California High Speed Rail: More Cost Overruns & Delays? (Los Angeles Times)

According to Los Angeles Times reporter Ralph Vartabedian (see: Cost overruns hit California bullet train again amid a new financial crunch, October 8), the troubled California high speed rail system could face additional cost overruns. According to Vartabedian, “The California bullet train is facing at least another billion dollars of proposed cost increases from its contractors, following a history of sharp cost growth on construction work over the last eight years, The Times has learned.”

The already much delayed start of service could be delayed further: “The current plan would start train operations by 2030, but officials working on the project say privately that it appears difficult, if not impossible, to meet that timetable.” At the time of the 2008, when voters approved Proposition 1-A to authorize $10 billion in bonds, the Los Angeles (Anaheim) to San Francisco (Transbay Terminal) line was to have cost $33 billion and entire route was to have opened in 2020. Current cost estimates are in the area of $100 billion, though that is after scaling the project back significantly and sharing conventional commuter rail tracks in the Los Angeles and San Francisco metropolitan areas.

Joseph Vranich and I authored a report on the system in 2008 (see: The California High Speed Rail Project: A Due Diligence Report). In that report we projected cost overruns of 30% to 60% for the entire system, which was to have included spurs to Sacramento and San Diego. Our projections were embarrassingly low, with the much more modest system now likely to cost more than the full promised system with its Sacramento and San Diego branches, little of which appears likely to be opened even 10 years late.

Wendell Cox is principal of Demographia, an international public policy firm located in the St. Louis metropolitan area. He is a founding senior fellow at the Urban Reform Institute, Houston, a Senior Fellow with the Frontier Centre for Public Policy in Winnipeg and a member of the Advisory Board of the Center for Demographics and Policy at Chapman University in Orange, California. He has served as a visiting professor at the Conservatoire National des Arts et Metiers in Paris. His principal interests are economics, poverty alleviation, demographics, urban policy and transport. He is co-author of the annual Demographia International Housing Affordability Survey and author of Demographia World Urban Areas.

Mayor Tom Bradley appointed him to three terms on the Los Angeles County Transportation Commission (1977-1985) and Speaker of the House Newt Gingrich appointed him to the Amtrak Reform Council, to complete the unexpired term of New Jersey Governor Christine Todd Whitman (1999-2002). He is author of War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life and Toward More Prosperous Cities: A Framing Essay on Urban Areas, Transport, Planning and the Dimensions of Sustainability.