XpressWest Awaits Federal Loan Decision

Jul 30th, 2012 | Posted by

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.

  1. Tony D.
    Jul 30th, 2012 at 22:09
    #1

    It’s completely straw man to compare XpressWest to Solyndra because a cheap, Chinese product can’t undermine the HSR service. Wanna talk about a complete waste of federal monies? See Iraq and Afghan wars…

  2. Paul Druce
    Jul 30th, 2012 at 22:57
    #2

    Problem is that XpressWest doesn’t have the revenue potential it needs to pay back the loans. At 2.58% interest rate, a 30 year loan for $5.5 billion incurs annual payments of 263.52 million. That’s 27% of their entire expected 30 year revenues (though in constant dollars). The debt burden is sufficiently high that they will be forced to borrow simply for operations and will be bankrupted. The only way it makes sense is land speculation (also known as “inducing sprawl in Victorville”), and I’m doubtful of their ability to actually recoup such an investment through real estate in Victorville.

    Derek Reply:

    $263.52 million is only 9.2% of $28,629.9 million.

    What is the projected operating cost?

    Paul Druce Reply:

    $263.53 million times 30 years. Should’ve made that clearer.

    I haven’t seen projected operating costs, but no HSR system in the world has that high of an operating margin. It’s possible some individual lines might, but Victorville-Vegas is not going to be one of them.

    Tom McNamara Reply:

    I posted this on the last thread, but is that assuming that riders are still having to drive to Victorville and then embark on the train?

    I think that MTA Premier Antonovich’s decision to reserve a right of way within the High Desert Corridor project opens the door to having a service from downtown LA to Las Vegas. That would completely alter ridership and revenue potential and you can bet that if the FRA does lend the money, it will be based on that assumption.

    Paul Druce Reply:

    It does, but it also assumes a 20% diversion of all auto travellers, which I don’t consider realistic.

    Tom McNamara Reply:

    20 percent diversion with the terminus in V-ville is unrealistic. But if the line reaches LAUS, I think 30-40 percent is possible:

    Most traffic to Vegas is bunched up at specific times that invites highway congestion. That makes the train much more desirable to those travelers as opposed to someone going between LA and SF for business on a Tuesday.

    And really, if DXW get clearance to reach LAUS, then there’s all sorts of other possibilities (like running it south along the Surfliner route) that could increase ridership even more.

    John Nachtigall Reply:

    I agree, if you can get LA to Las Vegas I think you can get 40+% of the car traffic. Las Vegas is one of the few destinations where I think having a car is a drawback not an advantage. It is 100% realistic to step on a train in LA and step off in Las Vegas an not need a car the whole time.

    Plus I think you will get a lot of “induced” traffic. People who on the spur of the moment decide to take a trip because they don’t have to face a drive and the train will be more convinent then air travel. Even if there was a train change I think if the schedules were well synced it would work.

    But if you make them drive to Victorville first then the balance starts to tip back.

    Andy M Reply:

    Agree, though there would also have to be some outer suburban stop at a location that is as easy and painless to drive to as possible, which cannot really be said of LA Union Station.

    thatbruce Reply:

    As Tom said, if DXW runs coordinated service from other parts of the LA Basin, even as far down as Irvine (end of CHSR phase II), and retain an ease of accessibility that surpasses air travel, then they might be getting a higher percentage of travelers.

    Paul Druce Reply:

    30-40% diversion is unreasonable for a mode that will cost as much or more than air and take longer (as will be the case for a train from LAUS, even after HSR is built to Palmdale, which won’t be for several years after this is supposed to open).

    Paul H. Reply:

    Does anybody really believe that a HSR ticket will cost more than a flight in 15 years? It’s almost impossible that that would be the case. We will be way past peak oil production by then, prices will be at least double what they are today.

    Paul Druce Reply:

    Prices will not be double. The average flight between LAX and LAS uses 1,849 kilograms of fuel and has 126 seats. It’s about $14.5 per seat in in current fuel costs and there are major economic reasons why the price of fuel is unlikely to double in 15 years in real dollars (namely, as it goes too high, demand will drop). Airlines can and do have the ability to switch to more efficient aircraft, both in terms of engines and in larger airplanes, in response to increases in fuel prices.

