April 24, 2020

USA: High-Speed LA-To-Las Vegas Virgin Train Wins $600 Million California Bond Allocation. California Bullet Train Officials Say They Were Told To Suppress Bad News And ‘Shut Up!’

written by Alan Ohnsman
Tuesday April 14, 2020

Amid the broad economic slowdown triggered by the coronavirus, California has approved a $600 million private activity bond allocation for construction of the $5 billion Virgin Trains-Brightline railway that within four years could be whisking passengers from Las Vegas to a (distant) Los Angeles suburb at speeds of up to 200 miles an hour.

Approved unanimously in Sacramento on Tuesday by a committee overseen by California Treasurer Fiona Ma, Virgin Trains-Brightline can sell up to four times the allocation amount, raising as much as $2.4 billion for the project. The company, which operates the Brightline rail service in South Florida, is also awaiting word on a $200 million private activity bond allocation from Nevada that would raise an additional $800 million. The U.S. Department of Transportation last month provisionally awarded the project $1 billion of private activity bonds, raising potential funding for the 180-mile-long project to $4.2 billion. That’s just $800 million shy of the railway’s $5 billion construction tab.

“West Coast, we’re coming for you,” Brightline tweeted on Tuesday afternoon. “Today, we were officially approved for tax-exempt bonds for our privately funded rail line between Las Vegas and Southern California. This means on track to break ground by end of this year.”
Trains on the line will be fully electric–a move that pleases California officials because they would eliminate vast amounts of automotive carbon dioxide and tailpipe exhaust–and run at 200 miles an hour alongside U.S. Interstate 15 highway. The target is to move riders between Southern California and Las Vegas in about 90 minutes.

Backed by Fortress Investment co-founder Wes Edens, the private project is to be built within about 36 months on a right-of-way through the desert that was approved by the U.S. government years ago. During that period it will create 30,000 construction jobs, and 1,000 permanent jobs, Brightline spokesman Ben Porritt tells Forbes. Although California awards the tax-exempt bond allocations, which are provided by the federal government, funds raised come entirely from private investment. At this point, the Virgin named is being used for marketing purposes. Richard Branson has told Forbes that he and his company haven’t invested in the U.S. rail project, but that he may in the future.

Unlike California’s publicly funded high-speed rail project that has run into major construction delays and cost overruns as it works to connect city’s in the state’s Central Valley, the Virgin-Brightline project doesn’t run through any heavily populated areas between Southern California and Las Vegas. To maximize ridership, however, it will have to eventually extend the line from Apple Valley, about 90 miles east of Los Angeles, to a suburban location connected by existing commuter rail lines.

The California bond allocation must be sold by September, with construction to start late this year, Porritt said. Currently, Brightline is also building an extension of its West Palm Beach to Miami line all the way to Orlando. Construction work on that project continues even as Brightline had to temporarily suspend daily rail service in South Florida at the end of March, due to stay-at-home efforts to reduce the spread of COVID-19.
CBS13 News, Sacramento local
written by Associated Press
Wednesday April 22, 2020

SACRAMENTO, Calif. — The major consultant on California’s high-speed rail project has hired an outside investigator to look into allegations that it discouraged employees from sharing bad news about the troubled effort to build a swift train link between Los Angeles and San Francisco.

Brian Kelly, chief executive of the rail project, confirmed the investigation at a Tuesday board meeting of the California High-Speed Rail Authority, the Los Angeles Times reported.

The consulting firm in question is WSP, which has a seven-year agreement to help move the project from its design phase to operation.

The firm has denied allegations in a Times story that quoted several WSP employees as saying they were discouraged from sharing negative information.

Separately, a former WSP employee, Mark Styles, told the Times he was contacted by federal investigators with the criminal division of the U.S. Department of Transportation’s inspector general, which is looking into the project. It wasn’t clear what they were investigating.

California voters approved nearly $10 billion in bonds to build a high-speed train connecting the north and south in 2008. Since then, the project has regularly missed deadlines and reported cost overruns. It’s now expected to cost $80 billion and take until at least 2033 to complete.

The state is in a legal battle with the Trump administration, which is trying to revoke a nearly $1 billion grant for the project.

Also on Tuesday, the rail authority board approved spending more than $400 million to help modernize Union Station in Los Angeles, one of the city’s major transportation hubs. Southern California lawmakers have called for greater investments in improving public transportation in the area.
Watchdog Wire
written by Katy Grimes
Wednesday March 26, 2014 👈

SACRAMENTO — It is very discouraging that something so clear-cut like the High-Speed Rail Authority’s misspending practices are embraced by state Democrats.

Assembly Bill 1501, by Assemblyman Jim Patterson, R-Fresno, California High Speed Rail Funding Accountability Act, was killed in the Assembly Transportation Committee Monday, with the majority of Democrats voting in opposition.

