High Costs Threaten California’s High-Speed Rail Project, But the Wider Context Must be Understood

» Over the long run, California’s fast train project remains within an acceptable range of costs, despite recent increases.

The release of the California High-Speed Rail Authority’s revised business plan on Tuesday underlined concerns about the future viability of the nation’s biggest proposed transportation project: Not only would its completion have to be delayed significantly — to 2033 or later — but projected costs have risen dramatically, to $98 billion in year-of-expenditure dollars. In a political environment where making a large long-term commitment to anything other than the military is almost impossible, the increasing costs required to pay for the program put in doubt its future. This fast train project designed to connect Los Angeles and San Francisco in 2h40 is not dead, but its completion is less likely now than it was last week.

The steadily rising nature of the public expenditures that would be required to build the project as now designed have been roundly criticized in some quarters, and it is true that the project’s increasing reliance on very heavy and expensive infrastructures like viaducts and tunnels may be unnecessary by international standards. But the project’s per-mile costs — even with the cost increase — are not hugely different from those in other developed countries for rail systems offering speeds of up to 220 mph.

Yet the broader issue is how the project’s price compares to that of existing public sector transportation investments and the economy as a whole, and as the chart above demonstrates, its ostensibly enormous price is, well, relatively small.

Between now and 2033, the rail project would cost between $65 and $75 billion (in 2010 dollars). Over the same period, Caltrans, California’s Department of Transportation, can be expected to spend at least $286 billion (also in 2010 dollars), mostly on roads projects, assuming that its current annual budget of about $13 billion (including federal and state outlays) stays intact. In truth, considering that there is considerable support for increasing infrastructure spending in general, that figure is likely to go up considerably.

Compare those figures to the state’s GDP, which is estimated at about $1.9 trillion a year. Over the course of twenty-two years, the state will produce $42 trillion in output (again, in 2010 dollars) — assuming no growth in the economy, despite the fact that California’s population is expected to grow by seven to seventeen million people by 2040.

This very conservative* estimate, then, suggests that a high-cost rail project would not only represent only 0.18% of a heavily depressed state economy over 22 years, but also that it would only account for 21% of the broader state transportation budget, which would remain mostly focused on highway construction and maintenance, as in the status quo. On average, the U.S. invested between 2.5 and 3% of its GDP on publicly sponsored infrastructure between the 1950s and 1990s. The full cost of the California project thus comes to appear far less dramatic.

The project becomes even less problematic considering it is, like almost every high-speed rail project, expected to be operationally profitable, and that its benefits to the society will be larger than its costs. The analysis done by the authority, based on decreased travel times, lower use of fuel, reduction in pollution, increases in productivity and reliability, and a decline in traffic accidents, suggests a decent benefits-cost ratio of 1.5 to 1.8. This does not include other benefits, such as the ability to avoid building hundreds of lane-miles of new highways and expanded airports to accommodate the mobility needs of millions of new California residents.

Nor is such a significant investment in one project out of the international norm. The Grand Paris Express, designed to connect the suburbs of the French capital with a circumferential rail network, will cost about $40 billion to build (including ancillary improvements in the existing system). This alone will represent about 0.4% of the Paris region’s GDP between now and 2025. Both the Paris and California projects will contribute massively to the economic growth of the regions in which they are being built.

The question, then, is two-fold: First, what level of investment should the country make in its transportation system? Second, are other transportation projects more valuable than the California rail project?

The first issue is political: Is there sufficient support among electoral constituencies in California to allow for the continued sponsorship of what will be a drawn-out process with plenty of controversy? California Governor Jerry Brown appears to remain on board, as does, surprisingly, at least one member of the state GOP delegation. The rail authority’s attempt to stage the project — beginning with a segment between the Central Valley and either the Los Angeles Basin or Bay Area, and then moving for a full-length line — is one way to make the project more palatable in the short term.

More broadly, the state must make a decision about how it wants to invest in its transportation future. As already noted, the state department of transportation is likely to invest about $300 billion in mostly highway infrastructure over the next two decades. With so much spending directed towards the roads network, it cannot be easy to dismiss a large spending commitment to rail. But the difference between the two is obvious: Because the rail line is a single project (despite its statewide implications), it is viewed in terms of its huge costs and long-term lifecycle; the roads improvements likely to occur during the same period are four times as expensive — but broken into much smaller, shorter-term projects, so they are far less politically vulnerable.

And the system will surely need further support from the federal government, which the authority hopes to convince (over the next few decades) to chip in $20 billion or more in grants. Because of the insecure fiscal situation, private funding for the project will have to wait. Nevertheless, a future Congress that considers high-speed rail an acceptable mode of transport will likely fund projects nationwide; remember that earlier in 2011, President Obama proposed entirely seriously investing $53 billion in fast trains. Though that effort was not successful, the idea is clearly on the minds of policymakers.

None of this suggests that it would be a bad idea to reduce the costs of the project. The cost of the line cannot continue to increase infinitely (though the authority’s math in this business plan is based on the considerable preliminary engineering completed since the last plan in 2009, so that doesn’t seem likely). The whole line cannot be put into tunnels or onto viaducts in order to avoid community opposition, or it will become impossible to fund.

At a certain point, the question is therefore whether there are other programs that would provide better societal benefit than the high-speed rail system, and this is a valid conversation worth exploring. From my perspective, moving the money into roads infrastructure would be simpleminded considering the need to expand mobility options and decrease levels of pollution. It could also be possible to use the funds for local transit expansion, which has plenty of unmet capital needs, especially in California’s largest cities. But who in the state is proposing a comprehensive effort to upgrade rail and bus networks? And how would that spending address the needs of intercity travel?

* And admittedly back-of-the-envelope, but the point is to highlight proportions here, not specific values.