    It’s worth noting that, if it uses the same pricing per mile as the Authority, a train from LAX to Vegas will be about $74-80 per person. That’s not competitive with flying.

    Paul H. Reply:

    Your missing the bit where supply is restrained because of the geological nature of depleting oil reserves. Not to mention that demand growth from China and India on middle east oil reserves will easily double prices once peak oil is internationally recognized. Then you also have exports dropping once exporting countries decide they want to keep their own oil for future generations. Your completely missing all the different avenues this situation can take. We will see $200 barrel of oil this decade, and it could go *much* higher than that. That’s double what oil prices are currently. Short-haul flights will be the first to go because of the inefficiencies in fuel consumption will kill the business model of those flights. All of that doesn’t even mention what the dollar itself will be doing in the next few years, though I do expect it to strengthen as the euro unwinds and people flock to the dollar for a period of time.

    Prices will be doubling this decade. As early as next year we will have a serious supply/demand mismatch.

    Paul Druce Reply:

    It won’t cause prices to double: Sufficiently high prices will destroy demand and the equilibrium point is below $200/bbl (in real dollars). Short-haul flights are rather unlikely to be the first to go, their short duration means you can do a quick turnover and run several flights per day with the same crew and craft, making them more profitable than a longer flight.

    I’ll note I already pointed out the fuel costs per seat for LAX-LAS. Do you really believe than an extra $30 round trip is going to destroy the air travel between them?

    VBobier Reply:

    Comair is being shut down by Delta, thereby laying off 1700 employees out of 2500…

    Delta shuts down Comair; workers given notice

    Comair has slashed its fleet, flights and workforce in the last seven years. Delta said the smaller regional planes are expensive to fly because they are not as fuel-efficient and cost more to maintain as the fleet ages.

    “We just really couldn’t get the cost structure to where we wanted to get it,” said Don Bornhorst, senior vice president of Delta Connection and a former Comair president. “It ultimately was a cost issue; it wasn’t a quality issue with Comair. They’re a good airline, great employees, very innovative … we just could not solve the cost issues.”

    The end for Comair

    DELTA AIR LINES, the world’s largest passenger carrier, is shutting down Comair, a Cincinnati-based regional affiliate, as it moves to consolidate its operations under the Delta banner. The move reflects ongoing shifts in Delta’s strategy—a new labour agreement with the airline’s pilots, ratified last month, envisions a move away from the smallest, 50-seat regional jets. Those jets, which were Comair’s mainstay, have fallen out of favour with big airlines as jet-fuel prices have increased. Delta’s pilot’s union also loathed the small planes, which were often flown by regional affiliates instead of Delta’s in-house pilots.

    The final straw for Comair was Delta’s agreement, finalised earlier this month, to lease several dozen 76-seat Boeing 717s from Southwest Airlines, which is returning to a 737-only fleet. Under the new labour agreement, the 717s will be flown by Delta pilots, not affiliates. That meant Comair, which has some of the oldest (and most expensive to operate) 50-seat planes in Delta’s affiliate fleet, was in big trouble.

    Comair, which is a wholly owned Delta subsidiary, employs about 2,500 people, the majority of whom will lose their jobs when the airline shuts down. Many of those people live and work in northern Kentucky and southern Ohio. Steve Beshear, the governor of Kentucky, has called the lay-offs “terribly disappointing”; it remains to be seen how many of Comair’s pilots, flight attendants, and maintenance workers will be able to find jobs at Delta or other regional affiliates.

    Neil Shea Reply:

    @PD: I think you are arbitrarily assuming that $200/bbl represents some kind of asymptotic ceiling beyond which demand will fall. I’d be interested on what basis you believe that because I would not expect that. The developing countries including China and India use petroleum much more efficiently than the U.S. but their demand is inexorably growing, and growing quickly. In many other countries, taxes already reduce the cost of oil to a smaller fraction of the cost of gasoline. And as we all substitute away somewhat from oil we will be able to tolerate a higher price for the oil that we still do expect to use.

