You Can’t Build High Speed Rail with No Money

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

The Legislative Analyst’s “concern” that funding is not available for the High Speed Rail (HSR) comes at the same time that the federal government – a source counted on for HSR funds — appears to be turning against the High Speed Rail.

Yesterday, the subcommittee on Transportation under the Appropriations Committee of the United States Senate put a hold on HSR federal funds for the 2013 fiscal year. Ken Orski, editor and publisher of Innovation News Briefs, which follows transportation issues on Capitol Hill, says the full committee usually follows the sub committee’s recommendations.

Orski stated,  “The Democrat-controlled Senate Transportation Appropriations Subcommittee, which usually marches in lock step with the White House, has disallowed all of the Administration’s FY 2013 request for high speed rail ($4 billion).  Of the total $1.75 billion federal rail budget, the Senate Subcommittee has allocated  $1.45 billion for Amtrak and $100 million for the High Performance Passenger Rail grant program to assist  with the improvement of existing intercity services  and multi-state planning initiatives.  The House appropriators, of course, have never intended to vote any money for HSR in FY 2013, but the Senate action puts an end to any hopes that a House-Senate conference might provide even a token amount for high-speed rail in the FY 2013 federal budget.”

So where is the money going to come from for California’s High Speed Rail project?

The new HSR plan says two-thirds of the revenue will come from the Feds. With a Senate Subcommittee taking a similar attitude as the Republican controlled House that seems unlikely.

Private funding? That was part of the original plan. However, private funders want to feel there is a chance to make a profit. If you consider the High Speed Rail Committee’s constantly shape-shifting proposal as a poorly conceived business plan, investors would be foolish to take the risk.

Could HSR pay largely for itself with ridership fees? The estimates on ridership on the HSR have been laughable from the beginning – and that’s being kind.

What about the governor’s plan to use fees generated by the greenhouse gases law, AB 32, for subsidizing the HSR?

Such a move is legally questionable. If such a move were attempted a lawsuit over taxes, fees, and the voters right of approval would probably be filed. The idea may also violate the dictates of AB 32. The Legislative Analyst noted that the HSR effect on greenhouse gases would take an extremely long time and would not be within the required timeline required by AB 32 for greenhouse gas reduction.

If all these funding alternatives fail that leaves the taxpayers.

In 2008 when the HSR bond was on the ballot, voters were told the project would cost $33-billion; that private funds would rush to the project; that annual ridership would equal the population of a number of states – all promises that now appear false.

Polling indicates the voters have changed their minds about supporting HSR.

The taxpayers should not be on the hook for this project. While the legislature is likely to postpone the decision on the HSR to study the facts, legislators should also consider Senator Doug LaMalfa’s proposal to give the voters another chance to vote on the idea.

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