CA: More money, less red tape. Here’s CA high-speed rail’s wish list for success

Since becoming its CEO last year, Ian Choudri has made changes at California’s High-Speed Rail Authority.

He reorganized agency leadership, brought in experts from the U.S. military and the private sector’s Brightline West bullet train initiative. Choudri also launched a complete review of California high-speed rail to find the quickest, most cost-effective and financially successful path forward.

Amid the Trump administration’s pull-back of federal dollars, the project’s roadmap has begun to take shape.

The rail authority needs to start laying tracks soon in the Central Valley, where construction began on the 119 miles between Shafterand Madera more than a decade ago. The state also will need to move up its plans to connect the Central Valley with the Bay Area and other major urban centers, so high-speed rail might turn a profit and attract private investment.

The project’s plans have undergone several changes since 2008, when California voters approved $9.95 billion in bonds to help fund a railway from San Francisco to Los Angeles by 2020 at a cost of $33 billion. Today, the focus is a 171-mile Merced-to- Bakersfieldline that could be operational by 2032 and cost $36.75 billion — if things go according to plans.

Choudri and rail supporters have a project wish list that The Bee has distilled into 5 things that need to happen for the project to move forward and have success:

CA high-speed rail needs strong state financial commitment

Henry Perea, a rail authority board member from Fresno, previously told The Bee the agency was not surprised when the Trump administration pulled $4 billion in July. The agency has sued for the money, but Perea said it had already pivoted toward more reliance on the state and Gov. Gavin Newsom.

On Saturday, California’s Legislature officially dedicated $1 billion annually to high-speed rail through 2045 from the state’s Cap-and-Invest program. The program generates public dollars from companies that buy credits at state auctions to offset their greenhouse gas emissions.

The state’s cap-and-trade investment brings the agency’s available public money up to almost $40 billion through 2045, which clears the total cost estimate for the Merced-to- Bakersfield segment.

The rail authority says more would be needed from the state to build past the Central Valley toward San Francisco and Los Angeles County. The most affordable expansion option that offers a profit — connecting the Central Valley to Gilroy but without a Mercedextension — would cost more than $54 billion.

“Let’s do it that way, get a longer commitment from the state and a higher dollar amount,” Choudri told The Bee. “Current simulations tell us, if we do all of it, we could finish everything by 2039: Palmdale, Merced- Bakersfield, and then Gilroy.”

CA high-speed rail set to lay tracks next year

The rail authority says it will start laying the first rail tracks next year in the Central Valley..

The agency recently began seeking bids from U.S. manufacturers to provide the necessary materials. It’s part of a cost-saving plan to buy directly from manufacturers, not contractors, to reduce costs, Choudri said.

The request for bids comes as the construction of a 150-acre rail staging yard is nearing completing in Kern County. That’s where freight trains will receive and deploy materials, including rail, concrete ties, electric poles and ballast to be installed between Shafter and Madera.

The rail authority said the $507 million approved cost for the materials — spread over multiple anticipated contracts — will be “100% state funded.”

“This procurement will not only accelerate construction of high-speed track, but by purchasing directly from American manufacturers, we will deliver significant savings to the state,” Choudri said in a statement.

CA Legislature asked to cut red tape for high-speed rail

The rail authority needs a faster way to take land it needs through eminent domain, relocate utilities and procure permits from local governments.

Choudri said jurisdictional conflicts have been at the root of the project’s delays and cost increases.

“That has nothing to do with how to build a bridge,” he told The Bee. “It has a lot to do with stopping 3,000 workers from doing what they are there to do ... because of a permitting issue, because of a utility issue, because of a court case.”

The rail authority wants the state to establish courts or appoint judges dedicated to handling the various cases and also create a statewide system it could use for utilities relocation and acquiring local permits.

A bill introduced in February, SB 445, would have addressed some of the issues but it was recently shelved because of heavy opposition from utilities owners and local governments, Calmatters reported. The bill’s main sponsor, state Sen. Scott Wiener, D- San Francisco, vowed to introduce something similar next year.

CA high-speed rail needs to move toward Gilroy

An August rail authority report showed the Merced-to- Bakersfield line will not generate enough revenue to cover its total operational expenses. The report presented four profitable expansion scenarios that the agency says it can build by 2039.

Two scenarios include a Merced station and two don’t, which caused a stir in the northern San Joaquin Valley. But each scenario connects the Fresno- Madera area to Gilroy, which would essentially be a connection to the Bay area. In Gilroy, high-speed rail trains will be able to carry passengers to Silicon Valley and San Francisco using the Caltrain commuter rail’s electrified tracks.

The agency also pitched delaying a Merced extension so it could build to Gilroy first. The rail authority said in an email that profit generated by higher ridership in the Bay area could then help pay for construction toward Merced.

A 2022 California law mandated that the agency prioritize the completion of the Merced-to- Bakersfield segment and placed a $500 million spending cap on work outside of that focus. The rail authority has said it is committed to building to Merced in the order mandated by state law. But it said in last month’s report that the Legislature could modify the law.

“It is critical that the project be responsive to evolving funding opportunities, market dynamics, and ridership potential,” the report says.

CA high-speed rail needs private investment, partnerships

The state’s new Cap-and-Invest commitment could provide potential investors with the security they want to see before lending money to high-speed rail, the rail authority has said. Connecting the system to Gilroy, where ridership and revenues are likely to increase, adds to extra security to potential investments in high-speed rail.

“They would look at the program (and say), ‘What’s the viability of getting a return on investment?’” Choudri said of investors.

Once built, Choudri said high-speed rail’s infrastructure could be commercialized by the private sector — ideas include allowing freight services to use high-speed rail tracks and utilities to install broadband along the right-of-way.

The rail authority requested expressions of interest for public-private partnerships in June. The agency says it received 31 responses “from a wide range of industry participants,” and that it will release more details in a later report.

The agency also anticipates partnerships with other rail systems. It is already set to partner with Caltrain in Gilroy. And in Palmdale, high-speed rail would connect to Metrolink to take commuters to Los Angeles. Through the planned High Desert Corridor, high-speed rail would to link to the future Brightline West system between Southern California and Las Vegas.

“When this system gets up and running and interconnects all these other modes, the system will generate enough proceeds that you can use that money to build more,” Choudri said. “What’s remaining? Get to San Diego and Sacramento.”

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