    And of course there is no real upper limit in any case. Certainly the nature of these secular adjustments is that they ramp and then pause before resuming their upward ramp. But let’s face it, oil is some pretty amazing stuff and I would certainly want to keep buying *some* even as I expect the price to rise sharply.

    I do want that both I and U.S. society arrange our economy so that we do have more substitution options for this fundamentally non-renewable resource. And just as you calculate that oil is only a fraction of the cost of delivering air transportation services, the cost of electricity is even a smaller fraction of the cost of delivering rail transportation services. And that electricity can be generated renewably, with a decreasing cost curve. So we can debate the rates of change but directionally these lines are headed in fundamentally different directions. How much risk to you prefer to take on for the future generations of your family? (Own a lot of stocks lately?)

    Meanwhile, as the ice cap disappears at an accelerating rate and as Koch-funded science can no longer deny that the cause is human release of carbon, at what point do we take that externality into account?

    Society may due that explicitly via a tax or cap, and/or we can do so morally in the sense that this has always been a pretty special planet to live on, and maybe even if we don’t have children we should still try to stop effing it up so much. (You know, first law of holes: When you find yourself in one, stop digging.)

    Derek Reply:

    Yes, as fuel costs rise, airlines will switch to turboprops to save fuel. That would make air travel less speedy and less comfortable, boosting alternatives like HSR.

    Paul H. Reply:

    @PD
    You’re not understanding the whole ‘limited supply’ portion of my argument. I understand high prices would kill demand, but people will be willing to pay A LOT more for oil once we begin having less and less every year. Once you go past peak, thats it. There is only a finite amount and whoever is willing to pay top dollar gets it. Once it breaks the $200/barrel mark it likely won’t come back down unless we are in the middle of the second great depression, but even then, growth in Asia will likely keep the price up. You can make your own assumptions about what happens to the US economy with oil over $200/barrel. The Twenty-Teens are going to suck, we need to start building our alternative transportation infrastructure now. We don’t have time to mess around. California is WAY ahead of most of this country in terms of building those alternatives such has high-speed rail.

    joe Reply:

    When airlines switch to fuel efficient jets or large jets or turbo propjets, who pays for the new jets ?

    These are cash strapped companies that raided pension funds, broke contracts and now run crappy service with bag fees. Anyone thing these airlines are going to remake their fleets?

    Run what they have into the ground and put the money saved on buying jet into paying for jet fuel until the next bankrupcy and bail out. Collude to drive up prices in small markets and avoid cutthroat competition.

    The FAA even wrote a report on the lack of competition between US airlines.

    Paul Druce Reply:

    The airliners would not switch to turboprops; worst case scenario is that they’d use propfans, but most likely it will just be more fuel efficient turbofans.

    As for $200/bbl, that makes so many alternatives so much cheaper that it’s simply ludicrous to pretend it’s feasible. You wouldn’t just be frakking for oil in North Dakota, you’d be seeing FT refineries built next to the coal mines in the Powder River Basin. For pretty much any known means, you’re at more than double the price point where it makes sense to synthesize oil. That’s not factoring into account the fact that people will increasingly use mass transit and hybrid or electric vehicles to cut down on their fuel expenses. The only way $200/bbl makes sense is if you assume that there is a complete abandonment of capitalism.

    Meanwhile, as the ice cap disappears at an accelerating rate and as Koch-funded science can no longer deny that the cause is human release of carbon, at what point do we take that externality into account?

    Whether planes or trains are used for transportation from SoCal to Vegas is so astoundingly low on the list of “Things worth giving a shit about when it comes to global warming” that it really isn’t worth actually bothering about.

    Paul H. Reply:

    @PD
    Price isn’t the most important factor in terms of resource extraction, energy is. The amount of energy it takes to get a barrel of oil out of the ground is the key factor in oil extraction today. Once you burn a barrel of oil to get a barrel, it is pointless to extract more. And that’s the problem with a lot of the remaining oil we have. It’s crappy tar sands and shales that take a shit ton of energy (and water) to extract, refine, and transport. We are headed towards the net energy cliff where our current industrial system will have *serious* trouble maintaining our current level of economic output. Add climate change to the equation and the U.S. will have to radically change our transportation and energy infrastructure over a relatively short amount of time, probably a couple decades. Energy transitions usually take 40-50 years, and we no of no other energy source that is as dense as oil. So, obviously moving to electricity is one of our very few options we have. The airline industry will likely not be around in 20 years, at least not of the middle class. It’s already going through multiple bankruptcies/consolidations just in the last 10 years.

