High-Speed Rail Project in California Under Scrutiny

The Obama administration's plans for a bullet train could be headed off the tracks in California, the one state where its high-speed rail initiative is still alive.

Since the project was first unveiled in 2008, officials tripled its projected cost, delayed its start of service 13 years, downsized ridership projections and increased ticket prices. Almost two-thirds of Californians now say they'd vote against issuing bonds to pay for a project they narrowly approved just three years ago.

"It is not viable. It is not the best use of tax dollars, especially when you're borrowing the money to do it," said California Republican Rep. Kevin McCarthy, who originally supported the project as a member of the state legislature.

McCarthy, the House majority whip, is among 12 Republicans asking for a federal audit into the assumptions and potentially misleading claims used to sell the California bullet train to voters.

Their questions cover the following concerns:

-- Ridership projections. Rail proponents claimed more people would ride the Los Angeles to San Francisco train than all Americans who currently use Amtrak. Critics say those figures were highly inflated. While state highways are congested, a bullet train traveling that far with virtually no stops will not drive people out of their cars, they say.

-- Cost. Originally, voters were told the project would cost $33 billion, with state government, federal government and private enterprise sharing the cost roughly equally. New projections put the price tag at $98 billion, with no accurate assessment of how much each entity would pay.

-- Travel time. By law, the train must take less than two hours and 40 minutes to travel from Los Angeles to San Francisco. That means reaching 220 miles an hour with one stop in San Jose. But other cities are now demanding equal treatment for bearing the cost and other negatives associated with train. But proponents say adding stops in Bakersfield and Fresno, among other locations, could slow the train considerably.

-- Ticket prices. Voters were told their money would pay only for capital or construction costs. Operating revenues would be paid for through ticket prices. However, newly revised ridership figures show that could require a government subsidy of $100 per passenger per ticket. And no private company has yet stepped forward to accept their share of the risk.

"The reason private equity is slow in coming is because Congress is not taking action," said Daniel Krause, of Californians for High Speed Rail.

But Krause added: "We need to move forward on this project because the costs of doing nothing are far greater."

Krause estimates that two rail lines equal six to eight lanes of highway and, with California expecting to add 20 million residents, said high speed rail is necessary to relieve congestion.

But the current proposal keeps changing. The cities of Bakersfield and San Jose recently voted to oppose the project. Farmers in the Central Valley worry about the environmental impact and the state's powers of eminent domain to take their land if they choose not to sell. Because the train is extremely loud at high speed, officials worry about noise and are asking the planners to elevate the track near their cities. Raising track raises construction costs.

"Costs have gone up, which is typical of large infrastructure projects," Krause admits.

High speed rail is the Holy Grail of public infrastructure projects. The California leg would be the single largest public investment ever in the U.S. Proponents originally claimed the bullet train would create more than 1 million jobs. They recently revised that downward, to several thousand.

"The numbers don't lie," said McCarthy. "And every time you look at this, the worse it looks."

When the president took office, he identified 10 corridors around the U.S. appropriate for high-speed rail. The stimulus bill earmarked $8 billion to jump-start the project. Since then, almost every state dropped out of the running because they couldn't afford their share of the cost. California is still in and wants all the money that's left. Supporters' strategy is to get some rail bed laid in the cheapest place they can find, then argue California is the only legitimate high-speed corridor under construction. Other states are attempting to claim the stimulus money for inner-city train travel, arguing it will help more commuters, faster.

Opponents in Congress have a different strategy. They believe high-speed rail is a bad public investment and believe a Government Accountability Office audit they've requested will prove it, thereby killing the project before a single spade of dirt is turned.