Palo Alto Weekly

News - January 22, 2010

New high-speed-rail business plan draws criticism

Lawmakers concerned about revenue projections, ridership estimates

by Gennady Sheyner

California's legislators have yet to fully digest the latest business plan from the California High-Speed Rail Authority, but the new document has already caused ripples of concern around the Peninsula and in Sacramento.

The business plan, which the rail authority released last month, has been criticized over the past two weeks by lawmakers from both chambers of the California Legislature. At a Senate informational hearing on Tuesday, Sens. Joe Simitian and Alan Lowenthal questioned the rail authority's financial projections and asked high-speed-rail officials to release more details about their plans to solicit private funds. Last week, the state Assembly Transportation Committee had expressed similar concerns.

At Tuesday's meeting, Simitian asked rail authorities for more information about how the new system would be funded. He also quoted from a variety of newspaper editorials characterizing the high-speed-rail project as a "boondoggle" and demanded more accountability from the rail authority.

"This to me is as fundamental an issue as anything else," Simitian said. "There's no one being held accountable."

Both Simitian and Lowenthal pointed to a recent report from the Legislative Analyst's Office (LAO), which found a multitude of flaws in the rail authority's new business plan. The report noted that the rail authority's business plan "assumes some form of revenue guarantee from the public sector to attract private investment." It also pointed out that the state bond that voters approved for the project in 2008 expressly forbids public subsidies for the system's operations.

The LAO report stated that the new business plan is more informative than the 2008 version. But analysts also faulted the plan for having an "uninformative timeline," and an inadequate discussion of project risks.

"We find there are significant issues still inadequately addressed in this business plan," Eric Thronson, an LAO analyst, said at the Tuesday hearing. "The plan's discussion of risk is incomplete and inappropriate for a project of this magnitude."

The new business plan was released at a time of major transition for the California High-Speed Rail Authority. Earlier this month, the authority announced that Mehdi Morshed, its executive director, will retire at the end of March, and began its search for a new chief executive officer. The rail authority had also hired a consultant to evaluate its operating structure, said Curt Pringle, chair of the High-Speed Rail Authority Board of Directors.

In the coming weeks, the agency plans to reorganize its leadership structure and hire new staff. The new structure would include a high-ranking official charged with risk management, Pringle told the Senate committee at this week's hearing.

The project has attracted great scrutiny on the Peninsula last year, when residents learned that high-speed trains would glide through their communities, possibly along elevated tracks. More than a dozen residents and elected officials from Palo Alto, Menlo Park, Atherton and Burlingame attended Tuesday's Senate hearing and a similar one in the Assembly on Jan. 11, to demand more information and criticize the current business plan.

Elizabeth Alexis, a Palo Alto resident who co-founded the grassroots group Californians Advocating Responsible Rail Design (CAARD), attended both Sacramento meetings and publicly criticized the rail authority's plan to have a private company operate the system once it's built.

Former Palo Alto Mayor Mike Cobb argued at the Jan. 11 hearing that the rail authority's plan to get more than $4 billion in local funds for the project is unreasonable, given that cities such as Palo Alto are already facing severe budget shortfalls.

Assembly members shared residents' concerns about the rail authority's plans to pay for the system.

Assemblywoman Joan Buchanan questioned the high-speed rail's assertion that the system would be profitable and its projection that the state will receive billions of federal dollars for the project.

Assemblyman Roger Niello was even more blunt. He said he has "huge concerns" about the proposed high-speed-rail project and the authority's plan to pay for it. The authority is banking on more than $10 billion in private funding; more than $17 billion in federal grants; and more than $4 billion in local grants to fund the project. That's in addition to the $9.95 billion California voters approved in November 2008, when they passed Proposition 1A.

Niello called the rail authority's plan for the new system a notion that becomes increasingly troubling upon closer examination.

"I wake up from my romantic notion and I see something next to me that's not as attractive as it was when I was entertaining my romantic notion," Niello said.