    Paul Druce Reply:

    You do realize that air travel makes up a pitifully small fraction of total oil consumption, right? Furthermore, the EROI on coal to oil by FT synthesis is still healthy.

    It’s all fine and dandy to care about climate change, peak oil, and so forth. But, please, please, please leave HSR out of it. HSR is like seeing an arterial spurt and slapping a band-aid on the wound.

    Paul H. Reply:

    What takes the majority of oil consumption is automobile travel, which high-speed rail will do a particularly great job of curbing millions of automobile trips per year. By no means is high-speed rail the ‘solution’ but it IS a very intelligent response to the issue of climate change and peak oil. It is also a catalyst for local streetcar, light rail, and walkable dense neighborhoods. HSR is easily one of the most important transportation projects in America today. Belittling its importance makes you look foolish.

    Paul Druce Reply:

    High speed rail won’t do jack about automobile travel. Commuter rail, light rail, subways, and buses are what you look towards for reducing automobile travel. The one segment where HSR could have a significant effect upon automobile travel, LA-SD, is being put off until 2040 or later.

    The price of LA-SF is about as much as 2,000 miles of streetcar. Which do you think will do more to reduce oil consumption and automobile travel?

    Paul H. Reply:

    I think a Nor Cal to So Cal HSR will be in more demand than 2,000 miles of streetcar. The trips that will be most affected in a post peak oil society will be longer trips between cities. We have in place systems today in many cities for local transit, we have no system that connects our cities together (sorry, Amtrak doesn’t cut it in California). To say HSR will have no affect on automobile travel is a ridiculous assertion. It will have a major impact, and will be a catalyst for the thousands of miles of streetcar and light rail lines in the cities themselves making HSR a benefit multiplier and leveraging local and private funds to accomplish that.

    Paul Druce Reply:

    Please explain why you think that there is more oil consumption and demand for 400 mile long trips (of which there are approximately 8 million between bay and basin annually) when the average auto trip is about 10-15 miles.

    Paul H. Reply:

    I never said there is more oil consumption for LA to SF trips than local trips. What I said is that we already have in place transit systems in cities today. We have no transit system in place for the 400-500 mile long trips that would connect 35 million people in California. When the next oil price shock happens, there are systems in place already for people to get around the city they reside, there is no system in place today to get them from northern to southern california or vice versa.

    BruceMcF Reply:

    Paul Druce:

    It’s about $14.5 per seat in in current fuel costs and there are major economic reasons why the price of fuel is unlikely to double in 15 years in real dollars (namely, as it goes too high, demand will drop).

    That logic is for four or five years, not for fifteen years. Elasticity of demand over a decade’s time is far greater than elasticity of demand over a year’s time, and the response to four or five years at $4-$5 is part of what paves the way for prices to rise sustainably to $6 to $8.

    Paul Druce:

    Furthermore, the EROI on coal to oil by FT synthesis is still healthy.

    But large scale adoption of synthoil from coal is a climate change suicide policy, so its EROI alone dramatically understates the net cost of the approach.

    Paul H:

    What I said is that we already have in place transit systems in cities today.

    And we can put more in place far more rapidly than we can put electric 400-500 mile intercity transport corridor, if it become a high priority to offer petroleum free and petroleum efficient transport.

    Travis D Reply:

    A train means avoiding the madness that is LAX or any of the other regional airports and that alone is worth a ticket regardless of price.

    Does anyone know what kind of train they plan to run? I see talk of them going down the surfliner route but that would seem to necessitate something other than a conventional electric HST.

    Would they be constrained in which company provides the train?

    Paul Druce Reply:

    A train means avoiding the madness that is LAX or any of the other regional airports and that alone is worth a ticket regardless of price.

    Never been to LAX myself, but never had an issue at John Wayne or Ontario or any of the out of state airports I’ve been to. Much ado about nothing in my opinion.

