WITH THAT POWERFUL GAVEL.
SOUNDED LIKE A. HORN I'LL CALL
THIS MEETING TO ORDER. UM GOOD
MORNING AND WELCOME TO THE JOINT
HEARING OF THE SUBCOMMITTEE
THREE ON CLIMATE CRISIS,
RESOURCES, ENERGY AND
TRANSPORTATION AND ASSEMBLY
TRANSPORTATION COMMITTEES. UM
THAT BY ITSELF IS A MOUTHFUL.
UM, WE ARE GOING TO GO AHEAD AND
GET STARTED. EVEN THOUGH WE
DON'T HAVE EVERYBODY HERE
BECAUSE WE'VE BUDGETED THIS AS
AN EXCLUSIVE ITEM, AND WE WANT
TO MAKE SURE THAT WE HAVE PLENTY
OF TIME FOR THE CONVERSATION OF
GOING TO HAVE HERE TODAY. TODAY
IN ROOM 1100. WE ARE IN PERSON.
WE'RE ACCEPTING PUBLIC COMMENT
AT THE END OF THIS HEARING, BOTH
IN THE HEARING ROOM AND ON THE
PHONE. THE PHONE NUMBER TO
CONNECT IS ON THE COMMITTEE
WEBSITE AND SHOULD ALSO BE ON
THE SCREEN. IF YOU'RE WATCHING
OVER THE INTERNET, THE NUMBER IS
THE PUBLIC TOLL FREE NUMBER
87769289. THE PUBLIC ACCESS CODE
1 85. 01 100. IF YOU ENCOUNTER
ANY PROBLEMS, PLEASE CONTACT THE
ASSEMBLY BUDGET COMMITTEE AT
9163192. AND A STAFF MEMBER WILL
ASSIST YOU. WE ENCOURAGE THE
PUBLIC TO PROVIDE WRITTEN
TESTIMONY BEFORE THE HEARING.
PLEASE SEND YOUR WRITTEN
TESTIMONY TO BUDGET SUB THREE AT
ASSEMBLY DOT CA.GOV. AND WITH
THAT, UH, I WILL, UH ASKED THE
WITNESSES TO ALL. UH, COME ON UP
TO THE.
AND THANK YOU VERY MUCH. AND
BEFORE YOU DO YOUR INITIAL
CONVERSATIONS IF YOU WILL
IDENTIFY YOURSELF AND THE AGENCY
THAT YOU'RE WITH. SHALL I START
MR CHAIR? OH NO, NOT YET. THANK
YOU. UM, WE ARE DOING THIS
PRESENTATION A LITTLE BIT
DIFFERENT ORDER THAN WE HAVE
NORMALLY DONE THIS ON THE BUDGET
COMMITTEE. WE HAVE ALERTED ALL
OF THE PANELIST WITNESSES. THAT
ABOUT THIS CHANGE? WE'RE GOING
TO START WITH THE PURE REVIEW.
THEN WE'LL GO TO LEGISLATIVE L A
OFFICE AND THEN WE'LL GO TO THE
REVIEW OF RESPONSES AND COMMENTS
FROM MR KELLY AND THE AUTHORITY
. THE REASON WE'RE DOING THIS IS
I THINK THAT IT'S IMPORTANT FOR
US AT THIS POINT IN TIME, SORT
OF STOP AND REFLECT ON THE
CHALLENGES THAT WE HAVE WITH
THIS PROJECT AND BY IDENTIFYING
ALL OF THE CHALLENGES BEFORE MR
KELLY STARTS, I THINK IT LETS US
FOCUS ON THE THINGS THAT ARE
MOST IMPORTANT TO US AS WE GO
FORWARD. EXCUSE ME. UM AND, UH
SO. WHAT I WANT TO GIVE IN MY
MIND. SORT OF THE OVERVIEW. IF
YOU THINK ABOUT IT IF YOU STEP
BACK IF SOMEBODY NEW COMING INTO
CALIFORNIA TRYING TO OBSERVE
THIS THIS THING, UH SOMEBODY
WOULD LOOK AT THIS AND SAY,
WHAT'S THE HISTORY OF THIS
PROJECT? WELL, 15 YEARS AGO,
2008 UM, THE VOTERS APPROVED THE
FINANCING FOR THIS PROJECT FOR
THE FIRST TIME. THE AUTHORITY
WAS CREATED BACK IN THE 19
NINETIES, WHERE THERE WAS NEVER
ANY FINANCING. FINALLY, THIS
BOND PROPOSITION MOVE FORWARD.
UM WHAT THE VOTERS WERE TOLD WAS
THAT $9 BILLION IN THIS PROJECT
WOULD BE WOULD BE ABLE TO
COMPLETE THIS PROJECT FOR $9
BILLION AND BE ABLE TO COMPLETE
THIS PROJECT AND FAIRLY TIMELY
PERIOD OF TIME. HERE WE ARE 15
YEARS LATER, AND THE PROJECT HAS
HAD MASSIVE COST OVERRUNS, AND
IT HAS HAS SIGNIFICANT DELAYS TO
THE POINT WHERE WE DON'T KNOW
WHEN WE WOULD BE ABLE TO
COMPLETE THIS WHOLE PROJECT AND
I THINK WE ALL KNOW THAT IT'S
MOST LIKELY THAT THE COST
OVERRUNS THE COST OF THE PROJECT
WILL CONTINUE TO GO UP AND UP
AND UP. UM AND IT IS APPROPRIATE
FOR US TO, I THINK, TRY TO LOOK
AT THE BIG PICTURE TODAY. WHILE
WE'RE DOING THIS. THE EASIEST
THING FOR US TO DO POLITICALLY
WOULD BE TO JUST KIND OF GO HIGH
SPEED RAIL. YEAH, WE WANT IT AND
JUST KIND OF LET THIS DRIFT
AGAIN AND WE WILL THEN GET SOME
MORE COST OVERRUNS AND SOME MORE
DELAYS. UM AND THE PROJECT, YOU
KNOW, COST WILL WILL CONTINUE TO
GO UP. AND THAT'S NOT A
CRITICISM OF THE AUTHORITY THAT
IS IN CHARGE TRYING TO DO THIS.
NOW IT IS THE NATURE OF THE
PROJECT THIS LARGE AND
PARTICULARLY THE NATURE OF A
PROJECT THAT IS LAUNCHED. BY A
LITERALLY ALMOST AN INITIATIVE,
YOU KNOW, PULLING THIS TOGETHER.
THAT'S NOT THE WAY THAT MOST
NATIONS WOULD DECIDE TO BUILD
HIGH SPEED RAIL PROJECT LIKE
THIS AND COMPLICATED PROJECT
LIKE THIS, AND SO I THINK IT'S
IMPORTANT AND I TALKED WITH, UH
, MY COLLEAGUE, THE CHAIR OF THE
TRANSPORTATION COMMISSION. UH
MEAN TRANSPORTATION COMMITTEE
AND ASSEMBLYMEMBER'S FRIEDMAN
AGREES TRYING TO FOCUS ON THIS
AND SO THE BEST WAY FOR US TO
FOCUS ON WHAT OUR CHALLENGES ARE
, I THINK IS BY STARTING WITH
PEER REVIEW, THEN GOING TO THE
L. A S OFFICE. AND GOING FROM
THERE. WE WILL THEN GO TO THE
COMMITTEE MEMBERS TO ASK THEIR
QUESTIONS. UM AND THAT WILL BE
THE KICKOFF. AND SO MR KELLY
WILL THEN BE RESPONDING TO THOSE
QUESTIONS. UH FROM THE COMMITTEE
MEMBERS FIRST, AND THEN WE'RE
GOING TO ASK HIM TO RESPOND TO
THE ISSUES RAISED IN THE PEER
REVIEW AND THE ISSUES RAISED BY
L. A. OH, OH, AND THE PEER
REVIEW COMMITTEE. AND THAT GIVES
HIM THE OPPORTUNITY TO DIRECTLY
MAKE SURE AND MAKE SURE THAT IN
THE TIME WE HAVE WE'RE RIGHT AT
THE QUESTIONS AND THE KEY ISSUES
THAT WE HAVE IN FRONT OF US. UM
I WOULD ALSO JUST LIKE TO POINT
OUT THAT, UM WE ARE AT AN
INFLECTION POINT FROM THE
STANDPOINT OF THIS PROJECT IS
FOR THE FIRST TIME GETTING AN
INSPECTOR GENERAL. COMING ONTO
THIS PROJECT. I THINK THAT IF
YOU LOOK BACK ON IT, I THINK
ALMOST EVERYBODY WOULD AGREE IT
WOULD HAVE BEEN BEST OF HAD AN
EXPECTED GENERAL ON THIS PROJECT
AT THE BEGINNING. AND SO INTO
THIS, UM, SITUATION AND QUANDARY
RIDES MR KELLY AND THE AUTHORITY
AND THE BOARD AND I WANT TO
START BY COMPLIMENTING MR KELLY
FOR GIVING US A MORE TRANSPARENT
AND UPDATED, UM. BREATHE REPORT
COMING TO US EVERY ODD NUMBERED
YEAR WERE WE NEED TO GET THAT
REPORT FROM THE FROM THE FROM
THE AUTHORITY. AND I JUST WANT
TO TALK ABOUT THE DILEMMA THAT
YOU FACE. YOU KNOW, MR KELLY'S
JOB IS TO TRY TO GET THIS
PROJECT DONE. AND YOU WANT TO
GET THIS PROJECT DONE. YOU WANT
TO PRESENT POSITIVE AND YOU WANT
TO CREATE POSITIVE ENERGY, AND
WE WANT TO TRY TO HAVE THE
FEDERAL GOVERNMENT FEEL GOOD
ABOUT THIS PROJECT AND FEEL GOOD
ABOUT FUNDING THIS PROJECT AND
IT IT'S ON THE ONE HAND. HE'S
TRYING TO PRESENT THIS POSITIVE
ENERGY AND AT THE SAME TIME, HE
HAS THIS DEMAND FROM THE
LEGISLATURE APPROPRIATE DEMAND
FOR THE LEGISLATURE AND THE
PUBLIC FOR MORE TRANSPARENCY.
WHAT'S GONE? WRONG WHAT DO WE
NEED TO DO? SO TODAY IS NOT A
REFLECTION ON UH, OUR ANALYSIS
OF THE INDIVIDUAL WORK BEING
DONE BY YOU AS THE EXECUTIVE
DIRECTOR BY THE BOARD BY ALL THE
PEOPLE INVOLVED IN THE AUTHORITY
, BUT IT'S A RECOGNITION OF HOW
DIFFICULT ASSIGNMENT THIS IS TO
TRY TO DO TO DELIVER THIS. THE
FINAL THING I WANT TO SAY IS
THAT, UM, MS REGAN AND I BOTH
WENT TO JAPAN. AND THE BIG FOCUS
OF MINE GOING TO JAPAN WAS TO
LOOK AT THE HIGH SPEED RAIL AND
FIND OUT WHAT DID THEY DO? UM
AND WHAT LESSONS COULD WE LEARN
FROM THAT? AND A FEW THINGS
NUMBER ONE THEY STARTED WITH A
GOVERNMENT RUN ATTEMPT TO TRY TO
BUILD HIGH SPEED RAIL. AND AFTER
A NUMBER OF YEARS, IT WAS JUST
OBVIOUS IT WASN'T GOING TO WORK
AND THEY DRAMATICALLY CHANGED
HOW THEY WERE GOING TO DO IT.
BASICALLY PRIVATE COMPANIES WERE
PUT IN CHARGE OF DIFFERENT PARTS
OF THE HIGH SPEED RAIL PROJECT,
AND THEY PUT THAT TOGETHER. THE
SECOND THING WAS, THEY CAME UP
WITH FUNDING SOURCES, REGULAR
FUNDING SOURCES AND FUNDING
SOURCES THAT ALLOWED THEM TO
HAVE THE HIGH SPEED RAIL
AUTHORITY BENEFIT FROM THE REAL
ESTATE THAT WOULD GO UP IN VALUE
WHEREVER THEY PUT THESE
STATIONS. AND THAT WAS THAT IS A
SIGNIFICANT PART OF WHAT KEEPS
THE HIGH SPEED RAIL. UM SYSTEM
IN JAPAN COST EFFECTIVE AND IT
DOES NOT REQUIRE SUBSIDIES FROM
UM FROM THE NATIONAL GOVERNMENT
. THIRD THING IS, IT IS A
NATIONAL PROJECT, THE HIGH SPEED
RAIL PROGRAM AND IT'S A THERE'S
A RECOGNITION THERE. SO HERE YOU
HAVE JAPAN WITH NEARLY 140
MILLION PEOPLE. ABOUT THE SAME
SIZE AS CALIFORNIA WITH, YOU
KNOW, THREE TIMES AS MANY PEOPLE
ALMOST AND, UH, THEY DO IT ON A
NATIONAL LEVEL AND HEAR WHAT WE
ARE TRYING TO DO IN CALIFORNIA'S
WITH 40 MILLION PEOPLE. THE SAME
SIZE STATE. WE'RE TRYING TO FUND
THIS WITHOUT THE BENEFITS OF
FEDERAL, A LONG TERM FEDERAL
COMMITMENT, ETCETERA AND ALL THE
BENEFITS THAT COME FROM THAT
FEDERAL FUNDING. SO THAT'S THE
OVERVIEW THAT I WOULD LIKE TO
CREATE OR PRESENT AS THE
ATMOSPHERE THAT WE SHOULD
CONSTANTLY WORK IN. NOT ONE OF
CRITICISM, BUT ONE OF VERY STARK
RECOGNITION OF HOW DIFFICULT IS
PROJECT IS AND WHAT ARE THE
CHALLENGES THAT WE HAVE TO
OVERCOME. AND SO WITH THAT
APPRECIATE THAT ASSEMBLY MEMBER
FRIEDMAN, THE CHAIR OF THE
TRANSPORTATION COMMITTEE IS HERE
AND I'LL TURN IT OVER TO HER
PART OF THIS JOINT HEARING.
THANK YOU, CHAIR BENNETT. AND
THANKS FOR EVERYBODY WHO IS HERE
TODAY OR WATCHING REMOTELY. THIS
IS A CONTINUATION OF A VERY
IMPORTANT DISCUSSION BECAUSE
THIS IS THE LARGEST PROJECT. IN
CALIFORNIA'S HISTORY AND I'M
REALLY LOOKING FORWARD TODAY.
TODAY'S DISCUSSION AND I HOPE
THAT WE CAN SPEAK VERY CANDIDLY
TODAY AND VERY HONESTLY ABOUT
WHATEVER HARD CHOICES MIGHT LIE
AHEAD ABOUT THIS WITH REGARDS TO
THIS PROJECT. I APPRECIATE THAT
HIGH SPEED RAIL AUTHORITY HAS
BEEN FOR TRANSPARENT AS OF LATE,
UM PARTICULARLY ABOUT THE BUDGET
CHALLENGES FOR THE PROJECT. I
THINK THAT TRANSPARENCY WOULD
HAVE BEEN HELPFUL ALL ALONG,
INCLUDING LAST SUMMER, WHEN WE
WERE NEGOTIATING THE RELEASE OF
THE REMAINING PROP ONE A FUNDS,
YOU KNOW, WE ALL HAVE TO HELP
MAKE DIFFICULT TO MAKE CHOICES.
AND IF WE DON'T HAVE ALL THE
INFORMATION ARE WE HAVING
COMPLETE INFORMATION OR WE HAVE
INFORMATION THAT WE FEEL IS YOU
KNOW, UH, YOU KNOW, DOESN'T GIVE
THE BIG PICTURE. IT'S REALLY
HARD FOR US TO HELP MAKE THE
POLICY DECISIONS THAT WE NEED TO
MAKE TO GUIDE THE PROJECT. I
ALSO WANT TO BE REALLY CLEAR
THAT I'M A SUPPORTER OF HIGH
SPEED RAIL IN CALIFORNIA. I
REALLY LOOK FORWARD TO THE DAY
WHEN WE DON'T JUST HAVE HIGH
SPEED RAIL FROM LOS ANGELES TO
SAN FRANCISCO, BUT LOS ANGELES
TO SAN DIEGO, WHICH IS A ROUTE
THAT DESPERATELY WANTS HIGH
SPEED RAIL AND TO LAS VEGAS AND
BEYOND I I'M A BELIEVER IN RAIL.
SO I COME TO THIS WITH THE
SPIRIT OF TRYING TO BE
CONSTRUCTIVE AND TRYING TO BE
HELPFUL. I AM NOT SOMEBODY WHO'S
HERE TO TRY TO PUT AN END TO
THIS PROJECT. MY FEAR IS THAT WE
GET TO A POINT WHERE BECAUSE OF
DECISIONS WE'VE MADE THE
LEGISLATURE DECIDES TO NOT
CONTINUE THE PROJECT, AND AS
I'VE SAID ALL ALONG THAT TO ME
IS THE BIGGEST WORRY THAT I HAVE
IN THIS. I'M NOT TRYING TO
DERAIL HIGH SPEED RAIL. I'M
TRYING TO MAKE SURE THAT IT'S ON
SUCH A SOUND FOOTING THAT AT
EVERY STEP OF THE WAY IT HAS THE
SUPPORT OF THE LEGISLATURE AND
MOST IMPORTANTLY OF THE PEOPLE
OF CALIFORNIA. AND IF THE PEOPLE
OF CALIFORNIA FEEL THAT THIS
PROJECT IS NOT ON THE MOST FIRM
FINANCIAL FOOTING DONE WITH THE
UTMOST TRANSPARENCY. THEY MAY
NOT WANT TO CONTINUE THE PROJECT
, CONTINUING THAT THE COSTS HAVE
GONE UP FAR BEYOND WHAT THE
PUBLIC HAD ENVISIONED. I ALSO
THINK IT'S IMPORTANT THAT WE
MAKE PEOPLE REALLY UNDERSTAND
THE BENEFITS THAT THE PROJECT
CAN BRING, AND THAT MEANS
BRINGING IN ALL THE LOCAL
COMMUNITIES THAT ARE INVOLVED AS
VERY ACTIVE PARTNERS SO THAT
THEY UNDERSTAND THAT THIS WOULD
BE HELPFUL EVEN AT A TIME WHEN
PEOPLE ARE COMMUTING AS MUCH TO
WORK. THAT THERE IS VALUE TO
HAVING ALTERNATIVE MODES OF
TRANSPORTATION THAT GET PEOPLE
OUT OF THEIR CARS. SO I WOULD
CERTAINLY BE VERY HAPPY TO HELP
WITH ANY OF THOSE EFFORTS. BUT
AT THE END OF THE DAY, AND I
THINK WHAT WE'RE GOING TO HEAR
TODAY IS WHETHER OR NOT WE HAVE
THE FUNDING TO CREATE ANYTHING
THAT'S TRULY MEANINGFUL IN THE
VALLEY, BECAUSE, AS I'VE SAID
ALL ALONG WHEN THIS PROJECT
OPENS AND YOU'RE RUNNING A TRAIN
, IT'S NOT GOING TO BE ENOUGH TO
JUST SHOW THAT THE TRAIN IS
GOING AT A CERTAIN SPEED. AND
THAT IT'S STAYING ON THE TRACKS.
WE KNOW YOU CAN DO THAT. WE KNOW
THAT YOU'RE GOING TO BE ABLE TO
DO THAT. WHAT'S GONNA BE
IMPORTANT AS PEOPLE RIDING THAT
TRAIN SO WE HAVE TO MAKE SURE
THAT WHATEVER YOU YOU, YOU
DELIVER IN THE CENTRAL VALLEY
HAS ENOUGH PEOPLE ON IT. AND LET
IT HAS THE FUNDING TO MAKE SURE
THAT THOSE PEOPLE HAVE SOMEWHERE
TO GO WHEN THEY GET TO THEIR
DESTINATION, MEANING CONNECTING
POSSIBLY TO A TRAIN TO GET THEM
INTO THE BAY AREA AND THAT THEY
WANT TO USE IT. BECAUSE IF NOT
WHEN YOU GO BACK FOR YOUR NEXT
BIG CRUNCH OF MONEY, YOU MAY NOT
HAVE AS MUCH AS A RECEPTIVE AS
AN AUDIENCE AS YOU NEED. I'M
ALSO CONCERNED THAT THE $10
BILLION FUNDING GAP WILL GROW
LARGER. BECAUSE WE BECAUSE OF
UNEXPECTED PROJECT COSTS BECAUSE
OF HISTORIC INFLATION RIGHT NOW.
AND DOESN'T DOUBLE DIGIT GROWTH
EVERY TIME A NEW PROJECT
DOCUMENT COMES OUT. UM I'M VERY
CONCERNED ABOUT THE RIDERSHIP
ESTIMATES, AND THAT'S CERTAINLY
NOT THE FAULT OF HIGH SPEED RAIL
. WE'RE SEEING THAT IN TRANSIT
ACROSS THE STATE EVEN BEFORE
COVID. WE'VE SEEN TRANSIT
RIDERSHIP DECREASE, WHICH IS A
TOPIC THAT WE'VE BEEN DISCUSSING
IN THE TRANSPORTATION COMMITTEE
. HOW DO WE COUNTER THAT TREND
AND GET PEOPLE ONTO TRANSIT? AND
CERTAINLY NOW AFTER COVID PEOPLE
HAVE NOT YET RETURNED TO THE
WORKPLACE, THEY WAY THAT THEY
HAD BEFORE? WHICH ALSO PRESENTS
CHALLENGES FOR THIS PROJECT. UM
BUT WE CERTAINLY NEED TO GET
PEOPLE ONTO PUBLIC
TRANSPORTATION. WE HAVE CLIMATE
GOALS. WE HAVE EQUITY GOALS.
NOBODY WANTS TO BE ON CONGESTED
HIGHWAYS AND HIGH SPEED RAIL
OFFERS AN ALTERNATIVE TO ALL OF
THAT. SO I WANT TO UNDERSTAND
EXACTLY WHAT THE HIGH SPEED RAIL
AUTHORITY BELIEVES THAT WE NEED
TO SEE FROM THE FEDERAL
GOVERNMENT THIS YEAR, AN EXACT
AND REAL NUMBERS. TO SHOW THAT
THEY'RE A RELIABLE AND STRONG
FUNDING PARTNER. AND I WANT TO
HIGHLIGHT THE DILEMMA THAT ARE
HIGH SPEED RAIL PURE REVIEW
GROUP RACE AND IT'S MARCH 23RD
LETTER, ACCORDING TO THE PRG.
I'M QUOTING THE DILEMMA THE
PROJECT NOW POSES IS THAT GIVEN
THE EXPECTED COST INCREASES,
DELAYS IN DEMAND DECREASES FOR
THEM ARE SAID TO BAKERSFIELD
SEGMENT. THERE'S FEW WHO WOULD
ARGUE THAT COMPLETING THIS
SECTION BY ITSELF AT A COST OF
UP TO $35 BILLION CAN BE
JUSTIFIED. RATHER IT WOULD ONLY
MAKE SENSE IN A CONTEXT OF
COMMITMENT TO BUILDING THE
COMPLETE PHASE ONE SYSTEM AT THE
SAME TIME, COMPLETING THE FULL
PHASE ONE SYSTEM POSES A GROWING
FINANCIAL CHALLENGE FOR THE
STATE BECAUSE THE GAP IS ALREADY
LARGE AND COST HAVE BEEN
INCREASING FASTER THAN THE
IDENTIFIABLE POTENTIAL FINANCING
. WHILE FORECAST RIDERSHIP HAS
FALLEN, I BELIEVE THAT THERE IS
GREAT VALUE. IN A ONE SEAT RIDE
, OR AT LEAST AN EASY TRANSFER
RIDE FROM THE BAY AREA,
HOPEFULLY INTO SAN FRANCISCO.
AND THROUGH THE VALLEY. I THINK
THAT THAT EVEN IF YOU IF IT
TAKES A WHILE TO GET TO LOS
ANGELES WOULD STILL HAVE GREAT
VALUE. BUT I'M NOT EVEN SURE
RIGHT NOW HOW WE MAKE THAT
CONNECTION, SOMETHING THAT
PEOPLE ARE GOING TO WANT TO DO,
GIVEN THE COST THAT THE TICKET
COULD END UP BEING, YOU KNOW, WE
HAVE TO LOOK AT THE COST OF THE
TICKET, PLUS THE TRANSFER TIME
AND HOW MANY TIMES PEOPLE ARE
GOING TO HAVE TO CHANGE
MODALITIES? TO GET TO A
POPULATION CENTER OR A JOB
CENTER, AND THAT'S WHAT WE NEED
TO BE REALISTIC ABOUT BECAUSE I
AGAIN DO NOT BELIEVE THAT A
DEMONSTRATION PROJECT WITHOUT
HUMANS TAKING IT ON A YOU KNOW
ON A REGULAR BASIS IS GOING TO
BE ENOUGH TO CONVINCE PEOPLE UM
SO UH, YOU KNOW AGAIN, THIS IS
NOT. THIS ISN'T AN ON AN
EXERCISE OF BLAMING ANYONE IN
PARTICULAR. I THINK EVERYBODY
HAS HUGE CHALLENGES THEY'RE
WORKING WITHIN AND I DON'T YOU
KNOW, TAKE ANY OF THAT FOR
GRANTED. UH I'M HERE TO TRY TO
DO MY BEST TO PUT THIS PROJECT
ON A GOOD FOOTING. YOU KNOW, SO
THAT ONE DAY I CAN TAKE IT. MY
DAUGHTER CAN TAKE IT AND WE SEE
PEOPLE WRITING THAT FAST TRAIN
INSTEAD OF TAKING CARS, AND
LASTLY, I'LL SAY THAT
QUESTIONING AND CHALLENGING IS
NOT OPPOSITION. AND THAT WE
DON'T DO THIS PROJECT ANY FAVOR
IF WE GLOSS OVER ANY OF THE
CHALLENGES THAT WE HAVE, WE HAVE
TO BE VERY HONEST ABOUT THEM,
AND WE HAVE TO HAVE A VERY
SERIOUS CONVERSATION ABOUT HOW
TO OVERCOME THEM. UH HUH. AND
YOU KNOW, AND. THE WHETHER IT'S
YES, WE WANT THE LEGISLATURE NOW
TO PICK UP THE BULK OF THE
FUNDING AND WE EXPECT YOU TO DO
THAT. IF THAT'S GOING TO BE THE
CASE. WHAT IS THAT FUNDING AND
WHERE WOULD YOU SUGGEST THAT
MONEY COMES FROM? AND WITH THAT?
I WILL TURN IT BACK OVER TO
CHAIR BENNETT. THANK YOU. THANK
YOU. THANK YOU VERY MUCH FOR
THOSE COMMENTS, AND I THINK THAT
I APPRECIATE THE FACT THAT I
THINK WE'RE BOTH ALIGNED. IN
TERMS OF TRYING TO THE BEST
THING WE CAN DO FOR HIGH SPEED
RAILS. MAKE SURE WE'RE HONEST
ABOUT WHAT ALL THE CHALLENGES
ARE AND WHAT WE'RE GOING TO DO
ONE FINAL BIG PICTURE ITEM, BUT
I WILL POINT OUT. WE HAVE A NEW
CHALLENGE, AND THAT IS A
RECOGNITION THAT TRANSIT
RIDERSHIP IS REALLY FALLING. UM
AND WE NOW HAVE REQUEST FROM
TRANSIT AGENCIES THROUGHOUT THE
STATE FOR US TO FUND OPERATION
AND MAINTENANCE, DAILY OPERATION
AND MAINTENANCE OF THOSE
PROJECTS. THE STATE OF
CALIFORNIA HAS NEVER FUNDED
OPERATION AND MAINTENANCE. WE
HAVEN'T SUBSIDIZED OPERATION AND
MAINTENANCE OF TRANSIT IN
CALIFORNIA, THE JAPANESE, I
THINK FOUND A WAY TO NOT HAVE TO
HAVE THAT KIND OF SUBSIDY. UM
AND SO THAT CHALLENGES IS LOADED
ON TOP OF THIS. CAN WE REALLY
CREATE A PROJECT THAT HAS WAS
ADVERTISED WITH THE PROPOSITION
WOULD NOT REQUIRE A STATE
SUBSIDY. UM AS WE MOVE FORWARD,
SO THAT CHALLENGE I THINK IS
PARTICULARLY ACUTE WHEN WE
REALIZE THAT HIGH SPEED RAIL
IT'S GOING TO HAVE TO COMPETE
WITH THE OTHER TRANSPORTATION
MODALITIES THAT WE HAVE IN THE
STATE OF CALIFORNIA AND UNTIL WE
HAVE THE COURAGE TO PROPERLY
PRICE CARBON HIGH SPEED RAIL
WILL BE AT A DISADVANTAGE.
BECAUSE WHEN, IF WE PROPERLY
PRICED CARBON AND YOU HAD. TO
ACTUALLY PAY THE TRUE COST OF
WHAT IT WAS DOING TO THE
ENVIRONMENT. IF YOU TOOK THESE
OTHER MODES OF TRANSPORTATION,
UM YOU WOULD FIND HIGH SPEED
RAIL WOULD BECOME MUCH MORE
ATTRACTIVE FROM A PRICE
STANDPOINT. UM AND SOMEDAY THE
STATE OF CALIFORNIA IS GOING TO
HAVE TO, I THINK, ACTUALLY. MAKE
THE COURAGEOUS POLITICAL
DECISIONS REGARDING PROPERLY
PRICING CARBON IN OUR STATE, AND
WITH THAT, I WOULD LIKE TO START
OFF WITH MR THOMPSON, THE CHAIR
OF THE CALIFORNIA HIGH SPEED
RAIL AND PEER REVIEW GROUP. IS
THE MIKE. OKAY, GOOD. HERE
FRIEDMAN AND CHEER BENNETT.
MEMBERS OF THE COMMITTEE
APPRECIATE THE OPPORTUNITY TO
SPEAK TO YOU TODAY. MY NAME IS
LOU THOMPSON. I'M THE CHAIRMAN
OF THE PEER REVIEW GROUP. AS YOU
KNOW, THE GROUP WAS CREATED BY
PROPOSITION ONE A AND TRY TO
REPORT TO YOU ON MATTERS OF
INTEREST. TO DATE. WE'VE COVERED
EIGHT BUSINESS PLANS IF YOU'D 18
LETTERS OF COMMENTS AND HAVE
TESTIFIED BEFORE THE LEGISLATURE
OR CONGRESSIONAL COMMITTEE, MR
THOMPSON, COULD YOU MOVE YOUR
MICROPHONE CLOSER TO WHEN YOU
FIND YOU LOOK DOWN, THEN WE LOSE
THE ANGLE DOESN'T STAY REMAINS
STABLE. OKAY AND WE'VE TESTIFIED
BEFORE THE LEGISLATURE OR
CONGRESSIONAL COMMITTEES. 15
TIMES. HELEN KIRSTEN'S EXCELLENT
REMARKS OR COMPREHENSIVE AND
THEY ARE ACCURATE. I CAN SAY
EXACTLY THE SAME ABOUT THE STAFF
PAPERS THAT WERE PREPARED FOR
THE COMMITTEE. UH THEY ARE
PARALLEL. MANY OF THE COMMENTS
ON OUR LETTER OF MARCH. THE 23RD
AS WE HAVE ALL SAID PROJECT
COSTS CONTINUE TO RISE SCHEDULES
OR STRETCHING OUT DEMAND.