89 Comments | Leave a Reply »
  • ThomasD

    Pretty good article, but you have to include the alternative costs of an additional north-south freeway and airport expansion to understand why spending $75 Billion on CAHSR is the smartest use of transportation funds in that state. Anyone living under the airport landing path does not want another LAX or SFO runway. And no one should want another freeway carved through Angeles National Forest headed to Northern California.

    • The problem is that GDP consists of many more things than transportation, and Caltrans’ budget (bloated as it is – the correct figure for public road spending is zero) consists of more than just intercity transportation from Los Angeles to San Francisco. Every program can be defended as a small portion of GDP, even well-known disasters like Star Wars. But a hundred billion here, and a hundred billion there, and soon enough it starts adding up to real money.

  • Caelestor

    I doubt that anybody here actually opposes the concept of HSR in CA. In my opinion, it makes absolute sense to build it. That being said, the report has made a lot of people sad, for lack of a better time. When your project is delayed 10 years and costs have doubled without any new benefits on the horizon, people like me will start to worry about the viability of the project. Worse, this provides ammo for critics who can then take these numbers and make them into talking points, leading to huge ramifications in the national transportation debate.

  • Danny

    Simply put, intracity mobility needs are much more important than intercity mobility needs. Intercity transportation only can provide that which a person’s city of residence can’t provide…things like extended family, unique industries, business partners, etc. But in the pareto chart of needs, those are on the tail end.

    Living in a college town away from home without a car, everything I did was slower, and would have benefited from better transit. But while the bus home took twice as long as driving, getting to the grocery store took 4 times as long, and getting to classes took about 5 times as long. But I still only went home 4-5 times per year…everything else was more than once a week.

    And while it would be awesome to have better intercity transportation, the fact of the matter is that intercity transportation already has plenty of options: cars, buses, air, and occasionally some slow trains.

    Cities have cars. They also have buses and stuff, but people don’t actually use those because their performance is piss poor. So they use cars. And if they happen to use buses, they work really hard to be able to afford a car, and then they ditch the bus.

    In a better-than-current world, CHSRA would disappear and funding would go to Los Angeles’ 30/10 plan.

    • Nathanael

      While it’s true that intracity mobility is more important than intercity mobility:
      (1) They are complementary;
      (2) Historically, good intracity trains and buses *follow* the establishment intercity trains. Don’t ask me why! It probably has something to do with the rich visitors on the intercity trains saying “Why do I have to take a taxi or rent a car after I get off the train?” It could have something to do with the realignment of land use patterns to cater to the intercity traveller (who is generally either rich, representing a business, or spending lots of money as a tourist).

      LA considers 30/10 complementary to CAHSR and wants to do BOTH. CAHSR will drop people off (and pick people up) in LA at LA Union, where (in the 30/10 plan) Metrorail will run in six directions and Metrolink will run in another six, along with a great mass of buses, express, rapid, local, and Flyaway. And a downtown streetcar seems to be on the drawing boards, too, for very local transportation from the same hub.

      LA Metro is already starting to rearrange LA Union for the arrival of CAHSR. They do not consider it to be in competition with local mass transit. They seem to consider it to be an anchor which will cause more people and funding to flow to local mass transit.

      Admittedly LA seems to be the only US city this smart (apart from St. Paul, Minnesota, which is getting well ahead of itself); SF’s plans are just sloppy. Sigh….

      • Danny

        Of course they are complimentary. But there are some investments with high returns and some investments with low returns, and some investments (CHSRA’s plan) where the returns are so low that the actualization of a single risk could put it in the negative returns category.

        By all means, build everything with positive returns…but you ALWAYS should build those with the highest returns first. There is no way that CHSRA’s plan is anywhere near the top of the list.

        • Matt

          Depends on you define high return vs. low return. Since CAHSR generates an operating profit, while all local mass transit lines lose operating money, one could make the opposite conclusion.

    • ThomasD

      Sounds like the old Red Herring of pitting Transit vs. HSR when the real problem is Tea Party failing to pass any or only crumbs for Transportation infrastructure.

      Truth is both are needed because we’ll pay more expanding interstate highways and airports if we don’t build more 110-220 mph HSR.

      • Danny

        Actually, this is the real red herring. Intercity highways are not overburdened because of intercity traffic…not even close.

        It is the connections to suburbia and intracity sections that are overburdened. If you drive on I-5 or Hwy99, the only time you will EVER slow down is when you are close to or in a city. Those cars aren’t intercity cars, they are intracity cars.

        Building more lanes in Delano never was the alternative to HSR.

        • I agree that cars traveling long distances are in the minority, but how many of those “intracity” cars really only exist in order to make the occasional long trip? I can survive pretty well just on local transit, but about half the reason I own a car is to visit my parents who only have transit access via a weekday commuter bus. (The other half is that the grocery options along my closest bus routes aren’t so hot.)

        • Danny,

          I respectfully disagree with you. I drive I-5 Freeway quite often between SF and LA 5.5-6 hours and dread driving on parking lot holidays up to 8 hours. Even on regular traffic days its no fun sharing I-5 with a gauntlet of semis going downhill through the winding mountain pass. And don’t get caught going through through the mountain with fog (as I have). You’ll pray for HSR. As California’s population grows, without CAHSR, I-5 traffic would get much worse and more dangerous.

          As for S-99 Freeway, it too will get worse as Central Valley population increases possibly by 10 million. If you’re looking for a national HSR corridor to condemn, you’re barking up the wrong tree. Reasonable people can disagree on alignment in the corridor, but California needs the LA-SF HSR route open by 2020.

          • Danny

            I used to drive the corridor every day as a truck driver, and the only times my travel time decreased was on major holiday weekends, accidents, inclement weather, and during rush hours in or around a major city. Only one of those is a true capacity problem, and even then we do not (and should not) build highways to 99th percentile event capacity situations.