Staff Writer Gennady Sheyner can be e-mailed at gsheyner@paweekly.com.

Comments

Posted by Martin Engel, a resident of Menlo Park
on Jan 20, 2010 at 6:37 pm

We have been lied to, not once, but many times. We have been subject to one charade after another. And by we, I mean each and every voter in California. There has been endless mis- and dis-information. We have complained and we have sued. We have worked to shine a light on the endless illegalities perpetrated by the rail Board.

When is enough enough? When will our Legislature do more than slap wrists and call them naughty boys? What is it that we are waiting for before serious and definitive action will take place? What are our legislators afraid of?

There are a number of possible consequences to the rail authority's fraudulent behavior. They can have their funding terminated; that is, denied access to the remaining budget funds borrowed against the bond issue. It is within Simitian and Lowenthal's power to do so. They - the rail authority - can be disbanded by the Governor and the project reconstituted with transportation and rail professionals having actual management experience and skills. The project can be folded within the State Department of Transportation where it belongs, and integrated into a much larger examination of the State's transportation needs and strategy. The project can be stopped for legal cause. The voters did not vote for and approve of a fraud. If there needs to be a referendum to rescind this bond issue, that process can and should be initiated now.

This project is being driven and tightly controlled by self-serving amateurs. California's stimulus funding eligibility might actually be greatly enhanced if this gang of back-room politicians were replaced by responsible adults with competence. It should be obvious to everyone by now that this current crew is way over its collective heads. They are constantly improvising; manipulating language to the very edges of ambiguity; making things up as they go along. A project of this magnitude, to become well over $100 billion, is now being administered by the Keystone Cops. So, when is enough enough?


Posted by Sharon, a resident of Midtown
on Jan 20, 2010 at 6:59 pm


HSR MAY make sense 30 yrs from now between LA and SJ if it provides for freight.

HSR from SF to SJ is a non starter and will never make economic sense.


Posted by Spokker, a resident of another community
on Jan 20, 2010 at 8:51 pm

"There has been endless mis- and dis-information."

There is a lot of misinformation, fear, uncertainty and doubt coming from the opposition as well.

"This project is being driven and tightly controlled by self-serving amateurs."

These people got some things wrong on the Peninsula. Those problems are outlined on Clem's blog that I am sure you are aware of. But they got one thing right.

They chose an active, century-plus old railroad right of way to put high speed rail on. The mantra of the Altamont supporters is to put the rail where the people are. Well, the Caltrain corridor is where the people are. Or is the problem that they are the wrong people?

And if the end result is an above ground Caltrain/HSR right of way, they will have gotten that right too.

Martin, at the end of the day, what would you change about the project to make it suitable for voters? Keep in mind that your plan would have to go back to the voters, and if it doesn't include San Francisco and the Central Valley, it would probably not pass.


Posted by Parent, a resident of Charleston Gardens
on Jan 20, 2010 at 10:20 pm

Spokker, glad to hear that Pringle doesn't think tunneling is too expensive (per your conversation with Pringle at this evening's anaheim meeting). What's good for the goose is good for the gander.

As for their (arrogant) choice of a century old railroad - which has over that century been built up cozily with residential homes, schools, communit parks, bike trails, and businesses. There coulden't BE a worse choice for route. 101 is FAR mor logical if you want to go where people are - people that can actually get to a train station. Locate it in the middle of a small residential neighborhood - you'll guarantee lowest ridership possible. You plan to build TOD and feeder transit around these stations? (because it certainly doesn't exist in these areas today) well then build it in the areas closest and most convenient to 101 - just as easily and with much more community benefit done in locations nearest to freeways that need econimic revitalization. Choice of Caltrain row is nonsense, (worse than nonsense actually - its arrogant, stupid, shortsighted), and the only way it will go there is if CHSRA comes up with tunnels for town after town after town after town. Even San Jose is going to require a tunnel - Diridon's biggest supporters are going to turn ugly unless CHSRA gets real on this fact real quick.