    Does anyone know what kind of train they plan to run? I see talk of them going down the surfliner route but that would seem to necessitate something other than a conventional electric HST.

    They’re planning on an EMU, they’re talking about connecting service with Metrolink via Palmdale.

    Richard Mlynarik Reply:

    Never been to LAX myself, but … Much ado about nothing in my opinion.

    First World Problems.

    They didn’t defer sufficiently to my Quadruple Platinum Ultra Suede Club Status. I’m so going to Yelp them.

    Joey Reply:

    they’re talking about connecting service with Metrolink via Palmdale.

    With current service levels and travel times, a connection with Metrolink at Palmdale is no connection at all.

    Alon Levy Reply:

    They’re a construction outfit; they get paid regardless of whether people ride the trains or not.

    BruceMcF Reply:

    Given an EMU, to run down onto the Surfliner route would entail hooking up a locomotive somewhere … or possibly two FRA compliant locomotives, front and back, if they meet the FRA standard for interrior cars but not for end cars.

    Derek Reply:

    $263.52 million is only 9.2% of $28,629.9 million.

    (0.92%, sorry.)

  3. D. P. Lubic
    Jul 31st, 2012 at 04:17
    #3

    Off topic, but here’s a blast from the past that’s too cool not to share–a promotional clip for the GM-Pullman demonstrator equipment set, “The Train of Tomorrow,” ca. 1948:

    http://www.youtube.com/watch?v=tEfznj0-Ac8

    The film appears to have been shot in some California locations, possibly on the Santa Fe. Can anyone identify them?

    Andy M Reply:

    amazing

    Reality Check Reply:

    The station at the 20-second mark is clearly Santa Barbara. Compare with this streetview image.

    Reality Check Reply:

    And that would suggest the video was shot on the SP Coastline.

    thatbruce Reply:

    Coastal bluffs near Del Mar heading south, Fullerton station, lots of interior shots, and heading north near El Toro (I think).

    D. P. Lubic Reply:

    Going through the “suggested” video links revealed this earlier film, also from Popular Science, featuring a Union Pacific CTC installation at the subject city of this thread–Las Vegas. There was a modern art-deco style station there in 1944, but I think it’s been gone for years. I wonder if something like that could be used on today’s proposed California high-speed system.

    http://www.youtube.com/watch?v=fOhD9kCt-z8&feature=relmfu

  4. Reality Check
    Jul 31st, 2012 at 10:04
    #4

    High-speed rail honcho [Dan Richard] gets White House honors

    The White House on Tuesday will lavish a little love on California’s politically controversial high-speed rail project, with the recognition of California High-Speed Rail Authority Chairman Dan Richard.

    The White House is naming Richard as a “Transportation Innovator Champion of Change.” Each week, Obama administration officials are designating champions in fields ranging from education to business.

    The White House event can be watched live starting at 11 a.m. EST/8 a.m. PST via the http://www.whitehouse.gov website.

  5. Trentbridge
    Jul 31st, 2012 at 10:08
    #5

    If Amtrak can run buses from SoCal to LV, then I’m sure there would be numerous buses from hotels/stations in LA/OC to Victorville to connect to the Desert Xpress. I don’t expect much diversion of Californians from automobiles to train for Desert Xpress but I would expect many tourists to take advantage of seeing the desert at ground level rather than flying over it at 28,000.

    Neil Shea Reply:

    Have you been in the weekend traffic backup on I-15?
    These are people who want to gamble BAD!

    VBobier Reply:

    Oh yeah, seen them there a lot in the past, a week or so back the traffic was back to crawling along, I would have had to drive back from Barstow via the i40 and a surface street to get back home.

  6. Reality Check
    Jul 31st, 2012 at 10:09
    #6

    XpressWest High Speed Rail Line Would Extend California Bullet Train To Las Vegas

    The plan has the strong, vocal support of powerful politicians like Senate Majority Leader Harry Reid (D-Nevada), which is good news for a project looking to secure approval on an approximately $5 billion loan from the federal government later this summer.

    If granted, this would be the largest loan of its type ever provided by the federal government for a rail project.

