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Shut It Down: California's High-Speed Rail Project Needs Another $100 Billion

AP Photo/Rich Pedroncelli

They call it a "white elephant" for a reason. The California High-Speed Rail Authority (CHSR) is now requesting that California and American taxpayers shell out another $100 billion to continue construction.

The project connecting Los Angeles and San Francisco via high-speed rail was sold to taxpayers in 2008 as costing $33 billion. That bit of magical thinking has led to current estimates of between $88 and $120 billion and climbing. 

No one knows the final cost, and no one knows when it might be completed. A New York Times investigation in 2022 found that the project was burning through $1.8 million a day and "according to projections widely used by engineers and project managers, the train could not be completed in this century."

The rationale the CHSR is now operating under is the political scare tactic of telling politicians that we've spent this much on the boondoggle so far, so what's another $100 billion when the voters will want to know what we've spent all this money for?

The dangdest thing is that it usually works. Politicians will gulp, avoid looking voters in the eye, and hope no one notices the extra $100 billion.

Reason:

On Tuesday, the project's CEO told state lawmakers in Sacramento that another $100 billion—yes, in addition to what state and federal taxpayers have already contributed—will likely be needed to finish the project. Meanwhile, there's still no timeline for when passengers will be able to take the train due to ongoing environmental reviews, Sacramento-based KCRA reported.

At the state Senate Transportation Committee hearing where High-Speed Rail Authority CEO Brian Kelly delivered the expensive news, at least one lawmaker asked the obvious question: "How do we get the public on board with something," asked state Sen. Kelly Seyarto (R–Murrieta), "that has this much of a downside funding wise?"

Kelly, of course, told lawmakers to just keep throwing money in the hole. "It feels impossible until it's not and then you grind, you do the work, you perform better and you deliver," he said.

Kelly missed several intermediate steps in that analysis, including what happens if you do all that and don't deliver? Too bad tar and feathers are no longer a fashionable way to deal with lying politicians.

It's really quite amazing. The project is currently running a $4 to $7 billion deficit just to complete the initial Central Valley segment of the project 

“It’s been tough to fund a project with something that has an expiration date,” Kelly testified. “We’re doing it in building blocks. We’re giving you the portions we think we can get done with the funding we have.”

Out of the projected $120 billion cost for the project, it's estimated that CHSR has only identified about 25% of where the funding would come from. That means that shutting the project down now would save California taxpayers close to $100 billion.

But Joe Biden may be preparing to ride to the rescue.

KCRA:

Kelly told lawmakers he's encouraged by an ongoing discussion with the Biden administration on establishing a railroad trust fund, and recent funds it received through the Bipartisan Infrastructure Act. Kelly said the project needs a strong, long-term federal partner.

State Senators on both sides of the aisle expressed serious concerns with the funding gap. Democratic State Senator Ben Allen noted a significant portion of the state's funds meant to reduce greenhouse gas emissions are going toward the project. Republican State Senator Kelly Seyarto said, "the air is being sucked out of the room by this one project."

More than air is being sucked out of the room, Senator. Taxpayer's wallets are being hoovered as well. This may end up being the most expensive boondoggle in American history when all is said and done.

And that's saying a lot.

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