California High Speed Rail Funding Risky

According to an audit, the California high speed rail network plan relies on risky funding, while overseeing the agency heading the project is weak. State auditor Elaine Howle says in a report that the California High-Speed Rail Authority (CHSRA) claims the US government is its biggest potential source for funding the $98.5 billion project. However, its business plan doesn’t give a lot of details of how it will get the funding. The plan also doesn’t include $96.8 billion in maintenance and operating costs between 2025 and 2060.

Howle says there are concerns that the revenue estimates and ridership forecasts made by the CHSRA may not be correct. The projections are fundamental on the attraction of private investment. Additionally, the authority has failed to oversee contractors and subcontractors, who outnumber employees of the agency by 25-1. The authority has given contractors too much control and may not have the information needed to make vital decisions.

CHSRA spokesman Lance Simmens says that they are working with the auditor to identify deficiencies and will continue working with them. They will deal with the concerns in a revised business that will be published next month. He added that nothing in the audit suggests the project should be stopped.

California is the only state in the US that is working to lay high-speed rail tracks for trains to travel up to 220mph. The network is planned to connect San Francisco and Los Angeles by 2033. The state has received $3.5 billion in funds from the US government to put towards the project. However, it says it will need between $17 billion and $19 billion from the federal treasury for the work. Congress, on the other hand, has scrapped high-speed rail funding requested for this year.

In 2008, voters in the state approved the sale of $9.95 billion in bonds to finance the project, and most of them haven’t been sold. It’s been revealed in a poll, however, that after the estimated cost of the project rose from $33 billion to nearly $100 billion, most voters would now reject approval for the sale of state bonds. Then on January 3, a legislative review panel recommended that the state’s debt not be sold to begin the project.

The chief executive of the CHSRA, Roelof van Ark, announced on January 13 that he will be resigning, effective in two months. Agency chairman, Thomas Umberg, also announced he will step down but keep his seat on the board. Umberg said in a statement that he thanks Mr van Ark for his service to the authority and the high-speed rail plan. His resignation will be felt throughout the state. His dedication, energy and passion for the project are proof of his character and professionalism. They are very lucky to have his continued advice and counsel as they introduce a high-speed network to California.