Here's one improvement that would make it suitable for voters - prohibit building or operating new rail within 500 feet of schools and parks and homes. Prohibit any existing or new train speeds over 45mph within 200 feet of homes, at or above ground level.


Posted by P.A. Native, a resident of Mountain View
on Jan 20, 2010 at 10:43 pm

Why do some Palo Altans think that they can completely rewrite every detail to this project? You are one city out of a HUGE state.


Posted by Sharon, a resident of Midtown
on Jan 20, 2010 at 10:50 pm

Well MA is a small state in a huge country, but a guy called Brown who drives a truck with 200,000 miles on it just changed the game for the whole nation and Obama agrees


Posted by funny, a resident of Another Palo Alto neighborhood
on Jan 20, 2010 at 10:52 pm

whole thing reminds me of the Library bond.


Posted by Spokker, a resident of another community
on Jan 20, 2010 at 11:02 pm

"As for their (arrogant) choice of a century old railroad - which has over that century been built up cozily with residential homes, schools, communit parks, bike trails, and businesses."

Lucky for the Caltrain ROW owners, enough room was saved on *most* of the route for four tracks. Did you think they would never use it?

Don't worry though, those residential homes, schools, community parks, bike trails and businesses will still be there. If they weren't killed off by 100+ diesel trains at 79 MPH with all of the noise and fumes they generate, they won't feel any pain from high speed electric trains.

"Locate it in the middle of a small residential neighborhood - you'll guarantee lowest ridership possible."

Caltrain alone sees over 9 million weekday boardings per year. These are some really low ridership neighborhoods.

"Here's one improvement that would make it suitable for voters - prohibit building or operating new rail within 500 feet of schools and parks and homes. Prohibit any existing or new train speeds over 45mph within 200 feet of homes, at or above ground level."

I see. Kill transit with silly ordinances. I've got an ordinance for you. How about prohibiting any cars within 500 feet of schools, parks and homes? A lot of people aren't just annoyed by vehicles, but killed by them every single day.


Posted by Mary, a resident of Community Center
on Jan 20, 2010 at 11:05 pm

To PA Native. Yes, PA is one of the cities on the rail line - but voters in in cities all over this state from border to border, who will probably never ride on it and will not be affected by it. got to vote on it and determine our destiny. It's not THEIR problem,not their homes, their institutions and buildings and way of life which are affected. and impacted. It sounded so good on paper - draped in grand sounding magnanimous platitudes. Those voters couldn't care less. And who is going to pay for this monster, let alone ride it enough times to make it pay?? It is a major disaster, and it is time for we-the-people to take back control from Sacramento...in the next election. Washington too.


Posted by wary traveler, a resident of Another Palo Alto neighborhood
on Jan 21, 2010 at 1:06 am

"Lucky for the Caltrain ROW owners, enough room was saved on *most* of the route for four tracks."
Where are you getting your 'facts', spokker? If it's not from the CHSRA, it's not worth 2 cents. You and I (and Clem) have debated this for over a year now. I hate to tell you, but in about 6 weeks I'll be telling you I told you so. They need more space than what's available. Ask them.


Posted by Parent, a resident of Charleston Gardens
on Jan 21, 2010 at 9:53 am

In Anaheim, the row width requirment was just increased from 50ft to over 100feet. By CHSRA.


Posted by Merrill Linmon Roe, a resident of Professorville
on Jan 21, 2010 at 9:56 am

Anyone know who will be running against Anna Eshoo on June 8th?


Posted by bikes2work, a resident of Santa Rita (Los Altos)
on Jan 21, 2010 at 10:02 am

"How about prohibiting any cars within 500 feet of schools, parks and homes? A lot of people aren't just annoyed by vehicles, but killed by them every single day. "

Oooh, I like that. Keep up the good fight Spokker! Bring on the electric trains and grade separations HSR. I can't wait.



