Despite a plethora of challenges, the Trump Administration is pushing ahead with its top-to-bottom review of government spending. It has already halted billions in what it views as wasteful spending. It now looks like one of the most wasteful, runaway public works projects in the country could be on the chopping block: California’s high-speed rail project. The project to build a bullet train from Los Angeles to Sacramento is an outrageous example of a public work that lacked any fiscal responsibility or oversight from the state government. Nevertheless, Democrats continue to push for billions more from the federal government as well as California taxpayers.
There is currently $4.3 billion in unspent federal funds for California’s high-speed rail project, and Trump should seek to claw back the money in light of the gross negligence shown by the California authorities.
The project was initially approved in 2008 with the support of Gov. Jerry Brown (D) as an environmental and technological advance for the state. It proved a costly bait-and-switch.
Voters approved a $9.95 billion bond issue in 2008 after absurdly low estimates of the projected cost. Influential figures and companies stood to make a fortune, and the key was to get a “buy-in” worth billions so that it would be more and more difficult to abandon the project as overruns and delays sent the costs soaring.
Now the official estimate of future ridership has dropped by 25% and it demands billions more to complete a project that would be delayed by decades to complete. Remember that this entire project was meant to create a rail line of only 171 miles. It is projected at over $128 billion and could ultimately come in a billion dollars a mile. There are still uncompleted environmental assessments and challenging rail lines through the mountains.
In his first term, Trump criticized the project and withheld a billion dollars in federal aid. However, when President Joe Biden came into office, he opened the federal coffers and approved billions more despite well-documented mismanagement and dubious spending.
Trump is now pledging an investigation, which is long overdue. There is ample reason to suspect fraud and other possible violations in this multi-billion dollar boondoggle.
Indeed, this week, the inspector general, Benjamin Belnap, issued a scathing report on the first phase of still uncompleted project. That is only the stretch from Merced to Bakersfield which was supposed to be completed by 2033. Belnap wrote:
“With a smaller remaining schedule envelope and the potential for significant uncertainty and risk during subsequent phases of the project, staying within the 2033 schedule envelope is unlikely. In fact, uncertainty about some parts of the project has increased as the authority has recently made decisions that deviated from the procurement and funding strategies that were part of its plans for staying on schedule.”
The Merced-Bakersfield line alone would now cost $35.3 billion, more than the 2008 projection for a complete system.
California Democrats have continued to throw money at the project without making meaningful changes on the overruns and delays. There is currently only $28.7 billion in state bonds left.
The inefficiency of the project has been raised for years. Even if completed, the system would reduce auto travel by 10 million miles a day in a state where citizens drive a billion miles a day. As noted by Cal Matters, “A 10 million-mile reduction would ostensibly cut emissions by scarcely 1%.” It added:
Logically, spending emission auction money on more direct carbon reduction programs, such as reducing emission-spewing wildfires, would make more sense.
The current estimate for linking San Francisco with Southern California is $107 billion. Officials don’t even know how to fully finance Merced-Bakersfield, much less raise the other $72.4 billion they would need.
Both a federal investigation and a cessation of funding are long overdue. It is time to bite the bullet. California has every right to spend over $100 billion during budget deficits, but the rest of the country should not subsidize it.