ESTIMATES HAVE FALLEN AND
FINANCING IS INADEQUATE AND
UNSTABLE. THERE IS NO POINT IN
BE LABORING WHAT YOU ALREADY
KNOW. I WOULD LIKE INSTEAD TO
FOCUS ON THE INCREASINGLY URGENT
DILEMMA THAT EMERGES FROM THESE
FACTS. IN DOING SO I DO NOT
INTEND TO CRITICIZE THE CURRENT
HS ARE A STAFF. THE PROJECT HAS
ALWAYS BEEN OVER PROMISED AND
UNDER FUNDED. IT GOT OFF TO A
ROUGH START, PARTLY DUE TO
INEXPERIENCE AND PARTLY BECAUSE
THE ALLURE OF SEEMINGLY FREE
FEDERAL MONEY LED THE AUTHORITY
TO AWARD CONTRACTS BEFORE THEY
WERE PROPERLY PREPARED. MANAGERS
HAVE LEARNED A LOT, AND I DO
AGREE THAT THIS IS THE MOST
ACCURATE AND HONEST PICTURE OF
THE PROJECT THAT WE'VE SEEN TO
DATE. THAT IS BOTH THE GOOD AND
THE BAD NEWS. FROM THE 2023
PROJECT UPDATE REPORT. WE NOW
KNOW THAT THE PHASE ONE WILL
COST ABOUT THREE TIMES WHAT WAS
EXPECTED WHEN PROP ONE A WAS
PASSED. AND THIS IS CERTAIN TO
RISE FURTHER. IT WILL ALSO TAKE
15 TO 20 YEARS LONGER. IT WILL
NOT REALISTICALLY MEET THE TRIP
TIMES SPECIFIED IN PROP. ONE A
AND IT IS NOW PREDICTED TO CARRY
ONLY THREE QUARTERS OF THE
PASSENGERS. THESE RESULTS ARE
SIGNIFICANTLY BELOW THE
EXPECTATIONS PROMISED BY PROPER
AND A AND THIS SHOULD ENCOURAGE
THE LEGISLATURE AND THE GOVERNOR
TO REASSESS THE VIABILITY AND
PRIORITY OF THE PROJECT. GIVING
THE OTHER FINANCING NEEDS THAT
THE STATE FACES. THE LEGISLATURE
MAY WANT TO REQUEST AN
INDEPENDENT, UPDATED ANALYSIS OF
THE BENEFITS AND COSTS OF THE
PROJECT. I UNDERSTAND THAT THE
AUTHORITIES CONDUCTING SUCH AN
ANALYSIS IN SUPPORT OF ITS GRANT
REQUEST TO THE U. S DEPARTMENT
OF TRANSPORTATION. SO ONE WAY TO
ACCOMPLISH THIS WOULD BE TO
COMMISSION INDEPENDENT REVIEW OF
THE AUTHORITIES SUBMISSION BY
ONE OF THE STATE'S UNIVERSITIES
AND ASKED THEM TO REPORT
FINDINGS TO THE LEGISLATURE. I
KNOW THE L. A AND THE PURE RIVER
GROUP WOULD ALSO REPORT ON THE
RESULTS OF THE REVIEW, AS WOULD
THE NEW HØI G IN THE IN THE
HOUSE SPEED RAIL AUTHORITY WHO I
HOPE WILL BE APPOINTED SOON. AT
THE SAME TIME, THE LEGISLATURE
COULD REQUEST AN ANALYSIS BY THE
L. A OVER AN APPROPRIATE AGENCY
OF WAYS TO FILL THE FINANCING
GAPS THAT ARE NOW APPARENT.
FIRST THE GAP, IF ANY, IN THE 1
19 MILES SECTION MADEIRA TO
POPULAR AVENUE. THE AUTHORITY
ARGUES THAT THIS SECTION IS
ADEQUATELY FUNDED AND THERE IS A
REASONABLE CHANCE THAT THEY ARE
RIGHT. THEN THERE IS THE 2.5 TO
$10 BILLION GAP IN THE MERCED,
THE BAKERSFIELD SECTION,
DEPENDING ON THE SUCCESS IN
GETTING FEDERAL MONEY. SIMILARLY
THERE IS A GAP OF 93 $203
BILLION IN PHASE ONE, AND I WANT
TO REPEAT THAT A GAP OF $100
BILLION IN COMPLETING PHASE ONE.
ANY FUNDING PLAN TO FILL THIS
GAP MUST BE ADEQUATE, CREDIBLE
AND STABLE. ANYTHING LESS IS A
GUARANTEED CONTINUATION OF THE
INSTABILITY AND MANAGERIAL
PROBLEMS OF THE LAST 14 YEARS.
ANYTHING LESS ALSO LEAVES LOCAL
PLANNERS IN DECISIONAL LIMBO.
THEY ARE IN THE POSITION OF
SPENDING MONEY TO RETAIN THE
OPTION OF HS ARE ACCESS WHEN IT
IS NOT CLEAR THAT HIGH SPEED
RAIL WILL EVER ARRIVE. PRESSING
NEED FOR A CREDIBLE FUNDING
APPROACH IS THE MOST IMPORTANT
MESSAGE WE CAN DELIVER. AND IT
HAS BEEN A COMMON THEME IN MANY
OF OUR STATEMENTS IN PRIOR
YEARS. WE HAVE ALSO POINTED OUT
THAT THE LEGISLATURE HAS OPTIONS
SHORT OF THE FULL PHASE ONE THIS
MAY BE ESPECIALLY IMPORTANT IF
PHASE ONE DOES NOT EMERGE
FAVORABLY FROM AN ANALYSIS OF
BENEFITS OF COST OR IF IT OR IF
IT CANNOT CREDIBLY BE FINANCED,
GIVEN THE STATES COMPETING
NEEDS. IF THERE IS NO COMMITMENT
TO THE FULL PHASE ONE, THEN IT
IS CLEAR, AT LEAST TO ME. THAT
THE CURRENT $35 BILLION PLAN FOR
MISS SAID THE BAKERSFIELD CANNOT
BE JUSTIFIED. THE LEGISLATURE
SHOULD REQUEST THE AUTHORITY TO
DEVELOP AN ALTERNATIVE PLAN IN
THE ABSENCE OF A COMMITMENT TO
PHASE ONE. SUCH A PLAN MIGHT,
FOR EXAMPLE, USE EXISTING
CONNECTIONS TO MERCED IN
BAKERSFIELD, ELIMINATE
ELECTRIFICATION BUT PURCHASED
BETTER DIESEL OR OTHER ROLLING
STOCK TO ELIMINATE THE SAN
JOAQUIN TRANSFERS IN MERCED. AND
COMPLETE THE STATION WORK IN
MERCED, IMPOSSIBLY BAKERSFIELD.
THE BARE BONES 119 MILE SECTION
FROM MADEIRA TO POPULAR AVENUE
WITH A SINGLE TRACK AND NO
ELECTRIFICATION ALSO REMAINS AN
OPTION, THOUGH IT MIGHT REQUIRE
NEGOTIATION WITH THE DEPARTMENT
OF TRANSPORTATION. THE
LEGISLATOR. LEGISLATURE MAY WANT
TO REQUEST AN ANALYSIS FROM THE
AUTHORITY. OF HOW THIS COULD BE
DONE AND WHAT IT WOULD COST. I
FULLY REALIZE THAT THIS IS NOT A
WELCOME MESSAGE. BUT THE RESULTS
OF THE 2023 P U R AND THE
FINANCIAL IMPLICATIONS IT HAS
MAKE IT URGENT THAT THE STATE
REVIEW ITS COMMITMENT TO THE
FULL PHASE ONE IF IT CAN FIND A
WAY TO PAY FOR IT, OR START THE
PROCESS OF DEFINING AND
CONSIDERING THE ALTERNATIVES.
THANK YOU FOR YOUR TIME. I'LL BE
HAPPY TO ANSWER ANY QUESTIONS
YOU MAY HAVE. THANK YOU VERY
MUCH, MR. THOMPSON UM, WE'RE NOW
READY TO GO TO THE LEGISLATIVE
ANALYST'S OFFICE. GOOD MORNING
CHAIRS AND MEMBERS. MY NAME IS
HELEN KIRSTEN WITH THE
LEGISLATIVE ANALYST'S OFFICE.
THANK YOU SO MUCH FOR INVITING
ME TO PARTICIPATE IN TODAY'S
HEARING. WE'VE PREPARED A
HANDOUT, WHICH HOPEFULLY YOU
HAVE. IF YOU DON'T HAVE IT, THE
SURGEONS HAVE A NUMBER OF EXTRA
COPIES. IT'S ALSO AVAILABLE ON
OUR WEBSITE AND ON THE
COMMITTEE'S WEBSITE. UM SO, MR
CHAIR, I HAVE A QUICK QUESTION.
I WAS WONDERING IF YOU WOULD
LIKE US TO REVIEW THE CONTENTS
OF THE PROJECT UPDATE REPORT AND
ALSO PROVIDE OUR COMMENTS OR IF
YOU JUST LIKE US TO GO STRAIGHT
TO OUR COMMENTS. AH! I WOULD
LIKE YOU TO SUMMARIZE THE
CONTENTS OF YOUR PROJECT UPDATE
REPORT AND THEN GO TO YOUR
COMMENTS. OKAY GREAT. THANK YOU
. UM SO I'M STILL GOING TO SKIP
OVER THE BEGINNING PART OF THIS
HANDOUT BECAUSE THE BEGINNING
PART OF THE HANDOUT REALLY JUST
PROVIDES BACKGROUND ON THE
PROJECT, AND I KNOW YOU ALL ARE
VERY FAMILIAR WITH THAT. UM BUT
I AM GONNA SKIP TO PAGE IF YOU
WANT TO FOLLOW ALONG IN YOUR
HANDOUT PAGE NINE, AND THAT'S
WHERE I SUMMARIZE WHERE WE START
TO SUMMARIZE THE MAJOR FEATURES
OF THIS PROJECT. UPDATE REPORT.
SOME OF THEM HAVE BEEN
REFERENCED BY PREVIOUS SPEAKERS
, BUT JUST I'LL TRY TO COVER
THEM RELATIVELY QUICKLY IN THE
INTEREST OF TIME. SO THE FIRST
MAJOR MAJOR FEATURE OF THE
PROJECT UPDATE REPORT WHICH, AS
WAS MENTIONED, THE AUTHORITY HAS
TO PREPARE EVERY EAT EVERY ODD
YEAR. SO EVERY EVEN YEAR THEY
PREPARE A BUSINESS PLAN EVERY
ODD EUROPE PROJECT AT THE
REPORT. USUALLY THE PROJECT
DEPUTY REPORTS ARE KIND OF MINOR
MINOR UPDATES THIS YEAR. IT'S A
LITTLE BIT MORE SIGNIFICANT, AND
PART OF THAT IS BECAUSE LAST
YEAR'S PROJECT UPDATE REPORT WAS
WHAT THE AUTHORITY CALLED THE
BRIDGE DOCUMENT, BASICALLY
BECAUSE OF COVID AND OTHER
FACTORS. THEY DIDN'T FULLY
UPDATE LAST YEAR'S REPORT AS
MUCH AS THEY MIGHT HAVE
OTHERWISE. SO THIS YEAR'S
PROJECT DEPUTY REPORT IS A MORE
MORE COMPREHENSIVE UPDATE UM, SO
SIMILAR TO LAST YEAR'S BUSINESS
PLAN. THIS PROJECT UPDATE REPORT
CONTINUES TO FOCUS ON MERCED TO
BAKERSFIELD. WE'VE HEARD A LOT
ABOUT THAT, UM, SEGMENT, THIS
FOCUS ON MERCEDES BAKERSFIELD
WAS FIRST INTRODUCED BY THE
AUTHORITY IN 2019. IT'S ALSO
CONSISTENT WITH LEGISLATIVE
INTENT, SO THERE WAS SOME
REFERENCE TO LAST YEAR'S BUDGET
ACTION, SO I'LL JUST BRIEFLY
MENTIONED LAST YEAR. FOR THOSE
OF YOU WHO MAY NOT RECALL
PROBABLY PROBABLY PRETTY MUCH
EVERYONE IN THIS ROOM DOES, BUT
MAYBE THOSE FOLKS WERE LISTENING
AT HOME MAY NOT RECALL THAT LAST
YEAR, THE LEGISLATURE
APPROPRIATED ESSENTIALLY ALL OF
THE REMAINING PROP. ONE A FUNDS
, THE 4.2 BILLION THAT WAS
REMAINING AND ALSO PASSED BUDGET
TRAILER LEGISLATION THAT DID A
NUMBER OF REALLY IMPORTANT
THINGS. ONE OF THOSE KEY THINGS
IS REALLY ESTABLISHING
LEGISLATIVE INTENT THAT THE
AUTHORITY FOCUS ON MERCED TO
BAKERSFIELD, WHICH AT THAT TIME
WAS ROUGHLY FULLY FUNDED. UM AND
SO THIS FOCUS CONTINUED FOCUS IS
CONSISTENT WITH THAT BUDGET
TRAILER LEGISLATION. UM ALSO,
THE PROJECT AFTER REPORT
CONTINUES TO THE PLAN OF DOING
SOME PLANNING WORK ON THE REST
OF PHASE ONE. SO THAT INCLUDES
DOING ENVIRONMENTAL WORK ON THE
ON THE PHASE ONE, AND THAT'S
CONSISTENT WITH FEDERAL GRANT
REQUIREMENTS AS WELL AS AS THAT
WORK IS COMPLETED, STARTING TO
DO ADVANCED DESIGN WORK, UM, TO
TRY TO DEVELOP BETTER COST
ESTIMATES, FOR EXAMPLE. AND WE
NOTE THAT THE AUTHORITIES
PLANNING TO SUBMIT A GRANT
APPLICATION TO HELP FUND SOME OF
THIS WORK IN THE NEXT COUPLE OF
WEEKS. ALSO THE PROJECT, DR
REPORT ARTICULATES A PLAN TO
COMMIT SOME OTHER ACTIVITIES
STARTING IN 2025 LIKE RIGHT AWAY
ACQUISITIONS, UTILITY
RELOCATIONS THOSE TYPES OF
THINGS. SO IF YOU TURN TO PAGE
10 1 IS A HIGHLIGHT THAT THERE
ARE FEW NEW ELEMENTS OF PROJECT
SCOPE THAT ARE ADDED. THESE ARE
NEW THAT WE HAVEN'T SEEN IN THE
PROJECT BEFORE, FOR EXAMPLE,
ADDING A SOLAR AND BATTERY
STORAGE COMPONENT. THAT'S A NEW
THING AS WELL AS A DIFFERENT
LOCATION FOR THE MERCED STATION
. THIS I KNOW IS VERY FAMILIAR
TO MEMBERS OF THIS COMMITTEE
THAT THERE WAS REALLY A
PREVIOUSLY THE MERCED STATION
WAS GOING TO BE AT A DIFFERENT
LOCATION FROM THE STATION THAT
AMTRAK ON THE SAME JOAQUIN'S
GOES TO AS WELL AS A SPACE AND
THAT DIDN'T MAKE A LOT OF SENSE.
AND SO THE LEGISLATURE, UM
EXPRESSED ITS INTENT THAT THERE
BE ONE COMBINED STATION, AND
THAT WAS CONSISTENT WITH WHAT
THE AUTHORITY WAS WAS HOPING TO
DO AS WELL. BUT THE COSTS
WEREN'T PREVIOUSLY REFLECTED IN
THE LAST BUSINESS PLAN. SO THIS
PROJECT AT THE REPORT FOR THE
FIRST TIME REALLY REFLECTS THOSE
COSTS. AND THEN ALSO THIS
PROJECT AFTER REPORT SHIFTS,
SOME COSTS THAT WERE PREVIOUSLY
IN THE AH, NOT IN MERCED TO
BAKERSFIELD INTO THAT SEGMENT,
SO THERE WERE COSTS THAT EXISTED
BEFORE LIKE PERMANENT GROUP
BAKERSFIELD STATION, BUT
PREVIOUSLY THAT PERMANENT
STATION WAS NOT COSTED OUT IN
THE MERCED TO BAKERSFIELD
SEGMENT. IF YOU TURN TO PAGE 11
UM, WE HIGHLIGHT SOME OF THE
DELAYS THAT ARE REFLECTED IN THE
IN THE PROJECT AFTER REPORTS SO
YOU'LL SEE IN THIS TABLE THAT
THERE ARE A FEW ACTIVITIES THAT
ARE PROBABLY GOING TO HAPPEN A
LITTLE BIT LATER THAN WERE
PREVIOUSLY ESTIMATED. YOU'LL
ALSO NOTE THAT THERE'S NO UPDATE
FOR THE TIMELINE FOR, UH, THE
WORK OUTSIDE OF MERCY TO
BAKERSFIELD, WHICH CURRENTLY
ISN'T FUNDED. NOW IF YOU TURN TO
PAGE 12, THERE'S A TABLE AND
THIS IS I THINK A REALLY KIND OF
KEY, UM, TABLE TO LOOK AT THIS
COMPARES THE COST ESTIMATES IN
THE 2022 BUSINESS PLANS WHEN
LAST YEAR'S PLAN TO THE 2023
PROJECT UPDATE REPORT AND YOU'LL
NOTICE A FEW KEY THINGS. YOU'LL
NOTICE THAT OVERALL COST
ESTIMATES ARE UP BY 13.4 BILLION
. MOST OF THIS IS IN MERCED TO
BAKERSFIELD. AND THERE ARE A FEW
REASONS FOR THIS. ONE OF THIS IS
THE SCOPE CHANGES I MENTIONED
LIKE THEM OR SAID STATION LIKE
THE COMBINED STOLLER AND
BATTERY. STORAGE SYSTEM. THAT'S
ABOUT 3.9 BILLION. 3.7 BILLION
IS RELATED TO CONTINGENCIES AND
OTHER FACTORS. 2.1 BILLION IS
RELATED TO INFLATION AND TIMING
IMPACTS AND THEN 1.7 BILLION. IS
THOSE SHIFTS AND COSTS RIGHT?
THOSE ONES I TALKED ABOUT BEFORE
THAT WERE PREVIOUSLY KIND OF
COUNTED IN OTHER SEGMENTS AND
MOVED TO MERCED TO BAKERSFIELD.
SO YOU'LL NOTICE THAT MERCED TO
BAKERSFIELD INCREASES IN COSTS
BY ALMOST 50% RELATIVE TO WHAT
THE LEGISLATURE SAW LAST YEAR.
UM THE OTHER BIG CHANGE THAT YOU
SEE IS THAT THERE'S A 3.3
BILLION INCREASED FOR
CONSTRUCTING SAN FRANCISCO TO
SAN JOSE. THAT'S ABOUT A 200%
AND CREATE, UM, PERCENT INCREASE
, BUT YOU'LL NOTICE THAT MOST OF
THE SEGMENTS HAVEN'T BEEN
UPDATED. SO THAT'S ANOTHER KIND
OF KEY THING TO NOTICE HERE. IF
YOU TURN TO PAGE 15, WE
SUMMARIZE, BASICALLY COMPARE THE
FUNDING THAT'S AVAILABLE THAT'S
ESTIMATED TO BE AVAILABLE UNDER
THE PROJECT. UPDATE REPORT. TO
THE ESTIMATED COSTS. AND YOU CAN
SEE HERE THAT THE ESTIMATED COST
OF 35.3 BILLION ARE
SIGNIFICANTLY LOWER THAN THE
FUNDING AVAILABLE, AND THERE'S A
RANGE OF FUNDING, DEPENDING ON
KIND OF WHERE CAP AND TRADE
COMES IN. UM, SO THERE'S.
ESTIMATED TO BE ROUGHLY 10
BILLION, ROUGHLY 10 MILLION TO
12 $BILLION BILLION FUNDING GAP
, DEPENDING ON WHAT THOSE CAP
AND TRADE REVENUES. UM COME IN
AT THE AUTHORITY DOES IDENTIFY A
TARGET OF $8 BILLION IN
ADDITIONAL FEDERAL FUNDS. UM SO
THERE WAS RECENT FEDERAL
LEGISLATION THAT I J A AND I R A
AND THE AUTHORITY HOPES TO GO
AFTER THAT FUNDING. WE NOTE THAT
, UH, THE PROJECT AFTER THE
REPORT DOESN'T IDENTIFY ANY
SPECIFIC FUNDING SOURCES FOR
WORK OUTSIDE OF MERCED TO
BAKERSFIELD. SO IF YOU GO TO
PAGE 17, WE SUMMARIZE SOME OF
THE REVISED RIDERSHIP ESTIMATES
SO THE PROJECT UPDATE REPORT
DOES SHOW REDUCED RIDERSHIP
ESTIMATES. UM 38% DECLINE IN THE
VALLEY TO VALLEY THAT'S THE SAN
FRANCISCO TO BAKERSFIELD SEGMENT
, UM, AND A ROUGHLY 20% DECLINED
FROM SAN FRANCISCO TO ANAHEIM.
THE PHASE ONE WILL NOTICE WILL
NOTE THAT THIS IS PARTLY RELATED
TO A NEW RIDERSHIP MODEL, BUT
ALSO PARTLY JUST AS WAS
REFERENCED. PEOPLE ARE TRAVELING
DIFFERENTLY, AND ALSO THE
STATE'S POPULATION HASN'T GROWN
AS ROBUSTLY AS WAS ASSUMED
ORIGINALLY. UM SO IF YOU TURN TO
PAGE 18, WE SUMMARIZE SOME KEY
ISSUES FOR LEGISLATIVE
CONSIDERATION, AND THEN I'LL
RAISE SOME QUESTIONS THAT FLOW
FROM THOSE THE FIRST ISSUE IS
REALLY THIS BIG FUNDING GAPS. SO
IF THERE'S ONE THING THAT YOU
TAKE AWAY FROM MY COMMENTS THIS
MORNING, THE FUNDING GAP, I
THINK SHOULD BE IT. THERE IS
LAST YEAR. IT LOOKED LIKE WE
BASICALLY BARELY HAD ENOUGH
MONEY POTENTIALLY TO DO MORE
SAID TO BAKERSFIELD. THERE'S
ALWAYS RISK THAT COST WOULD GROW
UP. BUT REALLY, THE ESTIMATES
PUT IT AT ABOUT FULLY FUNDED
THIS YEAR. WE'VE SEEN THE
EMERGENCE OF THIS VERY
SIGNIFICANT FUNDING GAP. AND WE
THINK THAT THERE'S A LOT OF US
THAT COST COULD BE HIGHER AS THE
CHAIR MENTIONED, UM AND THERE'S
A LOT OF REASONS FOR THAT PART
OF IT'S JUST THE NATURE OF THESE
TYPES OF PROJECTS. UM, PART OF
IT IS THAT SOME OF THIS WORK IS
IN EARLY PLANNING STAGES, AND
PART OF THIS IS THAT INFLATION
MIGHT JUST BE MORE PERSISTENT
THAN IS CURRENTLY ASSUMED. UM
ALSO, WE NOTE THAT SOME OF THE G
R F SOME OF THE CAP AND TRADE
DOLLARS THERE ASSUMED MIGHT NOT
MATERIALIZE. THEY MIGHT. THERE'S
JUST A LOT OF UNCERTAINTY. UM SO
THEY'RE PROJECTING THE AUTHORITY
PROJECTS OUT THE RELATIVELY
ROBUST CAP AND TRADE REVENUES
THAT WE'VE SEEN OVER THE LAST
COUPLE OF YEARS THAT THEY'LL
CONTINUE THROUGH 2030. AND
THERE'S A LOT OF UNCERTAINTY
ONCE YOU PROJECT OUT THAT FAR,
PARTICULARLY BECAUSE THE YOU
KNOW AS THE PROGRAM GETS CLOSE
TO KIND OF EXPIRING. IF YOU TURN
TO PAGE 19. WE ALSO HIGHLIGHT
THE UNCERTAINTY ABOUT THE
FEDERAL FUNDS. CERTAINLY WELL
HOPE THE STATE WILL BE VERY
SUCCESSFUL AT SECURING THOSE
FUNDS ON THE LAST COUPLE OF
YEARS. THIS THE AUTHORITY HASN'T
BEEN A SUCCESSFUL UM, AND FOR
EXAMPLE, IN THE LAST TWO YEARS,
IT'S APPLIED FOR AT LEAST 1.6
BILLION IN FEDERAL DOLLARS, AND
IT'S RECEIVED ABOUT 50 MILLION.
SO IT'S A RELATIVELY SMALL
AWARDS WE'VE RECEIVED IN LAST
FEW YEARS. WE KNOW THAT THEY ARE
PLANNING TO SUBMIT ADDITIONAL
GRANT APPLICATIONS, AND THERE'S
JUST THERE'S HOPE THAT THEY WILL
BE SUCCESSFUL, BUT IT'S UNCLEAR
AND THEN, UM, WE ALSO HEAR
IDENTIFY THE ISSUE OF NO PLAN
FUNDING PLAN BEYOND HER SAID TO
BAKERSFIELD. SO, AS MR THOMPSON
MENTIONED, THERE'S A VERY LARGE
FUNDING GAP, DEPENDING ON WHICH
NUMBERS YOU USE. YOU GET
SLIGHTLY DIFFERENT NUMBER, BUT
ESSENTIALLY, YOU KNOW, WE'RE
LOOKING AT THE HIGH TENS ABILITY
OF BILLIONS, IF NOT 100, BILLION
OR OR POTENTIALLY MORE IN TERMS
OF A FUNDING GAP. FOR THAT. UM
PHASE ONE, SO IT'S A LOT OF
MONEY, AND THERE'S NO UM,
CURRENTLY NO SPECIFIC PLAN FOR
HOW THAT WOULD BE FUNDED, AND
THAT'S BEEN AN ISSUE WITH THE
PROJECT FOR MANY YEARS, BUT AS
PROJECT COSTS GO UP, THE ISSUE
BECOMES MORE PRONOUNCED ON PAGE
20. WE DO MENTION THAT THE
REDUCED RIDERSHIP COULD AFFECT
THE PROJECT'S BUSINESS CASE. SO
WE THINK IT WILL AFFECT IF
THERE'S LOWER RIDERSHIP. IT'S
GOING TO AFFECT OPERATING
REVENUES. IT'S GOING TO AFFECT
THE ABILITY TO NOT REQUIRE AN
OPERATING SUBSIDIES, SO THOSE
ARE SIGNIFICANT ISSUES. AND THEN
FINALLY, WE THINK THAT PROJECT
OVERSIGHT CONTINUES TO BE REALLY
IMPORTANT. THIS IS SOMETHING THE
LEGISLATURE DID SOMETHING REALLY
IMPORTANT ABOUT LAST YEAR. SO
THAT TRAILER BILL THAT I
MENTIONED ONE OF THE OTHER KEY
ELEMENTS WAS ESTABLISHING THIS
OFFICE OF INSPECTOR GENERAL AND
REALLY A ROBUST OFFICE A REALLY
INDEPENDENT OFFICE. WE THINK
THAT'S REALLY, REALLY VALUABLE.
IT HAS A LOT OF PROMISE, AND
HOPEFULLY WE'LL START TO SEE THE
BENEFITS OF THAT SOON AS THAT.
INDIVIDUAL AND AS AN OFFICE IS
STOOD UP. SO IF YOU PAID TURN TO
PAGE 21, WE HIGHLIGHT SOME NEAR
TERM QUESTIONS FACING THE
LEGISLATURE AGAIN. LEGISLATURE
TOOK SOME REALLY IMPORTANT
ACTIONS LAST YEAR, BUT BECAUSE
THERE'S THIS BIG FUNDING GAP, WE
THINK THE LEGISLATURE COULD
CONSIDER WHETHER IT WANTS TO
TAKE ANY ADDITIONAL ACTIONS.
THESE ARE SOME OF THE KEY
QUESTIONS WE SUGGEST THE
LEGISLATURE KEEPS IN MIND. ONE
IS IT STILL COMMITTED TO
MERCEDES BAKERSFIELD AGAIN? THAT
WAS THE INTENT EXPRESS LAST
YEAR. BUT GIVEN THIS FUNDING
GAP, WHICH WASN'T THERE LAST
YEAR HAS ANYTHING CHANGED. UM TO
WHAT FUNDING DOES THE
LEGISLATURE WANT TO USE TO FILL
THAT GAP? UM SO THE LEGISLATURE
DOESN'T HAVE TO IDENTIFY FUNDING
TODAY. BUT THEY'RE GOING TO BE
REALLY DIFFICULT CHOICES, SO WE
THINK IT'S WORTH STARTING THAT
CONVERSATION SOONER RATHER THAN
LATER. UM THERE'S GONNA BE NO
EASY FUNDING SOURCE. EVEN IF WE
GET THE FULL EIGHT BILLION
THAT'S NOT GOING TO COVER THIS
FUNDING GAP. SO SOME OF THE
THINGS TO THINK ABOUT OUR
FINANCIAL APPROACH TO BORROW OR
TO USE CASH ON THE FUN SOURCE
AGAIN. THERE'S NO EASY FUN
SOURCE YOU CAN TAKE GENERAL
FUNDS COULD USE MORE OF THE G
RAFF. YOU COULD USE TRIP TRUCK
WAIT, PLEASE, AS A PIECE OF IT,
POTENTIALLY, BUT THERE'S NO EASY
, OBVIOUS SOLUTION, AND ALL OF
THOSE OTHER FUNDING SOURCES HAVE
CALLS ON THEM. THEY'RE ALL USED
FOR OTHER THINGS NOW. AND THEN
YOU COULD THINK ABOUT WHETHER
YOU WANT TO USE EXISTING
REVENUES OR I MEAN, THAT WOULD
POTENTIALLY MEANS SPENDING LESS
MONEY ON OTHER THINGS OR RAISING
NEW REVENUES. UM THEN THE NEXT
QUESTION WE RAISE IS WHETHER THE
LEGISLATURE AGREES WITH THE
ELEMENTS THAT ARE INCLUDED IN
MERCED TO BAKERSFIELD. A LOT OF
THESE ELEMENTS ARE REALLY
CRITICAL. I MEAN, COMBINED
STATION. IT'S PRETTY IMPORTANT
IF YOU ACTUALLY WANT THE SYSTEM
TO WORK. UM SO YOU DON'T WANT TO
GET RID OF THAT. PROBABLY YOU,
PROBABLY, BUT THERE'S A LOT OF
VALUE, PROBABLY TO HAVING TWO
TRACKS RATHER THAN ONE TRACK
WITH JUST PASSING TRACKS. BUT
THERE'S SOME THINGS THAT MAYBE
MAYBE ARE KIND OF MORE NICE TO
HAVE, FOR EXAMPLE, THE SOLAR AND
BATTERY SYSTEM. THAT'S ADDED,
THAT'S SOMETHING THE LEGISLATURE
COULD THINK ABOUT. WELL, IS THAT
IS THAT A PRIORITY OR NOT? UM
THE NEXT QUESTION IS, DOES THE
LEGISLATURE AGREE WITH THE
AUTHORITIES PLANNED ACTIONS
BEYOND VERSATILE BAKERSFIELD? SO
AGAIN? WE DON'T HAVE ENOUGH
MONEY TO DO MORE SAID TO
BAKERSFIELD NOW AND SO I THINK A
KEY QUESTION IS GIVEN THAT
WHAT'S THE LEGISLATURE'S COMFORT
WITH UNDERTAKING ADDITIONAL
ACTIONS OUTSIDE OF THAT SEGMENT?