Citizens for High-Speed Rail Accountability explains the history:
In 2013, a Sacramento County Superior Court judge ruled that neither the authorization for issuing bonds from the California High-Speed Passenger Train Finance Committee nor the funding plan put forward by California High-Speed Rail Authority met the requirements of Proposition 1A, the statewide ballot measure voters approved in November 2008 to authorize the state to borrow $9.95 billion for the rail system through bond sales. In other words, voters approved borrowing money under certain conditions, but the California High-Speed Rail Authority now wants to borrow it under different conditions.

Remember that Proposition 1A told voters they would get a $45 billion complete high-speed rail system connecting San Francisco, Los Angeles, Sacramento, and San Diego. Now it’s a $68 billion “blended plan” between San Francisco and Los Angeles in which the first and last parts of the journey (the “bookends”) are not high-speed rail. Construction of a new high-speed rail segment is most immediately planned for bisecting or demolishing more than 1,100 properties between Merced and Bakersfield.
In an interview last week, Patterson said he introduced AB 1501 to protect California taxpayers from a hugely risky financial obligation that leaves them on the hook to pay billions of dollars in matching federal funds by the High Speed Rail Authority. Patterson’s bill would have prohibited the HSRA from spending any federal funds unless matching state funds are immediately available.

“It is simply irresponsible to go forward with high speed rail when we don’t legally have the matching state funds available,” Patterson said at the hearing. “The HSRA has already spent $180 million in federal funds without batting an eye and is determined to go forward without regard for financial accountability.”

Big Labor, Big $$$

The State Building & Construction Trades Council of California appeared at the hearing in opposition to AB 1501. The labor union brags on its website, “We got it right. We elected the right governor and the right legislative leaders.”

“It is with that same sense of leadership and responsibility, that Governor Jerry Brown continues to move forward toward the construction of America’s first high speed rail system,” the labor union wrote in February. “Likewise, the State Building Trades’ advocacy in favor of the project remains as strong as ever.”

Project Vote Smart, supported by Follow the Money, reports transportation unions have made political contributions of $12,800 to the Assembly Transportation Committee Chairwoman, Assemblywoman Bonnie Lowenthal, D-Long Beach. Lowenthal has received a total of $77,450 from labor unions.

Committee member Assemblyman Tom Ammiano, D-San Francisco, even received $14,799 from transportation unions, and $121,473 total from labor unions.

Committee member Assemblyman Mike Gatto, D-Los Angeles, did not have any transportation labor unions listed specifically, but received $26,200.00 from the transportation sector, and $217,600 in total from labor unions.

Committee member Assemblywoman Joan Buchanan, D-Alamo, received $203,400 from labor unions, and $16,500 from the transportation sector.

Committee Vice Chairman, Assemblyman Eric Linder, R-Corona, received no political contributions from transportation labor unions, and only $3,500 from the transportation sector.

Committee member Assemblyman Katcho Achadjian, R-San Luis Obispo, received $12,900 from the transportation sector.

Patterson received $2,500 from the transportation sector, and $21,450 from agriculture.

Citizens for High-Speed Rail Accountability

Aaron Fukuda with Citizens for High-Speed Rail Accountability, testified at the hearing, and reminded legislators that the group is not trying to kill high-speed rail, but wants the rail authority to comply with Proposition 1A, and all applicable laws, including recent court rulings.

Fukuda was critical of the plan which shifted from “fiscal responsibility, pretty good engineering and science,” to the “economic fad” of turning the rail project into a green project and union job creator.

“It does not yield high speed, and will do more environmental damage,” Fukuda said. He warned, if allowed to continue, the rail project will end up taking funds from other programs, and leave others out of jobs.

Fukuda reminded lawmakers they have repeatedly been misled on many issues by the rail authority, including insisting that the project had to begin construction in 2012 — which has not happened. And, there still are no private investors, which the rail authority has promised all along.

“The only mechanism the Legislature has to control is the purse, and these are the public’s funds,” Fukuda said. “A fiscal disaster will be harder to undo than to prevent.”


Diane Friend testified on behalf of the Kings County Farm Bureau, and more than 1,000 family farmers, and the farm workers employed by them. “There are more cows than people [in Kings County],and people take care of these cows,” Friend said.

According to the Kings County Farm Bureau, encroachment permits are needed by the rail authority for construction. ”Thus far, Kings County has denied such permits due to the failure of the authority to ensure its proposals are consistent with the county’s general plan and the needs of public health, safety and welfare.”

The 11-4 vote came after testimony from Patterson and others, presenting staggering facts, amounts of money already spent, and planned spending.

Democratic Assembly members who voted “NO” were, Tom Ammiano, Richard Bloom, Rob Bonta, Joan Buchanan, Tom Daly, Jim Frazier, Mike Gatto, Chris Holden, Bonnie Lowenthal, Adrin Nazarian, and Sharon Quirk-Silva.

Votes supporting Patterson’s bill came from Republican Assembly members Katcho Achadjian, Eric Linder, Don Wagner, and Patterson.

Patterson requested reconsideration for the bill keeping it technically alive, however the message from Assembly Democrats was loud and clear.

No comments: