Analysis by Noel T. Braymer

In almost a matter of hours this January there were 2 news stories about the California High Speed Rail Authority. First that they would soon order High Speed trainsets with Amtrak. The second that the Authority and the Governor were seeking an appeal to the California Supreme Court to overturn the lower court ruling which is currently blocking bond sales for the State’s funding of construction of High Speed Rail.

It seems odd that the California High Speed Rail Authority would start ordering equipment now when it could be another 8 or more years before they would be needed. The trainset order could have been as part of a larger order to be given to a consortium of contractors. It would be expected that such a consortium would come from major contractors from the same country. So if say a consortium of Chinese Companies with American partners won the contract, it would also be for electrification, signalling, maintenance yards and the contract for the operation of the service. This could also include the consortium helping to finance the project.

A major reason for ordering equipment now is by law High Speed Trainsets must be built in this country in order to qualify for Federal funds for constructions of a High Speed Railroad. Amtrak is also in the market for equipment for speeds over 125 miles per hour.The California High Speed Rail Authority is the only other potential customer for such High Speed Rail equipment in this country. To improve the chances of having an order big enough to interest a car builder for this contract Amtrak and the Authority are combining their orders now.

The issue of buying American was the main reason given by the Department of Transportation for not granting a loan to XpressWest for construction of High Speed Rail on Interstate 15 from Las Vegas to Southern California. Perhaps if XpressWest were to join in this High Speed Rail car order with Amtrak and the California High Speed Rail Authority they might be able to qualify for a Federal Loan.

Amtrak and the California High Speed Rail Authority needs for High Speed equipment requirements are different. Amtrak needs a tilt-train with high level platform loading for a top speed of 160 miles per hour. Amtrak has admitted that 160 miles per hour is the fastest they can economically operate service on the NEC with the existing railroad. Amtrak has long range plans to build new alignments on the NEC for higher speeds, but there is nothing definite. Previous estimates by Amtrak were in the 100 billion dollars plus range for a rebuilt NEC.

Tilt train cars are not as wide as a standard rail car because of clearance issues. This reduces passenger capacity on tilt cars. There is no word if the California High Speed Rail Authority is planning to use tilt trains. The Authority was planning to run up to 220 miles per hour and planned to test equipment up to 250 miles per hour. The top speed for the cars of this order may be 200 miles per hour. If the Authority buys cars with high level platform loading this will make it difficult for these trains to share stations or tracks with the rest of the California Rail Passenger system. With car orders, car builders can modify cars to some degree for buyers needs with the same basic rail car.

The decision to appeal directly to the California Supreme Court on the state bonds for High Speed Rail ruling seemed sudden. But perhaps it shouldn’t have been unexpected. The San Joaquin Valley farm owners behind these lawsuits are willing to drag out this issue as long as they can. By getting a favorable ruling from the Supreme Court overruling the lower Court, this would cut short future attempts by the farm owners to continue appealing to try to further delay this project. The California Supreme Court has given the Court of Appeals the job to rule on this issue this month.

In the roughly last 3 years of the Brown Administration, politics in Sacramento have been fairly boring. State Budgets are being passed on time and are balanced. There is even a budget surplus now. The economy is slowly but surely growing and unemployment is slowly going down. Governor Brown is aware that the support he has doesn’t run very deep with the general public. Because of this he has been very cautious not to upset swing voters with controversial programs, even when this has upset elected officials in his own party.

This has been bad news for the media. The 2014 State elections are coming up soon. The Media thrives on an exciting and contentious election race. Also their advertising income increases during an elections with political ads. These ad revenues particularly go way up if an election race is close and both side buy more political ads to try to win the election.

Even though the Governor hasn’t announce if he is running in 2014, he does have campaign funds in the bank. There are no strong candidate in either party to run against him. In most elections the incumbent usually win re-elections. About the only issue that the media can find to try to use against the Brown Administration is High Speed Rail to try to create a contentious election campaign..

Despite years of constant negative stories against the High Speed Rail Project, support for the project is still fairly strong with the voters. Even the polls which have been run which were biased against the project shows almost a major of possible voters supporting still supporting it. Most transportation ballot measures in California get a majority vote of approval. When these measures lose, it is usually by barely failing to get a two-thirds majority needed for a tax increase. When these measures lose it is often within one percent of the two-thirds needed to win. Once construction can get underway the chances of stopping this project by its opponents will greatly diminish.

For the farm owners of the San Joaquin Valley, the biggest issue now and always is water, not trains. San Joaquin Valley farms are by far the greatest users of water in the State and are not prepared for the drought the State is in. Critical for the farm owners to getting water is their continued dominance of local politics in the San Joaquin Valley. The biggest threat to the farm owners by high speed rail service comes from potential loss of their political power. This is because with high speed rail service will come economic growth unrelated to farming in the Valley. This will also mean population growth in the cities with stations from people with jobs unrelated to farming.

The legal argument for releasing the bonds for High Speed Rail construction by the Brown Administration is that once the legislature approves the bonds their decision is final. Their argument is this has years of legal precedent, since the legislature represent the voters they express the will of the voters. The administration is saying that for a court to continue to block release of these bonds will create a precedent which could cause any minority to be able to block government activity and create a constant state of legal gridlock. We will soon see how these legal arguments play out.