UM. THE NEXT QUESTION. IF YOU
TURN TO PAGE 23 IS WHETHER THE
LEGISLATURE HAS SUFFICIENT
INFORMATION TO GUIDE ITS
DECISIONS. TO THE EXTENT THE
LEGISLATURE DOESN'T IT COULD
ALWAYS, UM, FIND ADDITIONAL WORK
OR ASK, UM ALL THOSE WHO WORK
FOR THE LEGISLATURE OR ARE
DIRECTED BY THE LEGISLATURE TO
CONDUCT ADDITIONAL WORK. AND
THEN FINALLY, HOW CAN THE
LEGISLATURE PROMOTE THE
EFFECTIVENESS OF THE OF THE
INSPECTOR GENERAL? OBVIOUSLY
REALLY IMPORTANT TO HAVE AN
INSPECTOR GENERAL AND WE WANT TO
MAKE SURE THE INSPECTOR
GENERAL'S AS SUCCESSFUL AS
POSSIBLE AND AS INDEPENDENT AND
IT'S REALLY FULLY RESOURCED. UM
SO THOSE ARE MY COMMENTS HAPPY
TO TAKE ANY QUESTIONS AT THE
APPROPRIATE TIME. THANK YOU VERY
MUCH. WE'RE NOW GOING TO TURN TO
QUESTIONS. UM SO THAT AGAIN, THE
SPIRIT OF THIS IS TO MAKE SURE
THAT THE AUTHORITY HAS ALL OF
THESE QUESTIONS OUT IN FRONT OF
THEM, AS THERE BEEN STARTING TO
RESPOND, SO MEMBERS AND ALL SO
MEMBERS. ARE THERE QUESTIONS
KNOWING THAT YOUR QUESTION
MAYBE. VERY NOT NOT DIRECTLY
ANSWERED RIGHT NOW. BUT I JUST
WANT TO GO THROUGH AND SEE WHAT
QUESTIONS MEMBERS HAVE. MR.
TING, YOU ARE OKAY?
ASSEMBLYMEMBER'S CONNOLLY. THANK
YOU APPRECIATE THE OPPORTUNITY
TO PARTICIPATE, PARTICULARLY AS
A NEW ASSEMBLY MEMBER. AH SO
COMING AT THIS FOR THE FIRST
TIME, ALTHOUGH AS A LOCAL
ELECTED OFFICIALS AS A RESIDENT
OF CALIFORNIA, OBVIOUSLY VERY AH
AWARE OF THE PROJECT, AND, UM,
PROPOSED, I THINK OF SOME OF THE
EARLIER REMARKS HAVE BEEN
SUPPORTIVE, BUT AT THE SAME TIME
RECOGNIZE AH, WE HAVE TO BE
CANDID. WE HAVE TO BE HONEST, WE
HAVE TO BE TRANSPARENT. ABOUT
THIS PROJECT, GIVEN THE OVERRUNS
GIVEN KIND OF THE AMOUNT OF
MONEY AT STAKE, SO IN THAT
SPIRIT HAD SOME QUESTIONS. UM
AND JUST TRYING TO KIND OF
NARROW THESE DOWN. UM AWARE OF
THE RECENT L A TIMES REPORT. UM,
THAT TOUCHED ON A NUMBER OF
ISSUES, BUT IT INCLUDED
QUESTIONS AROUND CONSULTANT
CARS, SO WANTED TO RAISE SOME
QUESTIONS AROUND THAT. RIGHT NOW
. THE L A TIMES REPORTED THAT
THE CONSULTING FIRM W. SP I WAS
GIVEN A NEW $700 MILLION
CONTRACT WITH HIGH SPEED RAIL.
DESPITE THE FACT THAT THEIR
ORIGINAL WORK DEVELOPING THE
ESTIMATE FOR BUILDING AH, PHASE
WINE WAS, UM, ESTIMATED TO BE 12
YEARS FOR $33 BILLION. WE KNOW
THAT ESTIMATE WAS NOW WILDLY
INACCURATE. WHY ARE WE STILL
GIVING ALMOST A BILLION DOLLARS
TO COMPANY WHOSE ESTIMATES HAVE
BEEN SO INACCURATE? MR CHAIRMAN
, IF I COULD ANSWER THAT I'M
BRIAN KELLY, THE CHIEF EXECUTIVE
OFFICER OF THE CALIFORNIA HIGH
SPEED RAIL AUTHORITY. THE SHORT
ENTERING THE QUESTION IS WE'RE
NOT W. S P WAS AWARDED A
CONTRACT BACK IN 2015. FOR THIS
PROJECT. UM I CAME ON THIS
PROJECT IN 2018. W S. P IS NOW
GETTING OFF OF THIS THIS PROJECT
NOW THAT CONTRACT HAS EXPIRED,
AND WE'RE TRANSITIONING AWAY
FROM WSB. HMM. GREAT THE L A.
TIMES ALSO REPORTED THAT THE
ADMINISTRATION AND HIGH SPEED
RAIL WERE UH, FIRMLY COMMITTED
TO BEING LESS RELIANT ON
CONSULTANTS. UH PROFESSIONAL
ENGINEERS IN CALIFORNIA
GOVERNMENT ALSO REMARKED THAT
THE RAIL AUTHORITY WAS MAKING
QUOTE A GRAVE AIR. BY RELYING SO
HEAVILY ON CONSULTANTS. AT THE
TIME OF THE STORY. THERE WERE
470 W SP EMPLOYEES ON THE
PROJECT AND ONLY 100 AND 80 RAIL
AUTHORITY EMPLOYEES I E PUBLIC
EMPLOYEES. HAS THIS DYNAMIC
CHANGED AND HOW RELIANT ON
OUTSIDE CONSULTANTS IS THE
PROJECT AT THIS TIME? I
APPRECIATE THE QUESTION, UH,
WHEN I CAME IN ONE OF THE FIRST
THINGS WE DID WAS STARTED
PROCESS WE CALLED FORM TO
FUNCTION, WHICH WAS TO REVIEW
WHO WAS DOING WHAT FOR THE
AUTHORITY CONSULTANTS VERSUS
STATE STAFF. WHEN I STARTED THE
AUTHORITY WAS 70% CONSULTANT.
AND 30% STATE STAFF. WE'VE GONE
WORKED WITH THE LEGISLATURE OVER
THE LAST SEVERAL BUDGET CYCLES.
AND WE'VE REVERSED THAT. NOT
ENTIRELY. BUT STATE STAFF TODAY
IS ABOUT 55% CONSULTANT STAFF IS
ON THE ORDER OF 45. THIS PROJECT
WILL ALWAYS NEED SOME
CONSULTANTS BECAUSE THE
MAGNITUDE OF THE WORK EXCEEDS
THE ABILITY OF THE CURRENT STATE
STAFF AND HIGH SPEED RAILS AND
NEW THING IN AMERICA AND IN
CALIFORNIA, SO SOME
SPECIALIZATION WILL ALWAYS BE
NEEDED. BUT WE HAVE FLIPPED THE
FLIP THE PROPORTION ON STATE
STAFFERS AS CONSULTANT AND
THAT'S BEEN DONE IN THE LAST
COUPLE OF YEARS. THANKS AND NOT
TO BELABOR THE POINT, BUT
REPORTS SHOW THAT THE AUTHORITY
AT LEAST IN 2010 WAS PAYING
CONSULTANTS. AN AVERAGE OF
$427,000 PER ENGINEER, WHILE THE
STATE'S IN HOUSE ENGINEERS WERE
APPROXIMATELY $131,000 PER
ENGINEER, HAS THIS DISPARITY
BEEN RESOLVED AND HOW MANY
CONSULTANT ENGINEERS AS A
AUTHORITIES STILL USING PRIVATE
SECTOR ENGINEERS TYPICALLY DO
MAKE MORE THAN PUBLIC SECTOR
ENGINEERS, BUT PUBLIC SECTOR
ENGINEERS ARE NO LONGER MAKING
JUST 100 AND 31 THOUSANDS IT'S A
SIGNIFICANTLY ABOVE THAT I DON'T
HAVE IN FRONT OF ME RIGHT NOW.
THE TOTAL NUMBER OF ENGINEERS
FOR EACH THAT WE HAVE, BUT WE
CAN PROVIDE THAT TO YOU. YEAH I
THINK I'D BE INTERESTED IN
SEEING THAT. THE STATE AUDITOR
ALSO NOTED IN HER HIGH SPEED
RAIL AUDIT THAT CONSULTANTS FROM
THE SAME FIRM, NAMELY W SP, WERE
BEING USED TO OVERSEE OTHER
CONSULTANTS, WHICH PRESENTED A
SIGNIFICANT CONFLICT OF
INTEREST. HAS THIS ETHICAL ISSUE
BEEN RESOLVED? I THINK THAT
THAT'S FROM A 2012 AUDIT 11
YEARS AGO, UM AND SO WHEN THAT
AUDIT FIRST CAME OUT, THAT'S
WHAT LED US TO DO WHEN I CAME
IN. TO DO. I'M SORRY, 2018 ON
IT, AND WHEN I CAME IN, WE DID A
THAT'S WHEN WE STARTED THE FORM
TO FUNCTION REVIEW. UH AND SO W
S. P AS THE PRIMARY CONTRACTOR
HAS SUB SUB SUB SOME
SUBCONTRACTORS THAT THEY MANAGE?
UM BUT WHAT WE HAVE GONE THROUGH
AND DONE IS IN THE FORM TO
FUNCTION PROCESS IDENTIFIED.
WHAT'S THE APPROPRIATE ROLE FOR
CONTRACT WORKERS VERSUS STATE
WORKERS? AND I THINK WE'VE
ALIGNED IT MUCH BETTER. TODAY
THERE ARE STILL SUB CONSULTANTS
THAT SERVE GENERAL CONSULTANTS
AND THAT THAT WILL EXIST IN ANY
CONTEXT, BUT I DON'T I DON'T
THINK WE HAVE ANY OBVIOUS
CONFLICTS THAT ARE IN FRONT OF
US RIGHT NOW. GREAT AND THEN UM
AND MAYBE YOU'LL NEED TO GET
BACK TO US ON THIS, BUT CAN YOU
BREAK DOWN THE FUNDING FOR THIS
PROJECT, NAMELY HOW MUCH IS
GOING TO CONSULTANTS AND HOW
MUCH IS ACTUALLY BEING SPENT ON
CONSTRUCTION? CAN YOU QUANTIFY
THIS IN PERCENTAGES? YEAH I
MEAN, I'M HAPPY TO DO. I CAN
COME BACK TO YOU WITH IT. BUT
I'M HAPPY THAT I CAN TELL YOU.
THE BULK OF IT IS GOING TO
CONSTRUCTION BUT HAPPY TO
PROVIDE IT TO YOU LIKE TO SEE
THAT BREAK AND I MAY HAVE MORE
BUT, UH AND AT THIS TIME ANY
OTHER COMMITTEE MEMBERS WITH
QUESTIONS ASSEMBLYMEMBER'S
HEART. RIGHT? THANK YOU. CHAIR
THANK YOU, MR CHAIR. I'M CURIOUS
ABOUT THE POINTS THAT CHAIR
BENNETT MADE AT THE BEGINNING
HIS PRESENTATION ABOUT THE
DIFFERENCES IN THE STRATEGIC
APPROACH OF THE JAPANESE MODEL
USING REAL ESTATE DEVELOPMENT AT
STATIONS, YOU KNOW, AND I
IMAGINE THAT IS USED PRIMARILY
TO SUBSIDIZE OPERATING COSTS.
BUT IS THAT A STRATEGY THAT IS
VIABLE FOR CAPITAL SHORTFALLS?
AND HOW DOES THAT RELATE TO YOUR
STRATEGIC VISION FOR OUR
CALIFORNIA HIGH SPEED RAIL WERE
THINGS WE CAN LEARN THAT CAN BE
APPLIED NOW TO THE DEVELOPMENT
HAS WORD DESIGNING AND BUILDING
THE PROJECT. YES, AND THAT'S IT.
WE ARE JUST AT THE BEGINNING
STAGE OF DESIGNING THE FOUR KEY
STATIONS IN THE CENTRAL VALLEY,
MERCED, KINGS, TULARE, FRESNO
AND BAKERSFIELD. BUT AS WE DO
THAT, AND WE WORK WITH THE LOCAL
COMMUNITIES ON THAT THERE WILL
BE OPPORTUNITIES FOR INCREASED
VALUE OF PARCELS AND LAND AROUND
THE STATION. SOME OF THAT WHICH
WE OWN, AND THERE WILL BE
ABILITY TO WORK WITH THOSE
LOCALS THROUGH THINGS LIKE
INFRASTRUCTURE FINANCE
DISTRICTS, FOR EXAMPLE, OR
SIMILAR MECHANISMS LIKE THAT TO
CAPTURE SOME OF THE VALUE OF THE
LAND BASED ON WHAT WE'RE DOING
THERE AND MAKE IT A REVENUE
GENERATING THING FOR THE FOR THE
FOR THE AUTHORITY. THE OTHER
THING IS SOME OF THE YOU KNOW
OPPORTUNITIES IN THE STATION
ITSELF THROUGH CONCESSIONS
THROUGH NAMING RIGHTS THROUGH
VARIOUS OTHER WAYS THAT YOU CAN
RAISE REVENUE, SO SOME CALL IT
AN ANCILLARY REVENUE. UM I THINK
ON THE VALUE CAPTURE STUFF, IT
COULD BE MUCH BIGGER THAN THAT.
AND SO THERE ARE OPPORTUNITIES
AND WE ARE PURSUING
OPPORTUNITIES IN WORKING WITH
THE CITY IS ON THE DEVELOPMENT
AROUND THE STATIONS AND PART OF
THE STATION TO RAISE REVENUE
THROUGH THAT PROCESS. BUT IT IS
HOW WOULD YOU CHARACTERIZE THAT
IN THE CONTEXT OF THE NUMBERS
THAT WE'RE TALKING ABOUT? IN THE
SHORTFALL IS IT IS A SIGNIFICANT
PERCENTAGE IS HIS DEATH. I DON'T
THINK PERCENT MY SENSE OF IT
SITTING HERE RIGHT NOW, AS I YOU
KNOW, I DON'T THINK IN TERMS OF
IF YOU KNOW WE HAVE IDENTIFIED
THE COST INCREASES FROM WHERE WE
WERE LAST YEAR TO NOW BETWEEN
6.5 AND 9.7 BILLION, AND I DON'T
THINK YOU'RE GONNA RAISE THAT
MUCH REVENUE TO COVER THAT
THROUGH VALUE CAPTURED STATIONS
, BUT YOU CAN RAISE SIGNIFICANT
REVENUE TO OFFSET OPERATING
COSTS AND OTHER THINGS. THROUGH
THOSE CONCESSIONAIRES. THANK YOU
. MAY I ADD SOMETHING TO THAT?
BECAUSE THAT WAS GOOD. I WAS
GONNA SAY, I WOULD LIKE TO HAVE
ALL THE PANELISTS FEEL FREE TO
ADDRESS ANY OF THE QUESTIONS
THAT ARE ARE BROUGHT UP HAVE
EXTENSIVE EXPERIENCE WORKING
WITH JAPANESE NATIONAL RAILWAYS
AND THEN WITH THE SYSTEM LATER
THEY ARE VERY AGGRESSIVE ABOUT
RAISING COMMERCIAL DEVELOPMENT
IN THEIR STATIONS AND OTHER
KINDS OF DEVELOPMENT AROUND THE
STATIONS. BUT I AND IT IS
BENEFICIAL. THEY DO. THEY DO
GENERATE MONEY, BUT IT WILL NOT
BE THE SOLUTION TO THIS PROBLEM
FOR TWO REASONS WHEN I DON'T
THINK IT'S THAT GREAT IN THE
OTHER IS THAT THE LOCAL
AUTHORITIES THAT ARE GOING TO
TRY TO GET THEIR SHARE OF
WHATEVER THE VALUE IS. AND
THAT'S GOOD IN THE OVERALL
ECONOMIC VALUE OF THE PROJECT,
BUT IT WILL NOT MAKE THAT MUCH
OF A CONDEMNED COMMITMENT TO THE
CONSTRUCTION OF THE SYSTEM. AND
I WOULD JUST OFFER MY
OBSERVATION IS THAT THAT'S MUCH
MORE IN IT. OPERATION AND
MAINTENANCE SUBSIDY THAN IT IS A
CAPITAL COST. SUBSIDIES. UM
OTHER QUESTIONS. ASSEMBLY MEMBER
ALL RIGHT, UM ASSEMBLYMEMBER'S
CARILLO. THANK YOU. UM FIRST I
WANT TO SAY THAT I AM SUPPORTIVE
OF PROJECT. THIS IS SOMETHING
THAT CALIFORNIA HAS TO DO. GIVEN
THE FACT THAT OTHER NATIONS ARE
REALLY SUCCESSFUL AND WHAT
THEY'VE DONE, IT WAS MENTIONED
JAPAN THE MODEL IN JAPAN,
SOMETHING I JUST LEARNED WITH
CHAIR BENNETT'S COMMENTS ABOUT
THE TRIP TO JAPAN. HOW JAPAN,
ACTUALLY PARTNER WITH OTHER, UM
SYSTEMS TO MAKE A SUCCESSFUL AND
MAYBE THIS CAN BE AN OPPORTUNITY
FOR US TO SEE HOW WE CAN PARTNER
WITH OTHER ONES. THE REASON I
SAY THAT IS BECAUSE I'M SURE YOU
KNOW DRYLAND IS HERE WHERE HE'S
GOING TO START CONSTRUCTION THIS
YEAR, ACCORDING TO A PRESS
RELEASE. THEY DID THEY ARE
ALREADY OPERATING IN FLORIDA,
AND THEY'RE COMING TO
CALIFORNIA. UM THE. ONE OF THE
QUESTIONS I HAD, AND MAYBE IT'S
GOING TO BE ANSWERED LATER. THE
NEXT PRESENTATION, BUT IF YOU
CAN ONE THING THAT I KEEP
HEARING IS WHY WAS THE DECISION
TO START THE SYSTEM IN THE
CENTRAL VALLEY? IF THIS IS ABOUT
RIDERSHIP, KNOWING THAT THIS WAS
FIRST APPROVED IN 2008? OF
COURSE, WE DIDN'T PREDICT THAT
WE'RE GOING TO HAVE THIS
SHORTAGE OF RIDERSHIP AND
SYSTEMS PUBLIC TRANSIT SYSTEMS
NOW, BUT IT SEEMS LIKE STARTING
THE SYSTEM IN POPULATED AREAS
LIKE L. A SAN FRANCISCO THAT
WOULD ACTUALLY HAVE THE
RIDERSHIP AGAIN. NOT KNOWING
THAT WE WERE FACING WITH THAT WE
CARVE IT AND WITH DECLINING
RIDERSHIP THAT WE HAVE NOW BUT
WHY WAS THE CENTRAL VALLEY AT
THE BEGINNING OF THE PROJECT?
BACK IN 2008, THE STATE OF
CALIFORNIA APPLIED FOR, UM
FEDERAL FUNDS TO DEVELOP THE
PROJECT AND UH, THEY STATES
SUBMITTED FOUR DIFFERENT SITES
FOR APPLICATION OF FUNDING. AND
THE FEDERAL GOVERNMENT CHOSE THE
CENTRAL VALLEY IS THE PLACE TO
START. UM IN PART, I THINK IT
WAS BECAUSE THERE WAS A THOUGHT
THAT THE RIGHT AWAY ISSUES IN
THE CAUSE OF PROPERTY. THERE
MIGHT BE AN EASIER PLACE TO
START THAN ANY MORE EXPENSIVE
AREAS. I ALSO THINK IN MY
RECOLLECTION IS THAT THEY HAD A
VERY CLEAR UNDER CLEAR INTENT TO
GET ECONOMIC DEVELOPMENT GOING
IN WHAT WAS THE DISADVANTAGED
ECONOMIC AREA? AND I THINK THAT
WAS PART OF THE DRIVE FORWARD AS
WELL AS AN AREA THAT IT WAS A
POOR AIR QUALITY BASIN, AND THEY
WANTED TO SEE THE BENEFITS OF
THE PROJECT. START TO HAVE AN
IMPACT THERE. OKAY I THINK IT'S
IMPORTANT TO GIVE THE REASONS
WHY SO THAT PEOPLE KNOW WHAT THE
REASON BEHIND THAT WAS. UM ON
PAGE NINE ON THE REPORT THAT YOU
PROVIDED US THE SECOND BULLET
POINT. THE FOURTH LINE UP, IT
SAYS, UH, THAT IT IS EXPECTED TO
LEASE THE RIGHT OF USE OF ITS
STRUCTURAL THIRD PARTY. UM AND
IT'S LAST YEAR'S TIME WORKING,
UM, POWERS AUTHORITY. DID THAT.
IT SEEMS TO ME THAT WE ARE
PREDICTING MAYBE THAT THE
PROJECT WILL NOT CONTINUE. WE'RE
LOOKING AT LEAST IN THE TRACKS.
FOR THE EXISTING SECTION. WHAT'S
THE REASONING BEHIND THAT? I'M
SORRY. WAS THAT ON MY HAND OVER
TO OUR HANDOUT AND SORRY I WAS I
SKIPPED OVER THAT ONE. BUT I'M
HAPPY TO TALK A LITTLE BIT ABOUT
THAT BULLET. SO, UM, IT'S WHAT
REFERENCES THE AUTHORITIES PLAN
TO USE A THIRD PARTY OPERATOR TO
OPERATE THE MERCED TO
BAKERSFIELD SERVICE ON AN
INTERIM BASIS, AND THE IDEA
WOULD BE THE JOINT POWERS
AUTHORITY. I THINK, ALTHOUGH
I'LL LET THE AUTHORITIES SPEAK
ON ABOUT THE RATIONALE UM, THERE
ARE A COUPLE OF THINGS ONE. THE
JOINT POWERS AUTHORITY ALREADY
OPERATES. THE ACE SERVICE AND
THEY OPERATE. UM UH, AMTRAK
SERVICE. THEY THEY'RE SORT OF
WELL POSITIONED TO PROBABLY
COORDINATE SERVICE BECAUSE
YOU'RE GONNA NEED A LOT OF
COORDINATION THERE AT MERCED. SO
THERE'S SOME LOGIC, PERHAPS TO
THAT. ALSO THERE IS THIS
REQUIREMENT UNDER PROP ONE A
ABOUT THE AUTHORITY NOT
REQUIRING AN OPERATING SUBSIDY.
SO THIS IS ONE SORT OF ONE PART
OF, UM OF ADDRESSING THAT ISSUE
. AS I UNDERSTAND IT IS IF YOU
USE A THIRD PARTY OPERATOR, UM
YOU KNOW, THERE'S PERHAPS A
STRONGER ARGUMENT THAT THE
AUTHORITY ITSELF IS NOT
REQUIRING AN OPERATING SUBSIDY,
BUT I'LL LET THE AUTHORITY JUST
TO BE CLEAR ON THE ON THE INTENT
OF THE BUSINESS MODEL FOR THE
INITIAL MERCED TO BAKERSFIELD
RUN UM, WE ARE PRESENTING. THAT
IS AS FOR THE INITIAL RUN THAT
WE WOULD OWN THE ASSETS AND THEN
AN OPERATOR WOULD LEASE THE
ASSETS AND THE TRAINS TO OPERATE
THE INITIAL SERVICE. SAN
JOAQUIN'S OPERATES THE SERVICE
TODAY. THAT IS THE THAT EXISTS
TODAY. BUT THE OPPORTUNITY HERE
WAS FOR US TO GET GET THE ASSETS
THAT ARE BUILT PUT INTO USE AS
SOON AS POSSIBLE. GET AN
OPERATOR RUNNING ON THAT
ELECTRIFIED HIGH SPEED SERVICE
AND THEN TRANSITION AS WE GET
INTO THE BAY AREA OR SOUTHERN
CALIFORNIA FOR AN OPERATION
THAT'S RUN DIRECTLY BY THE
AUTHORITY THROUGH A CONTRACT
OPERATOR, AND IT'S ALSO NOT I
SHOULD SAY IT'S NOT ENTIRELY
CLEAR. I THINK SAN JOAQUIN'S
THEMSELVES ARE ARE LOOKING
FORWARD, CONSIDERING, UH WHAT
THEY CALL A UNIVERSAL OPERATING
THAT MIGHT OPERATE ALL SYSTEMS
AND IT COULD BE UNDER CONTRACT
WITH THEM. SO THERE'S OPTIONS TO
COME ON THAT. BUT INITIALLY THAT
FIRST BUSINESS MODEL THAT WE'RE
DOING IS OWNING THE ASSETS AND
THE RAIL AND ANOTHER IS
OPERATING. ONE LAST QUESTION IF
YOU CAN EDUCATE ME ON THE
DIFFERENCE BETWEEN THE BRIGHT
AND SCOPE AND THE HIGH SPEED
RAIL, UM SO THAT I CAN
UNDERSTAND IF THERE IS A WAY TO
PARTNER WITH BRIGHT LINE AGAIN
GOING BACK TO THE MODEL FROM
JAPAN, WHERE AGAIN IF BRANDON
STARTS WORKING THIS YEAR, WHICH
THEY SAID THEY WOULD WITH STILL
DON'T THEY STILL HAVEN'T STARTED
WORKING RIGHT? BUT IF THE
OPPORTUNITY TO PARTNER WITH
BRIAN AND BEING A PRIVATE ENTITY
OBVIOUSLY SEEN THE MARKET IN
CALIFORNIA TO BE SUCCESSFUL FOR
THEM BASED ON THEIR MODEL OF YOU
KNOW WHERE THEY'VE BEEN REVENUE
OR WHATEVER THE CASE MAY BE, BUT
THEY ARE WILLING TO COME TO
CALIFORNIA. TO TAKE PEOPLE TO
VEGAS, WHICH ARE INTERNATIONAL.
UM, THERE WAS DESTINATIONS.
WHAT'S THE DIFFERENCE BETWEEN
THE BRIDE AND MORAL, THE HIGH
SPEED RAIL AND IF THERE IS THERE
AN OPPORTUNITY TO PARTNER TO
MAKE THIS SUCCESSFUL? I
APPRECIATE THE QUESTION. UM THE
FIRST THING I NEED TO BE VERY
CLEAR ON. IS THAT EVERYTHING WE
DO? AT THE AUTHORITY. THE
ALIGNMENT WE CHOOSE THE
TECHNOLOGY WE PICK. IS GUIDED BY
STATUTE, EVERYTHING WE DO THE
PROPOSITION ONE A BOND BILL.
LAID OUT PRETTY MUCH THE
ALIGNMENT. FOR WHAT? WHAT WE
WOULD WHAT WE WOULD PUT INTO
PLACE AND THAT ALIGNMENT WAS THE
NORTH SOUTH ALIGNMENT CONNECTING
SAN FRANCISCO TO ANAHEIM. YEAH
AND IT HAD TO GO THROUGH THE
CENTRAL VALLEY CITIES, UM, AND
THAT IT HAD TO MEET MANY
PERFORMANCE CRITERIA THAT
REQUIRED ELECTRIFICATION. AND SO
THAT'S THE REALITY OF WHAT WE
OPERATE IN. THAT'S THE BOX WE
OPERATE IN TODAY. THAT'S WHAT
THE VOTERS OF CALIFORNIA
APPROVED. THE PROJECT THAT IS
THE COMING BRIGHT LINE PROJECT
BETWEEN SOUTHERN CALIFORNIA AND
LAS VEGAS HAS A LITTLE BIT OF A
DIFFERENT STATUTORY HISTORY. I
RECALL AND THIS JUST GOES BACK
TO I THINK SOMEWHERE AROUND 2006
. THERE WAS A BILL PASSED THAT
AUTHORIZED THE THEN SECRETARY OF
TRANSPORTATION FOR THE STATE OF
CALIFORNIA TO PROVIDE RIGHT OF
WAY FOR A PASSENGER RAIL SYSTEM
THAT WOULD USE THE I 15 CORRIDOR
TO CONNECT CALIFORNIA WITH, UM
UH, WITH LAS VEGAS. UM AND BUT
BUT THAT ALIGNMENT WAS NOT WAS
NOT ALL LAID OUT IN THE STATUE
LIKE OURS IS, HOWEVER. UH AT
THAT TIME THERE IS A DIFFERENT
ENTITY CALLED DESERT EXPRESS
WEST. THAT WAS, UH, GOING
THROUGH A PROCESS OF APPROVAL TO
DO THAT PROJECT AND OVER TIME,
IT'S NOW IT'S GONE THROUGH THEM
AND VIRGIN AND NOW IT'S BRIGHT
LINE TO RUN A RANCHO CUCAMONGA
TO, UM LAS VEGAS STRETCH ALONG
THE I 15 CORRIDOR. AND ONE OF
THE KEY DIFFERENCES BETWEEN WHAT
THEY'RE DOING AND WHAT WE'RE
DOING. I MEAN, I'M HAPPY THAT
NOW THEY'RE AT A PLACE TO DO
ELECTRIFIED HIGH SPEED RAIL
BECAUSE THAT WAS A QUESTION FOR
AWHILE, BUT NOW THAT'S THE
PROPOSAL. THEY HAVE NOT HAD TO
DEAL WITH PRIVATE RIGHT AWAY
ISSUES BECAUSE THE STATE OF
CALIFORNIA HAS PROVIDED THEM
RIGHT AWAY. UM THEY HAVE NOT HAD
TO DO A FULL BLOWN SECRET OR
NIPAH DOCUMENT BECAUSE IT'S AN
INTERSTATE PROJECT. UM AND THEY
WILL NEED LIKE ANY OPERATOR WILL
NEED US THEM OR ANYBODY IN
AMERICA WHO WANTS TO BUILD A
HIGH SPEED PROJECT. THEY WILL
NEED FEDERAL FUNDING, AND THEY
WILL BE APPLICANTS FOR FEDERAL
FUNDING THIS YEAR. SO WHILE
THEY'VE BEEN PRIVATE BEFORE
THEIR BUSINESS MODEL IS CHANGING
A BIT TO BE SUCCESSFUL, SO I
EXPECT THERE'LL BE APPLYING NOW.
ALL OF THAT SAID I THINK THERE
ARE VERY GOOD OPPORTUNITIES FOR
US TO DO SOME THINGS TOGETHER,
FOR EXAMPLE, THAT WE WOULD
LIKELY BE THE FIRST TO ENTITIES
IN AMERICA THAT WE TRY TO
PROCURE ELECTRIFIED HIGH SPEED
TRAINS, AND THERE MAY BE GREAT
EFFICIENCIES AND ECONOMIES OF
SCALE IF WE DO THAT TOGETHER,
AND THAT MAY BE A BETTER WAY TO
MOVE THE MANUFACTURING OF
ELECTRIFIED HIGH SPEED TRAINS.
TO AMERICA BY HAVING IT BE A
BIGGER PROCUREMENT THAT WE BOTH
MAY MAY UNDERTAKE, SO THERE'S
OPPORTUNITIES THERE. THERE'S
INTEROPERABILITY OPPORTUNITIES.
WE'VE ENTERED AN MOU WITH THEM
TO MAKE SURE WOULD WORK ON
THINGS LIKE PLATFORM HEIGHTS AND
TRACK GAUGE AND THINGS LIKE
THAT. THAT WOULD BE
INTEROPERABLE. AND SO THERE'S
OPPORTUNITIES THERE AND THE BIG
ONE FOR US, I THINK IS THE
ABILITY TO CONNECT. INITIALLY
WITH A SERVICE AT THE IN THE
PALMDALE LOCATION, BECAUSE
THEY'RE GOING EAST TO WEST FROM
L. A TO VEGAS THROUGH
VICTORVILLE. NOW IT MAY MAKE
SENSE TO GO TO PALMDALE, WHERE
WE INTEND TO STOP AND HAVE A
STATION CONNECTION THERE SO THAT
THEY CAN MOVE PEOPLE FROM BOTH
NORTHERN CALIFORNIA AND L. A
EASTERN NEVADA AND SO THOSE ARE
ALL THINGS THAT ARE KIND OF DOWN
THE ROAD THAT ARE POSSIBLE, BUT
THERE ARE THERE ARE
OPPORTUNITIES FOR THE TWO
SYSTEMS TO COMPLEMENT ONE
ANOTHER. THANK YOU FOR THAT. ONE
LAST, UM ALMOND OR QUESTION ON
THE LAST TWO PAGES. AND WERE YOU
ASKING WHAT THE LEGISLATURE
WOULD LIKE TO DO? UM FOR ME
PERSONALLY. SPEAKING FOR MYSELF.
