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By Tim Hunt

The governor keeps public away from bullet train finances

Uploaded: Oct 6, 2016

Gov. Jerry Brown is remarkably determined to make the bullet train a central “accomplishment” for his political legacy.
The Democrat-dominated Legislature, for the most part, has avoided crossing Brown on the train despite its enormous cost and benefits that are questionable at best. Legislators took a step in the right direction during the session that concluded in August by passing a bill to require the business plan specify the projected costs and schedule and explain the changes. To say both have been moving targets since 2008 is another under-statement.
For a plan that originally had its first phase running from Bakersfield to Los Angeles and now has shifted that to Shafter to San Jose, that truly was a modest step by the Legislature.
Too much transparency for the governor who claimed the project already had plenty of transparency and vetoed the bill.
When voters passed the bond measure in 2008, they were promised a high-speed rail connection between the Bay Area and LA that was largely funded with private money and operated without a public subsidy. It was supposed to cost $40 billion. When estimated costs soared to between $98-118 million in 2011, the plan was redone so costs are pegged at $68 billion.
Now the governor has twisted arms in the Legislature so 25 percent of the cap-and-trade greenhouse gases revenues will go to the train. One big choking point: The May auction of credits netted only $10 million instead of the $500 million projected, according to the Wall Street Journal. Legal action is still pending that challenges whether the credits are a tax.
What’s more, there’s been no private investment forthcoming—President Obama’s shovel-ready stimulus package allocated $3 billion on a matching basis. The feds have consistently changed the rules to keep the project alive. Private investors have stayed away even after the potential steady public income stream from the cap-and-trade.
In an August hearing before the Congressional rail subcommittee, rail authority chair Dan Richard acknowledged that the current plan stops in the middle of an almond orchard in Shafter. Richard had his hand out to try to find $2 billion more in federal funds so the first phase could go into Bakersfield.
It’s abundantly clear that the choo-choo is a fiasco, but one Brown is determined to push forward regardless of its negative impact on the state’s finances.