NCPA - National Center for Policy Analysis

California High-Speed Rail Cost Goes Up

April 4, 2011

Like most large public infrastructure projects, the California high-speed rail project was sold to the public based on false promises, exaggerated benefits and lowball cost estimates, says Adam Summers, a policy analyst with the Reason Foundation.

  • Before the election, the cost of the project was estimated at $33 billion for the Los Angeles/Anaheim to San Francisco portion, and an additional $7 billion for the spurs to San Diego and Sacramento.
  • Voters narrowly passed a $9.95 billion bond in 2008, and the federal government and private investors were supposed to cover the remaining $30 billion.
  • Voters were promised that a one-way fare between Los Angeles and San Francisco would cost about $55, making it cheaper than flying.
  • After the election, costs rose to $43 billion for just the Los Angeles-San Francisco phase (chances are the San Diego and Sacramento lines will never be built) and ticket price estimates nearly doubled to $105.

Yet none of this seems to bother the California High-Speed Rail Authority or cause it to reevaluate the feasibility of the project.

  • Ridership estimates are projected as high as 117 million passengers a year.
  • To put this in perspective, consider that Amtrak's Acela Express service, which serves the larger, denser Washington, D.C.-New York-Boston corridor at speeds up to 150 miles per hour, counts just three million passengers per year.
  • In fact, the entire Amtrak system, which includes more than 500 destinations and 21,000 miles of track in 46 states, serves only 27 million passengers a year.

A September 2008 study by rail experts Joseph Vranich and Wendell Cox published by Reason Foundation and Howard Jarvis Taxpayers Association concluded that the actual costs of the high-speed rail system would be between $65 billion and $81 billion, and that the project was not viable because it was based on wildly optimistic assumptions, says Summers.

Source: Adam Summers, "California High-Speed Rail: the Next Stop Is Bankruptcy," San Diego Union-Tribune, April 3, 2011.

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