I WOULD LIKE TO SEE THAT PHASE
ONE BEING COMPLETED. THERE WAS
AN ARTICLE ON CALL MARTYRS ABOUT
HOW IT WOULD BE MORE EXPENSIVE
DO NOT COMPLETE HIGH SPEED RAIL.
AND I READ THE ARTICLE. BUT I
THINK IT'S BECAUSE OF THE
SIGNIFICANT INVESTMENT THAT HAS
BEEN DONE ON WHAT'S ALREADY
THERE. THE INFRASTRUCTURE UM,
THE YOU AGREE WITH THAT ARTICLE
THAT IT WOULD BE MORE EXPENSIVE
IF THE PROJECT IS NOT COMPLETED.
MAN I THINK I WOULD SAY IT THIS
WAY. UM ONE UH, EVEN WITH THE
YOU KNOW, COST IMPACTS THAT WE
ARE SEEING, AND EVERYBODY IS
SEEING FROM INFLATION AND OTHER
FACTORS. UM OUR COSTS HERE ARE
IN LINE WITH INTERNATIONAL HIGH
SPEED RAIL COSTS. THAT'S ONE.
SECONDLY IF YOU ARE TRYING TO
GET THE SAME CAPACITY FROM YOUR
TRANSPORTATION SYSTEM THAT WE
ARE OFFERING THROUGH HIGHWAY
WIDENING AND AIRPORT EXPANSIONS
, YOU WOULD SPEND A LOT MORE
THAN YOU'RE GOING TO SPEND DOING
WHAT WE'RE DOING. THANK YOU, MR
CHAIR. NO MORE QUESTIONS. THANK
YOU. ASSEMBLYMEMBER'S JACKSON.
THANK YOU VERY MUCH, MR CHAIR.
UM I WAS A LOT HAPPIER WALKING
IN TODAY. UM. HOW MUCH OF OUR
GENERAL FUND IS BEING ALLOCATED
IN THIS BUDGET TOWARDS THIS
PROJECT IS ANY GENERAL PHONE? IT
WAS ALL BOND, CORRECT. IT THE
TUESDAY AND FEDERAL FUNDING AND
GIRAFFE SO THE MAIN SOURCES OF
FANS ON THE STATE SIDE OR THE
PROP ONE A BONDS, WHICH THE
VOTERS APPROVED THAT WAS A
GENERAL OBLIGATION BOND AND THEN
ABOUT 25% OF THE STATE'S CAP AND
TRADE DOLLARS ARE CONTINUOUSLY
APPROPRIATED TO THIS PROJECT, SO
THE PROJECT IS RECEIVING
SIGNIFICANT FUNDING FROM THAT
SOURCE, AND THE AUTHORITY
ASSUMES THAT IT WILL RECEIVE
BETWEEN 750 A BILLION DOLLARS A
YEAR THROUGH 2030 FROM THAT
SOURCE. SO THAT'S THE MAIN AND
THAT SOURCE ALSO SUPPORTS A
VARIETY OF OTHER OTHER
ACTIVITIES AS WELL. SO EVEN
THOUGH WE ARE SEEING, UM, A
LARGE AMOUNT OF ADDITIONAL
UNANTICIPATED COST. IT IS STILL
NOT SOMETHING IT IS STILL WITHIN
THE. UM FUNDING STREAMS THAT ARE
NOT AFFECTING THE OVERALL
FINANCES OF THE STATE. WELL SO
TO SOME EXTENT. OH, SORRY, WOULD
YOU? UM SO TO SOME EXTENT, UM,
MONEY IS FUNGIBLE, SO I YOU
KNOW, IT DOES THE EMPTY THE
EXTENT THAT WE SPEND, FOR
EXAMPLE, GREENHOUSE GAS
REDUCTION FUND DOLLARS ON THIS
PROJECT. THOSE ARE DOLLARS THAT
AREN'T BEING USED FOR OTHER
ACTIVITIES, SOME OF WHICH WE
FOUND WITH THE GENERAL FUNDS. UM
AND THAT THE G R F IS A PRETTY
FLEXIBLE FUNDING STREAM. SO UM,
IT'S ONE THAT CAN BE USED FOR A
LARGE VARIETY OF PROJECTS. SO I
WOULD I THINK THAT THERE'S
CERTAINLY IS A TRADE OFF BETWEEN
USING G D F FOR THIS AND OTHER
PRIORITIES. UM, AND THEN PROP
ONE A. UM, WELL, THAT'S A
GENERAL OBLIGATION BOND. WE DO
REPAY THAT BOND, UM, WITH WITH
OTHER REVENUE STREAMS, AND WE'VE
BEEN USING AGAIN. WE TRACKWAY
FEES OFFSET SOME OF THE GENERAL
PHONE COSTS ASSOCIATED WITH THAT
, BUT THE EXTENT WE USED TRUCK
WEIGHT FEES FOR THAT AGAIN,
THEY'RE NOT AVAILABLE FOR OTHER
THINGS. SO, UM, I THINK IT'S
THERE THEY ARE. CERTAINLY STATE
REVENUE SOURCES THAT HAVE TRADE
OFFS ALREADY THAT WE ARE USING
FOR THIS PROJECT, EVEN IF IT'S
NOT DIRECT GENERAL PHONES AND
THAT'S I KNOW A LITTLE BIT
COMPLICATED. UM BUT, UM, I THINK
IT'S AN IMPORTANT PART OF THE
STORY BECAUSE I THINK SOMETIMES
PEOPLE FOCUS ON OH, THERE'S NO
GENERAL FUND THAT'S DIRECTLY
GOING TO THIS. BUT THERE ARE
SOME OTHER IMPORTANT STATE
FUNDING SOURCES. OBVIOUSLY
THAT'S IMPORTANT IN TERMS OF THE
FACT THAT IT IS TAKING UP ROOM
FOR US TO ADDRESS OTHER
PRIORITIES THAT WE COULD
ACTUALLY LITERALLY MAKE AN
IMPACT WITH RIGHT BECAUSE AT THE
END OF THE DAY WHEN WE GO BACK
TO OUR CONSTITUENTS AND TALK
ABOUT, YOU KNOW. WELL WHAT HAVE
WE ACCOMPLISHED WITH THE
DECISIONS THAT WE'VE MADE? THIS
IS A TOUGH ONE. RIGHT IN TERMS
OF WHAT WE'RE TRYING WHAT THE
ORIGINAL VISION WAS WHEN IT
COMES TO THIS. SECONDLY, WHAT.
IT IS OBVIOUSLY HARD DECISIONS
NEED TO BE. EXCUSE ME.
ASSEMBLYMEMBER'S BEFORE YOU GO.
I JUST I THINK MR KELLY WANTS TO
ADDRESS YOUR FIRST QUESTION.
ALSO NÓI JUST TO PROVIDE MONIN
SORRY. JUST. JUST TO PROVIDE THE
SOME HISTORICAL CONTEXT OF THIS
WHEN THE GR R F DOLLARS WERE
ASSIGNED TO THIS PROJECT. UM
ABOUT 40% OF THE DOLLARS WERE
ASSIGNED TO VARIOUS
TRANSPORTATION RELATED THINGS ON
THE ON THE NOTION THAT ABOUT 40%
OF GREENHOUSE GAS EMISSIONS CAME
FROM THE TRANSPORTATION SECTOR.
AND SO THERE'S MONEY FOR TRANSIT
OPERATING. THERE'S MONEY FOR
TRANSIT CAPITAL AND THERE'S
MONEY TO ADVANCE THIS PROJECT. I
JUST SAY THAT THERE IS NO
PROJECT ANYWHERE IN AMERICA THAT
IS MOVING ALONG AND CONSTRUCTING
HIS CLEAN AS WE ARE. R G H G F
OFFSETS FOR OUR CONSTRUCTION IS
NOT COMPARABLE TO ANYBODY ELSE
IN TERMS OF WHAT WE ARE
ACHIEVING, AND THE ULTIMATE GHD
OPPOSITES FROM OUR OPERATIONS.
ONCE WE'RE IN FULL OPERATIONS
WILL BE HUGE. IN TERMS OF
VEHICLE MILES REDUCED AND A
NUMBER OF CARS TAKEN OFF THE
ROAD. SO, UM YOU KNOW, WE THINK
THE OVERALL GHG IMPACT FROM WHAT
WE'RE DOING IS WORTHY OF THAT
INVESTMENT AND EVEN IN
CONSTRUCTION, LET ALONE ONCE
WE'RE IN OPERATIONS. WE PUT OUT
A SUSTAINABILITY REPORT EVERY
YEAR THAT GOES THROUGH THIS AND
AGAIN HAPPY TO HAPPY TO TALK
MORE ABOUT THOSE SPECIFICS. WELL
I MEAN, OBVIOUSLY, THAT BRINGS
UP THE IDEA THAT YOU KNOW. EVEN
WITH THIS FIRST SEGMENT, RIGHT?
CAN WE REALLY GIVE A COMPLETION
DATE. YEAH I MEAN, THE ISSUE.
YOU KNOW, WE WILL BE DONE WITH
119 MILES, BUT 2026 WOULD BE
TESTING TRAINS BY 2028. ASSUMING
IS BLUE AND L A AND WE HAVE BEEN
SAYING FOR YEARS FUNDING HIS
STABILIZED, WE THINK WILL BE IN
OPERATIONS IN THE WINDOW BETWEEN
2030 AND 33 FOR THE MERCEDES
BAKERSFIELD STRETCH. AND SO IT'S
AFTER THAT THEY REMAINDER OF
THAT PHASE THAT IS BEGINNING IS
IN QUESTION CORRECT IN TERMS OF
ADDITIONAL FUNDS NECESSARY, NO
QUESTION, AND THAT'S BEEN THE
CASE INTO THE BOND BILL PATH. I
MEAN, JUST AGAIN TO PROVIDE
CONTEXT. WHEN THE BOND BILL
PASSED IN 2008, THE VOTERS PUT
NINE BILLION UP FOR A PROJECT
PROPOSED TO COST 45 BILLION. IN
THE VOTER PAMPHLET, AND SO IT'S
NEVER BEEN A FULLY FUNDED
PROJECT. IT IS STILL NOT A FULLY
FUNDED PROJECT AND WE ARE, YOU
KNOW, SINCE I'VE BEEN HERE WE'VE
BEEN FOCUSED ON GETTING THE 1 19
DONE FIRST, WHICH WE ALL THE
FEDERAL GOVERNMENT FOCUS.
GETTING OUR ENVIRONMENTAL
DOCUMENTS DONE, WHICH WERE
ALMOST FINISHED WITH AND THEN
GETTING THE FIRST OPERATIONAL
RUN, WHICH WE THINK BASED ON
WHERE IT STARTED. WHERE THE
ASSETS ARE AND WHERE YOU CAN GET
A BANG FOR THE BUCK. IT SHOULD
BE THE MERCED TO BAKERSFIELD
RUN. ARE THERE ANY ADDITIONAL.
ARE THERE HARD DECISIONS FOR US
AS A LEGISLATURE THAT WE NEED TO
MAKE? MAY I RESPOND TO THAT?
BECAUSE THE REASON WHY WE
EMPHASIZED THAT YOU SHOULD STEP
BACK AND LOOK AT THE ENTIRE
PROJECT NOW? IS BECAUSE THIS IS
NOT THE PROJECT THAT WAS SEEN IN
PROP. ONE A THE COSTS ARE MUCH
HIGHER THE SCHEDULE AS MUCH
LONGER THE DEMAND IS LESS THIS
DOES NOT MEAN THAT IT ISN'T A
GOOD PROJECT. THAT JUST MEANS
IT'S NOT THE SAME PROJECT AND
YOU SHOULD STEP BACK AND SEE
WHAT YOU'RE GETTING FOR YOUR
MONEY. AND YOUR QUESTION ABOUT
TRADE OFFS IS EVEN MORE SERIOUS
NOW THAN IT WAS IN 2008. AND YOU
REALLY DO NEED TO TAKE THIS NEW
PERSPECTIVE BEFORE YOU SAY WE
REALLY ARE GOING TO DO THE
PROJECT. BECAUSE I THINK THAT IS
THE KEY TO THE SECOND PIECE,
WHICH IS, IF WE REALLY WANT TO
DO THE PROJECT. WHERE ARE WE
GOING TO GET THE MONEY? AND YOU
CAN'T MAKE THAT DECISION. WELL
UNLESS YOU KNOW FOR SURE THIS IS
WHAT WE REALLY WANT TO DO. THE
SECOND POINT I WANT TO MAKE IN
THIS DISCUSSION IS THAT THIS
SHOULD NOT BE SEEN AS A
GREENHOUSE GAS PROJECT. IT WILL
HAVE A GREENHOUSE GAS EFFECT.
YES BUT IT'S NOT THAT IMPORTANT
IN THE CONTEXT OF CALIFORNIA'S
GREENHOUSE GAS EMISSIONS,
ESPECIALLY WHEN YOU REALIZE THAT
WE'RE GOING TO HAVE ELECTRIC
CARS, WHICH WILL BE USING THE
SAME ELECTRICITY IN THE IMPACT
OF THE SHIFT ON GREENHOUSE
GASSES WILL NOT BE AS GREAT AS
IT WAS APPEARED TO BE FROM AIR.
YES, BUT THE MAIN SOURCE OF
DEMAND OF AUTOMOBILES WILL NOT
HAVE THE SAME IMPACT. SO THINK
ABOUT WHAT WE'RE DOING. FIT AND
MAKE SURE THIS IS WHAT WE WANT
TO DO. AND WE'RE NOT SAYING IT.
WE WON'T REACH A POSITIVE
CONCLUSION. BUT WE REALLY SHOULD
DO THAT NOW. BECAUSE OF THE
DIFFICULTY OF THE DECISIONS THAT
THAT YOU IDENTIFIED. OBVIOUSLY
THIS IS NO LONGER A BUDGET YEAR
OR MAYBE IN THE FORESEEABLE
FUTURE WHEN WE START THINKING
ABOUT THE UPS AND DOWNS OF OUR
ECONOMY. THIS IS NO LONGER A
DISCUSSION OF WHETHER THIS IS A
GOOD OR BAD PROJECT ANYMORE.
THIS IS A DISCUSSION ABOUT WHAT
SHOULD BE PRIORITIZED. RIGHT?
AND SO FOR ME, THERE'S NO DOUBT
THIS IS A GOOD PROJECT. BUT IN
TERMS OF CAN WE GET MORE BANG
FOR OUR BUCK IN TERMS OF OTHER
MONEY THAT WE COULD BE SPENDING
ON OTHER THINGS RIGHT AND
WHETHER THIS IS, UH CAN WE
ACTUALLY BELIEVE PROVIDE MORE
RELIEF TO OUR CONSTITUENTS BY
INVESTING IN OTHER PROJECTS THAT
HAS A GREATER RETURN ON
INVESTMENT OR A QUICKER RETURN
ON INVESTMENT FOR THE AMOUNT OF
FUNDS THAT WE HAVE AVAILABLE.
ANY COMMENTS ON THAT. I THINK
THAT'S AN EXTREMELY IMPORTANT
QUESTION, ESPECIALLY AS THE
STATE IS STARING DOWN
POTENTIALLY DEFICITS IN YEARS TO
COME, AND REALLY AS THIS PROJECT
FUNDING GAP HAS GROWN QUITE
SUBSTANTIALLY, EVEN IN THE LAST
YEAR, AND I THINK AS MR TRUMP,
YOU KNOW, MR THOMPSON POINTED
OUT THERE IS A QUESTION ABOUT
OKAY IF WE IF WE WERE TO JUST
STOP AT MERCED TO BAKERSFIELD,
WHICH AGAIN THERE'S A FUNDING
GAP FOR THAT. BUT SAY, SAY, WE
FIND THE MONEY. WE DO THAT. IS
THE LEGISLATURE COMFORTABLE WITH
THAT? IS THAT GOING TO PROVIDE
ENOUGH BENEFITS TO JUSTIFY THAT
COST? UM IF NOT THE LEGISLATURE,
COMFORTABLE FUNDING YOU KNOW,
VALLEY TO VALLEY OR PHASE ONE.
WE'RE LOOKING AT AGAIN. PROBABLY
SOMETHING IN THE ORDER OF AT
LEAST 80 BILLION, PROBABLY
SIGNIFICANTLY MORE THAN THAT, IN
TERMS OF FUNDING GAP, SO THERE'S
NO EASY FUNDING STREAM TO COME
UP WITH THAT KIND OF MONEY, SO
IT'S GOING TO REQUIRE REALLY
TOUGH CHOICES TO COME UP WITH
THE KIND OF MONEY THAT WE'RE
LOOKING AT TO REALLY COMPLETE.
PHASE ONE, MUCH LESS TO GET DOWN
TO SAN DIEGO OR, UM, GO BEYOND
THAT, WHICH I THINK IS, YOU
KNOW, AND MANY PEOPLE'S DREAM,
YOU KNOW, THAT'S WHAT WE WOULD
DO. UM, SO I THINK THAT'S THAT'S
REALLY A VERY DIFFICULT
FUNDAMENTAL CHOICE FOR THE
LEGISLATURE. NOT JUST IS THIS A
GOOD PROJECT, BUT IS THIS A GOOD
ENOUGH PROJECT TO PRIORITIZE IT
ABOVE THE VARIETY OF OTHER
REALLY IMPORTANT THINGS THAT ARE
COMING BEFORE YOU, SOME OF WHICH
MAY END UP GETTING CUT THIS YEAR
AND NEXT YEAR AND THE YEAR AFTER
. AND YOU KNOW WE CAN'T ANSWER
THAT FOR YOU. THAT'S A PRIORITY
QUESTION. UM BUT IT'S A
DIFFICULT PRIORITY QUESTION.
YEAH I WANNA DAD. UM, THE SECOND
RECOMMENDATION THAT WE MADE IS
THAT YOU? PUT TOGETHER A
COMPREHENSIVE SOURCE OF WHAT THE
MONEY MIGHT BE AND WHAT THE
SOURCES ARE AND HOW THEY MIGHT
ADD UP. DISCUSSING THEM IN THE
ABSTRACT ISN'T GOING TO GET US
ANYWHERE. YOU NEED A GOOD, SOLID
LIST OF THE VARIOUS THINGS LIKE
IF YOU EXTEND AND GREENHOUSE GAS
THEY CAMP AND TRADE TO 2050.
THAT IS X DOLLARS. WHAT ARE THE
VARIOUS SOURCES AND WHAT ARE THE
TRADE OFFS AND WE CAN'T DISCUSS
THEM IN THE ABSTRACT REALLY NEED
A GOOD SOLID LIST IN FRONT OF
YOU, MR THOMPSON, PLEASE DON'T
ASK US TO BE RESPONSIBLE. THAT
IS JUST THAT. YEAH WE DON'T WANT
TO ASK TO ASK YOU TO LEAVE.
OKAY, WE REALLY NEED TO THAT'S A
HARD THING FOR US TO DO. UM LET
ME SAY THIS. I MEAN THIS IS MY
FIRST HEARING ON THIS RIGHT? I'M
NOT SAYING I'M PREPARED TO MAKE
A DECISION OR HAVE THE ANSWERS
TO MY OWN QUESTIONS, RIGHT. BUT
THE IDEA IS CLEARLY THAT THERE'S
SOME RED FLAGS. AND WE'VE GOTTA
STOP PUSHING THIS. FROM ONE
SESSION TO THE NEXT, HOPING IT
JUST WORKS OUT. RIGHT AND SO, UM
I JUST THINK THAT AT THE END OF
THE DAY WE WE'VE GOT TO START
REALLY DIGGING DOWN INTO WHAT
DECISIONS AND THEY NEED TO BE
MADE. AND IF WE'RE NOT WILLING
TO MAKE THOSE DECISIONS, THEN IN
A RESPONSIBLE WAY IN A
COMPREHENSIVE WAY. UH THEN WE
NEED TO START THINKING ABOUT
WHAT'S A BETTER RATE OF OUR
RETURN. BECAUSE I DON'T THINK
HISTORY IS GONNA JUDGE US WELL.
ON THIS PROJECT AS THE WAY WE'RE
MAKING DECISIONS RIGHT NOW. MAY
I, MR CHAIRMAN. ABSOLUTELY I
APPRECIATE IT. UM, JUST ONE
THING I WANT TO BE BE REALLY
CLEAR ON. THERE IS NO
DISAGREEMENT BETWEEN L. A. OH
THE PRG AND THE HIGH SPEED RAIL
AUTHORITY ON WHETHER OR NOT WE
SHOULD DO MERCED AND BAKERSFIELD
IN STOP. I MEAN, AT LEAST FROM
MY PERSPECTIVE, WE ARE NOT
PROPOSING IT AS THE END OF THE
PROJECT. WE'RE PROPOSING IT AS
THE FIRST PART OF THE PROJECT.
AND THE REASON WE'RE DOING THAT.
IS AS WE TALKED ABOUT THE
FEDERAL GOVERNMENT GAVE
CALIFORNIA BACK IN, OH, NINE AND
10. $3.5 BILLION TO GET STARTED
IN THE CENTRAL VALLEY ON 119
MILES SEGMENT. THAT IS NOT A
GOOD OPERATIONAL RUN. IT IS
BETWEEN MADEIRA IN A PLACE
CALLED POPLAR AVENUE. AND WHAT
GOVERNOR NEWSOM CAME IN AND DID
AND WHEN WE TALKED TO THE
LEGISLATURE ABOUT LAST YEAR WAS
EXTENDING THAT SEGMENT FROM 119
MILES TO 171. SO THAT WE HAD AN
OPERATING SEGMENT THAT MADE SOME
SENSE. AND THAT'S WHAT WE
PROPOSED LAST YEAR NOW IT'S VERY
HUMBLING TO COME BEFORE YOU NOW
AND BRING YOU A PROJECT UPDATE
REPORT AT THE TIME THEY WERE AT
THE 40 YEAR HIGH OF INFLATION
AND SAY TO YOU, IT'S GOING TO
COST MORE. JUST LIKE EVERY OTHER
TRANSIT PROJECT IS FACING IN
CALIFORNIA RIGHT NOW, WE ARE NOT
IMMUNE FROM THOSE CHALLENGES. SO
WE PRESENTED A REPORT THAT SAYS
WE HAVE INFLATION COSTS. WE HAVE
HIGHER RISK COSTS THAT WE ARE
ACKNOWLEDGING AND PUTTING IN OUR
BUDGET. UH AND WE HAVE SCOPE
COSTS BECAUSE WE'VE DEFINED THE
SCOPE MUCH BETTER. THE OTHER
THING I JUST WANT TO BE CLEAR ON
AND THIS IS MAYBE A DIVIDE
BETWEEN LEO AND THE AUTHORITY.
WHAT I'M PROUDEST OF IN THE FIVE
YEARS THAT I'VE BEEN HERE IN THE
WORK I'VE DONE ON THIS PROJECT
AND WE HAVE DONE ON THIS
PROJECT. IS THAT WE HAVE LEARNED
ALL THE LESSONS THAT WERE NOT
LEARNED BEFORE WE GOT HERE. AND
THAT MEANS FUNDAMENTALLY, YOU
GET INTO CONSTRUCTION TOO EARLY
BEFORE YOU'RE READY. YOU DIDN'T
HAVE THE RIGHT AWAY. DONE YOU
DIDN'T HAVE DESIGN DONE. YOU
DIDN'T HAVE UTILITIES. MOVED.
OKAY TODAY, 100% OF THE DESIGN
IS DONE. 98% OF THE UTILITY OR
THE 96% OF THE RIGHT AWAY IS
DONE. AND WE HAVE A BETTER, MUCH
BETTER DEFINITION OF WHAT'S IN
FRONT OF US. SO WE FEEL LIKE
WE'RE CLOSING THE DOOR ON THE
BIG CHALLENGES OF THE 1 19, AND
WE'RE FOCUSING ON HOW TO DO IT.
RIGHT GOING FORWARD. WE'RE
PUTTING THE LESSONS LEARNED INTO
PRACTICE AND WHAT I MEAN BY THAT
IS, FOR EXAMPLE, WE ARE NOT
WAITING TO ADVANCE DESIGN LATER.
WE'RE DOING IT NOW. SO TODAY
WE'RE IN CONSTRUCTION ON THE 1
19, AND WE'RE IN DESIGN NOW ON
GETTING TO BAKERSFIELD IN
GETTING TO MERCED. WE'RE IN
DESIGN NOW ON THE FOUR STATIONS
THAT WOULD MAKE UP THAT SYSTEM.
THAT IS HOW YOU IDENTIFY RISK
EARLIER MITIGATE THAT RISK
EARLIER AND NOT HAVE A REPEAT OF
THE COST OVERRUNS THAT WE'VE
BEEN DEALING WITH. SO TO ME,
IT'S BEEN FIVE YEARS OF TRYING
TO CLOSE THE DOOR ON THAT PAST
AND DO A FUTURE THAT'S CLEAR,
BETTER AND SMARTER AND CANDIDLY.
I THINK WE'RE BEING SUCCESSFUL
AT THAT. SO IT'S WE'RE ALMOST
DONE WITH THE 1 19 STRETCH, AND
WE'RE LOOKING FORWARD NOW TO
MOVING FORWARD IN THE RIGHT WAY
ON WHAT'S IN FRONT OF US. BUT
ALL OF THAT SAID IT IS ALSO TRUE
THAT TO BUILD A HIGH SPEED RAIL
SYSTEM FROM SAN FRANCISCO TO LOS
ANGELES AND ANAHEIM AND REDUCE
THAT TRAVEL TIME FROM WHAT IS A
12 HOUR TRAIN RIDE TODAY TO
ABOUT THREE HOURS WILL WILL TAKE
A LOT MORE MONEY IN TIME IT WILL
TAKE BETWEEN 100 AND 100 AND $30
BILLION TO BUILD THAT. THAT WE
SAID THAT TWO YEARS AGO, AND I
SAID IT LAST YEAR, I'M SAYING IT
AGAIN. THAT'S WHAT IT WILL COST.
BUT YOU ALL DON'T HAVE TO MAKE
THAT DECISION NOW. THE DECISION
THAT YET THAT WE'RE ASKING YOU
TO MAKE NOW IS CAN WE GET THIS
DONE IN SEGMENTS IN BITE? YOU
KNOW, I COME FROM THE BAY AREA.
WE BUILT A BART SYSTEM IN THE
BAY AREA WHEN THAT SYSTEM WAS
FIRST BUILT, IT COVERED THREE
COUNTIES. RIGHT CONTRA COSTA,
SAN FRANCISCO ALAMEDA. THAT'S
IT. YOU KNOW? IT YOU KNOW,
PEOPLE WROTE ABOUT HOW COST
CRAZY IT WAS. YOU KNOW, NOW IT
ALMOST IS CIRCLING THE ENTIRE
BAY. THE RIDERSHIP IS, YOU KNOW,
WELL BEYOND WHAT IT WAS WHEN IT
FIRST STARTED, AND IT'S
SUFFERING FROM ALL THE POST
COVID THINGS THAT EVERYBODY ELSE
IS. BUT YOU KNOW, I JUST WANT TO
BE CLEAR THAT WHAT WE ARE SAYING
IS THIS PROJECT HAS NEVER HAD
ALL THE MONEY IT NEEDS FOR ALL
OF IT. WE CAN DO THIS IN BYTES
TO ADVANCE THE CONCEPT AND GET
RIDERSHIP GOING. GET PEOPLE TO
SEE WHAT WE'VE BEEN INVESTING IN
. AND THEN WE DO HAVE TO WORK ON
HOW WE FUND THE REST OF IT. AND
THAT'S SOMETHING THAT WE HAVE TO
WORK WITH ALL OF YOU ON ON HOW
WE DO IT, BUT THE BENEFITS OF
THE SYSTEM ARE STILL SIGNIFICANT
IN TERMS OF MOBILITY BENEFITS,
GREENHOUSE GAS EMISSION BENEFITS
AND ECONOMIC BENEFITS. SO I MEAN
THAT THAT'S THE QUESTION BEFORE
YOU TWO TODAY, IT'S NOT, YOU
KNOW, COME UP WITH $100 BILLION
TODAY. IT'S YOU KNOW, DO WE HAVE
A FEDERAL PARTNER? CAN WE GET
THAT FIRST SEGMENT DONE? LET'S
WORK THROUGH THAT. AND THEN WE
ADVANCED THE WORK EVERYWHERE
ELSE. WE CAN COME BACK TO YOU
WITH GOOD DATA ON MAKING
DECISIONS FOR HOW WE GO FORWARD,
SO I JUST WANTED TO PRESENT THAT
PERSPECTIVE. HELPFUL. THANK YOU
VERY MUCH, MR. CHAIR THANK YOU.
FOR THAT. I'D LIKE TO ASK MR
THOMPSON TO RESPOND TO THE
COMMENTS JUST MADE BY MR KELLY.
UH, I. I DON'T THINK I THINK I
AGREE WITH RYAN THAT YOU DON'T
HAVE TO HAVE IT DECISION MADE
TODAY. BUT I FEEL VERY STRONGLY
THAT YOU SHOULD PLAN TO MAKE A
DECISION WITHIN A REASONABLE
PERIOD OF TIME AND HAVE BEFORE
YOU WHAT YOU NEED TO MAKE THAT
DECISION. THIS SHOULD NOT BE
POSTPONED FOREVER. YOU CAN'T
MANAGE A PROJECT LIKE THIS HAND
TO MOUTH YEAR AFTER YEAR. THAT'S
WHAT HAS GOTTEN US INTO THE
PROBLEM THAT WE ARE IN NOW. SO
THE LEGISLATURE WITHIN A
REASONABLE PERIOD OF TIME. IF
YOU FAVOR THE PROJECT, THEN
COMMIT TO IT AND THEN FIND THE
FUNDING THAT'S NECESSARY SO THAT
BRIAN CAN MANAGE IT RESPONSIBLY
CANNOT MANAGE IT RESPONSIBLY NOW
AND YOU WHEN YOU SAY DO WE FAVOR
THE PROJECT? YOU MEAN DO WE
FAVOR THE WHOLE COMPLETED
PROJECT? BECAUSE I THINK YOU'VE
SAID THE PROJECT DOESN'T MAKE
SENSE. IF THERE IF IT'S ONLY A
SEGMENT THAT'S CORRECT. AND IF
THE IF THE LEGISLATURE IS NOT
PREPARED TO FUND THE ENTIRE
PROJECT. THEN YOU NEED TO THINK
AGAIN ABOUT EXACTLY HOW TO DO
MERCED TO BAKERSFIELD, UH, IN A
WAY THAT THAT'S MUCH MORE COST
EFFECTIVE THAN THEN IT WOULD BE
IF YOU SPEND $35 BILLION TO RUN
HIGH SPEED TRAINS FROM MERCED TO
BAKERSFIELD. THAT IS NOT THEIR
STABLE PROJECT AND YOU SHOULDN'T
DO IT. MR. KELLY, YOUR RESPONSE
TO THAT. A COUPLE OF THINGS. 1ST
35 INCLUDES A LOT OF EXPENSES
OUTSIDE THEM ARE SAID TO
BAKERSFIELD LIKE COMPLETING THE
ENVIRONMENTAL WORK EVERYWHERE
DOING BOOK AND PROJECTS IN L. A.