Posted by Parent, a resident of Charleston Gardens
on Jan 21, 2010 at 10:03 am

100+ diesel trains at 79mph? Sorry, your facts are wrong again. Most don't run at 79 (79 is top speed for express, of which there are relatively few), and are there 100+ trains? What, in a week?

AND the real point is - so what? What is happening there now is wrong, and needs to be corrected. Spokker, since when do two wrongs make a right?

The RIGHT thing to do is to NOT to run trains through peoples back yards and school yards. Period. Of any kind. Electrify Caltrain or get rid of it. And we don't need HSR to accomplish electrified caltrain or grade crossings. Adding the HSR volume to this small ROW is NOT happening.

Unless CHSRA gets smart real quick and figures out how to tunnel the whole Peninsula, this Peninsula segment will bring the whole California project to a finish. Lets ponder for a moment the ways that might come to pass...

By the way, how about that Massachusetts election? A huge democratic stronghold sending a stunning message to their own democratic party that THEY WILL NOT BE RAILROADED. (With health care, with bailouts, with nonsense stimulus schemes, with wild boondoggle spending) Imagine that...


Posted by Clem, a resident of another community
on Jan 21, 2010 at 10:49 am

> They need more space than what's available. Ask them.

Sadly, I have to agree--only because they are designing to ridiculously ample alignment requirements that are 100% out of sync with the way it's done in the rest of the world. If someone wanted to, they could fit four tracks quite comfortably within 80 feet of ROW. The trouble is, they don't want to and don't plan to. The plans I've seen are well north of 100 feet.

This is what happens when you give kids some crayons, but in this case several billion dollars are on the line.

We are going to get the HSR project we deserve.


Posted by P.A. Native, a resident of Mountain View
on Jan 21, 2010 at 11:21 am

I'm sorry to say that the tone on this board tends to be whining, and lots of it. How can you call the HSR a "major disaster"? The thing hasn't even been built yet.

The citizens of our community are playing the role of the obstructionists. Maybe they've learned this course of action from their friends in D.C. that they seem to admire so much. Congratulations on the election of Mr. Brown. I hear Obama is moving his stuff out of the White House as we speak. Biggest election EVER.

All hail the status quo! Talk about getting what you deserve...you get what you feel you're entitled to, and everyone else fends for themselves. I guess tthe others just don't realize that being from this part of the Peninsula gives us the final say on just about everything.


Posted by NONIMBYS, a resident of Another Palo Alto neighborhood
on Jan 21, 2010 at 12:17 pm

YOU MOVED NEXT TO AN ACTIVE RAILROAD..how clear is that mistake???
lies..well the nimbys and naysayers NEVER run out of spins and made up
Horrible "facts" enough..ITS already there and will be improved and upgraded and most people will be glad. IF a small group screams ohh
well thats lifeand they will not die from it nor will it be the end of the world or PA


Posted by Kathy Hamilton, a resident of Menlo Park
on Jan 21, 2010 at 1:34 pm

The voters of California did not vote for HSR at any cost. They voted for it with the assurances of AB3034 including profitability. There are material violations of the law starting with day 1. No business plan was submitted at the time of the vote. A re-vote should be done after an independent investment grade ridership study is done and the business plan proves profitability. Let the people vote for a closer reality than the concept they voted for. It would be the right thing to do if the legislature voted to put it back on the ballot and save us from the job, though quite attainable, to get this back on the ballot.


Posted by Steve L, a resident of Charleston Meadows
on Jan 21, 2010 at 2:51 pm

The whole HSR debate is wasting time trying to force a corridor through the peninsula. Even if HSR is built between SJ and SF, the train is probably never going to approach its top speed. Probably 80 to 100mph if you're lucky since the train needs to stop at stations along the way. Even in Japan, bullet trains travel at top cruising speed between cities, not within. Furthermore, the cost to build HSR through densely populated area like the peninsula is probably going to cost 5 or 10 times more than through rural areas. Why not just focus on SJ to north LA/LAX area and build a reliable local transportation network around these two hubs? Besides, $105 is a little expensive - doubt HSR will be able to attract enough riders.