    The Federal Railroad Administration estimates XpressWest between Palmdale and Las Vegas would create 80,000 new jobs–primarily in regions hit particularly hard by the collapse of the housing bubble. Only a small fraction of those jobs, however, would be permanent.

    There’s also a green argument for the train. Vegas Inc. reports:

    Officials anticipate the train would divert 2 million car trips from congested Interstate 15 a year, reducing traffic by an estimated 25 percent. The all-electric operation of the train is expected to reduce emissions by 40 percent along the I-15 corridor and save the equivalent of 8.5 million gallons of gasoline.

    The project’s backers hope the line will prove a moneymaker and ferry upwards of 2.5 million people a year to Sin City and back. Although not everyone is convinced.

    “When somebody comes and tells me I will build a system that pays for itself, I’m suspicious,” Hasan Ikhrata, executive director of the Southern California Association of Governments told the Associated Press. “There is no high-speed rail system in the world that operates without subsidies.”

    If XpressWest gets its federal loan and then fails, the government would likely take over the system’s operation.

    The train’s ultimate goal is to become the transit backbone for the entire American southwest, running from Los Angeles through Las Vegas and onward to Salt Lake City, Phoenix and Denver.

    BruceMcF Reply:

    There is a difference between “there is no high-speed rail system in the world that operates without {capital} subsidies”, and “there is no high-speed rail corridor in the world that operated without {capital} subsidies.”

    After all, when you build a corridor that repays its capital costs, then given the third party benefits getting a free ride on that corridor, the sensible thing to do is to provide for some capital subsidy and extend the system. So if the government of the country that has a corridor that operates without subsidies has a modicum of sense, it will keep extending the system beyond the corridors that can pay for themselves on a financial basis, and provide a bit of capital subsidy to extend the range of benefits provided by the system as a whole.

    Even if the XpressWest Las Vegas / California Desert corridor covers its capital cost, it seems likely that when it comes to the extensions to SLC, Denver and Phoenix, some capital subsidy would be required.

    Indeed, it is certain that some capital subsidy is required to get down into the LA Basin, with the trick being to draw the organizational boundaries so that those capital subsidies are not going to XpressWest directly, but are going to some other organization to the benefit of XpressWest.

    adirondacker12800 Reply:

    Unless airplanes are banned it’s never going to make sense to have high speed rail to Salt Lake City and probably not to Denver. They are too far away from other population centers and too small. With a whole lot of nothing in bewteen them and the next population center.

    BruceMcF Reply:

    It makes sense to have a Regional HSR tier along the front range through Denver, but that’s a North / South alignment, not an East / West alignment.

    It doesn’t make sense to have Express HSR corridor from Denver west to SLC or SLC west to northern California, but given current long haul truck tonnages alone that alignment, that’s certainly a target alignment for a Steel Interstate corridor, which would obviously allow a Express Intercity or Regional HSR service that would perform substantially better than the Zephyr.

    adirondacker12800 Reply:

    If you can do it cheap it would make sense to run two or three a day. But unless they ban airplanes most people aren’t going to go for the 7 hour train ride versus the 1 hour plane ride… if it’s cheap enough. Longer trips have less passengers to spread out the labor expenses and the depreciation….

  7. Travis D
    Jul 31st, 2012 at 12:22
    #7

    What ever happened to Phoenix wanting a spur to them as well?

  8. Jack
    Jul 31st, 2012 at 13:07
    #8

    I guess my biggest fear with DX and the single destination is that if it fails it’s going to be hard for CHSR to say wait, we are different.

    I hope they are wildly successful; (with an LAUS connection it will be) but the CA Gov’t and the Authority should be watching this and make damn sure it works.

    Paul Druce Reply:

    Why should we support this instead of in-state gambling? Let Vegas wither and die.

    Richard Mlynarik Reply:

    Let Vegas wither and die.

    That is guaranteed.
    Enjoy the ride.

    synonymouse Reply:

    All the vice that brands Vegas is available in the Golden State.

