Dan Walters

Bullet train’s bond funds shifting into local rail projects

This Sept. 27, 2016, photo shows an excavator breaking up what is left of an old warehouse in the 700 block of G Street in downtown Fresno, part of a project to lay track for the bullet train in the San Joaquin Valley.
This Sept. 27, 2016, photo shows an excavator breaking up what is left of an old warehouse in the 700 block of G Street in downtown Fresno, part of a project to lay track for the bullet train in the San Joaquin Valley. jwalker@fresnobee.com

Let’s assume that California’s bullet train project never gets beyond the current work in the San Joaquin Valley – about 100 miles of track and a few stations.

It’s a pretty reasonable assumption, given the problematic financial prospects for a $68 billion project that have become even dimmer with anti-bullet-train Republicans now controlling Washington.

Meanwhile, private and/or foreign governments are unwilling to finance it without assurances of operating subsidies, and funds from the “cap-and-trade” auctions of carbon emission allowances have dried up.

All in all, therefore, it’s likely that the bullet train as envisioned, linking San Francisco and Sacramento in the north with Los Angeles and San Diego in the south, won’t materialize.

What, then, happens to the $9.95 billion in bonds that California voters authorized for the project?

The bond measure said that $950 million could be spent on local transit systems that would connect to the bullet train, and they certainly will be. The state is also on the hook for $2.6 billion to match federal funds being spent on the San Joaquin Valley segment.

That would leave $6 billion-plus in bonds unspent, and as the bullet train’s financial prospects fade, officials are looking at shifting the remainder to what’s now being called “rail modernization.”

An initial step in the subtle shift of high-speed rail funds into local and regional transit systems occurred this year with the passage of Assembly Bill 1889, authorizing more than $1 billion in bond money for the electrification of the CalTrain commuter service on the San Francisco Peninsula.

The legal rationale for spending bullet train bond money on CalTrain is that it would be “suitable and ready for high-speed train operation” in what officials now call a “blended system.”

Critics say AB 1889 violates the strict limits of the bond issue but by signing it, Gov. Jerry Brown gave his blessing to the subtle redefinition and indirectly invited other regional transit systems to tap bullet train bonds as well.

After Brown signed AB 1889, Dan Richard, the longtime Brown adviser who heads the California High-Speed Rail Authority, made the invitation more explicit in remarks to a San Francisco rail seminar last month. He said state money would be “the last piece of the puzzle” on improving specific local commuter systems.

“One of my biggest frustrations is that we actually talk about the high-speed rail project in California, when, in fact, I’ve tried unsuccessfully to get the press and others to understand that that is not what we are doing,” Richard said. “What we are doing is a California rail modernization program (and) when Gov. Brown came in, and his leadership team came in, was that we started looking at high-speed rail as simply the spinal part of a statewide rail transportation system.”

What’s happening seemingly validates suspicions of some Capitol insiders, when the bullet train bond legislation was being written a decade ago, that it would be a bait-and-switch ploy to get state voters to finance local transit projects they otherwise would not support.

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