AND THE BAY AREA. WE'RE NOW
INVESTORS IN COLTRANE'S PROJECT
AND IN THE BAY AREA. WE ARE NOT
PROPOSING THIS AS THE END OF THE
PROJECT. I MEAN, FUNDAMENTALLY,
WHAT WE HAVE SAID, IS YOU KNOW
THAT AGAIN? THE DILEMMA I FEEL
LIKE THE STATE WAS PUT IN IS
HERE'S FEDERAL MONEY DO 119
MILES. 119 MILES IS NOT A VERY
GOOD OPERATIONAL RUN. WE'RE
TRYING TO DO A BETTER
OPERATIONAL RUN, AND SO IT'S
GOING TO TAKE SOME MORE TO DO
THAT. WE'RE GOING TO ASK FOR
MOST OF THAT TO COME FROM
FEDERAL HELP, AND WE'RE GOING TO
START THAT ASKED WITH A BIG
APPLICATION FOR FUNDS THIS YEAR.
UH THEN OUR HOPE IS TO ADVANCE
THE DESIGN WORK EVERYWHERE ELSE.
SO PEOPLE UNDERSTAND EXACTLY
WHAT THESE ELEMENTS WILL COST
BEYOND TO BAKERSFIELD. AND THEN
WE HAVE TO HAVE A CONVERSATION
ABOUT HOW WE FUND THOSE
ELEMENTS. THANK YOU. GENERAL
MEMBER, REVIS. THANK YOU TO THE
CHAIRS FOR SETTING TODAY'S
HEARING SO WE CAN HEAR THESE
UPDATES AND THE PROGRESS ON THE
HIGH SPEED RAIL. YOU KNOW, I'VE
SAT ON THIS COMMITTEE FOR THE
PAST 4.5 YEARS AND HAVE
PARTICIPATED IN THESE UPDATES
AND HAD THE OPPORTUNITY TO HEAR
. UH THESE, UM YOU KNOW THAT THE
STATUS OF THIS PROJECT AH, AND,
UH, THE COST. WHAT? WHAT EVERY
YEAR. WHAT I WHAT I HEAR IS THAT
THE COST OF THIS PROJECT
CONTINUES TO RISE. WHILE THE
RIDERSHIP ESTIMATES CONTINUE TO
DECLINE, AND SO THE FUNDING FOR
THIS PROJECT HAS ALWAYS BEEN A
CONCERNING CONTINUES TO BE,
ESPECIALLY TODAY, YOU IDENTIFIED
A FUNDING GAP. NO PLAN FOR
FUTURE FUNDING AND I UNDERSTAND
WE'VE NEVER FULLY FUNDED THIS
PROJECT. UM AND WE'RE ASKING,
YOU KNOW SOME OF MY COLLEAGUES.
IS THIS GOOD OR GOOD ENOUGH TO
CONTINUE? I FEEL THE DECISION
THAT WE MADE LAST YEAR, UM, TO
RELEASE THE REMAINING BOND FUNDS
. WHAT THAT WE ALL VOTED FOR IT.
UM WAS AN INDICATION THAT WE
THINK IT'S GOOD ENOUGH. UM AND
SO THAT I FEEL LIKE NOW THAT
PUTS US INTO A COMMITMENT TO
CREATE A PLAN FOR THIS PROJECT.
FUNDING WHETHER YOU KNOW I'VE
I'VE BEEN VERY CRITICAL ABOUT
THE HIGH SPEED RAIL
CONSTITUENTS. UH YOU KNOW, MY
THE PALMDALE TO BURBANK SEGMENT
WILL GO THROUGH MY DISTRICT
WITHOUT HAVING TO STOP. UH YOU
KNOW, IT'S ALWAYS BEEN AN ISSUE
IN MY AREA. UM, BUT AFTER LAST
YEAR, I FEEL THAT THE
LEGISLATURE COMMITTED Tð
CONTINUE OR A SIGNAL THAT THIS
IS GOOD ENOUGH AND THAT WE WILL
MOVE FORWARD WITH THE WHOLE
PROJECT. UM AND YOU KNOW WITH
RIDERSHIP. LEVELS TRENDING
DOWNWARDS AND FUNDING
COMMITMENTS FROM THE FEDERAL
GOVERNMENT MAY NOT MAY NOT REACH
THE LEVELS NECESSARY TO FUND
THIS PROJECT. AH FULLY. UH YOU
KNOW, MY CONCERN IS HOW MUCH ARE
THESE TICKETS GOING TO BE TO
RIDE? THE HIGH SPEED RAIL. DO WE
HAVE ANY IDEA AND I KNOW WE'RE
MAYBE 10 YEARS OUT TO THE FIRST
RIDE ON EVEN THE WORSE IT WAS
THAT MERCED TO BAKERSFIELD. BUT
IT IN THE WHOLE GOAL OF STARTING
IT IN THE CENTRAL VALLEY WAS TO
SEE ECONOMIC BENEFITS IN THAT
REGION. BUT IF NO ONE IS WRITING
IT OR IT'S ALREADY TOO IT WILL
BE TOO EXPENSIVE JUST TO WRITE
THAT SEGMENT. HOW ARE WE GOING?
YOU KNOW, TO SEE AND TO SHOW
THAT THIS IS, YOU KNOW, TO SHOW
CALIFORNIANS THAT THIS IS THE
RIGHT THING TO DO TO CONTINUE.
YOU KNOW, I FEEL LIKE THE
BUSINESS CASE. YOU'RE LOSING THE
BUSINESS CASE FOR THIS WELL,
IT'S CERTAINLY MORE CHALLENGING
IN THE ERA OF INFLATION. THERE'S
NO DOUBT ABOUT THAT. UM, THAT
SAID LOOK, AS I SAID, WE WANTED
TO OPERATIONAL RUN TO START THAT
MADE SOME SENSE AND WHAT WE KNOW
BASED ON EVEN WITH OUR, UH
REDUCED, UH, RIDERSHIP
PROJECTIONS RIGHT NOW THAT ARE
STILL GOING TO GO THROUGH A LOT
OF WORK AND ANALYSIS WITH OUR
OUR PARTNERS ON THAT INITIAL
SEGMENT. UM EVEN WITH THAT, UM,
BUILDING THE SYSTEM BY THE
DEADLINE BY THE TIMELINE. WE
WANT TO GET THAT THING UP AND
RUNNING WOULD ALMOST DOUBLE THE
RIDERSHIP VERSUS A NO BUILD
SCENARIO. WHICH MEANS THAT IF
YOU DON'T BUILD IT, YOU LEAVE
AMTRAK THERE, YOU KNOW, YOU'LL
HAVE HALF THE RIDERSHIP YOU'LL
HAVE IF YOU BUILD OUR SYSTEM, SO
THERE'S A VALUE IN THAT, UH,
ALREADY AND THEN YOU KNOW THAT
RIDERSHIP NUMBER BETWEEN 6.6 AND
7.5 MILLION WRITERS A YEAR JUST
TO GIVE YOU SOME CONTEXT ON
THAT. THE THREE CORRIDORS THAT
AMTRAK RUNS IN CALIFORNIA TODAY
, THE SAN JOAQUIN'S THE LOW SAND
AND THE CAPITOL CORRIDOR. THEIR
COMBINED ANNUAL RIDERSHIP IS 5.6
MILLION RIDERS. AND IN YEAR ONE,
WE WOULD BE EXCEEDING THAT BY A
MILLION WRITERS A YEAR. UM SO WE
SEE VALUE IN THE INITIAL
OPERATING RUN. IT IS NOT THE END
OF THE PROJECT FOR US. WE THINK
THE VOTERS SAID BUILD PHASE ONE.
WE THINK THAT'S WHAT WE GOT TO
GET TO. WE'RE TRYING TO GET TO
IN A WAY THAT MAKES SOME SENSE
AND THAT'S THAT'S WHAT WE'RE
PROPOSING. THANK YOU REMEMBER
TING? THANK YOU, MR CHAIR. UM
JUST A CLARIFY. I APPRECIATE
ALEJO'S COMMENTS, BUT THE AGAIN
. THE ONLY STATE FUNDS THAT ARE
COMMITTED THAT THE FUNDS THAT WE
HAVE DIRECT OVERSIGHT OVER OUR
BOND REPAYMENTS, WHICH,
TECHNICALLY WE DON'T HAVE
OVERSIGHT OVER JUST BECAUSE
WE'VE WE'VE COMMITTED IT. WE'VE
THE VOTERS HAVE PASSED IT AND
THEN THE G R F IS THAT CORRECT?
YEAH SO WHEN, UM, WE'RE TALKING
ABOUT WHAT OUR ROLE IS, AND I
GUESS GOING BACK TO MR THOMPSON.
THE QUESTION IS WHETHER OR NOT
WE WOULD I DON'T KNOW IF MR
THOMPSON'S ASKING WHETHER WE'D
BE WILLING TO COMMITS FURTHER
DOLLARS OR IS IT JUST ARE WE
GOING TO DIRECT DIRECTOR KELLY
TO GO CHASE AFTER MORE DOLLARS
FOR THE SAN FRANCISCO TO ANAHEIM
LAKES? HATE THE HATE TO FINANCE
A PROJECT OF THIS SIDE BY
CHASING AFTER FEDERAL MONEY THAT
THAT ISN'T WHAT WE'RE TRYING TO
DO. AH THE EXISTING SOURCES WILL
NOT PAY FOR THE PROJECT. THAT'S
CLEAR. SO SOMETHING ELSE HAS TO
BE FOUND. TO PAY FOR IT. NOW, IF
THERE IS A FEDERAL PROGRAM
THAT'S THE EQUIVALENT OF THE
INTERSTATE HIGHWAY PROGRAM.
THAT'S THAT'S GOOD, BUT IT
DOESN'T EXIST TODAY. AND IF YOU
IF YOU WISH TO FOLLOW THROUGH ON
A COMMITMENT TO THE PROJECT,
THEN A THOROUGH STUDY OF WHERE
MIGHT THAT MONEY COME FROM OR
AND WHO'S GOING TO PAY? IT HAS
GOT TO BE DONE. IT MUST BE DONE.
AND I APPRECIATE THAT, MR
THOMPSON. I APPRECIATE
EVERYTHING YOU'VE DONE.
INCREDIBLY UM, YOUR YOUR
GUIDANCE HAS BEEN ABSOLUTELY
CRITICAL FOR THE LAST NUMBER OF
YEARS. I GUESS MY QUESTION
EITHER TO YOU OR MR KELLY OR LOW
IS WHAT SIGNIFICANT STATE
TRANSPORTATION PROJECT HAS BEEN.
SIGNIFICANTLY PAID FOR BY A
STATE DOLLARS. I'M NOT AWARE OF
. ONE UH, THE CALIFORNIA STATE
HIGHWAY SYSTEM THAT'S ACTUALLY
LIKE A GOOD EXAMPLE. UM MOST
TRANSPORTATION, BIG
TRANSPORTATION PROJECTS IN
CALIFORNIA. HAVE MULTIPLE
SOURCES OF FUNDING, OFTEN IN
CALIFORNIA IS A UNIQUE AND THEN
IT'S GOT LOCAL SALES TAX
MEASURES FOR TRANSPORTATION. BUT
EVEN THOSE ARE OFTEN MATCHED BY
FEDERAL OR STATE FUNDS OF
SIGNIFICANT VALUE. UM JUST LAST
WEEK. I MEAN, I'M SORRY IN
JANUARY THE STATE TRANSPORTATION
AGENCY PROVIDED ABOUT 2.5
BILLION TO TRANSIT PROJECTS
AROUND THE STATE. THAT ALL WE'RE
JUST DEALING WITH INFLATION
RELATED COST ISSUES. THERE WAS
NOTHING NEW ABOUT THE PROJECTS,
NO NEW SCOPE, BUT THEY WERE
DEALING WITH COST ISSUES. SO THE
STATE OF CALIFORNIA PROVIDES A
TON OF MONEY EVERY YEAR. I THINK
THE BUDGET FOR CALTRANS ALONE IS
ON THE ORDER OF 20 BILLION AND
SOME OF THAT INCLUDES FEDERAL
FUNDS, BUT THE BULK OF THAT
ESTATE STATE FUNDS I MEAN, AND I
COMPLETELY APPRECIATE, UM MR
THOMPSON'S COMMENTS. ALEJO'S
COMMENTS THE ENTIRE COMMITTEE. I
THINK THERE IS A SIGNIFICANT
AMOUNT OF UNCOMFORTABLENESS
AROUND THE UNCERTAINTY OF THE
PROJECT. BUT I WOULD ALSO JUST
REMIND ALL OF US AS LEGISLATORS
. I THINK IF YOU GO BACK TO THE
CONSTRUCTION OF THE GOLDEN GATE
BRIDGE OR IN, YOU KNOW MY DISK
IN MY AREA, THE BAY BRIDGE OR
YOU GO TO THE CONSTRUCTION OF
BART. WHICH IS A CRITICAL SYSTEM
IN OUR, UH IN OUR REGION THAT
THAT REALLY ACCOUNTS FOR MOVING
SIGNIFICANT NUMBER OF PEOPLE'S
EVEN AT A TIME WHEN IT'S RATHER
LOW AND YOU GO BACK TO THE
HEADLINES. FOR EACH OF THOSE
MAJOR MAJOR PROJECTS, AND YOU
COULD PROBABLY COMPARE THEM TO
THESE HEADLINES. I IMAGINE IN
TERMS OF COST OVERRUNS,
UNCERTAINTY. WHETHER OR NOT WE
SHOULD BUILD THAT GOLDEN GATE
BRIDGE BETWEEN SAN FRANCISCO AND
MORAN WHETHER WE SHOULD DO LARGE
INFRASTRUCTURE PROJECTS ARE VERY
DIFFICULT. THEY OFTEN TIMES, UM,
TAKE MANY, MANY YEARS. AND THEY
THEY OUTLIVE THE PEOPLE WHO
STARTED THEM, AND THEY REQUIRE
THE PEOPLE WHO UM YOU KNOW? SEE
YOU THROUGH OVER MULTIPLE
ADMINISTRATIONS, MULTIPLE
LEGISLATURES MULTIPLE BOARDS.
HOWEVER, HOWEVER, WE SEE IT. UM
TO ME, UH, YOU KNOW, JUST ANSWER
MR THOMPSON'S QUESTION. I THINK
IF WE DIDN'T STOP THE INITIAL
LEG OF MERCED TO BAKERSFIELD, OR
WHATEVER BETWEEN PARTS OF MERCED
TO POPULAR AVENUE. I THINK WE'RE
ALREADY COMMITTED TO PHASE ONE.
BECAUSE YOU'RE ABSOLUTELY
CORRECT. IT DOES NOT MAKE ANY
SENSE TO ONLY RUN A TRAIN
WHATEVER TRAIN THAT IS BETWEEN
MERCED TO BAKERSFIELD IN TERMS
OF RIDERSHIP. I THINK THAT TO
NOT CONNECTED TO THE BAY AREA TO
NOT CONNECTED TO L A MAKES
ABSOLUTELY NO SENSE. RIGHT? SO I
THINK YOUR YOUR NEXT QUESTION
IS, IS THE NEXT THE RIGHT
QUESTION, WHICH IS WHAT DOES I
THINK? COMMITMENT LOOK LIKE AND
I THINK COMMITMENT JUST FROM A
STATE BUDGETARY POINT OF VIEW.
UM. MAY INCORPORATE MORE MONEY
AT SOME POINT BUT I DON'T THINK
THAT THIS PROJECT GETS DONE
WITHOUT A SIGNIFICANT AMOUNT OF
FEDERAL MONEY, BERT THAT'S JUST
THAT'S THE WAY YOU KNOW WHEN YOU
LOOK AT L. A METRO METRO WASN'T
OKAY. LET'S GO TALK TO THE
VOTERS OF THE CITY OF L A. AND
WE'RE GONNA FLOAT BONDS, AND
WE'RE GONNA SPEND MONEY OF OUR
GENERAL FUND. YOU KNOW, L A
METRO, THE MOST RECENT LARGE
SCALE. TRENDS OF PROJECT THAT'S
FOCUSED ON FEDERAL MONEY. RIGHT
THAT THAT'S THAT'S WHERE YOU GET
THE MONEY, SO I DON'T I DON'T
THINK IT'S INCORRECT IN TERMS OF
ANY I THINK. I THINK ALL OF YOU
ARE SAYING ALL THE RIGHT THINGS
AND PUSHING US TO MAKE THE RIGHT
DECISIONS. I THINK THE CHALLENGE
FOR US IS WHAT DOES COMMITMENT
LOOK LIKE? AND IN TERMS OF STATE
MONEY, OR I THINK DIRECTION, I
THINK I THINK WE TOOK A BIG STEP
LAST YEAR WHEN WE AUTHORIZED THE
REMAINDER OF THE $4 BILLION IN
TERMS OF BOND FUNDING AND TO
PROVIDE GREATER DIRECTION,
WANTED TO MAKE SURE THAT THE
AUTHORITY WAS VERY MUCH FOCUSED
ON MERCED TO GET THAT COMPLETED
. MAKE SURE THAT THAT WAS
COMPLETED NOT NOT AT THE EXPENSE
OF THE OTHER. OTHER LOCATIONS,
BUT TO MAKE SURE THAT THERE WAS
A CERTAIN LEVEL OF FOCUS. WE
DIDN'T WANT TO HAVE A LITTLE BIT
OF WORK HERE A LITTLE BIT OF
WORK HERE. LET'S LET'S LET'S AT
LEAST GET SOMETHING DONE.
STATIONS OPEN. GET GET THOSE
TRAINS RUNNING. I THINK I THINK
THE LARGER QUESTION IS IN TERMS
OF. YOU KNOW, SORT OF OUR
COMMITMENT AND DIRECTION. LET'S
GO BACK TO MR THOMPSON. I MEAN,
WHAT WHAT WOULD YOU WHAT WOULD
YOU ONE IN TERMS OF. DIRECTION
THAT WOULD MAKE SENSE BECAUSE I
THINK ANYTHING THAT GETS PUT
TOGETHER IN TERMS OF FINANCIAL
PLAN IN TERMS OF PROJECTED, UM
YOU KNOW REVENUES AND THEN THIS
IS NO DIFFERENT FROM ANY PUBLIC
PROJECT. I MEAN, WE HAVE AN
AFFORDABLE HOUSING CRISIS. ONE
OF THE MAJOR CHALLENGES WE HAVE
AROUND AFFORDABLE HOUSING IS
LOOK AT ANY AFFORDABLE HOUSING
PROJECT, WHETHER IT'S 10 UNITS
OR 100 UNITS OR 400 UNITS.
YOU'VE GOT TO STITCH TOGETHER
LIKE 5 10 15 DIFFERENT FUNDING
STREAMS. THAT'S THE CHALLENGE
WITH ANY KIND OF PUBLIC PROJECT
. IF THIS IS A PRIVATE PROJECT
THAT WE COULD BUILD, AND BECAUSE
SUSTAIN ITSELF ON THE MARKET
THIS THIS WOULD HAVE BEEN BUILT
YESTERDAY. SO I GUESS IN TERMS
OF YOUR COMMITMENT, MR THOMPSON
, WHAT? WHAT ARE YOU ADVISING US
TO DO IN TERMS OF SEEING THAT,
BECAUSE ANYTHING WE PUT OUT
THERE IS STILL OUR BEST VISION
OF THE FUTURE. LET ME EMPHASIZE
THE WORD YOU USED STREAM, NOT
SINGLE POINT, BUT STREAM THIS IS
A 30 YEAR PROJECT. IT WILL NOT
BE FINANCED YEAR TO YEAR BY. OH
WE FOUND ANOTHER POT OF MONEY.
IT JUST DOESN'T WORK THERE OR
SHOULDN'T WORK THAT WAY. THE
2000. BUSINESS PLAN THAT WAS
ISSUED FOR THE AUTHORITY BEFORE
THESE PEOPLE PROPOSED TO FINANCE
THE PROJECT WITH A QUARTER SINCE
SALES TAX THAT'S A STABLE AMOUNT
OF MONEY YEAR TO YEAR THAT
PERMITS THEM TO PLAN IT PREVENTS
THEM TO HIRE. IT PERMITS HIM TO
TRAIN. IT PERMITS HIM DESTRUCTOR
OF THE CONTRACTS IN AN EFFICIENT
WAY AND MANAGE THEM. THAT'S WHAT
REALLY IS NEEDED IF THE STATE
WANTS TO DO THIS PROJECT, NOT
BEGGING FOR FEDERAL MONEY. WE
HOPE TO GET SOME NEXT YEAR AND
WE PROBABLY AND WE USUALLY DO.
THAT'S TRUE. BUT YOU CAN'T PLAN
AND MANAGE AND THAT KIND OF WAY.
SO THAT'S MY ANSWER. IF YOU WANT
TO DO THIS CONSTRUCT, STABLE,
CREDIBLE, PREDICTABLE STREAMS OF
MONEY THAT ARE ADEQUATE TO DO
THE PROJECT. AND I JUST HAD ONE
THING TO THAT FIRST I YOU KNOW,
I COULDN'T AGREE MORE IN EACH OF
OUR LAST THREE OR FOUR BUSINESS
PLANS. WE'VE TALKED ABOUT THE
POTENTIAL OF THE EXTENSION OF
CAP AND TRADE AT SOME POINT AND
WHAT THAT ALLOWS US TO DO WITH A
NEW FUNDING STREAM, INCLUDING
TAKING ADVANTAGE OF FEDERAL
FINANCING OPTIONS THAT ARE VERY
GOOD ON TERMS AND VERY
AFFORDABLE AND GOOD FOR THE
STATE OF CALIFORNIA. SO WE DO
AGREE, WHATEVER THE SOURCES,
WHATEVER THAT PLAN IS, THAT OF
THE LONG TERM STREAM IS WHAT'S
GOING TO BE REQUIRED FOR A
PROJECT. OF THIS, THIS MAGNITUDE
THAT ONE OTHER THING, I JUST
WANT TO COMMENT ON FEDERAL
FUNDS. THERE IS NO HIGH SPEED
RAIL PROJECT ANYWHERE IN AMERICA
THAT'S GOING TO BE BUILT WITHOUT
FEDERAL FUNDS AND BRIGHT LINE IS
PROVING THAT IN REAL TIME THEY
STARTED OUT AS A PRIVATE THOUGHT
. THEY CAN'T GET IT DONE WITHOUT
PUBLIC MONEY. THERE'S NEVER BEEN
A BETTER OPPORTUNITY FOR FEDERAL
FUNDS, AND THERE IS RIGHT NOW,
UM AND WE HAVE A STRATEGY BEEN
WORKING WITH THE F R A ON
PURSUING THOSE FEDERAL FUNDS. TO
EITHER COVER THE GAP, OR AT
LEAST GET THIS GAP SHRUNK SO
MUCH THAT IT'S WE'RE AT A MUCH
SMALLER AMOUNT TO GET THE
INITIAL SEGMENT DONE. AND SO
THAT'S PART OF WHAT WE PUT IN
THE PROJECT UPDATE REPORTED, IS
WHAT WE'RE WORKING TOWARDS. IF I
MIGHT JUST ADD QUICKLY, UM SO I
THINK ONE OF THE CHALLENGES IS
THIS REALLY IS AN UNUSUALLY GOOD
TIME TO GO FOR FEDERAL FUNDS.
THESE RECENT INFRASTRUCTURE
BILLS ARE VERY SUBSTANTIAL
COMMITMENTS ON THE HEART OF THE
FEDERAL GOVERNMENT. EVEN IN THAT
CONTEXT, WE'RE LOOKING AT A
TARGET OF EIGHT BILLION AND WILL
PROBABLY BE PROBABLY CANDIDLY BE
LUCKY TO GET A BILLION SO WELL.
THAT WOULD BE VERY HELPFUL,
ESPECIALLY TO COMPLETING MERCED
TO BAKERSFIELD. THAT'S NOT GOING
TO GET US TO PHASE ONE. WE'RE
STILL GOING TO HAVE A VERY
SUBSTANTIAL FUNDING GAP. AND AT
THIS POINT, THERE IS NO ONGOING
FUNDING STREAM ON THE FEDERAL
SIDE. THAT WOULD REALLY MEET.
YOU KNOW THAT FUNDING GAP SO IT
WOULD BE. IT WOULD BE IDEAL. I
THINK ALL OF US WOULD LOVE IT IF
THE FEDERAL GOVERNMENT WOULD
PROVIDE FUNDING THAT WOULD
REALLY HELP US. GET TO PHASE
ONE. AT THIS POINT THAT DOESN'T
EXIST. SO IN THE SO I THINK THE
LEGISLATURE CAN'T JUST IN MY
MIND. I DON'T THINK IT'S I DON'T
THINK WE CAN JUST ASSUME THAT
THE FEDERAL GOVERNMENT GOING TO
COME FORWARD AND CREATE THAT. UM
IT WOULD BE GREAT IF THEY DO,
BUT THERE'S NO CERTAINTY AND SO
REAL COMMITMENT TO PHASE ONE
WILL PROBABLY MEAN THE STATE
PLANNING ON THE SCENARIO IN
WHICH THE STATE REALLY HAS TO
FUND THAT, AND I THINK THE
QUESTION IS IN THAT SCENARIO.
WHAT WHAT WOULD THE STATES BE
PLANNED TO BE TO COME UP WITH
THAT AMOUNT OF MONEY AND IT IS A
LARGE AMOUNT OF MONEY, SO
PROBABLY, AND MAYBE IT'S MAYBE
IT'S A VARIETY OF DIFFERENT
SOURCES. IT MIGHT NOT JUST BE
ONE. I MEAN, EVEN IF YOU CAP IT
IF YOU EXTEND CAP AND TRADE TO
2050 AND DEDICATE ALL OF IT TO
THIS PROJECT. THAT'S PROBABLY
NOT GOING TO BE ENOUGH, RIGHT?
SO WE'RE GONNA HAVE TO THINK
ABOUT WHAT, OR MAY NOT BE,
DEPENDING ON WHAT CAP AND TRADE
REVENUES ARE AND WHAT THAT
PROGRAM LOOKS LIKE, SO I THINK
IT'S REALLY IMPORTANT TO, UM YOU
KNOW, I THINK, YOU KNOW, WE'RE
GONNA HAVE TO THINK REALLY
CAREFULLY ABOUT THOSE CHOICES
AND WHAT THE LEGISLATURE'S
PRIORITIES ARE, AND PROBABLY NOT
JUST EVEN THOUGH IDEALLY, THE
FEDS WOULD COME THROUGH, UM NOT
ASSUME THAT THEY WILL. IN THIS
CASE. I'M I HAVE TO STEP OUT AND
GO TO THE HOUSING COMMITTEE.
HOPEFULLY IT WON'T BE LONG AND
I'LL BE BACK. BUT I DO HAVE
COMMENTS. LOTS OF COMMENTS ABOUT
THIS PROJECT. I HAVE COMMENTED
SPECIFICALLY RELATES TO WHAT
YOU'RE ASKING ABOUT MR TING. AND
SO IF YOU WOULDN'T MIND I'D LIKE
TO. I'D LIKE TO MAKE THESE COME
MAKE THESE COMMENTS VERY
QUICKLY. I THINK A REASON WHY WE
CHANGED THE FORMAT OF THIS
MEETING. AND I KNOW IT'S
FRUSTRATING FOR MR KELLY BECAUSE
HE HASN'T REALLY HAD A CHANCE TO
SORT OF PRESENT HIS WHOLE
PACKAGE YET. BUT IT IS
SPECIFICALLY BECAUSE THERE ARE
SO MANY QUESTIONS AND LOOK AT
WHERE AT 2.5 HOURS OR WE'RE
COMING UP ON TWO HOURS IN THIS
PROJECT. AND I DID NOT WANT TO
SQUEEZE ALL OF THESE QUESTIONS
IN IN THE LAST LITTLE BIT IN A
HURRY, RATHER THE OTHER WAY
AROUND. THAT BEING SAID OF THE
REASON WE CHANGE THIS ORDER IS
BECAUSE I THINK, ALTHOUGH WE
MADE A COMMITMENT TO THIS
BEGINNING PROJECT I'M NOT
WILLING TO SIMPLY SAY ALL PUBLIC
PROJECTS ARE LIKE THIS ALL
PUBLIC PROJECTS. YOU JUST DO
WHAT YOU CAN. AND THEN SHE WHEN
YOU WHEN YOU WHEN CAN YOU PATCH
TOGETHER THE NEXT THING AND DO
WHAT YOU CAN THAT THAT WE HAVE
TO BE SOMETHING BETTER THAN THAT
. AND SO MR THOMPSON'S, YOU
KNOW, SORT OF INSISTENCE THAT
WE'RE NOT BEING RESPONSIBLE OF
ALL AS WE SAY, AND THAT'S HOW I
STARTED TO SING OFF. I SAID, I
DON'T WANT TO JUST SAY THE
EASIEST THING TO DO POLITICALLY
RIGHT NOW WAS JUST GO, GO. I
HOPE YOU GO GET THE FEDERAL
FUNDING. AND THANKS FOR THE
THANKS FOR THE NICE REPORT HOPE
THE FEDERAL FUNDING COMES
THROUGH AND I DON'T KNOW WHAT
WE'LL DO WITH THE FEDERAL
FUNDING DOESN'T COME THROUGH. I
THINK THAT, UM IT IS IMPORTANT
AND IT WON'T BE SORT OF A QUICK
THING THAT WE'RE GOING TO DECIDE
RIGHT HERE. BUT WE HAVE TO BE
SERIOUS EVERY TIME WE TALK ABOUT
THIS PROJECT. ABOUT THIS BECAUSE
NOT ALL PUBLIC PROJECTS GET
FINISHED. AND I WANT TO HARKEN
BACK TO I GREW UP IN THE
MIDWEST. THERE ARE CANAL
PROJECTS ALL OVER THE MIDWEST
THAT ARE SEGMENTS THAT NEVER GOT
COMPLETED. AND AFTER THE ERIE
CANAL WAS BUILT, EVERYBODY SAID
, OH, THE WAY FOR YOUR STATE TO
BECOME POWERFUL IS TO BUILD A
CANAL AND CONNECT YOU AND HAVE
THIS GREAT COOL TRANSPORTATION
THING, AND THEY LITERALLY DIDN'T
HAVE FUNDING FOR THOSE PROJECTS
. UH AND THE DEPRESSION OF 18 37
HIT AND BY THE TIME AND THAT
THOSE TIME PERIODS YOU STARTED,
YOU KNOW, THESE THINGS WERE
STARTED IN 18 TWENTIES YEAR
CANAL WAS BUILT. BY THE TIME
THEY GOT IT ALL, FINALLY GOT
THEMSELVES FINANCIALLY IN
POSITION TO DO IT. THEY DIDN'T
WANT TO BUILD CANALS ANY LONGER
, RIGHT? I DON'T WANT TO HAVE
THIS PROJECT BE SO FAR DOWN THE
ROAD RIGHT THAT, IF BECAUSE OF
FAIR QUESTION IS THIS IF YOU'RE
CRUISING DOWN THE ROAD AND YOUR
ELECTRIC TESLA WITH ALL OF THE
CONVENIENCE OF AN ELECTRIC TESLA
DO I REALLY WANT TO DRIVE TO
BAKERSFIELD? GET OUT OF MY TESLA
. TAKE A RIDE OF MERCED. RIGHT
OR DO I EVEN WANT TO TAKE THE
HIGH SPEED RAIL? YOU KNOW, IF IT
YOU KNOW IF IT'S A LONG TIME
DOWN THE ROAD, SO I'M NOT TRYING
TO THROW A MONKEY WRENCH AT IT.
