Surface Transportation Board Issues Delay for HSR Construction
I guess if we’re going to have rulings like this, might as well get them all in at once:
The California High-Speed Rail Authority, the only bullet-train builder in the U.S., may have to renegotiate a $1 billion construction contract after a federal regulator refused to grant early approval for a 114-mile segment.
The Surface Transportation Board in Washington, which previously gave the go-ahead for a 24-mile section of the line north of Fresno, rejected the state’s request for a further 114 miles between Fresno and Bakersfield. The high-speed rail authority said it needed the additional approval because it had awarded a contract for 29 miles of the line, consisting of the full first section and 5 miles in the second section….
The state in August signed a $1 billion contract with a joint venture among Tutor Perini Corp. (TPC), Zachary Construction Corp. and Parsons Corp. Without conditional approval for all 29 miles, the state said it may need to slice 5 miles out of the contract and renegotiate the terms. That could increase costs and delay the project, the authority said.
“The fact that the authority contractually agreed to notify its contractor by a certain date that construction can proceed is not a sufficient basis for the board to carry out its independent statutory obligation in a piecemeal fashion,” the board said in decision dated Dec. 3 and made public today. “No construction may begin until after the environmental review is completed and the board issues its final decision.”
This delay isn’t fatal by any means, and can probably be resolved within a few months – the same timeline that a new financial plan will take anyway. So this isn’t anything to get concerned about.
That said, with the September 2017 stimulus deadline less than four years away, the room for delays shrinks. So hopefully this gets resolved quickly, as the Authority believes it can.
There has been a lot of talk about flaws in the HSR process. It’s becoming increasingly clear to me that the flaws that do exist are those introduced in well-meaning but ultimately misguided efforts to appease Republicans. Prop 1A’s flaws include the ban on operating subsidies and the requirement that all funding be identified before construction on a segment begins, as well as the smaller size of the overall bond authorization.
The February 2009 stimulus has numerous problems that have been identified over time, particularly the fact that it was shrunk under $1 trillion in an effort to appease the right (it didn’t). One of those problems was that it required all the money to be spent by September 30, 2017. Even at the time many observers knew that this recession would be long and deep and that recovery might not be complete by 2017. Requiring funds to be spent by that date didn’t really serve an economic purpose, and as the rise of the Tea Party shows, it didn’t serve an economic purpose either.
The lesson is that it is never, ever a good idea to shape a transit project around appeasing critics, in whole or in part. Haters gonna hate. The right move is to plan everything out the best way possible to ensure a smooth construction process and to of course ensure the project actually does its job of moving people quickly from place to place. In 2008 and 2009 Democrats believed they had to compromise on some of these things in order to blunt Republican criticisms that came anyway. Next time, just ignore the GOP and move ahead with what we know to be right.