Auditor: California bullet train's financing 'increasingly risky'
The financing plan for California’s nearly $100-billion bullet train project has become “increasingly risky,” the state auditor warned Tuesday.
In the latest in a series of cautionary reports by outside agencies and groups, the auditor's report finds that the California High-Speed Rail Authority has made some progress in addressing planning and fiscal concerns but still has important work to do to ensure that the project can be built as promised.
“The program’s overall financial situation has become increasingly risky, in part because the authority has not provided viable funding alternatives in the event its planned funding does not materialize,” the auditor's report says.
The authority has secured $12.5 billion for the first leg -- from Los Angeles to San Francisco -- of what is planned to be an 800-mile network, according to the report says. But it notes the projected cost of that phase has risen to between $98.1 billion and $117.6 billion.
“The success or failure of the program” depends on obtaining up to $105 billion in additional funding, which has not been identified, the report says. It also finds that cost estimates for the initial phase do not include operating or maintenance outlays, which the auditor estimates could total $97 billion between 2025 and 2060.
Moreover, concerns have been raised about ridership projections that form the basis of the state financial plan for the system, including by a group of experts hand-picked by the head of the rail authority, the auditor’s report says.
The concerns expressed in the report generally echo or amplify on issues previously raised by the state auditor, the nonpartisan Legislative Analyst’s Office, an expert review panel created by state law and others.
Still, Gov. Jerry Brown, organized labor, many members of the legislature and business groups are pushing to start construction in the Central Valley later this year, arguing that a bullet train represents a bold vision of progress for the state and will create jobs, accommodate future growth and help the environment.
Backers note that voters approved the project -- and billions in state funding -- in 2008. Critics, however, point to recent polls that show voter sentiment shifting away from support for the project.
-- Rich Connell