Kevin McCarthy (R-CA). The GAO report found that the federal government will have to give California an astonishing $38.7 billion in order for the state to complete the idiotic project, footing more than half of the total cost.

Not that California will ever see much, if any, of that money; with Republicans controlling the House and the public increasingly concerned over ludicrous levels of federal spending (and borrowing), there’s going to be heavy pressure not to give Sacramento a dime.

And I call that a good thing.

My fellow Californians passed Prop 1A in a fit of bong-born enthusiasm in 2008, but, since then, public opinion has soured to the point that a majority would just cancel it, largely due to skyrocketing costs. Here are five good reasons this boondoggle should be tossed in dumpster, including the fact that rider numbers –and thus the ticket sales needed to pay off the debt we’re incurring– will never match projections.

(Which is surprising. You’d think millions would flock to ride that opening stretch from Bakersfield to Madera.)

Thankfully, Representative McCarthy and his Republican colleagues are working to block any federal aid to this folly. It’s sad when a federal representative has to work against his state government, but, in this case, call it “tough love.” If Governor Brown and the dreamland progressives in the legislature can’t see the need to kill this lunatic project, someone will have to do it for them. Sadly, my guess is this will only happen after we’ve taken on tons more debt pursuing it.

Why is the left so obsessed with fixed rail? Or does “progressive” really mean “the future as seen from the 1930s?”

(Crossposted at Sister Toldjah)


California’s high-speed train wreck potentially not a metaphor. Update: about those profitable EU rails

December 26, 2012
Boondoggle

Boondoggle

Or, “Science kills another liberal dream.”

California voters were sold a worthless bill of goods when the voted for Prop 1A, authorizing the construction of a high-speed rail to run (eventually) from Los Angeles to San Francisco. The project is already far above projected costs: the initial 65-mile stretch from Madera to Corcoran (1) is estimated to cost $4.15 billion – so far. And there are serious doubts about the ridership projections, meaning the system would face even greater difficulty recovering its costs and paying the debt incurred to build it. Just what a cash-strapped, economically wheezing state needs.

Now, on top of all that comes news that the system may be unsafe at the speeds promised in 1A:

Professor Peter Woodward, one of the world’s leading experts on the geo-engineering of railways, said that high-speed running created “new problems” in track which “may threaten the stability and safety of the train”.

In papers lodged with the Government’s Engineering and Physical Sciences Research Council (EPSRC), Prof Woodward warned that speeds as high as those proposed by HS2 could trigger “significant amplification of train-track vibrations” causing “rapid deterioration of the track, ballast and sub-ballast, including possible derailment and ground failure”.

High-speed rail in the West has a fairly good safety record, but experts are worried that HS2 plans to run trains faster than any other line in the world. Trains will travel at 225mph, rising to 250mph within a few years.

Most high-speed lines, including Britain’s existing Eurostar, run no faster than 186mph and the world’s current fastest rail-based trains, France’s TGV Est, travel at 200mph.

Some trains on the new Chinese high-speed network used to run at 220mph, but were reduced to 186mph last year on safety grounds.

Now, the professor’s estimate for the danger zone is 225mph, but that’s a not a firm limit. Much depends on the ground over which the track runs: trains in Sweden running as “slow” as 110mph were observe to create a dangerous increase in track vibrations that could amplify suddenly as the train crossed a speed barrier, with an effect similar to a sonic boom.

Of course, the problem can be mitigated by running the trains slower, as the Chinese did, but that then means fewer trains running, which lowers ridership, which lowers revenue, which means more money spent on debt interest and maintenance on a system that can’t pay for itself…

Such is Jerry Brown’s great legacy to California.

Gomez Addams, eat your heart out.

via Cal Watchdog

Footnote:
(1) And from whom do they expect to draw their riders on this route? Prisoners and their guards?

UPDATE: One of the questions surrounding HSR is its economic viability: Can it support itself without subsidies from the taxpayer? Backers claim that, with enough riders and fast enough trains (enabling more trips), HSR can support itself. They often point to Europe, especially France’s TGV, as proof of this.

Not so fast. In 2008, Amtrak’s Inspector General looked into this and found that HSRs in the EU were profitable thanks mainly to creative bookkeeping (PDF).

Overall Conclusions

After examining a representative sample of European Passenger Train
Operations over a multi-year period, we found that:

a) When all revenues and expenses for the entire passenger train system are
taken into consideration, European Passenger Train Operations operate at a
financial loss and consequently require significant Public Subsidies, and

b) The average annual subsidies for European Passenger Train Operations are
much higher than those for comparable Amtrak services.

Individual Findings

The review of Public Funding for European Passenger Train Operations
provided the following findings.

1. European Passenger Train Operations are typically organized into two separate
business entities (operating companies and infrastructure managers) whose financial
performance and public funding are closely intertwined with each other.

2. In addition to direct funding, some of the Passenger Train Operations receive public
funding that did not show up on the company’s balance sheet and therefore does not
show up in the company’s financial statements.

3. Although some Train Operating Companies may report a “profit”, this profit is
generated through a large amount of public funding provide by the European
countries.

I suspect similar financial shenanigans will be necessary to make Governor Brown’s High-Speed White Elephant appear profitable, too.

(Crossposted at Sister Toldjah)


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