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The Unraveling of the High-Speed Rail Program: A News Analysis

Posted by Ken Orski on Wednesday, December 1st, 2010

Innovation NewsBriefs
Vol. 21, No. 29

The future Republican House leadership  is determined to retrieve whatever remains of the unspent and uncommitted stimulus (ARRA) funds. So stated  Rep. Jerry Lewis (R-CA), the prospective  House Appropriations Committee chairman, as he introduced a bill (H.R. 6403, the “American Recovery and Reinvestment Rescission Act”) to rescind any unobligated ARRA funds and return them to the U.S. Treasury.  Even already obligated ARRA funds may be at risk.  Congressional GOP aides are reported to be closely reviewing agency records to identify particular stimulus-funded projects that could still be “reasonably” halted because work on them is only beginning.

House Republicans are also expected to use the power of rescission to undo certain elements of the Obama transportation agenda that they consider unsound and wasteful. The unobligated high-speed rail (HSR) grants are a prime target.   According to a Wall Street Journal analysis, of the $46 billion in stimulus funds originally allocated to transportation, around $6.3 billion (14%) still remain unobligated  — and most of it happens to be in the federal high-speed rail program (WSJ, “Unspent Stimulus Dollars,” November 20).  HSR funds have been obligated more slowly than other ARRA dollars because of delays encountered in concluding cooperative partnership agreements between states and the freight railroads that are a condition of receiving federal aid. The  cancelled HSR grant awards to Wisconsin and Ohio add another $1.2 billion to the unobligated funds.   (Some of the $24 billion in ARRA transportation dollars that have been obligated but not yet paid out, including some TIGER grants, could also be candidates for defunding.)

A $4.3 Billion “High-Speed Train to Nowhere”

Also at risk is a $2 billion federal grant to California’s high-speed rail line. Among those urging rescission of the funds are several California congressman including Rep. Kevin McCarthy (R-CA), the third-ranking member in the new House Republican leadership hierarchy  (See, “GOP House aims to take $2 billion back from California high-speed-rail,” The Mercury News, November 22; and “Valley May Get Train to Nowhere, by Dan Walters in The Sacramento Bee, November 28).

Undeterred,  the California High-Speed Rail Authority is forging full speed ahead. It announced on November 24, that the first 65-mile leg of California’s  high-speed rail line will be built in California’s Central Valley, from Fresno (pop. 505,000)  to Corcoran (pop. 14,500). The staff recommendation  follows a directive from the Federal Railroad Administration that the federal funding awarded to the project  must be dedicated to a single operable line segment  in the Central Valley. Roelof van Ark, the Authority’s CEO said this segment would make “the best use of the $4.3 billion currently available construction funds.” But if Congress fails to authorize further funds to extend the line—a highly likely possibility in the newly empowered Republican Congress—the project will end up truly as  “a high-speed train to nowhere.”

If confirmed by the Authority’s Board next week, the decision to spend $4.3 billion on an isolated 65-mile route in the sparsely populated Central Valley, far removed from any large population concentration, could become a huge embarrassment  for the Administration. Like Alaska’s “bridge to nowhere,” the Central Valley line would become emblematic of wasteful government spending on a project that defies common sense and is of little economic value— thus casting doubt on the legitimacy and soundness of  the entire federal high-speed rail program and its decision-making process.

A brave but poorly conceived and badly executed initiative may thus be prematurely reaching  its demise.

C. Kenneth Orski is a public policy consultant and former principal of the Urban Mobility Corporation. He has worked professionally in the field of transportation for over 30 years, in both the public and private sector. He is editor and publisher of Innovation NewsBriefs, now in its 21st year of publication.

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