XpressWest Awaits Federal Loan Decision
As the California high speed rail project moves forward after a key vote in the State Senate, the other high speed rail project in the state – from Palmdale to Las Vegas – is nearing an important moment of decision of its own. Mike Rosenberg has the story about XpressWest’s federal loan application:
Already, private companies responsible for the train, which also include North Dakota motel developer Gary Tharaldson, have spent more than $50 million to clear all the required bureaucratic and planning hurdles. If the federal government approves XpressWest’s $5.5 billion loan application from December 2010, project officials claim that would trigger $1.4 billion in private financing.
While President Barack Obama is a huge high-speed rail backer, the XpressWest loan would be 10 times larger than any other loan given since the $30 billion-plus rail funding program was created a decade ago. The California project is not vying for the loans and is searching instead for federal grants.
Critics call the loan plan a super-sized version of Solyndra, the former Fremont solar company that shut down last year after receiving a $535 million federal energy loan. Still, the mostly-under-the-radar Vegas project hasn’t had to endure the gantlet of political attacks levied on the high-profile California bullet train, which skeptics call a boondoggle for its historic price tag and potential to drain vital state resources.
Federal rail officials said they do not comment on pending loan applications.
XpressWest officials expect to hear back on the loan’s fate later this summer. They confidently predict a groundbreaking on the initial $6.9 billion stretch from Vegas to Victorville later this year, with the first trains running by 2018, followed by a $1.5 billion extension west to the California-wide project at Palmdale.
But what if the loan falls through?
“Backup planning,” XpressWest counsel Greg Gilbert said, “isn’t necessarily at the top of (our) minds right now.”
I think the reason why XpressWest hasn’t had to face the same level of attacks is because it won’t go through heavily populated areas. The “boondoggle” claims being levied against the California HSR project have their roots in efforts by NIMBYs living near the tracks on the Peninsula to get the train out of their neighborhoods. They couldn’t win the battle at the ballot box, so they tried to discredit the project by attacking its ridership projections and funding plans. XpressWest, however, would skirt Barstow, cut through the Victor Valley sprawl, and otherwise would be built through empty desert.
Republican charges that HSR would be a “new Solyndra” are typical of their opposition to clean energy programs, motivated by the millions of dollars they receive annually from oil companies and the Koch brothers. Those claims have no merit, and as we know the truly risky and wasteful approach is to continue relying on oil without developing alternatives. But it is likely that Republican charges make it likely that XpressWest won’t get a decision on their loan until after the November election.
Additionally, Rosenberg’s article contains the kind of positive storytelling about high speed rail that we haven’t seen in quite a long time, emphasizing the benefits and actually talking to people excited about riding the rails:
“It’s definitely a cool idea — it’s unique, it’s different, and that alone makes it worthwhile” to try, said Newark resident Jennifer Kupferman, who often travels to Las Vegas with her husband. “But it’s got to be cheaper than flying.”
IT specialist Sharon Morris, of Pleasanton, agreed: “The train sounds like fun. But I don’t think I’d pay a lot more than a flight.”
Travelers like the idea of being able to use their phones on board, and skip such hassles as airport security, bag checks and flight delays.
“It allows you to relax a lot more,” said 26-year-old San Jose law clerk Megan Powell. She joked that “celebrity-themed train rides would be ideal. A diamond-encrusted train car featuring (rapper) T-Pain as the entertainment,” for instance.
These are all sensible points (well, the joke about the bling train aside) and it’s good to see them in the news again after what’s seemed like a long time.