    Appears that Anaheim is risking some riots – one way to open jobs for the protesters is to build mega casinos in the area. The economic pressure – just the huge welfare load California is bearing – makes its inevitable.

    joe Reply:

    OH no. We might have to stop growing rice in the semi-arid CV.
    http://www.lundberg.com/products/rice.aspx

    and King Cotton too

    http://wwf.panda.org/about_our_earth/about_freshwater/freshwater_problems/thirsty_crops/cotton/

    Water impacts
    It can take more than 20,000 litres of water to produce 1kg of cotton; equivalent to a single T-shirt and pair of jeans. 73% of global cotton harvest comes from irrigated land (as documented in the WWF report The Impact of Cotton on Freshwater Resources and Ecosystems).

    http://articles.latimes.com/2011/oct/05/local/me-bullet-train-20111005
    ……which happens to tie into HSR.

    With California’s bullet train project facing new opposition in the Central Valley, including from the operator of the nation’s largest farm, J.G. Boswell Co., the state agency in charge of the project has announced a two-week delay in the release of a key business plan.

    Farming giant Boswell’s 200 square miles of holdings would be pierced by a corridor of track that could shut down a company cotton gin complex, seed oil plant, private airport and maze of irrigation canals and levees, according to a company attorney. “The project would deprive the Boswell Company of these operations,” said Robert M. Dowd. ,b>”The company would be opposed to the project where the routes have been proposed at this time.”

    It can take more than 20,000 litres of water to produce 1kg of cotton;

    There are some serious problems coming ahead but never underestimate the amount of water we currently waste in semi-arid California and the Colorado River Basin.

    Michael Reply:

    Great read, if you want to learn more about the nature of farming in the southern San Joaquin Valley and the poor underdog family farmers.
    http://www.publicaffairsbooks.com/publicaffairsbooks-cgi-bin/display?book=9781586480288

    Miles Bader Reply:

    Wait, why would a HSR line “shut down” any of that stuff?

    Alon Levy Reply:

    I’m still waiting for New York to open a large casino in Midtown. Bonus points if it uses regular shoes for blackjack and not a continuous shuffling machine.

    adirondacker12800 Reply:

    Casinos are too low margin for Manhattan. That’s why they are in places like Las Vegas or Atlantic City…. or Indian Reservations.

    Alon Levy Reply:

    Monaco real estate isn’t exactly Detroit cheap.

    adirondacker12800 Reply:

    and the casinos have been there since the real estate was cheap

    Alon Levy Reply:

    The first one was; the newer ones, not so much. I think the fourth casino opened less than ten years ago.

    Stephen Smith Reply:

    That’s ridiculous…casons like Las Vegas and AC because it’s legal there! (Well, more so Las Vegas than AC…in LV it’s a relatively free market in gambling, whereas AC is much more controlled…hence the fact that AC is a fucking shithole.) If gambling were legal in Manhattan, Times Square would be one giant casino. Which sounds like an improvement.

  9. Walter
    Jul 31st, 2012 at 17:36
    #9

    Three things XW naysayers don’t understand about Vegas:

    -Vegas has about 40 million visitors a year. One in four is from SoCal. That’s 190,000 Southern Californians headed to Sin City every week.
    -Traffic on I-15 is CRIPPLING.
    -Vegas is not all about gambling, and hasn’t been for some time. Indian casinos are not the same as the Las Vegas strip. Among other things (and for better or worse), Vegas means permissiveness toward ’round-the-clock drinking (booze is served 24/7 and open containers are legal) and, of increasing importance, mega-clubs in the big hotels on the Strip. And of course, there’s the shows, the fancy restaurants, and the various other attractions.

    VBobier Reply:

    I can vouch for that, I live in Yermo CA and I’ve seen that traffic, here there are side roads, past Minneola though there are none for nearly 75 miles or until one gets to Baker CA for a pitstop…

    10 million, Yep I can believe that, all on a two lane freeway beyond Yermo, if there’s an accident then the freeway becomes a parking lot until the CHP can make their way out there via the side of the Freeway.

    Travis D Reply:

    Yeah Vegas would still be a major destination even if California straight up legalized gambling. Conventions are huge in Vegas and part of that is the “mystique” that pretty much no where else has.

    I mean loads of places have parties that emulate Mardi Gras but people still go out of there way to get to New Orleans that time of year.