I REALLY THINK I'M TRYING TO
THROW A LIFELINE, SAYING WE'VE
GOT TO BE MORE SERIOUS AND
COMING UP WITH A COMMITMENT TO A
FUNDING STREAM, OR WE HAVE TO
FIND OUT IF THE FEDERAL
GOVERNMENT IS GOING TO BE THAT
PARTNER. THE QUESTION FOR THE
FEDERAL GOVERNMENT SHOULDN'T BE
YOU KNOW? HEY, WE'RE ASKING FOR
1.9. OR YOU ASK FOR 1.6 BILLION
AND WE GOT 50 MILLION. WELL IF
THAT'S THE ANSWER, WE'RE GETTING
. WE SHOULD SAY WE GOT A BIG BIG
PROBLEM HERE WITH THIS PROJECT.
WE NEED TO KNOW THAT THE FEDERAL
GOVERNMENT IS A PARTNER IN A
FUNDING STREAM. NOT A SOMETIMES
DEPENDING ON WHO'S IN POWER
BECAUSE WE'VE HAD. WE'VE HAD
ADMINISTRATIONS THAT HAVE BEEN
TRYING TO TAKE THE MONEY AWAY
FROM US. SO IS THAT OF A LOGICAL
PARTNER OUT THERE, SO I THINK WE
HAVE TO GO BEYOND THE LEAP OF
FAITH THAT ALL PUBLIC PROJECTS
EVENTUALLY MAKE IT BECAUSE WE
EVENTUALLY PASS IT ALL TOGETHER.
UM THIS ONE IS DIFFERENT. IT
STARTED ON A MUCH ROCKIER
FOUNDATION. IT DIDN'T START ON
THE STRONG FOUNDATION THAT MAYBE
SOME OTHER PUBLIC PROJECTS DID
AND IT IS NOT CERTAIN THAT HIGH
SPEED RAIL WON'T BE SOMETHING
THAT WE'RE LOOKING AT 30 YEARS
FROM NOW, AS BOYD THAT'S SEGMENT
THROUGH THE THROUGH THE CENTRAL
VALLEY IS REALLY COOL,
ELECTRICAL ELECTRIFIED SEGMENT,
BUT WE JUST NEVER PULLED IT OFF
TO DO EVERYTHING ELSE. I WANT TO
BE SERIOUS ABOUT THAT. EXCUSE
ME. I'M GOING TO GO TO THE
HOUSING COMMITTEE BUT TURNING
OVER TOO FAR MORE COMPETENT
SHARE. UM ASSEMBLYMEMBER'S
FRIEDMAN I DON'T KNOW AFTER
THOSE COMMENTS, SO I WAS HOPING
TO KEEP. YEAH, NO GOING BACK.
I'M SAYING AFTER THOSE COMMENTS
AH, BUT YES, I'M GONNA GO BACK
TO CHAIR TING. THANK YOU, MADAM
CHAIR, SO I THINK YOU KNOW JOE
BENNETT ROUND OF EXCELLENT
POINTS, I THINK AGAIN. UM HMM.
WHAT ONE? I THINK THIS HAS BEEN
, UM, ONE OF THE MOST PRODUCTIVE
. I THINK DISCUSSIONS THAT WE
HAVE. I THINK FIRST OF ALL,
BECAUSE THIS REPORT IS MUCH
BETTER THAN SO MANY REPORTS IN
YEARS PAST 2023 PROJECT UPDATE.
UM, I THINK BECAUSE NOW WE YOU
KNOW, SEE SOME LIGHT ON HOW TO
POTENTIALLY FINISH THIS. WERE
SAID TO BAKERSFIELD LEG, BUT OF
COURSE, I THINK MR THOMPSON CUT
TO THE CHASE IN A EXCELLENT WAY
THAT WE DO HAVE TO MAKE A
DECISION THAT IF WE ARE GOING TO
COMMIT LONG TERM, ARE WE WILLING
. TO GO FOR A REVENUE MEASURES.
ARE WE GOING TO GO? MAYBE
ANOTHER BOND. I DON'T KNOW WHAT
THE DIFFERENT SOLUTIONS ARE, BUT
WHAT? UM YOU KNOW, WHAT ARE WE
GOING TO ASK THE PEOPLE TO
SUPPORT? I THINK THAT'S THAT'S A
EXCELLENT, EXCELLENT POINT. I
THINK THAT'S SOMETHING THAT
WE'RE GOING TO NEED TO CONTINUE
TO GRAPPLE WITH. IN THE IN THE
NEXT PROBABLY PROBABLY THE NEXT
YEAR OR TWO. WE REALLY SHOULD BE
MAKING THAT SORT OF COMMITMENT
OR DECISION RIGHT? BECAUSE I
KNOW THAT WE HAD, UM YOU KNOW,
WE HAVE CALTRAIN AND THAT WAS
PART OF ONE OF MY QUESTIONS
AROUND CALTRAIN BETWEEN SAN
FRANCISCO SAN JOSE, WITH MOSTLY
BEING RUN BY THE SAN MATEO
COUNTY AUTHORITY, BUT THAT WE
WENT WITH THE SALES TAX MEASURE
TO FINALLY GIVE IT SOME STREAM
OF FUNDING, AND THAT'S ONE OF
THE REASONS THAT IT'S BE ABLE
TO. SUSTAIN ITSELF THROUGH
THROUGH COVID. OTHERWISE, WE'D
BE IN VERY, VERY TOUGH.
SITUATION SO WHAT? ONE CAT? ONE
QUESTION TO DIRECTOR KELLY WAS
THERE'S THE SAN FRANCISCO SAN
JOSE LEG IS THAT IS THAT AROUND
THE ELECTRIFICATION PEACE IN THE
GREAT SEPARATION BECAUSE I KNOW
THAT'S QUITE YOU KNOW, BECAUSE
I'VE OBVIOUSLY THERE'S AN
EXISTING SYSTEM. I THINK THE
IDEA WAS TO ELECTRIFY THAT, YOU
KNOW, PART OF THAT SEGMENT TO
CONNECT TO UM, HIGH SPEED RAIL
EVENTUALLY. SO UM, YOU KNOW, WE
ARE SIGNIFICANT FUNDING PARTNERS
IN THE COW TRAIN ELECTRIFICATION
PROJECT THAT'S ABOUT A $2.4
BILLION PROJECT NOW. 2.5 BILLION
HIGH SPEED RAILS, CONTRIBUTING
ABOUT 733 MILLION TO THAT. SO
WE'RE HELPING FUND THE COW TRAIN
ELECTRIFICATION PROJECT RIGHT
NOW, BECAUSE ULTIMATELY WE WILL
USE THAT CORRIDOR TO GET TO SAN
FRANCISCO. SO THE SHORT ANSWER
IS SAME RIGHT AWAY. THERE WILL
BE SOME CURVES STRAIGHTENING
THAT WE'LL NEED TO DO AFTER
THIS, BUT THE CORE
ELECTRIFICATION THEY'RE DOING
RIGHT NOW WILL ULTIMATELY SERVE
OUR ENTREE INTO SAN JOSE AND SAN
FRANCISCO IS THAT IS THAT PART
OF THE 3.3 BILLION LISTED IN THE
REPORT? YEAH THE THREE THE 3.3
BILLION. I THINK THE REFERENCE
THERE IS THE WE COMPLETED THE
ENVIRONMENTAL DOCUMENT. AND IN
THE ENVIRONMENTAL DOCUMENT. WHEN
WE FINISHED THE WORK ON THE
ENVIRONMENTAL DOCUMENT, WE PUT
IN ALL OF THE MITIGATION ISSUES
AND EVERYTHING ELSE THAT WE HAVE
TO ADDRESS, SO IT HADN'T BEEN
UPDATED, AND I DON'T KNOW, SEVEN
OR EIGHT YEARS AND SO WHEN WE
FINISHED THE ENVIRONMENTAL
DOCUMENT, WE UPDATED THE COST
FOR THAT SEGMENT, AND THAT
INCLUDED ALL OF THAT. WHAT ONE
OF THE MAIN ISSUES WE HAD LAST
YEAR REGARDING MERCED WAS THE
CONNECTION TO A YES THAT
ADDITIONAL MONEY FOR THAT MERCED
EXTENSION TAKE INTO ACCOUNT A
CONNECTION TO A SPACE YEAH, WELL
, WHAT WE'RE DOING IS GETTING
OUR SYSTEM INTO THE DOWNTOWN
MERCED SEGMENT SECTION WHERE WE
WOULD, UH MOVE THE, UH, HAVE
THIS STATION GO WHERE THE A
SYSTEM WILL GO? EAST DOESN'T GO
TO MERCED YET, BUT THEY ARE
WORKING THEIR WAY TOWARD MERCED
AND THE IDEAS BY THE TIME WE'RE
OPERATIONAL, WE WOULD ALL BE
MEETING AT A SINGLE STATION IN
DOWNTOWN MERCED, SO OUR COST
ESTIMATES INCLUDE THE DOUBLE
TRACK INTO THAT DOWNTOWN MERCED
STATION. THE ACE FUNDING TO GET
THERE IS COMING NOT THROUGH US
DIRECTLY, BUT THROUGH CALISTA,
THE STATE TRANSPORTATION AGENCY
AND OTHER FUNDING SOURCES, BUT
NOT DIRECTLY THROUGH US TO GET A
STEAMER SET. SO THE PLAN IS
STILL THE PLAN THEN. AS IT'S
BEEN MODIFIED, IS TO HAVE A
SINGLE STATION NOT TO HAVE ONE
LOCATION IN MERCED, AND THEN
THAT'S CORRECT. THAT'S CORRECT.
UM. SO I THINK THAT, UM AGAIN,
YOU KNOW, SO THE BOTTOM LINE IS
IF WE. THE COMMITMENT IS TWOFOLD
. I THINK IT'S POLICY DIRECTION,
I THINK, WHICH WAS WHICH WE GAVE
ON THIS INITIAL MERCED TO
BAKERSFIELD, LIKE LAST YEAR, THE
GREATER POLICY DIRECTION IN
TERMS OF SAN FRANCISCO TO
ANAHEIM. AND THEN THE SECOND
PIECE OF IT IS SOME AH, SOME
INCORPORATED FINANCIAL PLAN OR
SOME REVENUE STREAM THAT THAT'S
WHAT THAT'S WHAT THE NEXT PHASE
OF THIS DISCUSSION SOUNDS LIKE
FOR US LIKE, YOU KNOW, PHASE
PHASE ONE A FOR THE LEGISLATURE.
IS THIS THOSE TWO QUESTIONS? I
AGREE. I WOULD JUST ADD THAT
MAYBE ONE THING THAT IS A
CONSIDERATION ON TIMING ISSUES.
THERE IS LATER THIS MONTH DO THE
APPLICATION FOR THE MOST
SIZEABLE FEDERAL PROGRAM FOR
THAT THIS SYSTEM, AND SO, UM, I
MIGHT SUGGEST THAT YOU HAVE SOME
TIME TO SEE WHERE THE GAP IS.
AFTER WE SEE WHERE WE ARE. AFTER
YEAR, ONE WITH THE FEDS AND
WHETHER OR NOT THEY'RE GOING TO
COMMIT TO A MULTI YEAR FUNDING
COMMITMENT ON THIS, AND THAT'S
SOMETHING THAT WE'RE ASKING THEM
ABOUT, SO BUT WE WILL KNOW THAT
IN 2023. AND THE PICTURE.
THOMPSON WANTED TO SAY ANYTHING
AT ANYTHING OR NOT, OR YES, I
THINK THAT'S A SUMMARY OF WHAT?
WHAT WHAT I AM ARGUING ANYWAY,
THAT THAT YOU NEED POLICY
COMMITMENT THAT YOU DO WANT TO
COMPLETE THE PHASE ONE AND THEN
YOU NEED A CREDIBLE FUNDING
PROGRAM OR YOU WON'T GET THAT
IMMEDIATELY. BUT OVER THE NEXT
YEAR OR SO, IF YOU CAN DO THE
SUMMARIES OF WHAT THE FUNDING
SOURCES ARE THAN YOU ARE IN THE
POSITION TO MAKE THE CHOICES.
AND OF COURSE, I'D LIKE I LEFT
OUT THE FACT THAT OBVIOUSLY THE
GOVERNOR IS GOING TO BE NEED TO
BE INVOLVED IN THIS AS WELL AND
DIRECTION. FROM HIS OFFICE IS
CRITICAL. UM ARE THERE ANY IN
THIS GOES BACK MORE TO MR
THOMPSON. ARE THERE ANY SORT OF
OPERATING ITEMS THAT WE SHOULD
BE LOOKING AT OR THINKING ABOUT.
UM THAT MAY SAVE US SOME MONEY,
OR IS IT REALLY THE PROJECT AS
DESIGNED REALLY IS WHAT WE NEED
TO GO FIND, AND THAT'S IT'S UP
TO US TO FIGURE OUT OKAY. IS
THERE MONEY TO REALLY FUND THIS
OR THERE'S SOME SOME THINGS THAT
WE SHOULD BE LOOKING AT. I THINK
L A L MENTIONED SOME ITEMS TO
SAVE MONEY. UM WHICH I TRY
APPRECIATE IN TERMS OF HER
HIGHLIGHTING IN HER ARE ALSO
HIGHLIGHTING HOW WHILE THOSE
WILL SAVE US MONEY, MAYBE THEY
WOULDN'T BE NECESSARILY THE
BEST. BEST PLACES TO SAVE MONEY.
UM YOU KNOW, GIVEN THE
IMPORTANCE OF THOSE KINDS OF
DECISIONS, YOU KNOW, SHE
MENTIONED BY DOING A SINGLE
TRACK, OR PERHAPS YOU COULD SAVE
MONEY ON STATIONS AND THINGS
LIKE THAT, BUT AGAIN ALSO
HIGHLIGHTED THE DOWNSIDE, BUT
THEY THINK WE'RE NOT LOOKING AT
THAT WOULD MIGHT REDUCE THE
COST. THE PHASE. ONE PROPOSAL,
AS IT STANDS NOW IS CONSISTENT
WITH NORMAL HIGH SPEED. REAL
PRACTICE AROUND THE WORLD. I
DON'T THINK THERE'S MUCH YOU
WOULD CHANGE ABOUT THAT. IF
YOU'RE GOING TO DO THAT PHASE
ONE SYSTEM IF YOU'RE NOT GOING
TO, THEN I THINK YOU WOULD LOOK
AT MERCED, THE BAKERSFIELD AT A
DIFFERENT WAY. YOU PROBABLY
WOULDN'T ELECTRIFY IT. YOU
PROBABLY WOULD REDUCE THE SPEED
OF THE TWO IN CONNECTIONS. I'M
SURE YOU WOULD DO THE STATION
THE SAME WAY THAT IS THAT IS A
GOOD IDEA, AND IT IMPROVES THE
VILE VALUE OF THE SERVICE. UH IF
YOU CUT BACK TO THE 119 MILE
SEGMENT, THEN I THINK YOU WOULD
CUT A LOT OF OTHER THINGS. SO
THERE ARE CHANGES. BUT IF YOU
ARE GOING TO DO PHASE ONE, AS IT
IS CURRENTLY ENVISIONED, I THINK
THAT'S FULLY IN LINE WITH
INTERNATIONAL PRACTICE AND
CHANGE MUCH. GOING BACK TO YOUR
POINT ABOUT INTERNATIONAL
PRACTICES. I MEAN THERE. YOU
KNOW HOW THERE'S HIGH SPEED RAIL
ALL AROUND THE WORLD. THIS IS
NOT SOMETHING. THIS IS NOT A
UNICORN. HIGH SPEED RAILS ARE
BUILT ALL YOU KNOW, I HAD AN
OPPORTUNITY TO RIDE. UM, WRITE
IT IN. CHINA AS WELL AS IN
TAIWAN. UM. IT'S CURIOUS IS
THERE IS WHAT WE ARE FACING SORT
OF CONSISTENT WITH WHAT OTHER
COUNTRIES, OTHER JURISDICTIONS
WHAT PEOPLE IN EUROPE. FACE AS
WELL OR IS OR IS WHAT WE'RE
GOING THROUGH. A LITTLE MORE
UNIQUE. YOU WE WILL TALK ABOUT
JAPAN EARLIER AS WELL. IN TERMS
OF THE TECHNOLOGY. THERE ARE
DIFFERENT WAYS OF SOLVING THIS
PROBLEM. BUT WHAT WE'RE DOING IS
CONSISTENT WITH THE APPLICATION
THAT WE HAVE. THE DIFFERENCE IS
THAT MOST OF THE INTERNATIONAL
SYSTEMS WERE DEVELOPED BY THE
NATIONAL RAIL COMPANY. THEY HAD
FULL COMPETENCE IN PLACE AT THE
BEGINNING. THEY HAD DONE THESE
THINGS BEFORE, AND THEY HAD THE
FULL BACKING OF THE NATIONAL
GOVERNMENT TO GET THE JOB DONE.
AND I WOULD SAY IN SOME
COUNTRIES THEY DIDN'T HAVE THE
SAME ENVIRONMENTAL CLEARANCE
ISSUES AND OTHER KINDS OF
VICTORIES. WE HAVE SO IN CHINA,
FOR EXAMPLE OF THEY'VE BUILT
25,000 MILES WHILE WE'VE BEEN
TRYING TO GET STARTED HAD
CERTAIN ADVANTAGES OF
ORGANIZATION AND MONEY THAT WE
DIDN'T HAVE, BUT TECHNOLOGICALLY
. WHAT WE'RE PROPOSING TO DO IS
PERFECTLY CONSISTENT WITH THE
VARIOUS ALTERNATIVES THAT ARE
AVAILABLE. BUT BUT BUT I THINK
IT GOES BACK TO SORT OF WHAT YOU
WERE TALKING ABOUT IN TERMS OF
THE INTERSTATE HIGHWAY SYSTEM
RIGHT ONCE ONCE WE MADE THAT
COMMITMENT FROM THE FEDERAL
LEVEL. THERE WAS FEDERAL
COMMITMENT. FEDERAL MONEY
RESOURCES. I'M SURE POLICY LEGAL
LEGISLATION TO MAKE THAT OCCUR,
EVEN THOUGH WE'RE. THE FOURTH
LARGEST ECONOMY IN THE WORLD,
WERE FINANCIALLY NOT SET UP IN
EXACTLY THAT SAME WAY WHERE EVEN
WE SEE OURSELVES AS AS AS A
NATION STATE. WE DON'T HAVE THAT
SAME SORT OF EXACT FUNDING
ABILITY THAT WE WOULD THAT WORD
. YOU KNOW, EVEN A SMALL COUNTRY
LIKE YOU KNOW, SMALL PLACES LIKE
TAIWAN WOULD COULD COULD DO
THAT. IS THAT FAIR TO SAY? THE
INTERSTATE HIGHWAY PROGRAM,
WHICH WAS PASSED OVER A LOT OF
OPPOSITION. INCIDENTALLY, WHEN
THEY ABSOLUTELY, UH WAS BASED
ESSENTIALLY ON A STABLE FUNDING
FROM THE GAS TAX, PLUS A FEW
OTHER THINGS. THAT PERMITTED THE
FEDERAL HIGHWAY ADMINISTRATION.
OH, AND WE PAID END OF END, THE
FEDERAL GOVERNMENT PAID 90% OF
THE COST, BUT THAT PERMITTED THE
FEDERAL HIGHWAY ADMINISTRATION
TO ESTABLISH THE NATIONAL MAP
THAT EVERYONE AGREED TO IT
PERMITTED THEM TO PLAN THE
CONSTRUCTION OF THE SYSTEM
INCONSISTENT, CONSISTENT WITH
THE MONEY THAT WAS COMING IN. IT
PERMITTED THEM TO TRAIN A CADRE
OF PEOPLE WORKING WITH THE
STATES THAT THAT WE'RE FULLY
COMPETENT TO DO THE JOB. AND IT
TOOK THEM 30 OR 40 YEARS TO DO
IT, AND THEY STILL LEARN
ENTIRELY FINISHED. THEY'RE STILL
MINOR THINGS THAT ARE GOING ON.
THAT'S THE WAY YOU DO A PROGRAM
LIKE THIS. I THINK NOT HOPING TO
FIND MONEY FROM YEAR TO YEAR.
GOT IT. BUT IT ALSO I THINK
WHERE YOU DESCRIBED IS, UM, WHAT
HAPPENS WHEN THE FEDERAL
GOVERNMENT HAS THAT BACKING?
WHICH IS WHAT WAS THE CASE IN
ALL THE OTHER COUNTRIES WE WERE
DISCUSSING THESE WERE ALL
NATIONAL PROJECTS. THEY WEREN'T
A STATE PROVINCIAL PROJECT. IT
WASN'T A STATE PROJECT OR
PROVINCE PROJECT. IT WAS
SOMETHING THAT THE NATIONAL
GOVERNMENT FULLY. UH WHEN, AFTER
SO IT SEEMS LIKE THAT'S THAT'S
THE ONE PIECE TO ME. THAT'S A
LITTLE BIT DIFFERENT FOR US THAT
WE'VE DECIDED TO TRY TO GO IT
ALONE AND THIS IS PART OF THE
REASON WHY IT'S CHALLENGING, BUT
I DO WANT TO ADD ONE POINT WE
HAVE. FINALLY I HOPE ABANDON THE
IDEA THAT THE PRIVATE SECTOR IS
GOING TO BUILD. THEY ARE NOT
THEY MIGHT INVEST LATER. ONCE
THE OPERATION OF THE SYSTEM HAS
PROVEN, AND I SAID MIGHT, I'M
NOT EVEN SURE OF THAT. BUT THEY
WILL NOT MAKE A CONTRIBUTION TO
CONSTRUCTING THE SYSTEM THAT
NEEDS TO COME FROM PUBLIC
FUNDING EITHER STATE OR FEDERAL.
I APPRECIATE THAT. YOU'RE YOU'RE
REITERATING THAT THERE'S NO ONE
COMING TO SAVE US. WE GOTTA
DECIDE IF WE'RE GOING TO SAVE
OURSELVES. THAT'S WHAT WE'RE
HEARING. SO I AGAIN I COMPLETELY
APPRECIATE THE DISCUSSION REALLY
APPRECIATE ALL THE COMMENTS FROM
MY COLLEAGUES, AND I THINK I
THINK THERE IS, UM A LOT MORE
AGREEMENT THIS YEAR THAN WE HAVE
HAD IN YEARS PAST. I REALLY
APPRECIATE THAT. BUT I THINK
OBVIOUSLY THEIR DECISIONS FROM A
HIGHER POLICY LEVEL THAT NEED TO
GET MADE IN ORDER FOR THE FOR
THE COMMITMENT TO BE SOLIDIFIED
SO VERY MUCH APPRECIATE THAT.
THANK YOU. THANKS UM, I ALSO I'M
GOING TO HAVE TO MAKE SOME
COMMENTS AND QUESTIONS NOW AND
THEN MR BENNETT COMES BACK.
WE'RE TAG TEAMING. IN HOUSING
COMMITTEE, SO I'LL HAVE TO GO
AND PRESENT MY BILL AND THEN
HOPEFULLY STILL COME BACK TO
HEAR THE REMAINDER OF THE
CONVERSATION. THIS HAS BEEN A
REALLY EXCELLENT DISCUSSION,
PROBABLY IN A COUPLE OF YEARS
THAT I'VE BEEN DOING THIS. I
THINK THE MOST HONEST DISCUSSION
THAT WE'VE HAD ABOUT THE PROJECT
AND WHAT WE NEED TO DO. ALTHOUGH
MR THOMAS, YOU HAVE BEEN RAISING
THESE CONCERNS FOR QUITE A
WHILE, UM, YOU KNOW, THE I THINK
IT'S VERY EASY TO COMPARE. OUR
PROJECT WITH PROJECTS OVERSEAS.
BUT AS YOU POINT OUT, THERE'S A
WORLD OF DIFFERENCE IN MANY OF
THESE COUNTRIES COMING OUT OF
THE GREAT DEPRESSION COMING OUT
OF WORLD WAR TWO. THEY INVESTED
IN A NATIONAL RAIL SYSTEM WE
INVESTED IN A NATIONAL HIGHWAY
PROGRAM. AND THAT PUT THEM IN A
VERY DIFFERENT PATH TO BEING
VERY READY TO TRANSFER TO
TRANSITION TO HIGH SPEED RAIL.
THEY HAD A LOT OF EXISTING RIGHT
AWAY. THEY HAD A PUBLIC THAT WAS
USED TO TAKING TRAINS AND THEIR
BEARING THE BENEFIT OF THAT, IN
SOME COUNTRIES, THEY DON'T HAVE
THE SAME KIND OF ENVIRONMENTAL
REGULATIONS THAT WE HAVE. I
WOULD SAY THAT THAT'S NOT A GOOD
THING FOR THOSE COUNTRIES. THEY
DON'T HAVE THE KIND OF LABOR
STANDARDS THAT WE HAVE. AND THAT
ALLOWS THEM TO BUILD QUICKLY AND
BUILD CHEAPLY. I DON'T WOULDN'T
ARGUE THAT WE MOVED TO THAT
MODEL EITHER. UM BUT WE ARE
WHERE WE ARE. UM AS MUCH AS THE
GLANCE, THE GLIMPSES BACKER
HELPFUL TO GIVE US CONTEXT. WE
STILL I STILL NEED TO FIGURE OUT
HOW TO MOVE THE PROJECT FORWARD
AND WHAT CHAIR TING SAID. I
THINK IS THE KIND OF THE MOST
SALIENT POINT THAT I'VE HEARD
TODAY, WHICH IS NO ONE'S GOING
TO COME IN AND SAVE US. WE HAVE
TO SAVE OURSELVES AND EVEN THE
FEDERAL FUNDING THAT'S BEEN
DISCUSSED IS REALLY A PORTION OF
THE MERCED TO BAKERSFIELD
FUNDING. I HAVEN'T HEARD ANYBODY
IDENTIFY ANY FEDERAL SOURCE IN
ANY STREAM THAT'S AVAILABLE NOW
THAT WOULD FUND THE ENTIRE PHASE
OF THIS PROJECT. AND THE L. A S
COMMENT THAT IF WE EXTENDED CAP
AND TRADE TO 2050 AND DEDICATED
100% OF THE CAP AND TRADE
REVENUE TO THIS PROJECT. IT'S
STILL WOULD NOT FUND THE
PROJECT. AND LET'S NOT FORGET
THAT THAT 100 BILLION ESTIMATE
FOR PHASE ONE IS TODAY'S DOLLARS
, AND THAT PROJECTS NOT MOVING
FORWARD FOR 7 TO 10 YEARS. SO
WHO KNOWS WHAT THOSE DOLLARS
WILL LOOK LIKE IN THAT AMOUNT OF
TIME? SO I THINK THAT WHETHER OR
NOT WE LIKE THE PROJECT OR DON'T
LIKE THE PROJECT. IT'S NOT A
QUESTION OF THAT. YOU KNOW,
WE'RE NOT GONNA THINK TRYING TO
SAY SOMEBODY LIKES IT. SOMEONE
DOESN'T LIKE IT. SOMEONE'S
FORWARD. SOMEONE'S AGAINST. IT
IS ALL BESIDE THE POINT. RIGHT
NOW. WE HAVE A DECISION TO MAKE
ABOUT HOW DO WE GET THE MOST
VALUE OUT OF THIS. HOW DO WE
EITHER FIND ENOUGH STUDY FUNDING
TO REALLY COMPLETE PHASE ONE?
RATHER THAN DO WHAT HAS BEEN
DONE FOR LEGISLATURES NOW FOR
MANY YEARS, WHICH IS STALL AND
STALL, INSTALL OR DO WE SAY?
THAT IS A QUESTION FOR ANOTHER
DAY. LET'S JUST FOCUS ON MERCED
, BAKERSFIELD, AND IF THAT'S
GOING TO BE THE ANSWER. IF WE
DON'T GET A FEDERAL PARTNER,
BECAUSE WE DON'T KNOW YET IF
WE'VE BEEN GETTING A FEDERAL, UH
ENOUGH OF A FEDERAL PARTNER TO
YOU KNOW, WE DON'T EVEN KNOW
WHAT THAT COMMITMENT IS GOING TO
BE FROM THE FEDERAL GOVERNMENT
COULD BE TWO BILLION COULD BE 10
BILLION COULD BE NOTHING COULD
BE EIGHT BILLION. WE DON'T KNOW.
SO WE NEED TO BE PREPARED FOR
ALL THOSE CONTINGENCIES AND WE
NEED TO ALSO BE BE WILLING TO
FLOAT A CONCEPT THAT SAYS, DO WE
TRY TO GET THE MOST VALUE OUT OF
MERCED TO BAKERSFIELD AS WE CAN
, AND THEN AGAIN, WAIT TO SEE
WHAT HAPPENS IN THE FUTURE. UM
AND IF SO, WHAT DOES THAT LOOK
LIKE? WHAT DOES THAT PROJECT
LOOK LIKE? BECAUSE AS MR
THOMPSON SAID, RUNNING HIGH
SPEED RAIL FROM MERCED TO
BAKERSFIELD. THAT'S THAT'S NOT A
GREAT USE OF TAXPAYER MONEY,
EITHER. UM BUT WHAT YOU KNOW IF
WE BUT WHAT IS THE CONTINGENCY
THERE? AND IF NOT, IF WE'RE
REALLY COMMITTING TO PHASE ONE,
CAN WE IDENTIFY A STUDY FINDING
A STEADY ENOUGH FUNDING SOURCE
TO GET US THERE? WE'RE GOING TO
HAVE TO DO THAT. AND THIS IS THE
TIME WE CAN'T KEEP WAITING
BECAUSE THEY'VE GOT DECISIONS TO
MAKE THAT ARE GOING TO IMPACT
WHAT THEY'RE BUILDING. RIGHT. WE
CAN'T IT'S NOT FAIR TO THEM FOR
US TO CHANGE THE SCOPE OF THE
PROJECT YEAR TO YEAR. AND IF
WE'RE REALLY COMMITTING TO PHASE
ONE, AND WE IDENTIFY A FUNDING
SOURCE, THAT'S ONE PROJECT, BUT
IF NOT, THEY NEED TO BE PREPARED
TO DO SOMETHING DIFFERENT. AND
THAT'S JUST THE REALITY OF IT.
YOU KNOW, WE'VE BEEN TRYING TO
KIND OF HAVE THIS DISCUSSION. I
THINK FOR THE PAST SEVERAL
YEARS, I THINK WE'VE INCHED
CLOSER TO IT. BUT WE HAVEN'T
ANSWERED IT YET. WE WERE WE JUST
HAVEN'T YOU KNOW, WE DID SOME
THINGS. LAST YEAR WE GOT AN
INSPECTOR GENERAL, WHICH WILL
GIVE SOME TRANSPARENCY, I THINK,
GIVE US SOME ANSWERS THAT WE
NEED AND CERTAINLY FOR A PROJECT
OF THIS SIZE SHOULD HAVE BEEN
DONE YEARS AGO. WE DID ASK FOR A
STATION IN MERCED THAT WILL AT
SOME POINT CONNECT TO WASTE. BUT
AS WE HEARD WE DON'T I DON'T
KNOW WHETHER A SEASON HAS THE
MONEY TO GET TO THAT STATION.
DOES ANYBODY KNOW UP THERE? ELLA
OH, DO YOU KNOW TO WHETHER THEY
HAVE A POINT? IT'S ALL BEEN
SECURED YET. I BELIEVE THEY
HAVEN'T EVEN TALKED ABOUT THAT.