            The alternative to not building HSR is having even worse airports than we do now. They are the only intercity travel medium that is truly constrained for intercity travelers. I5 and 99 might be expanded, but if it happens it will be entirely due to intracity traffic and commuter traffic…not the lack of a HSR system.

            And if they are expanded in the big cities, it wouldn’t even be a mobility improvement for intercity passengers, because local traffic is always in higher demand. Any extra capacity will be sucked up by more people trying to get to their job…and your drive will continue to be as slow as before.

            I guess another alternative would be to create pass-through lanes (truck drivers have been clamoring for these for decades) where if you had no intentions of stopping in a city you could drive straight through in a barricaded lane without having any of the local traffic in your way. But those have never been a serious alternative.

            I’m not even condemning the corridor. HSR in California would be amazing, and a definite improvement over the status quo. If we could have it built and operated by JR East or SNCF, I would be the loudest supporter on this forum.

            I’m condemning the idiots who run the agency. This was our one real chance to prove that an outside organization could be better than Amtrak, and we blew it.

            • Beta Magellan

              +10,000 on your last paragraph. People need to realize that being an HSR supporter ≠ being a CHSRA booster.

            • Nathanael

              You are right that HSR is mainly an alternative to air travel. (There are some exceptions in the East; the number of people who drive East Coast-Chicago is startlingly high.)

              I think you are too hard on the agency, which honestly has made a perfectly reasonable design for the only segment which is actually *finalized*, Bakersfield to Frenso. All else is PR, and I don’t think SNCF or JR would have done any better on PR in the toxic environment of US politics.

        • Nathanael

          Depends which highway you’re talking about, Danny.

          The Ohio Turnpike & Indiana Toll Road are certainly crowded with intercity traffic alone, as anyone who’s driven from Chicago to New York can tell you. The same is probably true along I-95 (though it’s hard to tell since the corridor is urbanized all the way from Boston to Washington).

          But you’re right, in most places only the urban sections of expressways are crowded. Urban expressways are basically a mistake anyway.

    • Wad

      Intracity vs. intercity transportation is not a zero-sum game. Funding one does not have to come at the expense of the other. It’s a matter of allocating assets and matching needs (knowing what is needed where and why).

      The cost structures are different, for one thing. Intracity transport’s cost burden is operational. These are paying for goods and services already rendered and exhausted, and they are ongoing.

      Intercity transportation, in this case, is capital-intensive. The cost burden is primarily on the time value of money — interest, amortization and depreciation. If done right, operations costs should show some savings over low-capital/high-operations-cost goods or services.

    • Marcella D.

      Danny,

      The situation of a college student in terms of time availability to take long Greyhound bus trips is very different to that of an executive or even a couple going out of town for a short weekend getaway.

      College students are not much representative because they have plenty of time to organize themselves and usually are unlikely to reject a very good college for their SAT/extras just because it is out of the way (ceteris paribus).

      Access to other cities is paramount for a city to prosper first place. Cities are not islands surrounded by their country dominions like feuds. They depend on proper connections to have strong economies…

      • Danny

        An executive or a couple going out of town can take buses (not just Greyhound, there are plenty of luxury and express options), fly or drive. They might not have the best options, but they have options. The lack of a HSR system means that their access to other cities is suboptimal, but tangible and still pretty good. And that goes for every resident there, even a poor college student like me without a car.

        By contrast, getting around your city only works if you have a few extra hours, every single day or can afford a car. You want to get to work? You have to leave 45 minutes before your colleagues…every day. You want to go to the grocery store? You have to plan an extra hour and a half into your day for travel time, and you can only take two arms worth of bags home with you.

        Access to other cities might be important to the economies of cities, but it is most definitely not paramount, doesn’t require the best and fastest technology or anything of the sort. But a truly prosperous city can not exist without intracity mobility. It might not be a cause of prosperity, but it is a requirement for it.

        If flashy forms of intercity mobility truly were paramount, cities like Los Angeles would succumb to the economic forces of places like New Haven or Seville. That isn’t going to happen any time soon.

        • Nathanael

          But again, there’s a weird phenomenon where good intracity transit often *follows* intercity transit, more often than preceding it. This is simply a historical fact. I don’t properly understand why it is the case, though I’ve made some guesses above.

          Another guess: people (movers and shakers) take intercity transit to cities which HAVE intracity transit, and get the idea that they want that at home. Whereas cities which are isolated from other cities, or which only visit them by going to airports and catching taxis… the movers and shakers never see intracity transit.

          By this argument, the key thing to do with California High Speed Rail is to connect the Central Valley to Los Angeles Union Station, because, if this is done, the people of the Central Valley will start demanding their own local rail systems….

          • Do you have a case study for this? I know cases for which it’s true of roads (the US Highway System led to further road development in cities, geared toward suburban needs), but the examples I know of rail are the opposite. Lyon built its subway pretty much simultaneously with the LGV Sud-Est, Japanese cities had large rail networks with many under-construction subway lines when the Shinkansen opened, etc.

            In Tel Aviv they’re kind of trying to orient the city’s transit system around the intercity train station, and the result is a complete disaster. The area near the station is urban renewal hell, with office buildings located next to a freeway and a pedestrian-hostile arterial road. Meanwhile, the dense part of the city has been refused subway money on the grounds that it’s insufficiently high-rise.

  • ML

    Basically, I want to echo Danny’s point. Right now, fixing intracity transit should take precedence over new intercity transit. What are people supposed to do when getting off the high-speed train? Probably rent a car. Only a couple cities in America have anything close to a truly functioning intracity transit system. BRT, LRT and just better bus system design will get far more bang for the buck than HSR right now.

    • Matt

      Even today, there is pretty good transit from Los Angeles Union Station (Gold Line north to Pasadena, East to East LA, Blue Line south to Long Beach, Red Line to Hollywood, Purple to Mid-Wilshire, and soon Expo to Santa Monica). Add in many other Metrolink lines and the many buses that go through there also. San Jose has a light rail system and of course San Francisco has BART and an extensive bus and light rail system in MUNI.

