High speed rail: Checking the Fact Check
For its story on the Brown-Kashari debate, the Chronicle had a "fact check" sidebar of the candidates' statements. On high-speed rail:
Statement: Kashkari said that as a result of Brown spending $70 billion on the high-speed rail project, the state is spending only $2.7 billion on water storage and other important matters such as upgrading school facilities.
Fact check: The state can't dip into one pot of money for unrelated projects. California's $68 billion high-speed rail plan calls for using a combination of federal dollars, voter-approved state bonds and potentially cap-and-trade money. The state's water bond, which is on the November ballot, calls for $2.7 billion for surface storage.
True, if the water bond passes in November, the state can't take that money and spend it on schools. But Kashari's point was obvious: If the state is going to spend billions on the train to nowhere, it limits what it can spend on other issues.
True too that the state's high-speed rail plan is counting on money from the federal government to build the system. But it's been clear for several years that there will be no more money from the feds for this project. You have to get to page 53 of the high-speed rail authority's 2014 business plan to find a discussion of where it's going to get the money to build the system.
The cost to build only the initial operating segment from the Central Valley to the San Fernando Valley:
State Bonds (Proposition 1A) $2,684
State Bonds (Proposition 1A) $4,240
Uncommitted Funds $20,934
If the bonds are sold at an average interest rate of 5 percent, and assuming a repayment period of 30 years, the General Fund cost would be about $19.4 billion to pay off both principal ($9.95 billion) and interest ($9.5 billion). The average repayment for principal and interest would be about $647 million per year. (emphasis added)
Thanks to TRANSDEF for some links.
Labels: High-Speed Rail