THAT WE HAVE ANOTHER AGENCY THAT
WE'RE EXPECTING TO MEET THIS
TRAIN THAT'S NOT FUNDED. FOR
THEIR, UH, EXTENSION TO GET TO
THE STATION. SO I'LL ASK, UM, MR
KELLY. I GUESS THAT IF WE DON'T
HAVE THE FEDERAL FUNDING PARTNER
THAT WE EXPECT WHAT THEN IN THE
NEAR TERM WOULD YOU DO TO MAKE
THAT MERCED BAKERSFIELD SECTION
TO COMPLETE IT AND TO GIVE IT
UTILITY WOULD IF WE DON'T HAVE A
FEDERAL PARTNER, WE'RE GOING TO
BUILD ONLY WHAT WE'VE BEEN
FUNDED FROM THEM TO BUILD. 119
MILES AND FINISH THE
ENVIRONMENTAL DOCUMENTS. SO THE
119 MILES FROM POPLAR AVENUE?
YEAH OUTSIDE OF MERCED, MADERA
MADERA. SORRY AND ON ONE TRACK
OR TWO TRACKS. UH PROBABLY TWO.
AND WHAT'S YOUR RIDERSHIP?
ESTIMATES FOR THAT, BUT WE DON'T
HAVE ONE. AS I SAID AT THE
OUTSET, THE 119 MILES IT'S NOT A
GOOD OPERATING RUN. AND THAT'S
WHY WE'VE ARE PROPOSING TO GO
FURTHER. HMM. UM.
I MEAN, IT'S HARD TO. YEAH IT'S
HARD TO EVEN ASK QUESTIONS,
GIVEN THE AMOUNT OF UNKNOWNS AND
IN ALL OF THESE SCENARIOS, RIGHT
? UH YOU KNOW, I. IT'S CLEAR TO
ME THAT YOU KNOW THERE'S A LOT
OF DECISIONS THAT WE HAVE TO
MAKE. THAT WE JUST HAVEN'T MADE
YET AS A LEGISLATURE. AND AS A
PUBLIC, YOU KNOW, TO HAVE THAT
PUBLIC DIALOGUE, THERE'S
CERTAINLY A LOT OF VERY LOUD
VOICES IN THE PUBLIC THAT WANT
TO SEE THIS PROJECT COMPLETED.
BUT I THINK THAT THE UM, UH, THE
WITH WITHOUT THE TRADE OFFS, AS
AS, UM AS WAS, AS WAS STATED. UM
BY ONE OF MY COLLEAGUES WITHOUT
PRESENTING TO THE PUBLIC THE
TRADE OFFS THAT THAT MIGHT
ENTAIL. IT'S HARD TO EVEN HAVE
THE PUBLIC DIALOGUE. FOR
INSTANCE, THE CAP AND TRADE
REVENUE WHAT ELSE IT'S GOING TO
NOW AND WHAT IT COULD GO TO UM
AND THEN BEYOND THAT, WHERE THE
REST OF THIS FUNDING COMES FROM,
AND IN, BY THE WAY, I DON'T
THINK THAT WE SHOULD STOP
PUSHING THE FEDERAL GOVERNMENT
TO BE A MORE STEADY PARTNER. I
THINK THAT THAT'S AN IMPORTANT
CONVERSATION TO HAVE. AND YOU
KNOW, IT COULD BE THAT GIVEN
THIS ADMINISTRATION'S, UH,
PRIORITIES THAT THAT'S A
POSSIBILITY. BUT ALSO THE
VITAMIN ASTRAY. SHIN DOESN'T
NECESSARILY HAVE THE SUPPORT OF
CONGRESS FOR A LOT OF THIS, SO
THERE'S A LOT OF UNKNOWNS IN
THAT, BUT I, BUT THAT DOESN'T
STOP SHOULDN'T STOP US FROM FROM
AS CALIFORNIA, HOPEFULLY
SPEAKING WITH ONE VOICE TO ASK
THE FEDERAL GOVERNMENT TO BE A
BETTER PARTNER IN THE PROJECT.
UM I THINK I'LL MOVE ON TO I
KNOW THAT WE HAVE OTHER MEMBERS
THAT HAVE QUESTIONS. I THINK, MR
FONG, WE'RE NEXT. THANK YOU,
MADAM CHAIR. UM THIS IS A VERY
SOBERING CONVERSATION. AND AS
PROBABLY THE ONLY MEMBER OF THIS
PANEL AT THE MOMENT THAT
REPRESENTS THE CENTRAL VALLEY
AND IS THE MOST IMPACTED. BY
THIS PROJECT, EVERYONE HERE IS
TALKING ABOUT OTHER REGIONS, BUT
I LIVE IN THIS COMMUNITY. AND SO
I'VE SEEN THE DIFFICULTIES AND
THE CHALLENGES AND THE CHAOS
THAT'S BEEN CREATED BY THIS
PROJECT AND I AM FULLY
TRANSPARENT. I TALKED TO MR
KELLY BEFORE THIS HEARING. I AM
A VOCAL CRITIC OF THIS PROJECT.
BUT IT'S NOT BECAUSE I LIKE I
DON'T HAVE INFORMATION. IT'S
BECAUSE I SEE IT. AND I'M SEEING
THE STRUCTURE. AND I KNOW
THERE'S FATIGUE. WHERE ALL THE
CONSTANT CRITICISM AND I'VE SAID
THIS BEFORE IN THIS COMMITTEE,
WE AS LEGISLATORS MAKE DECISIONS
ALL THE TIME WITH IMPERFECT
INFORMATION. BUT NOW WE GET
EVERY SINGLE YEAR MORE AND MORE
INFORMATION. LET ME JUST REMIND
THE MEMBERS IN 2008. THE
BUSINESS PLAN SAID THAT THIS
TOTAL PROJECT PHASE ONE IT COSTS
$34 BILLION AND BE COMPLETED IN
2020. IN 2012. THE BUSINESS PLAN
SAID THAT THEN THIS PROJECT
WOULD CAUSE 68.4 BILLION AND
COMPLETED IN 2029. IN 2014
BUSINESS PLAN WAS PRESENTED THAT
SAID THIS PROJECT WOULD COST 68
BILLION BE COMPLETED IN 2028 A
LITTLE FASTER. IN 2016. THE
BUSINESS PLAN SAID THIS PROJECT
WOULD COST 64 BILLION. IT
COMPLETED IN 2029. THEN IN 2018
, IT ROSE TO 77.3 BILLION
FINISHED IN 2023 OR 2033. IN
2020. IT ROSE TO 80.3 BILLION
FINISHED IN 2033 2020. IT WAS 83
BILLION. COMPLETED IN 2023, 23 3
. AND THEN, OF COURSE, LAST YEAR
IT ROSE TO 94.2 BILLION AND THEN
NOW WE'RE LOOKING AT A $128
BILLION COST WITH NOW NO DATE
PROVIDED FOR COMPLETION. SO.
THAT THIS IS OUR FRUSTRATION IS
THAT THE CONCERNS WE HAVE RAISED
THE MORE INFORMATION THAT WE'VE
BEEN PRESENTED BY THESE BUSINESS
PLANS. HAVE PROVEN THAT OUR
WARNINGS ARE COMING TRUE. SO I
GUESS MY QUESTION AND I WANT
REAL INTEGRATE ALL THE QUESTIONS
AND BUT TO THE ELIO, HOW MUCH
FUNDING AND MONIES. HAS THIS
PROJECT RECEIVED FROM THE STATES
CAP AND TRADE PROJECT. UM SO I
THINK THAT'S ACTUALLY
HIGHLIGHTED. UM IF YOU LOOK AT
OUR FIGURE ON PAGE 15. WE HAVE
THE CAP AND TRADE. THIS WAS AN
ESTIMATE THROUGH NOVEMBER 2022.
IT WAS ABOUT 5.5 BILLION. IT'S
PROBABLY A LITTLE BIT HIGHER
SINCE THEN. UM AND THEN THERE'S
AN ESTIMATE. UM THAT ASSUMES
THAT THE PROJECT WILL RECEIVE
BETWEEN 750 A BILLION DOLLARS A
YEAR FROM CAP AND TRADE THROUGH
2030 THAT IT WOULD GET ANOTHER 6
TO 7.7 BILLION. THROUGH 2030
FROM THE INCEPTION OF THIS
PROJECT, AS MORE INFORMATION HAS
BEEN PROVIDED AS ANYONE OR HAS
THE GOVERNOR'S BUDGET EVER
PROPOSED ANY CUTS OR REVISIONS
TO THIS PROJECT? I MEAN, HAS. IS
THERE ANY BEEN? HAS THERE BEEN
ANY REEVALUATION OF THIS
PROJECT? THERE HAVE BEEN VALUE
ENGINEERING. SO, FOR EXAMPLE,
ORIGINALLY, I THINK THAT THE
PROJECT WAS SUPPOSED TO HAVE
MORE DEDICATED, ACTUALLY, LET ME
LET ME THINK ABOUT THE QUESTION.
HAS THERE EVER BEEN A OPTION TO
REDUCE FUNDING FOR THIS PROJECT?
AND MOVE IT TO SOMETHING ELSE.
UM I DON'T RECALL. I DON'T
RECALL THAT, UM, AT LEAST IN MY
RECOLLECTION. THERE'S BEEN
CHANGES IN SCOPE. I'LL STIPULATE
THAT. I JUST DON'T KNOW IF
THERE'S EVER BEEN OPTION BEFORE
THE LEGISLATURE TO SAY, HEY,
MAYBE WE SHOULDN'T SPEND HALF A
BILLION DOLLARS IN KAPPA TRADE
AND MAYBE PUT IT TO SOMETHING
ELSE. NO, I DON'T. YEAH, I DON'T
RECALL ANY, UM, PROPOSAL OF THAT
SORT. OKAY BECAUSE IT IS MY
UNDERSTANDING. YOU KNOW, THE
GOVERNOR HAS PROPOSED AS BUDGET
WITH A NUMBER OF CUTS TO THINGS
LIKE FLOOD PROTECTION, TRANSIT
SCHOOL FACILITIES, BUT I'M JUST
TRYING TO FIGURE OUT
CONTEXTUALLY WHETHER THERE'S
EVER BEEN AN OPTION PRESENTED
BEFORE US THAT ACTUALLY MOVES
THE RESOURCES TO SOMETHING ELSE.
I DON'T BELIEVE SO FROM THIS
ADMINISTRATION NOW, AND SO I
GUESS THE QUESTION MAYBE TO THE
TO THE L A O OR IS SHOULD WE BE
PRESENTED THAT OPTION? WELL, I
THINK ALL OF THE OPTIONS ARE
CERTAINLY BEFORE THE LEGISLATURE
. I DON'T KNOW THAT THE
ADMINISTRATION'S THEY PRESENT
WHAT THEY PRESENT. WHATEVER THE
GOVERNOR, YOU KNOW, WHATEVER HIS
PRIORITIES ARE, AND THAT'S
CERTAINLY THE GOVERNOR'S
PREROGATIVE. AND IT'S THE
LEGISLATURE'S PREROGATIVE TO
LOOK AT THAT PROPOSAL AND TO
TAKE IT OR TO LEAVE IT OR TO
TAKE IT IN PART AND LEAVE IT IN
PART, OR TO PROPOSE SOMETHING
ENTIRELY NEW AND IN FACT, THE
LEGISLATURE'S POWER OF A
PREPARATION IS ONE OF ITS MOST
POWERFUL CORE. ROLES AND
RESPONSIBILITIES AND ONE THAT
THE LEGISLATURE. REALLY UM, YOU
KNOW, THAT'S THAT'S WHERE THE
LEGISLATION OF LEGISLATURES
POWER IS AS YOU AS YOU ALL KNOW,
UM, AND SO CERTAINLY WHETHER OR
NOT THE GOVERNOR PROPOSES TO
REDUCE FUNDING IN THIS AREA. THE
LEGISLATURE COULD CONSIDER THAT.
IF THAT IS, IN FACT, THE
LEGISLATURE IS PRIORITY
QUESTIONS SET THIS UP PERFECTLY.
WHICH IS IT IS UP TO US AND TO
THE LEGISLATURE. WE CAN
DETERMINE WHETHER WE CAN
REALLOCATE OR CHANGE THAT
ALLOCATION TO OTHER THINGS.
ABSOLUTELY WITHIN OUR POWER.
ABSOLUTELY EVEN THOUGH THE CAP
AND TRADE DOLLARS ARE
CONTINUOUSLY APPROPRIATED, SO
THEY'RE KIND OF ON AUTOPILOT IN
A SENSE ON THE LEGISLATURE
DOESN'T HAVE TO APPROPRIATE THEM
EVERY YEAR IN THE BUDGET ACT THE
WAY IT DOES FOR MOST THINGS, AND
THAT'S PRETTY UNUSUAL AND
ACTUALLY IN MANY CASES ARE
OFFICE. UM OFTEN, YOU KNOW, IT'S
UM, CAUTIONS AGAINST THAT,
BECAUSE IT DOES SORT OF PUT
THINGS ON AUTOPILOT. UM BUT EVEN
WITH THAT, THAT DOESN'T MEAN THE
LEGISLATURE COULDN'T CHANGE
THAT. IF AGAIN THAT WAS THE
LEGISLATURE'S PRIORITY. THE
LEGISLATURE COULD ALWAYS SAY,
HEY, WE WANT TO MODIFY OR MORE
DISCONTINUE THAT CONTINUOUS
APPROPRIATION. CERTAINLY THAT'S
WITHIN THE LEGISLATURE'S
PREROGATIVE. AND UM, YOU KNOW,
OBVIOUSLY, THE LEGISLATURE WILL
NEGOTIATE. ULTIMATELY THE FINAL
BUDGET WITH THE ADMINISTRATION
BUT UM, YOU KNOW, THE
LEGISLATURE HAS A LOT OF
FLEXIBILITY IN TERMS OF WHAT IT
DOES AND IN THE BUDGET I THINK
THEN I GAINED. I'LL JUST END
WITH THAT MESSAGE, WHICH IS THAT
IS THE CRITICAL COMPONENT IN THE
BIG. THE BIG DEBATE WE'RE HAVING
RIGHT NOW IS THAT IT'S NOT THE
GOVERNOR ONLY. IS THAT WE AS
ELECTED OFFICIALS IN THE
ASSEMBLY AND THE STATE SENATE
AND ON THIS BUDGET COMMITTEE
HAVE THE ABILITY TO REALLOCATE
OR TO CHANGE AND MODIFY THIS
PROJECT. SO THAT IT CAN BE
EITHER USED FOR OTHER PURPOSES
FOR OTHER USEFUL CRISES AS THE
CHAIR OF THE BUDGET COMMITTEE.
AS MENTIONED. WE HAVE A LOT OF
CRISES FACING IT, CALIFORNIA.
AND SO IS THIS GOING TO BE THE
NUMBER ONE PRIORITY. I WOULD
STIPULATE THAT IT'S PROBABLY NOT
WHEN THEY'RE BORN PRIORITY OF
CALIFORNIANS. AND AS WE LOOK AT
ALL THE INFORMATION AND WE
EXAMINED THE BUSINESS PLANS, WE
HAVE TO BE HONEST ABOUT WHAT WE
ARE ALLOCATING AND WHAT WE'RE
INVESTING DOLLARS IN AND AS, UM,
AS MR THOMPSON HAD MENTIONED THE
PRIVATE SECTOR ISN'T COMING IN.
AND IF I WOULD LIKE TO REMIND
FOLKS THAT THE VOTERS WERE TOLD
THAT 21 TO 22% OF THE FUNDING OF
THIS PROJECT THAT THIS WAS GOING
TO COME FROM THE PRIVATE SECTOR
AND THAT THIS WAS GONNA BE, YOU
KNOW, A $34 BILLION PROJECT THAT
HAS AN ORIGINAL 128 BILLION WE
HAVE TO COME AT THIS WITH THEIR
EYES WIDE OPEN, AND SO I WOULD
MAKE THE ARGUMENT RIGHT NOW THAT
EVEN THOUGH WE'RE FATIGUED, AND
WE'RE HERE, WE'RE JUST GETTING
BOMBARDED WITH THE SAME THING.
HIGHER COSTS COST OVERRUNS.
DELAYS AND THE RIDERSHIP NUMBERS
AREN'T REAL. AND IF EVERY SINGLE
BUSINESS PLAN KEEPS REPEATING
THE SAME THING, THEN WE SHOULD
TAKE THAT WARNING AND TAKE THAT
INFORMATION TO ACCOUNT. AND, UM
AND STOP THIS PROJECT AND TO PUT
THOSE RESOURCES INTO BETTER USE.
THANK YOU. THANK YOU, SENATOR
MEMBER. THANK YOU, MR CHAIR.
GOOD MORNING. APPRECIATE YOU ALL
BEING HERE, UM AND, UH, THEIR
REFERENCES MADE TO OTHER
COUNTRIES. WE ARE DIFFERENT THAN
OTHER COUNTRIES. AND THAT'S
THAT'S A GOOD THING WHERE A
CONSTITUTIONAL REPUBLIC WHERE
REPRESENTATIVE DEMOCRACY WE'RE
ACCOUNTABLE TO THE PUBLIC TO THE
PEOPLE, AND I THINK IT'S
IMPORTANT THAT WE'RE HONEST WITH
THE PUBLIC AND THAT WE ARE GOOD
STEWARDS OF THEIR MONEY. AND SO
I'M ACTUALLY VERY, UM UH,
APPRECIATIVE OF THE COMMENTS
FROM MY COLLEAGUES. I THINK IT'S
REFRESHING THAT WE'RE TAKING AN
HONEST ASSESSMENT OF THIS AND I
REALLY APPRECIATE THE QUESTIONS
. I WANT TO ECHO ASSEMBLYMAN
CONNOLLY'S QUESTIONS. I THOUGHT
THEY WERE EXCELLENT QUESTIONS,
AND I WOULD LIKE TO MR KELLY I
WOULD LIKE THE ANSWERS TO THOSE
QUESTIONS AS WELL. SO WHEN YOU
WRITE TO HIM, IF YOU COULD COPY
ME ON THAT, I APPRECIATE IT VERY
INTERESTED IN THAT PROVIDED ME
THE WHOLE COMMITTEE. THANK YOU.
UM I THINK IT'S A POINT THAT WE
TAKE IT HONEST ASSESSMENT OF THE
PROJECT, WHICH WE'VE BEEN DOING
AND THAT THEY'RE ALSO WE DISCUSS
ACCOUNTABILITY FOR PERFORMANCE
BECAUSE I DO NOT BELIEVE THE
HIGH SPEED RAIL HAS HAS DONE A
GREAT JOB BASED ON PERFORMANCE.
MR KELLY. I WAS SHOCKED TO HEAR
YOU SAY THAT EVERYTHING YOU DO
IS IN ALIGNMENT WITH WHAT THE
VOTERS APPROVED. IS THAT
CORRECT? DID YOU SAY THAT? YEAH.
THE BOND BILL, UM, LAID OUT WHAT
WE HAVE TO BUILD, AND THAT'S
THAT'S WHAT WE'RE DOING. BUT THE
BOND BILL PROP ONE A. WHICH I
WAS IN LAW SCHOOL IN THIS PAST.
REMEMBER JOKING WITH MY FRIENDS
THAT THIS IS A JOKE? IT'S NEVER
GONNA HAPPEN BARELY PASSED. UM
AND THEY WERE TOLD IT WAS A $34
BILLION PROJECT. THAT'S WRONG.
THEY WERE TOLD TO BE DONE BY
2020 THAT'S WRONG. THEY WERE
TOLD THE STATE WOULD ONLY SPEND
NINE BILLION THAT WAS WRONG. AND
THEY WERE TOLD WE GET FROM L L.
A TO SAN FRANCISCO IN TWO HOURS
AND 40 MINUTES. THAT'S WRONG.
THERE'S NOTHING ABOUT THIS
PROJECT THAT'S CONSISTENT WITH
WHAT WAS TOLD AND PROMISE TO THE
VOTERS. IF THIS WAS DONE IN THE
PRIVATE SECTOR OF MONEY WAS
RAISED IN THIS FASHION WITH THIS
TYPE OF DECEPTION, WE CALL IT
INVESTMENT FRIED, BUT HERE WE
JUST CALL IT GOVERNMENT. BUT I
DO HAVE SOME SPECIFIC QUESTIONS.
UM. WE GET THEM HERE. THE
PROJECT COSTS. I DON'T
UNDERSTAND WHY THEY'RE SO WRONG.
UM. WHEN THE WHEN THE CONTRACT
WAS SIGNED WITH MADEIRA AND
SCHAEFER. IT WAS SUPPOSED TO
COST SIX BILLION AND NOW IT'S
TRIPLED IN COST IS THAT IS THAT
ACCURATE URINE? SCHAEFER IS I'M
SORRY. SHAVE SCHAEFER SHAFTER.
SORRY IT WAS SIX BILLION. NOW
IT'S TRIPLED IN COST. IS THAT
CORRECT? I DON'T I DON'T STAND
YOUR REFERENCE. SORRY. NO 119
MILES SEGMENT THAT YOU'VE BEEN
TALKING ABOUT? YES WHAT'S THE
QUESTION ABOUT THAT? IT WAS A $6
BILLION CONTRACT WHEN IT WAS
SIGNED CORRECT THREE SEPARATE
CONTRACTS THAT WERE VOTE VALUED
AT UH, A TOTAL OF IN TERMS OF
CONTRACTION CAUSE THAT ABOUT
THREE BILLION ACROSS THE BOARD.
OKAY NOW THAT THAT VALUE IS
ABOUT 6.5 TO 8 OKAY. BUT LET'S
JUST TALK ABOUT THE ESTIMATES
FROM A YEAR AGO. SURE 54 OF YOUR
REPORT THAT CONSTRUCTION BETWEEN
MADEIRA AND SHAFTER, WHICH IS
116 MILES SEGMENT HAVE RISEN BY
25% IN ONE YEAR ALONE. THE
SEGMENT FROM MERCED TO
BAKERSFIELD HAVE GONE UP BY 38%
IN ONE YEAR ALONE. SO WHY? WHY
ARE THERE SUCH DRAMATIC PRICE
DIFFERENCES IN LESS THAN A YEAR
? I DON'T UNDERSTAND. WE COVERED
THIS LAST YEAR WHEN WE
INTRODUCED THE BUSINESS PLAN IN
2022. WE SAID WE'D COME BACK IN
23. AND UPDATE THE ISSUE. BUT
FUNDAMENTALLY, THE PROBLEM IS
THAT AS IT'S BEEN ARTICULATED
MANY TIMES BEFORE WHEN THIS
PROJECT GOT INTO CONSTRUCTION
OUT OF SEQUENCE, WHICH MEANS
THEY ISSUED CONSTRUCTION
CONTRACTS WITHOUT HAVING THE
ENGINEERING DONE WITHOUT HAVING
THE RIGHT AWAY IN PLACE WITHOUT
HAVING SOME OF THE DESIGN DONE.
UM THEY THEN RAN INTO ISSUES
WITH DESIGN AND RIGHT AWAY BEING
DELAYED, WHICH DELAYED THE
PROJECT AND WHEN YOU DELAY THE
PROJECTS, THE CONTRACTORS GET
DELAYED CLAIMS AND WE DON'T HAVE
THE DESIGN DONE OR THE RIGHT
AWAY DONE. THOSE COSTS INCREASE
OVER TIME. AND SO YOU KNOW, AS I
SAID AT THE OUTSET, I CAME IN
HERE IN 2018. A LOT OF THOSE
PROBLEMS WERE IN FRONT OF US,
AND WE ARE NOW FINISHING AND
PUTTING THE SCOPE OF THAT WORK
INTO THE CONTRACTS TODAY, AND SO
WE'RE UPDATING THOSE CONTRACT
AMOUNTS NOW TO REFLECT THE WORK
BEING DONE. THAT WASN'T DONE
EARLIER. LET'S TALK ABOUT CHANGE
ORDERS BECAUSE THESE WERE DONE
IN YOUR WATCH. CHANGE ORDERS IS
NOT SUPPOSED TO BE A REGULAR
THING. I MEAN, THIS IS A DESIGN
BUILD. PROJECT THE CONTRACTORS
ARE SUPPOSED TO ABSORB THE
ADDITIONAL COSTS. SO IT'S TO ME
WHEN THERE'S A CHANGE ORDER THAT
THAT MEANS THERE'S A THERE'S A
TOTAL FAILURE. SOMETHING'S WRONG
. UM IS THAT YOUR VIEW OF A
CHANGE ORDER? IS THAT SUPPOSED
TO BE COMMON PRACTICE? WAS THAT
SUPPOSED TO BE AN EXCEPTION? NO
BUT AS I JUST HAVE TO FIGHT A
MINUTE AGO, UM A LOT OF THE
DESIGN WORK WAS NOT COMPLETED.
UM UH, OH, BUT A LOT OF THE
DESIGN WORK WAS NOT DONE ON
ELEMENTS OF THE SCOPE OF THE
PROJECT. UH BEFORE THE CONTRACTS
WERE LET THINGS CHANGED AND WHAT
WE'VE BEEN DOING OVER THE COURSE
OF THE LAST SEVERAL YEARS IS
PUTTING ALL OF THAT SCOPE. ALL
OF THAT. ALL OF THOSE DELAYS AND
ALL OF THOSE CLAIMS INTO THE
CONTRACTS WHICH YOU HAVE TO
EXECUTE THROUGH A CHANGE ORDER,
AND I'M THE FIRST GUY TO TELL
YOU THIS, AND I SAID THIS LAST
YEAR AND TESTIMONY WE WERE
CLEANING UP THE PAST AND WE'RE
NOW GETTING TO THE END OF THAT.
AND AS WE GO FORWARD, AND WE DO
THIS CONTRACT GOING FORWARD, WE
DO IT RIGHT. WE DO IT IN
SEQUENCE. WE DO IT IN THE RIGHT
WAY, AND WE REDUCE THOSE RISKS
AND THOSE DELAY COSTS BUT I
DON'T HAVE THE LUXURY OF
CHANGING YESTERDAY SO WE COULD
TAKE THE CURRENT COST ESTIMATES
TO THE BANK. IS THAT YOUR
TESTIMONY THERE WILL BE SOME
COST IMPACTS FROM THE COMPLETION
OF THE ENVIRONMENTAL WORK IN
SOUTHERN CALIFORNIA. BECAUSE
WHEN YOU COMPLETE THE
ENVIRONMENTAL WORK YOU HEAR FROM
COMMUNITIES ON WHAT'S IMPORTANT
TO THEM. WHAT MITIGATIONS THEY
WANT, WHAT THAT NEEDS TO LOOK
LIKE THEY'LL BE SCOPE CHANGES
PART OF THE ENVIRONMENTAL AND WE
WILL REFLECT THAT IN OUR COSTS
GOING FORWARD AND LOOK I'VE BEEN
HERE FOR FIVE YEARS. I COME FROM
THE LEGISLATURE. OKAY? I DON'T B
S THE LEGISLATURE. SO EVERYTHING
WE PUT INTO OUR DOCUMENTS IS HIS
BEST. WE KNOW IT AT THE TIME.
AND IN THIS CASE, YOU KNOW WE
HAVE. THIS IS A VERY HUMBLING
DOCUMENT TO PUT FORWARD. BUT
IT'S WHAT IT'S WHAT HAS TO BE
PUT FORWARD BECAUSE IT DOES
REFLECT THE COST OF IMPACTS ON
CONSTRUCTION PROJECTS IN AMERICA
AND INTERNATIONALLY RIGHT NOW,
AND IT DOES REFLECT WHERE WE ARE
ON GETTING THE YESTERDAY CAUGHT
UP AND THAT'S WHERE WE ARE.
WELL, I THINK EVEN THAT RECENT
PROJECTIONS HAVEN'T PANNED OUT
TO BE ACCURATE. LET ME ASK MR
THOMPSON, DO YOU AGREE? DO YOU
HAVE CONFIDENCE IN THE CURRENT
PROJECTS COST ESTIMATES? THEIR
ESTIMATES S¼. I'M GOING TO USE
THE TERM P 65, WHICH MEANS THE
PROBABILITY OF 65% THAT THE
ESTIMATES ON THE 119 MILE
SECTION OR CORRECT AND I THINK,
AS WE'VE LOOKED AT IT THAT
THAT'S WITHIN THE REALM OF
POSSIBILITY. WHAT DO YOU HAVE TO
BE AWARE OF? IS THAT MUCH OF THE
WORK ON THE PROJECT IS DIFFERENT
THAN WHAT'S BEEN DONE BEFORE,
AND THERE IS NO BIDDING
EXPERIENCE ON THIS WORK.
ELECTRIFICATION ROLLING,
ELECTRIC ROLLING STOCK SIGNALING
PANELING, MAJOR ELEMENTS OF THE
COST OF THE PROJECT HAVE NO
BIDDING EXPERIENCE TO DATE YET
SO WE'RE GUESSING NOT GUESSING,
BUT YOU SHOULD. YOU SHOULD BE
AWARE THAT THE POSSIBILITY FOR
IT TO BEING SOMEWHERE AROUND.
THE ESTIMATE IS MUCH GREATER FOR
THIS THAN IT IS FOR THE
REMAINING WORK ON THE 119 MILE
SECTION. AND MR THOMPSON LET ME
ASK YOU AND I APPRECIATE YOUR
TESTIMONY. UM I THINK YOU'VE
BEEN VERY TRANSPARENT AND
HONEST. UM IF THERE'S NO
PROSPECT OF FEDERAL FUNDS, AND
THE ONLY THING I'VE HEARD ABOUT
FEDERAL FUNDS IS HOPE. HOPE IS
NOT A PLAN. UM I DO NOT BELIEVE
THIS. CONGRESS HAS ANY DESIRE
INTENTIONS TO FUND CALIFORNIA
HIGH SCHOOL ROAD PROJECT, AND I
THINK THEY'VE SAID THE OPPOSITE.
UM SO IF THERE'S NO PROBABILITY
OF FEDERAL FUNDS, DO YOU
RECOMMEND THAT WE CONTINUE WITH
THIS PROJECT? TODAY. I THINK YOU
YOU. MY RECOMMENDATION IS THAT
YOU LOOK AT THE COST OF THIS
PROJECT AND THE CONTEXT OF THE
OTHER STUFF THAT THE LEGISLATURE
NEEDS TO FUND AND DECIDE WHAT
YOUR PRIORITIES ARE. I CAN'T
MAKE A RECOMMENDATION ON THAT,
BUT I CAN CERTAINLY SUGGEST AS
WE HAVE THAT YOU TAKE A THOROUGH
LOOK AT THE PROJECT AND DECIDE.