    VBobier Reply:

    If Barstow had a stop people who work in Las Vegas could own a house in the Barstow CA area and commute there by HSR once a week, why the Barstow area Ya ask? Simple from what I’ve been told Las Vegas doesn’t cool off much at night, My own experience says that’s true, here the air temps at night do cool off by about 20F-30F… Especially if monthly passes were offered…

  10. Paul Dyson
    Jul 31st, 2012 at 18:39
    #10

    I have yet to see much discussion about system compatibility between the CA and DX proposals. It would be quite ridiculous to have to transfer between trains at Palmdale or anywhere else. The Fed loan should be conditional on this. We could then see Bay Area to LV through trains as well. There is a strong but secondary market from the SJ Valley to Vegas with little air competition and a more daunting drive. Another market not mentioned is the large number of foreign and mid western and eastern visitors to LV who are “stranded” (without a car) and who could be offered side trips to either end of CA, with pricing slewed to fill mid week and contra flow weekend capacity. BUT it has to be a single seat ride or you won’t get the business.

    Clem Reply:

    Re: compatibility. Why do it right when you can do it twice?

    jonathan Reply:

    If you’re a contractor, that’s great, because you get paid for doing it twice. But if you’re an owner, it’s lousy. Stlil, if CHSRA can’t get Caltrain on the same page regarding platform height, what reason is there to think DesertXpress will do any better?

  11. Spokker
    Jul 31st, 2012 at 21:46
    #11

    Transportation infrastructure denied in Atlanta tonight.

    http://www.macon.com/2012/07/31/2116578/transportation-plan-trailing-in.html

    “Metro Atlanta voters have rejected a penny sales tax referendum that would have helped pay for billions in transportation projects over the next decade, according to unofficial returns.

    With 88 percent of precincts reporting, 63 percent of voters rejected the tax, compared to 37 percent who backed it.

    Tea party members, the state NAACP and the Sierra Club comprised an unlikely coalition that opposed the referendum, relying on e-mail and social media to urge voters to defeat the measure.”

    Before they go to the voters to increase taxes, government has to earn their collective trust. They clearly did not have it in Atlanta. I support transportation infrastructure improvements, but this should represent a warning to other regions.

    Personally, my state and federal governments have lost my trust over the past couple of years so I am proud of Atlanta tonight if they indeed feel that way. I am inspired and my resolve to vote down our own tax increase measures this November is strengthened.

    synonymouse Reply:

    @ Spokker

    Sadly, you are correct. I should not have voted for Prop 1A had I known it was to be a BART on steroids in the boonies.

    Van Ark obviously tried to get a re-think and a rationalization going but was dropped in his “tracks” by the PB worshippers. The whole idea of fastest and at the best price was dropped in favor of pandering to provincial politicians. Pretty much the definition of boondoggle.

    You can be sure in the wake of the Atlanta vote and the Tea Party victory in Texas Jerry will be telling the unions to fake pension reform prior to the election with the nod that the bennies will be restored later once they have their tax increase. Kinda think the voters are on to that charade.

    Maybe they should approve the Deserted Xpress fantasy – a supersized mutant of the Sin City Monorail in bankruptcy should put the permanent lid on this type of nonsense.

    adirondacker12800 Reply:

    I should not have voted for Prop 1A had I known it was to be a BART on steroids in the boonies.

    It’s unfortunate that you weren’t paying attention. The route you were voting for was through Palmdale, Bakersfield and Fresno.

    synonymouse Reply:

    Curious all the pre-election Prop 1A video propaganda showed only surface or trench hsr operations. Nary a stilt to be seen. Wonder why?

    Alon Levy Reply:

    The official website showed the Palmdale detour and Pacheco.

  12. Reedman
    Jul 31st, 2012 at 23:32
    #12

    (California train related, a bit off topic …)

    In Livermore, on June 7, a woman pedestrian took a shortcut (2 second duration) walking across the Union Pacific tracks there. June 7 is International Level Crossing Awareness Day. (http://www.ilcad.org/ILCAD-2012,105.html) A UP security officer issued her a citation. She made her court appearance, and was given a $6000 fine for trespassing.
    http://livermore.patch.com/articles/railroad-track-citation-a-hefty-6-000

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