      Places like Bakersfield and Fresno aren’t that big. If I was going there, I would still be likely to take HSR and then a cab to where I was going unless I had to really go a bunch of different places.

    • 23skidoo

      In SF, I would be comfortable without a car. In LA, why not rent a car when you get off the train? Think of the train as a faster (both in travel and waiting time) alternative to taking a plane.

      • Nathanael

        Driving in LA is kind of awful; but I’ve found in recent years (since 2005 or so) that you don’t usually really need a car to visit LA. The urban rail lines hit most of the major destinations and most of the the rest are covered by super-frequent bus services.

    • Rider

      LA is investing 30 billion in its rail. When you get off at union station you can take the metro to pasadena (and beyond), east los angeles, hollywood, long beach, the valley, santa monica, the LAX region, down wilshire, and more places.

      30/10 can happen on its own without killing high speed rail. Its not like California or the federal government will redirect this money they already approved to los angeles or any local agency. This money is a reflection of the desire for cross-state travel alternatives.

      SF is the same story if not better for transit.

    • Matt in SF

      SF has fantastic public transit options. (For example, roughly 2/3 of SF commuters travel by alternatives to the automobile.) It’s when you leave SF and the SF Bay Area that you quickly run out of public transit options.

      Now let’s look at travel between northern CA, central CA and southern CA. Almost 100% of the trips are done by auto or plane. Passenger rail exists but a trip between SF and LA currently takes around 12 hours and is only used by rail fanatics, retirees and as a last resort by the desperate.

      If you don’t think longer distance travel is worth investing in, that’s your opinion, but I think it is. I get around locally by bicycle and the occasional bus, light-rail or cab ride. I haven’t owned a car since 2000. But if I want to leave the area, I only have a choice of flying or riding in some type of automobile. CHSR would change that and give folks a high-speed connection to the rest of the state that is powered by renewable energy.

      In the end, I don’t think this needs to be a case of one or the other – we can do both. The report shows that the HSR system would be used and generate an operating profit. Building HSR doesn’t keep local jurisdictions from building out their own transportation options. Theoretically the more systems we have the more they will complement each other and promote each others’ use, which will increase farebox revenue and reduce pollution.

  • You are right on that the cost of mega-transportation projects should be framed in the light of a region’s overall economy. Transit naysayers like to throw out absolute numbers, which when added up over the implementation timeframe look very daunting. Even environmental documents do this. But when put in the context of the broader economy (such as the chart you included) things come into better focus.

    The problem with CAHSR from the outset (versus legacy HSR startups elsewhere in the world) is that planners tried to superimpose something brand new (to California eyes) on a blank slate. Other countries had at least an incremental network of passenger rail before they made the switch over to HSR. A study was developed in the mid-90’s which concluded that for a bit over $1B, rail travel times on the EXISTING coast route could be reduced to 6-7 hours (vs. the current 10-12) with curve revisions, use of tilting trains, passing sidings, and strategic civil improvements. This is comparable to auto travel which can take from 6 hours (best case via Interstate 5) to 8-9 hours or more (more likely, especially at peak commute times and on weekends).

    I argue that this and similar INCREMENTAL upgrades on 4-5 California routes should have been part of CAHSR’s business plan from the start. I make the trip from SF to Southern California quite frequently, and would take the train if times were even remotely comparable to auto travel. There are many others in my shoes. By making incremental investments to current routes and BUILDING THE RIDERSHIP BASE EARLY ON, the agency could set the stage for a successful, highly patronized true HSR system in the future, and also building the all-important feeder network that makes HSR so successful elsewhere in the world.

    • Nathanael

      California actually has quite an impressive “incremental” network. The San Diego-LA trains are the highest-ridership Amtrak trains outside the Northeast Corridor.

      The Coast route from SF to LA, however, has two things against it:
      (1) Union Pacific, which has shown a bad attitude;
      (2) Misses the current major intermediate population centers, namely the Central Valley.

      #1 is the larger problem. Building a track adjacent to UP only requires fighting with them once, but upgrading the entire length of a UP-owned route requires dealing with them continuously.

    • John,
      The notion of improving the coast route to 6-7 hours does not cut it. People can drive between LA and SF in 6 hours, add an 1 to 1.5 hours during the holidays. That won’t pull people out of cars. I personally know this to be true having driven the route many times every year since 1982.

      If you don’t lower SF-LA to 4 hours or less you won’t get people out of cars, but doing that on the coast would be real expensive.

      • Wad

        None of California’s three Amtrak state-supported trains can clock car trips, but they aren’t hurting for ridership.

        Humans aren’t computers that operate on a “If TrainTime > CarTime, Then take Train” command line. There’s something else that’s going on.

        The Surfliner’s appeal is pretty easy to figure out: It has a great view in south Orange and north San Diego counties. But you can’t say the same for the Capitols or San Joaquins (though the delta between the Bay Area and Stockton is quite verdant and beautiful).

        All three trains now carry 1 million-plus annually. Plus, Surfliners have now become the second-busiest trains in the nation, recently passing Acelas.

        The trains do offer advantages in amenities and other time savings (no need to stop for food and restroom breaks, for one).

        • Marcella D.

          1 million/year is pretty much irrelevant for the overall market of travel between those areas. That is a tricky issue with any very-low-market-share mode of transportation like Amtrak’s services: they are a sort of niche that sometimes can easily be doubles. The problem and challenge is not getting Amtrak to move from 0,6% to 1,2% of the national passenger-mile count (doubling it), but, for instance, to grow from 5% to 10%

      • Danny

        The ridership assumptions that are used to show HSR as being a sure success depend on historical experience from other regions with similar geographic and political features as those found in CA. If that assumption is true, then you are most certainly wrong here.

