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Costs Rise, Timeline Extended for CA Bullet Train

Friday, March 16, 2018

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The cost of California’s bullet train, which is slated to run from San Francisco to Los Angeles, could rise from $77.3 billion to $98.1 billion, with the completion date being bumped back to 2033, according to a recently updated business plan.

The California High-Speed Rail Authority has indicated that the earliest trains would be operating on a partial system between San Francisco and Bakersfield in 2029, four years later than originally predicted. If completed, the train would be the nation’s fastest, carrying passengers between northern and southern California in less than three hours.

Cost Increase and Delays

This latest information, disclosed in a 114-page business plan issued in draft form to the state legislature on March 9, focuses primarily on first opening a track between San Francisco and the inland Central Valley, which is still billions short of successful funding. According to the Associated Press, baseline cost for the overall project is estimated at $77 billion, with the total cost potentially going as low as $63.2 billion or as high as $98.1 billion.

Officials hope that by connecting the San Francisco Bay Area with the more economically challenged Central Valley, there will be an economic boost. From there, the project would continue to Los Angeles and Anaheim.

California High-Speed Rail Authority

The cost of California’s bullet train, which is slated to run from San Francisco to Los Angeles, could rise from $77.3 billion to $98.1 billion, with the completion date being bumped back to 2033, according to a recently updated business plan.

Otherwise, the rail authority continues to contend with a $40 billion funding gap for the full system, which may increase even further in light of new cost estimates. The previous business plan indicated that there was enough money to build an initial operating system the could carry passengers and generate revenue, but the new business plan now states that higher costs and uncertain funding have left the operation short of that goal.

“You cannot build a mega-project of this magnitude on a pay-as-you-go basis,” Brian Kelly, the project’s new chief executive, told reporters.

Moving forward, the project is still relying in part on borrowing against fees garnered from the greenhouse gas auction system. Borrowing against the future fees would last through 2050. Even with this in mind, there would still be a funding gap that could only be fixed with partnerships with the federal government and private investors.

New Business Plan

According to Kelly, the new business plan is based on a variety of uncertainties, such as the cost of 35 miles of tunnels that would run through southern California and could range in cost from $26 billion to $45 billion.

Both costs and risks could be reduced if funding were more certain, Kelly noted.

Response to the new business plan from both parties was less than optimistic, with Jim Frazier, chairman of the Assembly Transportation Committee, noting that “we still have no realistic way to pay for the project.”

An oversight hearing of the plan will be held by the Assembly Transportation Committee on April 2.

   

Tagged categories: Construction; Funding; Government; Infrastructure; NA; North America; Program/Project Management; Project Management; Rail

Comment from Raymond Merrill, (3/16/2018, 1:46 AM)

Mr. Rogers here. Hi there boys and girls! Can you say "boondoggle?"


Comment from Mark Bowen, (3/16/2018, 12:17 PM)

It's amazing what you could do with other people's money.


Comment from Pat Patterson, (3/16/2018, 4:50 PM)

Proposition 1A: Safe, Reliable High-Speed Passenger Train Bond Act. The California's who voted for this project, were intentionally mislead. Governor Jerry Brown's "Browndoggle" voted in 2008 for a 2 hr 40 minute door to door ride at a total cost of $36 Billion. We are over $100B & 4 hrs min. This project might have been a good idea when Brown was first governor in the 1970's. Now it's a clear-cut money grab of over $10 Billion so far, for the governor's contributors and cronies. The Browndoggle low speed train project is illegal, as it will never do what the bill stated. The voters continue to be mislead by the governor, who in a just world would simply step down and/or possibly put in jail!


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