Posted by Problems, a resident of Professorville
on Jan 21, 2010 at 5:02 pm

Those for the project must address the problems that the LAO lists. The most glaring one is the use of private (taxpayer's) money to guarantee private investment. The approved bond prohibits the use of private subsidies specifically.

Speaking of subsidies there isn't one HSR in any country that doesn't susidize its system. Worldwide every city or state government subsidizes its public transportation systems. Local examples losing money are San Francisco and San Jose railways and BART. This HSR system, like all the others, will need taxpayer money to survive. Projections of ridership and cost for HSR are not real.


Posted by onthecase, a resident of Downtown North
on Jan 21, 2010 at 5:28 pm

Car companies are behind this anti-high speed rail movement. Wake up. Look into car and oil companies and see that they are the fuel driving anti- high speed rail. Go to Europe or Japan and see the wonders of trains and low obesity rates.


Posted by John, a resident of Menlo Park
on Jan 21, 2010 at 7:42 pm

Problems said: "Speaking of subsidies there isn't one HSR in any country that doesn't susidize its system."

This is quite simply not true. SNCF, the French state railway earned a $1 Billion profit in 2008. Considering that they use the HSR profits to subsidize money losing, legacy-rail lines to small towns in the countryside, that is no small profit. No wonder they want to invest some of it in the CA project...


Posted by Spokker, a resident of another community
on Jan 21, 2010 at 7:55 pm

"In Anaheim, the row width requirment was just increased from 50ft to over 100feet. By CHSRA."

Do you even know what you are talking about?

Currently in Anaheim there is a 1.5 stretch of 50 foot wide ROW between Vermont Ave. and North St. This must be widened to 100 feet to accommodate four tracks. The "row width requirement" was not just increased from 50 feet to over 100 feet. The plan was to go with 100 feet for a while now.

You can see what this looks like here on page 46: Web Link

Furthermore, there is a contingency plan to go wider than 100 feet in case the OCTA, owner of the right of way in that area, decides that they don't want high speed trains too close to their tracks. I don't see why this would happen, but it makes sense to plan for it.


Posted by Midtown anon, a resident of Midtown
on Jan 21, 2010 at 8:18 pm

To "Problems":

As far as I know roads are subsidized by taxpayers as well, and so are airports. So why lament about trains being subsidized, even though they may or may not be?

Trains make sense when they are modern and fast enough (unlike current rail lines between SF and LA).

I live in Palo Alto, voted for HSR, and would vote for it again in a heartbeat.


Posted by Midtown anon, a resident of Midtown
on Jan 21, 2010 at 8:20 pm

Actually, to go from SF to LA by train right now one needs to go to Oakland to catch the train, or take the train to San Jose first and then change in SJ.

It won't make sense to have HSR from LA to San Jose only, and then have to take something else from SJ to SF. That's a non starter.


Posted by REALLYPARENT, a resident of another community
on Jan 21, 2010 at 9:32 pm

The HSR IS going thru..like it or not and so much for your "open" minded little nimby group planning it for the rest of us..guess what I think I will show up at one of those meetings you have..or is it only the arrogant types


Posted by We Idiots !, a resident of Community Center
on Jan 22, 2010 at 12:07 am

We can build the HSR in China.



Posted by Spokker, a resident of another community
on Jan 22, 2010 at 12:18 am

Here's what the CHSRA has to say about your property: Web Link

It's a Q&A detailing eminent domain.


Posted by Nayeli, a resident of Midtown
on Jan 22, 2010 at 2:28 pm

Will the cost of a ticket be much less expensive for travel than a plane ticket? If not...then why spend tens of billions of our tax dollars to build it?


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