        HSR in France wasn’t built to boost ridership…it was built because their slower rail (but still about 2x the speed of ours) system was so damn successful that they didn’t have any more capacity. Higher speeds was a capacity solution, not a demand solution.

        Just because you wouldn’t ride a train that took 6-7 hours doesn’t mean that hundreds of thousands of other people wouldn’t.

        • This isn’t completely true. SNCF was bleeding ridership to cars and planes, and the joke at the time was that soon the only people riding trains would be SNCF employees and their families. It built the LGV Sud-Est explicitly to turn itself around. Although there was a capacity problem, it came from commuter rail, not from high demand for intercity trains; the choice was to four-track the line and run incrementally faster intercity trains, or build an LGV and run much faster intercity trains.

      • PRE

        “The notion of improving the coast route to 6-7 hours does not cut it.”

        This is simply not a true statement. As someone who has driven 5, 99 and 101 many, many (many…) times and hates it, a 7 hour train ride to LA sounds like a dream come true. I would never drive again, and judging by the number of people on the San Joaquin the last time, even with the bus ride, a lot of people agree with me and the coast train would be even more popular.

        • PRE,

          Granted you would take the train for 7 hours, but that’s not would an economically feasible group of people would do to justify the upgrade cost.

          And what about train frequency? Would you continue running run only 1 train a day? Before you say more trips, remember to factor in higher train, staffing and safety upgrade costs. Not that I’m against improving a LA-SF coast route, just acknowledge that if it were to be done well, boost it to 12+ trains daily each way with average speed of at least 100 mph to pull a large chunk of people from cars and remove the need to expand airport runways to handle intrastate traffic.

    • Wad

      @John, an incremental approach is an adequate political currency but is a poor economic currency.

      A big problem with increments is that in construction, especially when an American government is involved, increments are diminishing returns.

      Say you want to get to 220 mph from 80 mph, and you decide to go incrementally by spending $1 billion to get a 10 mph speed improvement. So, you’d get to high-speed rail in 14 slow steps.

      Despite the cost ($1B) and speed improvement (+10 mph), the project gets more expensive because each increment delivers less of a speed improvement.

      The biggest improvement comes from going from 80 to 90. The train is now 12.5% faster. Going from 100 to 110 drops down to a 10% improvement. The worst increment? The capstone, 210 to 220. That’s only a 4.5% improvement.

      This is just an example in a vacuum. Real-world costs will be higher because of inflation and variable materials and labor costs, so they can’t follow a simple $1 billion per 10 mph improvement.

    • Alan Kandel

      I think what we’re forgetting here is that full build-out of Calif. high-speed rail (if it is able to get started) won’t happen until year 2033. The line may be partially ready by 2020. Driving and flying, on the other hand, I don’t believe to be infinitely sustainable. By maintaining business-as-usual scenarios, mobility in state will become stifled. What’s more, as the price of gasoline continues to climb, presumably the price of an airline ticket and the cost of car ownership will continue to escalate, alternatives to these already heavily-subsidized modes look more and more attractive. Whereas in the 1950s 10 percent of family income went to transportation, currently 25-to-30 percent goes to transportation.

      Assuming population doubling in the San Joaquin Valley (if not the state) in 35 years that means the eight-county Valley will have anywhere from 9 to 12 million people. How will all these people be able to effectively move about the state with their transportation options limited to cars and planes along with what right now is only a presently modest rail system.

      As it stands, under Amtrak’s operational structure in the Valley, the established means for affected rail passengers to get between Bakersfield and Southern California is to get off the train and onto a bus which places these travelers back on the road adding more traffic. Without HSR, I don’t foresee this train-bus arrangement changing anytime soon if at all.

      What this tells me is that reliance on predominantly highway and air travel in the central Valley corridor is unsustainable, not to mention the problem of increased air pollution as a result of the accelerated burning of fossil fuels. The Valley already has some of the worst air pollution – both particulate matter and ozone (smog) – in the U.S. It’s been reported in the news recently that, nationally, greenhouse gas emissions increased six percent over the period of just one year.

      Planning for the future is prudent and it has to be done now. High-speed rail provides a viable service as it is safe, comfortable, affordable, relaxing, efficient, fast, reliable and environmentally sustainable. It is better to get to work on this now than to wait until mobility in the state comes to a grinding halt. By then it will be too late.

      • Nathanael

        “By maintaining business-as-usual scenarios, mobility in state will become stifled. ”

        Crucial point.

        Mobility suppression is already happening in the head-in-sand states of Indiana and Ohio. While their economies continue to decline due to the relocation and closure of manufacturing, air prices go up and service goes down, leaving them entirely car-dependent. Then, with incomes dropping and rising gas prices, *even with no congestion* mobility starts vanishing.

      • Alan K,
        You hit the nail on the head. California can’t afford NOT to build a HSR system.

        We already have proof that community groups will not let SFO, San Jose, Oakland, San Diego, LAX, Long Beach, Ontario and Burbank add airport runways. They won’t do it for reasons of more traffic, noise and air pollution. If California tries to alternatively build major international new airports north of Vallejo, Palmdale, northern San Diego County, we’ll be in the courts for decades because new residential areas don’t want to be under the next flight path. Even if those new airports with access roads were finally approved, costs would jump past $30B.

        And If you want to complain about public costs that will make your head spin, estimate the costs to carve the equivalent of another six-lane I-5 freeway through fault-ridden Angeles National Forest up to Northern California by 2035-ish. There is no way it could done for under $100B.

  • Progressive Capitalist

    Want lower costs? Let Asian firms or others with experience complete the project as a design-build and operate it as a concessionaire.

    Need public cash? Sell I-5 to separate private firms to convert parallel freeways to private turnpikes.

    Improve fare recovery? Stop subsidizing the airlines.

    Don’t like any of the above? Don’t criticize HSR as a public project in terms of its costs, operating subsidies, and/or private competition.

