We’re sorry for flogging a dead boondoggle, but can the news about California’s High Speed Rail project get any worse? Apparently, there is no bottom to the negative revelations about this international embarrassment.
For those who have been living on Mars since 2008, we’ll bring you up to speed. What began as a $10 billion bond measure to fund a rail project that would travel from Los Angeles to San Francisco is projected to cost well over ten times the original bond amount. Critics of the project have been vindicated in their predictions of failure starting with the Due Diligence Report from the Reason Foundation and the Howard Jarvis Taxpayers Association issued even before the November 2008 election authorizing the HSR bond. The study concluded that, “The CHSRA [California High-Speed Rail Authority] plans as currently proposed are likely to have very little relationship to what would eventually be built due to questionable ridership projections and cost assumptions …”
Since then, reports and studies from official California agencies have warned that the project may not be viable at all. These include a 2018 report from the California State Auditor (“Flawed Decision Making and Poor Contract Management Have Contributed to Billions in Cost Overruns and Delays“) and a 2025 Legislative Analyst’s Office review of the rail authority’s 2025 Project Update Report.
The latest blow is from the California High Speed Rail Authority’s own Inspector General, Benjamin M. Belnap, in a 25 page report to the governor and the Legislature on HSR’s “progress.” The report is damning and reads more like a criminal indictment than some sterile bureaucratic status report.
Among the findings:
- “The business plan does not adequately communicate the scope changes and cost increases between past and current Merced-to-Bakersfield (M-B) cost estimates, obscuring the fact that— absent scope reductions—costs have substantially increased on the M-B segment. In so doing, the plan does not comply with legal requirements that cost estimates be comparable across reports.”
- “The cost estimate for the Authority’s reduced scope M-B segment excludes financing costs (estimated to be between $3.6 and $6.6 billion), a default-level contingency budget ($1.2 billion marginal difference), project construction costs it assumes other entities will pay ($816 million), and the projected additional cost of building infrastructure in accordance with an existing local agreement that it assumes it will be able to modify ($1.7 billion marginal difference).”
- “In a plan section devoted to managing risks, as opposed to the plan section describing project costs, the Authority added a cost estimate for what it purports to be a full-scope M-B segment that complies with state law. However, the Authority failed to explain that the much higher estimated cost of the full-scope segment included increased cost assumptions not necessary to make the estimate compliant with state law and may give a false impression of the magnitude of the additional costs to do so.”
- “Although the business plan disclosed that, between August 2025 and March 2026, the Authority experienced a nine-month slip in the M-B schedule, it offers no explanation of the “optimization and pending policy changes” it indicated were the cause for this schedule slippage.”
- “The business plan does not disclose that the schedule window for the M-B segment is no longer 2032-2033, but rather its risk-based statistical analysis determined that the appropriate schedule window now extends to September 2034.”
- “The business plan does not sufficiently emphasize that the Authority will exhaust its current funding resources as soon as December 2027 if it does not secure financing.”
An addendum to the report is a response from the Authority ostensibly answering the concerns raised by the inspector general. But the responses are obscure and fail to directly address the points raised by the IG’s report.
From the perspective of taxpayers, a major disappointment has been the lack of media coverage on the failures of the High Speed Rail project and its intentional obfuscation of the legitimate concerns raised by the report and the litany of other reports over the last 25 years. (A notable exception has been KCRA’s Ashley Zavala’s excellent reporting on HSR).
Is the ho-hum response from most media outlets merely willful ignorance or is just because HSR’s failures can simply be classified as “old news”? That thinking would hold more weight if it were not for the tens of billions of taxpayer dollars at risk.
Jon Coupal is president of the Howard Jarvis Taxpayers Association.