Voters, enthralled with the concept, approved a $10 billion bond issue in 2008 to help pay for a high-speed train connecting Northern and . The idea was that the federal government, local governments and private investors would put up the rest.
But here is the hitch. Voters specified that if the system ever gets built, no tax money can be used to operate it, and there is no backup plan if the train were to turn out to be unprofitable.
That might be an acceptable risk, except that three years into it, promoters of the project still haven't come up with an acceptable business plan. Their guestimates about costs and ridership have been rejected by outside experts, and even by the state's own legislative analyst.
Cost estimates have risen from $15billion to $45 billion, and a management professor speculates that if this project goes like virtually any other major state construction project, the costs could end up more like $243 billion. Nobody, other than the promoters, believes the revenue projections, or even how fast the train would go (considering that it would ride part way on ordinary tracks, rather than those designed for high-speed rail).
It's very unlikely that this project will ever get finished, since the federal government's relatively small contribution of $3 billion looks like the last of the handouts for a long while.
It's the same with private investors, none of whom have stepped forward, and local governments, most of which are on the edge of bankruptcy.
But even if it did get built and turned out to operate at a loss, which is the usual case with train systems, then what happens? Nobody has an answer.
Critics within state government, such as Sen. Alan Lowenthal, D-Long Beach, say the first leg of the project should be built in the . or , not in the state's mostly rural midsection, yet the spending continues, with the midsectiion as the unlikely starting site. That's what the federal government insisted on, because the political fantasy was that pumping a few billion into the Fresno area would light up the state's economy. That won't happen, either.
The federal government has nothing to lose but its $3 billion, which is like crumbs from its trillion-dollar recession spree. But California has a lot to lose.
Fortunately, thanks to pressure from a few legislators like Lowenthal, the state has told the California High-Speed Rail Authority it can have only half of an allotted $2.5 billion for engineering and other preliminary costs. Unless it then, at last, can come up with a credible business plan, the state will stop the money supply.
That is a good time to stop this whole project. Bullet trains are exciting, and maybe even worth subsidizing on a manageable scale when well conceived, well planned and well run.
This project is none of those things. It presents monumental risks at a time when the state can't even get its budget under control, and a money drain that has gone on long enough.
Let's throw the switch.
GOP tries to shift rail money to Midwest flood relief
WASHINGTON Congressional Republicans this week are side-tracking $1.5 billion in high-speed rail funds already awarded to several states.
In an adroit maneuver, GOP lawmakers propose shifting the high-speed rail dollars to pay for Midwestern disaster relief. The move would help ease the federal deficit while it underscores Republican resistance toward the Obama administration's rail plans.
"The flooding in the Midwest has been devastating," said Rep. Rodney , R-N.J., adding that "we must be serious about controlling the deficit."
If House Republicans succeed, California would lose $368 million. The Amtrak Northeast corridor would lose $795 million, and a Midwestern high-speed rail corridor linking , and would lose $404 million.
The high-speed rail grants were announced by the Transportation Department in May, after had rejected the money. The checks, though, have not yet been sent.
"They're taking after this because it's sponsored by the president," Rep. Jim Costa, D-Calif., complained Monday, adding that "I think it's a real slap at California."
California has planned to use its $368 million to help extend the initial high-speed rail route from Bakersfield to a rural junction near . The California money would also help pay for additional rail cars and locomotives.
Frelinghuysen chairs the House energy and water appropriations panel and added the funding shift as part of a fiscal 2012 energy and water bill. The bill is often a popular one in California's , as it provides money for Sacramento-area flood control, safety upgrades at the Tule River's Success Dam and other projects.
The must-pass bill can also become a vehicle for controversial policy prescriptions, as well. The 2012 House bill, for instance, would block further spending on River restoration for the coming year.
This year's bill would add $1 billion for the Army Corps of Engineers to respond to floods, tornadoes and other natural disasters in the and basins. The post-disaster work is considered an emergency, which usually means lawmakers don't need to offset the additional spending.
Since Hurricane Katrina devastated , for instance, Congress has provided some $5 billion on an emergency basis without demanding budget offsets.
"We have always treated those as stand-alone items," Costa noted.
Nonetheless, the Republican-controlled House Appropriations Committee wrote its energy and water bill to include taking away the high-speed rail funds. The committee on Friday rejected previous Democratic efforts to restore the funding on a party line 20-26 vote.
"It is important for the federal government to learn to live within its means," Rep. Hal Rogers, the Republican who chairs the House Appropriations Committee, said during the committee debate.
The funding maneuver prompted Costa, Rep. Dennis Cardoza, D-Calif., and other members of the congressional High-Speed and Intercity Passenger Rail Caucus to rally together in a blizzard of emails and phone calls Monday, though it's unclear whether they can force a House vote before the overall bill is approved later this week. Politically, it may not be advantageous to force a vote if it's likely to lose in the GOP-run House.
The House and Senate must eventually reconcile their different versions of the energy and water bill. The high-speed funding transfer is among the divisive items likely to incite intensive negotiations, as is the San Joaquin River restoration funding ban.