    • The problem is that the first is not happening. Instead the design is done by PB, which is also going to bid on construction and will almost certainly get it. Effectively, California is letting a private company with minimal oversight design its own contracts. Foreign firms have no reason to bid – they’d lose.

      Compare this with Florida, which was going to do exactly what you’re saying until Scott came along.

  • Doug

    I’d also like to point out that state output is not comparable to national output; the former is a portion of the latter. Therefore, taxing power (which is really what we’re measuring with GDP) is not comparable.

    More to the point, California has around a 10% max tax rate; the US has a 35% max tax rate. CA indebtedness is limited by US indebtedness, not solely by GDP.

  • I understand the push for better intracity systems, but intercity travel is substantial, especially along this corridor. CAHSR has done a study on the subject of what it would cost to build sufficient capacity using established infrastructure, and it’s greater than the $98 billion price tag.

    Intracity rail projects are incredibly important, too, but we shouldn’t overlook the pressing need for intercity travel.

    • Chris

      I think the key difference is not so much the size of the traveling population as the different price elasticities and secondary benefits of travel. “Sufficient capacity” is a loose term, but obviously it’s much easier to get people to reduce their travel between LA and SF (using prices) than it is to get people to reduce their travel between points in LA (e.g. from home to work). Plus, the secondary benefits of improved intracity transit per dollar spent, in terms of increased economic activity and particularly densification, exceed the secondary benefits from intercity transit spending.

  • Beta Magellan

    Yonah, some of your arguments are a bit specious. First, as Alon already noted, just because it’s a small waste in proportion to GDP doesn’t mean it’s waste. Furthermore, Caltrans’ profligacy doesn’t excuse paying for overbuilt HSR infrastructure—indeed, I’d argue that reining in highway programs is even more important than building HSR. Demand-management—or even just allowing congestion to grow and witholding providing the funds for “solutions” such as road-widening—would probably do more to curb personal automobile usage in California than building new intercity rail links. It would also come at far less cost—although HSR costs less than expanding highway and airport capacity, HSR also costs more than keeping highways and airports as they are and letting people adjust.

    That said, HSR for California’s still a good idea, but not as currently designed. Canceling CAHSR needs to be on the table: the only thing that will compel serious value engineering is the possibility that the project might not be funded at all. Even though this strategy introduces the risk of outright cancellation, at these costs that’s probably the second-best option in this case (which project—other than HS2—has similar or higher per-mile costs to those in CHSRA’s Business Plan?). By coddling CHSRA and its contractors, HSR advocates both inside and outside government are legitimizing incompetence, which only makes it less likely that we’ll see federal funding for intercity passenger rail in the future. Better to kill it now and hope for something better to come up in seven or eight years than to allow the current program to inch forward.

    • Nathanael

      The only way, politically, to prevent the Central Valley from demanding more and more agriculture-destroying road lanes is to *give them a train*.

      Cancelling CAHSR is just stupidity.

      Riding herd on the contractors? Well, that’s certainly a good idea, and will improve costs overall. That requires in-house rail expertise. Ready to PAY for that, upfront? Good, you’ll be lobbying for a few tens of millions per year to staff up CHSRA’s internal expertise then?

      • Beta Magellan

        If the project timeline allowed for HSR in ten years rather than twenty I’d be more inclined to agree with you—but as is there’s plenty of time for the Central Valley to build more roads before even a preliminary, blended HSR link is completed. At this point, stopping road construction’s probably an easier hill to climb than getting HSR built on-budget (the original budget) and on-schedule.

        Furthermore, I don’t think dangling cancellation’s a bad thing at all—I agree with you about in-house engineering, but at this point it’s probably too late for that. Most of the overruns are outside the central valley—PB is entirely capable of delivering a project with minimal overruns. They just have no incentive to—as long as the project gets uncritical support, they’re going to keep over-designing and overbuilding. It’s time to break out the rod and give the contractors a clear signal that if they design irresponsibly they’ll build nothing. Hit them where it hurts—their bottom line.

        • Nathanael

          “Most of the overruns are outside the central valley—”

          In other words, there are no overruns. Because the Central Valley is the only part which is even close to final design.

          By all means lobby for cost-effective designs on the other segments. I’d focus on Sylmar-Bakersfield, as once that is built, the rest of the system becomes much more attractive to absolutely everyone.

      • Danny

        If your concern is the preservation of agriculture, road lanes are not even 1% of your enemy. Snout houses and cul-de-sacs are.

        • Nathanael

          As Alon notes, the road lanes really are there to support the house construction. *sigh*. But the politicos will use intercity mobility as their *excuse*.

      • The problem is that some of the CV politicos are demanding road lanes anyway – either as part of opposition to HSR, or as part of not wanting to give up road construction. Fresno is upgrading an arterial to a full freeway serving agricultural and undeveloped land as we speak.

  • Wad

    Yonah, I agree with your analysis, but high-speed rail is now futile.

    The revised business plan is the death warrant for high-speed rail in California and everywhere in the U.S. By effectively setting the price so high and time-frame so long, this will discourage anyone from ever trying.

    Construction firms and engineers will now use this document as the floor for negotiating all future proposals. Also, HSR opponents can kill projects by insisting on California design specifications as ransom money to blow any projects out of the water.

    The only way Americans will get to ride high-speed rail is by getting a passport.

  • Ocean Railroader

    Great Jumping Grandmas this is steep 98 billion. I really can’t understand why 42 billion wouldn’t be enough to build this thing in that most of the land it is going though is empty desert between these cities. I mean the state of Vriginia is going to spend 300 million dollars on a bran new four lane six mile long new limited acess highway to act as a freeway bypass of a city. I really can’t see how this thing is this steep to build. Why can’t they lay this thing next to the existing freight tracks such as in the form of a four track wide railroad with the two passanger only tracks running to the side of the freight tracks.

