High-speed rail panned by state auditor

Rebecca Neipp

News Review Staff Writer

The concerns long expressed by local conservative leaders were validated last week with the release of California State Auditor Elaine Howle’s report that heavily criticizes contracting and cost-control practices with Gov. Jerry Brown’s high-speed rail project.

In the introduction to the 90-page report, Howle notes that her office provided the analysis at the request of the Joint Legislative Audit Committee.

“This report concludes that the authority’s flawed decision making regarding the start of high-speed rail system construction in the Central Valley and its ongoing poor contrac management for a wide range of high-value contracts have contributed to billions of dollars in cost overrun for completing the system.”

She continues to explain that the construction began in 2013, despite well-known risks associated with a failure to acquire sufficient land for building, no determination about how to relocate existing utility systems and no agreements with stakeholders.

“These unmitigated risks have contributed to $600 million in cost overruns thus far for the three active Central Valley construction projects, with another $1.6 billion in additional costs needed to complete the projects.”

Howle further notes that the project will not meet its construction deadline (already extended once) unless it progresses twice as quickly as it has thus far. “Missing the deadline could expose the state to the risk of having to pay back as much as $3.5 billion in federal funds.”

She also cites a failure to implement “sound contract management practices. As a result, it cannot demonstrate that the large amounts it has spent on its contracts have been necessary or appropriate.”

Among the contracts that have been scrutinized is one for nearly $1 billion garnered by Sen. Dianne Feinstein’s husband, Richard Blum. Critics have accused the longtime senator of using her influence to help her husband procure work associated with the project.

The project has also been plagued with claims that the system will never be self sufficient, as a ridership has never been identified and a plan has never revealed how revenues could be collected to repay investments, let alone long- term maintenance.

Others accuse the state of siphoning funds out of voter-approved bonds for water, education and other needs to be redirected to the ill-fated bullet train.

Assemblyman Vince Fong responded to the report that it reveals what critics have known all along, “flawed internal oversight that has resulted in wasted hard-earned tax dollars.

“Billions of dollars are being poured into a project that does not resemble anything that was told to voters a decade ago. This is wrong,” said Fong.

The report clearly shows “the real systemic and structural flaws that exist, which should concern every Californian. Sacramento must be held accountable, and this project cannot continue.”

The full report can be viewed at www.auditor.ca.gov/pdfs/reports/2018-108.pdf.

Story First Published: 2018-11-21