Out of Control Policy Blog

High-Speed Rail an Especially Bad Deal for San Diego

Reason Foundation's George Passantino's column in today's San Diego Union-Tribune:

Disneyland has always been a California icon, conjuring up our passion for nostalgia and futurism. Riders of the Disneyland Monorail, the first monorail in the Western hemisphere, still experience the train's magical ability to both transport us and capture our imaginations. So it's no surprise that the talk of a statewide high-speed train system is intoxicating to many. Sadly though, the reality of the proposed statewide high-speed train is nothing like a Tomorrowland ride.

For San Diego taxpayers, the high-speed rail system, on November's ballot as Proposition 1A, is an especially bad deal. Want to get out of traffic and commute via a quick bullet train ride from San Diego to Irvine? Sorry, the train does not go there. Well, at least you can go from San Diego to Anaheim. Actually, that route isn't offered either. How about a direct trip from San Diego to Los Angeles? Yes, you can make that trip, but you'll head to Escondido, out to Riverside, and then onto the Ontario Airport, before heading back west toward Los Angeles.

Questionable route choices may not be the worst of it for San Diegans. San Diego isn't included in the plan's first construction phase and seeing a complete, statewide train system that ever gets to the city is far from guaranteed. The California High-Speed Rail Authority already dropped a proposed route to Oakland. San Diego could be the next to go.

Proposition 1A would authorize $9.95 billion in bonds to start building the Los Angeles to San Francisco segment. But that isn't even 25 percent of the total funding needed for the train. The California High-Speed Rail Authority estimates it will need $45 billion (in 2006 dollars) to build the first two phases. So where does remaining $35 billion in funding come from?

The rail authority curiously believes it can get $10 billion to $15 billion from the federal government – even though no federal government program currently exists to hand out high-speed rail grants to states, let alone give $10 billion to a single state.

The rail authority also claims it will get another $15 billion to $20 billion from private companies – even though it doesn't even have a finished business plan to share with these potential contributors yet.

If by some miracle, the state can round up the $35 billion in outside funding, taxpayers will have to pray there aren't any cost overruns. The book "Megaprojects and Risk" studied 258 major infrastructure projects across the world and found that 90 percent suffered cost overruns. Rail projects were the worst offenders, going over budget by an average of 45 percent.

A new due diligence report by Reason Foundation examines the costs of other high-speed train systems around the world, as well as previous estimates on the California rail proposals. It concludes that the final price tag for the statewide high-speed rail system will actually be between $65 billion and $81 billion, not the $45 billion advertised. Taxpayers will have to make up that difference.

One of the study's co-authors is Joseph Vranich, a high-speed rail supporter. He was president of the High Speed Rail Association in the early 1990s and is a former Amtrak spokesman. But Vranich says "the California High-Speed Rail Authority hasn't leveled with the public about the high risks and uncertainties this project brings."

He's referring to the rail authority's ridership estimates that claim up to 117 million riders will ride the train each year by 2030. For comparison, the entire Amtrak system – spanning 46 states and 500 destinations – had 25.8 million riders in 2007.

Listening to the rail authority's claims, you get the feeling they've been to Disneyland's Fantasyland one too many times. They want you to believe they will give Californians a train that carries more passengers than any other system (including Europe and Asia); goes faster than any train in the world; offers lower ticket prices than any other; and costs less to operate than any train, anywhere.

That doesn't sound like the debt-ridden, bureaucratic state government we all know. Californians should expect the train to cost tens of billions more than being estimated. A taxpayer-funded, multibillion-dollar bailout of the high-speed rail system, or ending up with an incomplete system that skips places like San Diego, is likely. As romantic as this rail plan might seem to some, it's a bad idea for a state already facing a $15 billion deficit. And it's an even worse deal for San Diego.

Reason's Due Diligence Report on High-Speed Rail Proposal

Chris Mitchell is Director of Communications/Media Contact


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