    We now have a higher chance of getting invated by a race of flying unicorns than getting this thing built in that no one I know even has 20 billion or 100 billion dollars lying around.

    • Nathanael

      It’s based on excessive estimates of inflation (they’re using the unjustifiable “year of expenditure dollars”). 65-75 billion is about right in real dollars, and the estimate does seem high. Of course it includes two major mountain crossings, one minor (San Fernando Valley to LA proper) and two long urban segments (Peninsula and LA)

  • DBX

    California will be consigning itself to higher transportation costs and a degraded environment by not doing this project, but unless it is value-engineered it probably can’t survive such a drastic cost increase. And accordingly I have a question. Why isn’t 186mph fast enough, or even 160? You have huge energy savings (environmentally friendly) and huge savings in maintenance and presumably very significant savings in construction costs (probably also environmentally friendly due to an alignment that doesn’t need to blast its way through geographical features as much) for a relatively modest speed reduction

    • Beta Magellan

      I’m pretty sure they need 220 mph to get from the LA Basin to the Bay Area in less than 2:45, with most of the high speeds in the flat Central Valley rather than the mountain crossings.

      Again, don’t forget demand-management people—it’s not sexy, but in terms of curbing the growth of CO2 emissions it’s almost certainly a better value per dollar. The choice isn’t between building HSR or roads and airports—it’s the difference between building HSR, building roads and airports, and actually doing nothing and letting people’s travel patterns adapt.

      • In California there is no “Do Nothing” option. That has never been true in a state with the world’s 7th largest economy. People will move one way or another and transportation infrastructure will adapt, not the other way around. That’s been our history and it will be out future.

        We just have to get over this two year road bump called the Tea Party stopping new infrastructure funding while wanting more military funding. After the 2012 election, I look forward to traditional Chamber of Commerce Republicans joining with Democrats to build transportation infrastructure again.

        • Wad

          Thomas, there is the possibility, or dare I say certainty, that the Republicans are poised to do as well or better in 2012 than 2010.

          Voters punish incumbents for a bad economy. The Obama 2008 base has been demoralized and possibly jaded from the political process altogether. Like the 1968 elections, a “silent majority” will get the last laugh in the face of a young, energetic protest movement. Plus, the organizing force for the GOP is The Black Man in the White House.

          • No one has a crystal ball for 2012 elections, but if the GOP was running a traditional Bob Dole, they would have a good shot of winning the Presidency.

            Dole was what I call a Chamber of Commerce Republican who would work with Democrats to move the country forward, particularly on infrastructure that moves people and goods. Today, the Tea Party would threaten him into a corner as they have use-to-be-Moderates such as Romney, McCain and Boehner. It is that spineless flip-flopping by Romney that so many indie voters find distasteful.

            Given Occupy is building broader support, don’t be surprised if the TP is delivered a kick in the butt in 2012 and sanity returns to the GOP.

            • Nathanael

              What an optimist you are! I would be very pleased if sanity returned to the GOP, but I’ve been watching the leadership go progressively nuttier since 1980 (when a man with Alzheimer’s was elected President on a platform of platitudes, and proceeded to budget using a “magic asterisk” — look it up if you don’t recognize it).

              I don’t think the institution of the Republican Party is capable of returning to sanity at the national level, not with powerful folks like the Koch Brothers paying to make it crazier. Perhaps local branches can “go sane”, but they’ll probably have to split from the national party and declare themselves “Infrastructure Republicans” or something.

        • Ocean Railroader

          They are already talking about giving Fanny May six billion more dollars in tax payer funding to keep them afloat this year. At least with Amtrak we can all go see what it looks like and go ride it. They could at least take that six billion and give three billion to the nation’s passanger railroads and give three billion to highway repairs instead of dumping into the Fireplace known as Fanny May.

          • Mike Jones

            The newest CAHSR docs say all their Tehachapi alignments are good for 220mph (350kph). I don’t know about Pacheco, but the climb up to Tehachapi is much more demanding. Not sure I necessarily believe that’s what we’ll get but, they do say the the max grade is 3.5% (which is steep but not unknown). I’m not sure how grades effect current HSTs running at 300kph? The website shows a time of 50 mins between San Jose and Bakersfield, this is 10 mins faster than TGVs manage the similar distance between Marseilles and Valence…

    • You get operating cost savings from slowing down from 350 km/h to 300, but not construction cost savings. The full-speed track in the Central Valley is cheap, because the land is flat. The highest costs as well as the worst cost overruns have been in the urban segments in the Bay Area and the LA Basin, where speeds are going to be very limited anyway (to 200 km/h in the Bay Area and 180 km/h between LA and Anaheim).

      The next worst in terms of both absolute cost and cost overrun are the mountain passes, and those have significant speed restrictions as well, at the highest 220 km/h through Pacheco, and need to be heavily tunneled no matter what the top speed outside the tunnels is. In fact there’s a 350 km/h alignment for Altamont that’s actually cheaper than both Pacheco and the Altamont route studied in the EIR, using Interstate and power line ROWs. The top speed matters a lot less than the viaduct and tunnel needs.

      • Ocean Railroader

        To keep this project realstic I would use the existing Amtrak trains and have them run down the freight tracks but build a series of privet passanger rail only high speed rail short cut tracks that would any where from ten to 50 miles long and go around busy freight yards or rail switching areas where there is a lot of known freight back up. Over time once this frist system is built of passanger rail bypasses I would slowlly extened these freight only lines into one another slowlly turning these cut up sections into one none stop high speed rail line. The bypasses would also get eletric catenary but only where the Cal Trains section is at first and the catenary would be extended south down from there over time. The rail bypass idea with the Amtrak trains would also run along side most of the freight railroad tracks the whole route. This would save tens of billions of dollars and would at the least triple existing Amtrak ridership and bring in funds and suport for more upgrades in the future. Also at the same time it would leave something behind if the whole system goes belly up in one sitting.

