Monday, January 27, 2020

"A billion here, a billion there..."

Reviewing my material on California's high-speed rail project the other day, I took another look at a LA Times story from last year:

The cost of building a 119-mile section of the California bullet train in the Central Valley is projected to increase by $1.8 billion, taking the total to $12.4 billion, according an internal draft report by the state rail authority’s staff...The draft report projects that the cost of building that partial operating system, including the 119-mile section now under construction, would be $20.4 billion.

...Gov. Gavin Newsom called for building the Bakersfield to Merced system earlier this year, saying the full $77-billion project to connect Los Angeles to San Francisco with 220-mph trains had no funding or realistic plan for completion.

...The $1.8-billion cost increase covers bridges, viaducts, trenches and roadbed from Madera to Wasco, a distance of 119 miles. That includes $477 million for actual cost increases, $362 million for increases in scope of the project and nearly $1 billion for additional contingencies to manage risk.

Central Valley costs have been growing for years. Originally, the rail authority had planned to build about 130 miles of track from Madera to Bakersfield for about $6 billion. Now the construction ends north of Bakersfield near Wasco. 

The cost of land acquisition, utility relocations and environmental assessments, among other items, have grown sharply.

The $20.4-billion cost to build the Bakersfield to Merced line would take almost all of the rail authority’s funding through 2030. It includes all the bonds that taxpayers approved in 2008, all the federal grants provided by the Obama Administration, and all of the 25% share of greenhouse-gas fees that the state collects in quarterly [cap and trade]auctions. 

It is unclear how the rail authority would complete the partial operating segment by 2026 on funding that does not arrive fully until 2030...

Rob's comment:
Following the progress or lack thereof of the state's high-speed rail project over the years, brings to mind Senator Everett Dirksen's quip: "A billion here, a billion there, and pretty soon you're talking about real money."

The "$1 billion for additional contingencies to manage risk" is a nice touch, a supplement to the Dirksen quote, with the implication that wasting taxpayers' money is of course part of the deal.

To understand the scale of this folly, the Legislative Analyst's Office told us that just the interest on the $9 billion bonds authorized by Proposition 1A in 2008: $647 million a year! 

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John Bolton: Trump is lying

Bolton: Yeah, Trump tried to extort Ukraine.

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