        • Allen

          Ocean Railroader, you may run them down existing freight tracks but the freight railroads won’t go for it. MOre so, those lines physically can’t support high speed passenger trains. It’d be a bit like trying to run drag races on a busy downtown street.

      • Nathanael

        “In fact there’s a 350 km/h alignment for Altamont that’s actually cheaper than both Pacheco and the Altamont route studied in the EIR, using Interstate and power line ROWs.”

        *THIS* route is worth getting into the studies. (Not the Altamont route from the EIR). I assume, however, that there’s a way to get it under the Bay cheaply….? ‘Cause if not, forget it.

        • That’s the SETEC alignment into Newark. The Bay crossing is separate, but apparently it could be tunneled using all the exploratory and geotechnical work of the water tunnel.

  • Bobby99

    Ca. can’t plan a budget for 1 year but the crystal ball reading financial geniuses have got costs and inflation figured out for the 20+years the speedy train will take to build and they also know how to force people into riding the train.??

  • Chad Brick

    Shut up and build it. Raise my taxes to pay for it. Thanks.

    While you are at it, raise my taxes even more and build things like it all around the country.

  • Tom Marney

    This is just like health care: The US cannot do what our peer nations can do, for no obvious reason, and a large portion the body politic considers it a matter of pride. American exceptionalism, indeed. :rolleyes:

    • No, it’s worse. With health care, once costs rose to the point that the difference with the rest of the first world became easy to see the left seized on this as an efficiency argument and turned universal health care from a matter of empathy to one of good policy. In 2009-10, it was the conservatives who kept demagoguing about death panels and the government’s getting its hands on Medicare. It’s not like with transportation, on which to find people who are concerned with cost control you have to go to contrarian outfits that don’t have a lot of clout, like IRUM and Caltrain-HSR Compatibility.

  • Tom Marney

    Well, since this thread has played itself out on the topic at hand…

    It’s all about the narrative. Anything the government attempts (aside from military adventures) turns to poo. Health care reform can’t possibly reduce costs– that’s too at odds with the narrative, even though it works that way in every other advanced nation. Medicare is a success, and therefore cannot be a government program (LOL!). The auto industry rescue was a disaster even though it saved 2 million jobs. Tax cuts reduce the deficit. And so on.

    As far as being truly concerned about cost control, I suppose you’re right. But feigning concern about costs based on zero factual evidence is easier than falling off a log while drunk, and it’s the default setting of the right wing punditocracy and its millions of followers.

    Not that you didn’t already know this. :P

  • I think the high speed rail people should rephrase the cost in a different, more palatable way. Instead of saying $98 billion, why not say, as Yonah, does that this will only be 21% of Caltrans revenues through 2033? And spend more time comparing it to the cost of other public works, like the water project and the Interstate Highway System. One of the main problems is that few people can truly understand what the world will be like in 2033 – it certainly won’t be like it is now with cheap oil, etc. Take a look at my review of the cost elements of the business plan .

    • Chris,
      Thanks for providing the $171 billion YOE alternative cost of building/widening freeways and airport lanes coupled with rising oil prices, air pollution and more fatal accidents.

      Why doesn’t CHSRA drum up these facts to justify the $98 billion YOE (partly paid with private money) as a comparative bargain?

  • Michael Schaeffer

    Why the frak aren’t they listening to reason and hiring professionals instead of incompetent fools?

  • Andrew

    High speed rail will never have much of an impact on the need for road expansion because the capacity constraint is within the cities for commuter traffic, not between the cities. I-5/99/101 are not congested outside major cities. High speed rail will greatly reduce the need for airport expansion by killing all the short haul air traffic between Northern and Southern California, but has little or nothing to do with highway expansion.

    If you want to reduce the need for road expansion invest in mass transit (buses, light rail, commuter rail, subways, etc.). California needs lots of this.

    • Nathanael

      Road expansion historically happens first in the outlying areas, not in the cities. *Even though the outlying areas are not congested*.

      Yes, this is perverse, but go look it up. :-P I think it’s a highway-lobby racket.

  • Richard Rider

    It has become apparent that HSR proponents lied about EVERYTHING to sell the voters on the deal — projected ridership (bogus projections that peaked at well over 100 million annually), ticket prices (more than doubled since 2008), travel times (utter fiction), promised jobs, private funding without taxpayer guarantees, earning a profit, zero operating subsidies and incredibly low-balled construction costs. EVERYTHING.

    But now we are supposed to believe these new dreamed up projections? I think not. These more “realistic” projections were put together by hand-picked “rail experts” who knew that they had to sound a bit more reasonable than their bozo predecessors.

  • Richard Rider

    My favorite fictitious factoid from the new bogus CA HSR study:

    “The business plan predicts that in 2030, 14,400 passengers per day will board southbound bullet trains in Merced (a California backwater town). That’s more than the daily departures last year from the busiest Amtrak depot in the United States, Penn Station in New York.”

    • Bob

      ^check your sources. The numbers I see for Penn station traffic are around 300,000 per day.

    • Richard R,

      Its a red herring to complain about one intermediary HSR station station rather than the system ridership projections as a whole by 2033 and beyond. California Amtrak already has proof points that ridership boosts when gas surpasses $4/gallon (and thats will lousy speeds, frequencies and dependability). Want to estimate HSR demand when prices escalate beyond $10/gallon gas prices by 2025, if not sooner?

      BTW, Merced and the rest of the Central Valley are forecast for substantial population growth by 2030-40. Backwater today, booming faster than most other American cities tomorrow.

      • FG

        The article somehow begs two questions; is the actual total travel comparable – in other words, do Americans travel as much as nationals of other countries, between domestic points and is travel via rail at all influenced by local transportation options (say suburb in city A to suburb in city B?) – I’m asking in the sense of is there a “control” group for that and comparison between countries.

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