IS IT WORTH IT IN THE CONTEXT OF
WHATEVER ELSE YOU'VE GOT TO PAY
FOR? YOU AGREE WITH THE PROJECT
IS NOT VIABLE WITHOUT FEDERAL
FUNDS. NO I DON'T AGREE TO THAT
. THE THERE ARE THERE ARE A
NUMBER OF WAYS THAT IF YOU WANT
TO DO THEM, YOU COULD CERTAINLY
FINANCE IT WAS STATE MONEY. IF
YOU EXTEND THE CAP AND TRADE TO
2050, IF YOU GAVE ALL OF THAT TO
THE TO THE AUTHORITY IF YOU HAVE
A TWO CENT SALES TAX ON SUGAR,
FOR GOODNESS SAKE OR SALES TAXES
, OR THERE ARE PLENTY OF SOURCES
. THIS IS NOT UNAFFORDABLE TO
THE STATE. AND IN A SENSE,
DEPENDING ON THE FEDERAL
GOVERNMENT TO DO IT FOR US TO
SOLVE A AN INTERNAL STATE NEED
IS, YOU KNOW WE SHOULD THINK
ABOUT THAT. IF WE REALLY WANT
IT, WE CAN PAY FOR IT. MR KELLY
ASKED YOU DO YOU THINK THE
PROJECTS VIABLE WITHOUT FEDERAL
FUNDS? I THINK THE PRIDE I THINK
YOU KNOW, THE BEST ANSWER I CAN
GIVE YOU IS THAT I THINK
PROJECTS LIKE THIS DO GET AND
REQUIRE A LONG TERM FEDERAL
PARTNER. IT WAS TRUE AT THE
HIGHWAY SYSTEM. IT'S TRUE WITH
THE PROJECT LIKE THIS. AND I
THINK WE WILL HAVE THE
OPPORTUNITY THIS YEAR TO GET
FEDERAL FUNDS. OKAY, WELL, WE'LL
WE WILL. WE SHALL SEE. UM UM I
DO THINK TO MY COLLEAGUES THAT
JUST SAY WE WERE GONNA HAVE SOME
REALLY TOUGH DECISIONS MOVING
FORWARD WITH OUR BUDGET. I
PERSONALLY IN MY DISTRICT I'VE
TOWARD SOME HOSPITALS. UM THE
HOSPITAL SYSTEM IS FACING A
MASSIVE FINANCIAL CRISIS. WE'RE
TALKING ABOUT HOSPITALS BEING
SHUT DOWN. UM THERE ARE BILLIONS
OF DOLLARS IN DEFICIT. WE'RE
TALKING ABOUT CHILDREN'S
HOSPITALS AND OTHER THINGS WE
HAVE. UM HEAVILY, BUT WE DON'T
REALLY HAVE THE ELECTRIC GRID
SYSTEM SET UP. I MEAN, THERE ARE
A LOT OF AREAS THAT REQUIRE
IMMEDIATE FINANCIAL CAPITAL. AND
I'M NOT SURE THAT THIS PROJECT
IS THE BEST USE OF OUR RESOURCES
. WE HAVE TO BE GOOD STEWARDS
WITHOUT MONEY, AND I'LL JUST SAY
, I THINK OVERALL AND WITH THIS
MR CHAIR IS JUST I THINK IT'S
SAD. I THINK AMERICA THE UNITED
STATES OF AMERICA, WE SHOULD BE
ABLE TO BUILD BIG PROJECTS ON
BIG SCALES. BUT I THINK WHAT
WE'RE SUFFERING FROM TODAY'S
JUSTICE OVER BLOATED BUREAUCRACY
AND GOVERNMENT AND, UM, CRONY
CAPITALISM AND REGULATIONS AND
ALL SORTS OF BARRIERS THAT WE'VE
ARTIFICIALLY CREATED. AND I
THINK THE LEGISLATURE SHOULD
TAKE A HARD LOOK AT HOW DO WE
GET BACK TO THE DAYS WHERE WE
COULD BUILD? UM, NOT NECESSARILY
CHEAPLY, BUT YOU KNOW,
AFFORDABLY. THANK YOU VERY MUCH
, MR. JUST JUST CONCERNED ABOUT
OUR TIME WITH THAT, BUT I THINK
WE SHOULD GARCIA, ARE YOU DO YOU
HAVE QUESTIONS, RIGHT? UM SO I
THINK IT'S ASSEMBLYMEMBER'S
HEART HAS ANOTHER QUESTION. I
JUST WANT TO APPRECIATE THE
CANDOR AND TRANSPARENCY AND THE
HARD WORK THAT'S DONE THEN DONE
TO BRING THIS INFORMATION TO US
TODAY. AND I DO TAKE VERY
SERIOUSLY THE ADMONITIONS FROM
MY COLLEAGUES AND FROM THE
PANELIST THAT THIS YOU KNOW IT'S
COMING TO TIME TO TAKE A REALLY
HARD LOOK AT PRIORITIES AND TO
IDENTIFY, YOU KNOW, LONG TERM
FUNDING SOURCE THAT'S RELIABLE.
IT'S PREDICTABLE THAT CAN
DELIVER A PROJECT LIKE THIS. AND
AT THE SAME TIME, YOU KNOW WHEN
WE'RE DOING THAT WE ALSO HAVE TO
LOOK AT THE EXISTING RAIL FOR
INFRASTRUCTURE THAT EXISTS
AROUND THE STATE OF CALIFORNIA.
AND FIGURE OUT THESE THINGS IN
CONTEXT. THERE ARE INCREDIBLY
IMPORTANT EXISTING NEEDS IN THE
SYSTEM THAT WE HAVE THAT WE
DON'T HAVE A FUNDING SOURCE TO
FIX. YOU KNOW, MOST NOTABLY,
WE'RE TRYING TO CONNECT THE
COACHELLA VALLEY TO DOWNTOWN LOS
ANGELES IS REAL SERVICE RIGHT
NOW. THAT'S SOMETHING THAT
ASSEMBLYMEMBER'S. GARCIA IS VERY
INTERESTED IN. WE HAVE CRITICAL
, UM, NEEDS ON THE LOW SAND
CORRIDOR IN SOUTHERN ORANGE
COUNTY AND SAN DIEGO COUNTY.
WITH SEA LEVEL RISE AND LEFT
COLLAPSED ALONG THE COASTAL
SEGMENTS THERE THAT ARE, YOU
KNOW BILLIONS OF DOLLARS OF
INVESTMENTS REQUIRED JUST TO
MAINTAIN THE EXISTING TRACK IN
MY DISTRICT IN THE CENTRAL COAST
, YOU KNOW WE CAN CONNECT LOS
ANGELES AND SAN FRANCISCO WITH
THE COAST RAIL UNION PACIFIC
OWNS AT A MUCH LESS EXPENSIVE
COSTS, AND WE'RE DOING WITH THE
HIGH SPEED RAIL SYSTEM. THESE
ARE NOT THE SAME SYSTEM. IT'S
NOT AN APPLES AND ORANGES
COMPARISON, BUT WE HAVE TO LOOK
AT ALL THE OPTIONS AND CONSIDER
ALL THE COSTS AND THE BENEFITS
ARE PROVIDING THAT CONNECTIVITY
AND PROVIDING A 21ST CENTURY
RAIL SERVICE SYSTEM FOR
CALIFORNIA THAT WE POTENTIALLY
COULD AFFORD. AND AT THE SAME
TIME TRYING TO DO OUR BEST TO
BUILD THIS SYSTEM AS WELL
BECAUSE I THINK THERE ARE
TREMENDOUS ADVANTAGES THAT ARE
ORDERS OF MAGNITUDE SCALE
CONNECTING THE VISIONARY PLAN
THAT THIS ENTAILS, BUT YOU KNOW
THE EXPENSE THE VERY DIFFICULT
LESSONS THAT MR KELLY DESCRIBED
THAT HAVE BEEN LEARNED THROUGH
THIS PROCESS NEED TO BE APPLIED
TO THE SYSTEM AS A WHOLE AND TO
MAKE REALLY STRATEGIC
INVESTMENTS GOING FORWARD. THANK
YOU VERY MUCH. MR KELLY, YOU
HAVE BEEN EXTREMELY PATIENT AND
TERMS OF ANSWERING QUESTIONS
YOU'VE HEARD. I THINK
SIGNIFICANT CONCERNS. THERE'S
NOT ANYTHING THAT WOULD BE
PARTICULARLY INSIGHTFUL FROM THE
QUESTIONS THAT I WOULD
POTENTIALLY THROW AT YOU. IT
WOULDN'T BE REPETITIVE. I MEAN,
I THINK THAT THE PEER REVIEW
COMMITTEE MR THOMPSON, L. A S
OFFICE AND KURT STEEN HAVE
OUTLINED THE MAJOR ISSUES IN
FRONT OF US. SO NOW IT'S AN
OPPORTUNITY FOR YOU TO PRESENT
WHAT YOU WOULD LIKE TO PRESENT
IN THE LIGHT OF WHAT YOU'VE
HEARD HERE BECAUSE THAT MAY
INFLUENCE WHAT YOU WANT TO SPEND
YOUR TIME ON IN TERMS OF YOUR
PRESENTATION. SO I WANT TO THANK
YOU FOR YOUR PATIENCE. AND THEN
I WILL MAKE MY COMMENTS AFTER I
HEAR YOUR PRESIDENT. THANK YOU,
MR CHAIRMAN, I YOU KNOW, I
APPRECIATE THE CONVERSATION
TODAY AND AGAIN, UM WE SORT OF
TALKED A LOT ABOUT WHAT'S IN THE
PROJECT UPDATE REPORTING AGAIN.
I JUST REITERATE THE DILEMMA
THAT WE FIND OURSELVES IN WHICH
IS YOU KNOW, WE GOT FEDERAL
FUNDING IN THE STATE OF
CALIFORNIA TO BUILD 100 AND 19
MILES. WE CAN BUILD. WE CAN
BUILD THAT WE CAN BUILD THAT.
BUT IT'S NOT A GREAT OPERATING
RUN. YEAH AND WHAT THE
ADMINISTRATION AND THE
LEGISLATURE TALKED ABOUT LAST
YEAR WAS GETTING A BETTER
OPERATING RUN IN PLACE. WE HAVE
FINISHED A LOT OF WORK ON THE
119 MILES IN TERMS OF GETTING
IT. CONSTRUCTION READY? REMOVING
A LOT OF RISKS AND MOVING
FORWARD. AND WE'VE ACCOMPLISHED
A LOT CANDIDLY. WE ARE FIRST
CONSTRUCTION PACKAGE WILL OPEN
OR BE SUBSTANTIALLY COMPLETE IN
2023. WHEN I STARTED IN 2018, WE
HAD ONLY ENVIRONMENTALLY CLEARED
THE 119 MILES UNDER CONSTRUCTION
. TODAY WE HAVE ENVIRONMENTALLY
CLEARED 422 MILES, UH, FROM SAN
FRANCISCO ALL THE WAY TO L. A
COUNTY. AND WE WILL FINISH THAT
ENTIRE SYSTEM IN THE BEGINNING
OF 2025 WITH THE NEXT BIG BIG
STRETCH BEING PALMDALE TO
BURBANK. BY THE END OF THIS
YEAR, WE JUST HIT 10,000 JOBS
CREATED IN THE CENTRAL VALLEY.
WE ARE CREATING A LOT OF JOBS
FOR THIS WORK THAT WE'RE DOING.
AND IF WE BUILD MERCED TO
BAKERSFIELD, THAT JOBS NUMBER
WILL GO WAY UP. OUR ESTIMATION
IS A IN BETWEEN TWO AND 300,000
JOBS. YEARS ARE CREATED THROUGH
THE FUTURE CONSTRUCTION OF THIS
THIS PROJECT. SO THERE'S A TON
OF ECONOMIC DEVELOPMENT THAT HAS
BEEN DONE. THERE'S A TON OF
ECONOMIC DEVELOPMENT THAT WILL
OCCUR. AS WE GO FORWARD. UM THE
TRICK AGAIN IS 119. MILES
DOESN'T GIVE YOU MUCH. PHASE ONE
IS A BIG BITE IS THAT WE'VE
DISCUSSED HERE TODAY, AND WHAT
WE'RE TRYING TO DO IS GET THE
INITIAL OPERATING SEGMENT LIKE
VIRTUALLY EVERY TRANSIT SYSTEM.
I'M AWARE OF HIS BEEN BUILT,
STARTING WITH AN INITIAL SEGMENT
AND THEN BUILDING FROM THERE.
AND THAT'S WHAT WE'RE PROPOSING
TO DO. I THINK IT'S RIGHT THAT
WE HAVE TO GET OUR HEADS AROUND.
POLICY WISE HOW WE'RE GOING TO
FUND THE ENTIRETY OF THE PHASE
ONE SYSTEM. UH AND FROM WHERE I
SIT, IT'S STILL VERY GOOD USE OF
STATE MONEY TO DO SO BECAUSE
AGAIN, I'VE NEVER COME ACROSS A
SINGLE PROJECT. THAT HAS THE
MOBILITY, THE ENVIRONMENTAL AND
ECONOMIC IMPACTS THAT THIS ONE
DOES, AND SO ULTIMATELY, YOU
KNOW, THAT'S WHAT WE'RE FOR. I
THINK WE COVERED KIND OF WHAT'S
IN THE PROJECT UPDATE REPORT.
THE ONLY THING I WOULD ADD IN IN
I THINK IT'S IMPORTANT TO
UNDERSTAND A LITTLE BIT ABOUT
THE TIMING OF THE CONVERSATIONS
ON SOME OF THIS STUFF. I THINK
WE WOULD ALL BENEFIT YOU THE
ADMINISTRATION EVERYBODY FROM
WHERE EXACTLY ARE WE WITH THE
FEDERAL GOVERNMENT IN 2023. YOU
KNOW WE'RE GOING TO APPLY FOR A
BIG SLUG OF MONEY AND IN THIS
MONTH UM, LIKELY THEY WILL AWARD
THAT BY THE END OF THE YEAR AND
WILL AT LEAST KNOW WHAT THE
PICTURE LOOKS LIKE. IN TERMS OF
WHAT DID WE GET WHAT'S LEFT? IS
THERE A MULTI YEAR COMMITMENT?
AND WE'LL AT LEAST HAVE A BETTER
UNDERSTANDING WHAT THE PROBLEM
THAT'S LEFT TO DO IS, UM AND SO.
YOU KNOW, I DON'T KNOW IF I'D
SAY MUCH MORE THAN THAT AGAIN.
UM WE COVERED A LOT OF THE
VARIOUS ISSUES THAT ARE IN THE
PROJECT. UPDATE REPORT. UM YOU
KNOW, WE'RE GOING ABOUT THIS.
THE WAY THAT WE THINK MAKES THE
MOST SENSE WITH CONSTRAINT
REVENUES THAT WE HAVE YET THIS
STATUTORY DIRECTION WE HAVE ON
GOING FORWARD, AND THAT'S WHAT
WE'RE TRYING TO DO SO WITHOUT.
I'M HAPPY TO TAKE ANY QUESTIONS.
I KNOW IT WAS IMPORTANT TO YOU
TO BE ABLE TO HAVE AN
OPPORTUNITY TO RESPOND. JUST
WANT TO CLARIFY THAT YOU FEEL
COMFORTABLE. YOU'VE HAD THE
OPPORTUNITY TO RESPOND TO THE
ISSUES RAISED BY PERIOD. OH,
YEAH, IT'S BEEN A VERY GOOD
DISCUSSION, MR CHAIRMAN. THANK
YOU. UM SO I'M GONNA TRY TO
SUMMARIZE THIS. AT THIS POINT IN
TIME FROM FROM MY PERSPECTIVE.
UM ONE. I THINK WE'VE WE'VE
PERHAPS AT THE END OF THIS
MEETING, I AND I HOPE HOPEFULLY
, MORE OF US ON THE COMMITTEE
HAVE A GREATER APPRECIATION FOR
THE NEED FOR A CREDIBLE FUNDING
SOURCE. TWO I THINK WE HAVE TO
FIND OUT TO WHAT EXTENT IS THE
FEDERAL GOVERNMENT, AT LEAST IN
THIS CURRENT ADMINISTRATION OF
THERE AS A CREDIBLE AS IT'S
HELPING US IDENTIFY A CREDIBLE
FUNDING SOURCE. TO THE EXTENT
THAT WE CAN. WE NEED TO FIND OUT
WHETHER THAT'S A FEDERAL FUNDING
STREAM VERSUS A ONE TIME GRANT
OF MONEY, WHICH IS SIGNIFICANTLY
DIFFERENT, YOU KNOW, QUESTION
OUT THERE FOR US, UM THE. THE
ISSUE THAT I THINK PARTICULARLY
MR THOMPSON'S I IDENTIFIED FOR
US PRETTY WELL, I THINK IS THAT
THIS PROJECT. BY ITSELF, YOU
KNOW, WERE SAID TO BAKERSFIELD.
DOES THAT? IS THAT WORTH THE
MOUNT? IT'S GOING TO COST TO
BUILD, AND I THINK THAT MOST
PEOPLE WOULD SAY I DON'T THINK
ANYBODY WOULD HAVE GONE OUT AND
DESIGNED TO MERCED TO
BAKERSFIELD LINE AT THIS PRICE.
SO I DON'T. I CAN'T. I CAN'T SEE
HOW THE LEGISLATURE WOULD
ULTIMATELY SAY WOW, THAT WAS
THAT WAS REALLY GOOD THAT WE DID
THAT SEGMENT AND WE JUST DON'T
HAVE THE ABILITY TO DO THE REST
OF THE SEGMENT. SO IT ONLY MAKES
SENSE TO GO FORWARD. IF YOU HAVE
A COMMITMENT TO INCREASING
CONNECTIVITY TO THE TWO MAJOR
POPULATION CENTERS THAT
ULTIMATELY DON'T DOWN TO SAN
DIEGO AS WE GO FORWARD, UM HMM.
AND THAT WE HAVE TO MAKE THAT
DECISION IN LIGHT OF THE RATE OF
CHANGE IN AMERICAN SOCIETY IS
ACCELERATING AS TECHNOLOGY GETS
BETTER THE RATE OF CHANGE
TELERATE AND I THINK WE'RE
SEEING THAT WITH OUR TRANSIT
SYSTEM RIGHT NOW. WE WERE HAVING
DECLINING TRANSIT RIDERSHIP
BEFORE COVID. THE SALT IS NOT
JUST A COVID ISSUE. IT'S AN
ACTUAL DECLINE IN TRANSIT
RIDERSHIP, UM AS TECHNOLOGY GETS
CHANGES AND CHANGES THE NEED FOR
OUR TRANSIT SYSTEM TO BE ABLE TO
FLEXIBLY ADAPT TO THOSE CHANGES
, UM, IS SIGNIFICANT. WHAT WILL
WORK. I GO BACK TO THE CANALS.
ONCE THE TRAINS CAME ALONG
NOBODY. NOBODY REALLY WANTED TO
USE THE CANAL SYSTEM ANY LONGER.
WHO KNOWS WHERE WE WILL BE IN 30
OR 40 YEARS DOWN THE ROAD AND IN
TERMS OF TRANSPORTATION OPTIONS
THAT ARE OUT THERE. UM SO, UH,
BIG QUESTION IS WE HAVE
COMPETING DEMANDS JUST FROM THE
STATE OF CALIFORNIA. FOR TRANSIT
FUNDING. THE BRIGHT LINE IS
GOING TO BE APPLYING FOR FEDERAL
FUNDING. UM AT THE SAME TIME
THAT WE'RE APPLYING FOR FEDERAL
FUNDING. UH AND WE CAN MAKE, I
THINK STRONG ARGUMENTS ABOUT
THIS PROJECT ABOUT THIS PROJECT
, BUT EVERYTHING IS RELATIVE AT
THIS POINT IN TIME AS WE GO
FORWARD, UM, AS MR THOMPSON
POINTED OUT GREENHOUSE GAS. UH,
GAINS FROM THIS PROJECT ARE NOT
SIGNIFICANT AND ARE NOT ENOUGH
TO JUSTIFY THIS PROJECT. THERE
HAVE TO BE OUT THERE NEEDS TO BE
OTHER JUSTIFICATIONS FOR THIS.
UM AND. I HOPE THAT WE LEARN A
LOT BETWEEN NOW AND NEXT JANUARY
ABOUT THE FEDERAL GOVERNMENT
BECAUSE I THINK AT THAT POINT IN
TIME HOPEFULLY WE USE BETWEEN
NOW AND THEN TO SET THE SCENE
FOR THIS LEGISLATURE HAS TO
START TO GET SERIOUS. WE HAVE TO
GET SERIOUS ABOUT WHAT ARE WE
GOING TO DO WITH CAP AND TRADE
IN 2030? IS IT IT'S NOT
SOMETHING WE SHOULD WAIT TILL
2029 ON. ALL KINDS OF THINGS IN
CALIFORNIA CAN'T WAIT. SHOULD WE
DO? UH, AN EXTENSION OF CAP AND
TRADE? SHOULD WE MODIFY CAP AND
TRADE SHOULD WE HAVE COMPONENTS
OF CAP AND TRADE? SHOULD WE HAVE
A CARBON TAX? SHOULD WE HAVE
COMPONENTS OF CAP AND TRADE THAT
SPECIFICALLY ARE IDENTIFIED FOR
CERTAIN PROJECTS CERTAIN NEEDS
OF THE STATE OF CALIFORNIA. THAT
ROBUST CONVERSATION SHOULD BE
TAKING PLACE AS SOON AS WE CAN
GET. A CLEARER IDEA OF FEDERAL
SUPPORT, BECAUSE IF WE CAN'T GET
FEDERAL SUPPORT FROM THIS
ADMINISTRATION, I DON'T THINK WE
SHOULD COUNT ON MUCH FEDERAL
SUPPORT FROM FUTURE
ADMINISTRATIONS AND FUTURE
CONGRESSIONAL REPRESENTATION
THAT WE HAVE THERE. SO THE ONE
CHALLENGE THAT I WOULD WALK OUT
OF HERE THAT I'D LIKE TO OFFER
TO YOU. MR KELLY IS AH, TO
REALLY TRY TO MAXIMIZE WHAT WE
CAN GET IN TERMS OF A COMMITMENT
FROM THE FEDERAL GOVERNMENT,
PARTICULARLY A COMMITMENT TO A
FUNDING STREAM RATHER THAN ONE
TIME AND TRY TO SELL THEM ON THE
IMPORTANCE OF A FUNDING STREAM
AND HOPEFULLY ON THEIR VALUE OF
HIGH SPEED RAIL IN CALIFORNIA,
THEREFORE SETS UP HIGH SPEED
RAIL IN THE REST OF THE COUNTRY
IN A MORE APPROPRIATE PATIENTS
OF WITH THAT HAPPY TO HEAR ANY
CLOSING COMMENTS FROM ANY OF THE
THREE OF YOU AS WE GO FORWARD.
AND IT'S CERTAINLY CLOSING
COMMENTS FROM ASSEMBLYMEMBER'S
FRIEDMAN. MR CHAIRMAN, I JUST,
YOU KNOW, APPRECIATE YOUR LAST
POINT ON THE FEDERAL FEDERAL
GOVERNMENT PART AND I DO THINK
2023 IS GOING TO BE A SEMINAL
YEAR ON WHERE THAT PARTNERSHIP
IS, SO I THINK IT'S A VERY
IMPORTANT CONVERSATION. THE ONE
THING THAT I DON'T THINK IT WAS
DISCUSSED TO EXPLICITLY HERE
TODAY THAT NEEDS TO AT LEAST BE
CONSIDERED AS WE GO FORWARD. IS
IF WE'RE NOT DOING MERCED TO
BAKERSFIELD, WE HAVE AN
OBLIGATION RIGHT NOW AS THINGS
STAND TO DO THE 1 19. WE GOT
FEDERAL MONEY FOR THAT, AND IT'S
GOT TO BE COMPLETED AND THAT'S
GOING TO REQUIRE THE CAP AND
TRADE MONEY THAT WE HAVE. SO I
JUST I THINK WE GOT TO
UNDERSTAND. THEN THE QUESTION
IS, WHAT DO YOU HAVE? WHAT ARE
YOU LEFT WITH? AND IS THAT
ACCEPTABLE? SO I JUST THINK THIS
CONVERSATION HAS TO INCORPORATE
ALL ELEMENTS OF THAT. THAT THAT
EQUATION THANK YOU VERY MUCH, MR
FREEMAN. YOU WANT TO GO BEFORE
OR AFTER THAT? I JUST I HAVE A
QUESTION TO SUPPORT OF
CLARIFICATION. BECAUSE WE'VE
BEEN TALKING ABOUT THE FEDERAL
PARTNERSHIP AND I THINK IN A
VERY KIND OF BROADWAY, BUT AT
THE TALKS THAT YOU'RE HAVING NOW
ABOUT AN ONGOING FUNDING STREAM
, OR ARE THEY JUST ABOUT US
TRANCHE OF MONEY TO COMPLETE
THIS CURRENT BUILD BETWEEN
MERCED AND BAKERSFIELD? WELL,
WE'VE BEEN ENGAGED WITH THE F R
A PRIMARILY ON HOW TO HOW TO
ADDRESS THE OPPORTUNITIES THAT
ARE IN THE II J. A BILL, WHICH
IS WHAT'S THE MAXIMUM THAT
YOU'RE EXPECTING? FROM THAT? WE
PUT A GOAL IN PLACE OF EIGHT
BILLION OVER THE FIVE YEARS.
PERIOD WOULD LOVE TO GET MORE,
BUT WE'RE NOT TO BE CLEAR.
YOU'RE NOT TALKING ABOUT WITH
THEM RIGHT NOW. WHEN YOU
MENTIONED THE FEDERAL
PARTNERSHIP, YOU'RE NOT TALKING
RIGHT NOW, SPECIFICALLY ABOUT AN
ONGOING FUNDING STREAM FOR THE
PHASE 100 $100 BILLION PROJECT
YOU'RE TALKING ABOUT TO HELP US
COMPLETE BAKER'S INITIAL SEGMENT
. I JUST WANT TO BE VERY CLEAR
ABOUT THAT. ALTHOUGH WE ARE WE
ARE. I MEAN, THERE'S TWO PARTS
ONE THE PRIORITY FOR THE
LEGISLATURE IN THE PRIORITY FOR
US IS CLEAR. Dð MERCED TO
BAKERSFIELD FIRST, AND SO THAT
IS WHERE OUR EMPHASIS IS WITH
THE FEDERAL GOVERNMENT. HOWEVER
I UNDERSTAND. I JUST WANT TO
WANT TO SET EXPECTATIONS. I
THINK IT'S IMPORTANT THAT PEOPLE
DON'T HAVE THE EXPECTATION THAT
YOU'RE GOING TO COME BACK IN
FIVE MONTHS, AND YOU'RE GOING TO
NOW HAVE A STUDY FUNDING STREAM
YOU'RE TALKING ABOUT. AND I'M
NOT. THIS ISN'T A CRITICAL I
UNDERSTAND. I'M JUST TRYING TO
MAKE SURE THAT EVERYBODY
UNDERSTANDS BECAUSE WE'VE BEEN
TALKING ABOUT A WE KEEP WE KEEP
USING FEDERAL FUNDING STREAM
INTERCHANGEABLY AT THIS POINT
WITH FEDERAL MONEY, BUT YOU'RE
NOT TALKING ABOUT A FUNDING
STREAM. THAT'S ANOTHER
CONVERSATION. THAT'S SOMETHING
WE'D LOVE TO HAVE. BUT WHAT'S IN
FRONT OF US FROM THE FEDERAL
GOVERNMENT? THE ONLY MONEY
THAT'S BUDGETED FROM THEM RIGHT
NOW IS THE POTENTIAL TO HAVE AS
MUCH AS $8 BILLION FOR MORE SAID
TO BAKERSFIELD, WHICH STILL
LEAVES US POSSIBLY IN DEFICIT IN
THAT PROJECT OR IS THAT IS THAT?
I MEAN, I WOULDN'T SAY IT THAT
WAY. WE'VE EXPRESSED THE GOAL. I
WOULD SAY THAT THE I J OVER THE
NEXT FIVE YEARS HAS 75 BILLION
AUTHORIZED FOR A SIX DIFFERENT
POTS THAT WE PLAN TO COMPETE IN
ON EVERY TIME A NOBLE COMES OUT,
AND SO AND SO ONE. WE'RE HAVING
A CONVERSATION ABOUT THAT, TOO.
I JUST WANTED TO BE CLEAR. THAT
SOME OF THE CONVERSATION IS ALSO
ABOUT FEDERAL MONEY TO ADVANCE
DESIGN OUTSIDE OF THE THEM ARE
SAID TO BAKERSFIELD STRETCHED
BECAUSE WHERE WE FINISHED THOSE
ENVIRONMENTAL DOCUMENTS, WE
THINK WE SHOULD DO MORE TO
UNDERSTAND WHAT'S LEFT TO DO IN
THOSE AREAS, GEOTECHNICAL WORK
AND OTHER THINGS IN THE
TUNNELING AND WE HAD A YOU HAD
TALKED TO US LAST YEAR ABOUT
ANOTHER PART OF FEDERAL MONEY,
AND YOU DID APPLY FOR THAT. AND
WHAT HAD YOU ASKED FOR? AND WHAT
DID YOU RECEIVE FROM THAT FIRST
GRANT WILK. CALIFORNIA DIDN'T DO
VERY WELL ON THAT GRANT. BUT WE
DID YOU APPLY FOR WHAT DID YOU
TELL US YOU WERE APPLYING FOR?
AND WHAT DID YOU DO? WE APPLIED
FOR WAS AT 1.11 POINT TWO WE
APPLIED FOR 1.2 BILLION OUT OF A
MEGA GRANT PROGRAM, WHICH WAS
ONE OF THE PROJECT GRANTS THAT
THAT THEY MADE AVAILABLE LAST
YEAR. AND WE DIDN'T GET ANYTHING
OUT OF THAT APPLICATION, BUT I'M
NOT BASED ON OUR CONVERSATIONS
WITH THE UP ARE A I'M NOT THAT
DISSUADED BY THAT BECAUSE THEY
CHANGED THE WAY THEY WERE GOING
TO DO THAT PROGRAM AFTER OUR
APPLICATION WAS SENT, AND WE'RE
NOT EXPECTING THAT ON THE
FEDERAL STATE PROGRAM. UM AND SO
, YEAH, WE BUT ALSO THAT'S A
$1.1 BILLION PROGRAM OR THE
STATE OF CALIFORNIA GOT 30
MILLION FOR ONE PROJECT IN SANTA
CRUZ. SO THE STATE DID NOT DO
VERY WELL IN THAT PROGRAM, NOT
JUST US, BUT WE'VE HAD A LOT OF
CONVERSATION WITH THE FEDS ABOUT
HOW TO GO FORWARD, AND THAT'S
WHAT WE'RE GONNA JUST ONE LAST
THING. I JUST WANT TO SAY ABOUT
THE FEDERAL STREAM ISSUE BECAUSE
I DON'T I DON'T WANT TO LEAVE
YOU WITH THE IDEA. WE'RE
IGNORING IT. AND SO, YES, OUR
FUNDAMENTAL CONVERSATIONS WITH
THE FEDERAL GOVERNMENT RIGHT NOW
ABOUT HOW TO TAKE ADVANTAGE OF
THE I J A HOWEVER, WE ARE ALSO
TALKING TO THEM AND SAYING, YOU
KNOW, TO GET HIGH SPEED RAIL
DONE RIGHT BECAUSE THERE SEEMS
TO BE AN INTEREST IN THIS
ADMINISTRATION WERE BEING VERY
CLEAR THAT THEY NEED SOMETHING
LIKE THE INTERSTATE PROGRAM. FOR
RAIL. AND SO THOSE ARE
CONVERSATIONS WERE CERTAINLY
HAVING THAT DOESN'T MEAN I'M
GONNA COME BACK AND HAVE THE
ANSWER IN A YEAR, BUT BUT WE ARE
MAKING THAT POINT AS WELL.
RIGHT. BUT AS AS OF NOW THERE 75
BILLION FOR THE WHOLE COUNTRY IS
THAT FOR ONLY FOR HIGH SPEED
RAIL, OR IS THAT FOR ALL REAL?
NO IT'S FOR DIFFERENT PARTS.
DIFFERENT PODS ARE FOR DIFFERENT
PARTS, BUT I WOULD JUST SAY,
LIKE THE FED STATE PROGRAM.
WHERE WE'RE IDENTIFYING. THERE'S
BETWEEN 12 AND 16 AVAILABLE OUT
OF THAT PROGRAM. IT'S REALLY NOT
FOR THE WHOLE COUNTRY BECAUSE,
LIKE THE NORTHEAST CORRIDOR,
THEY GOT A SEPARATE SET ASIDE,
SO I DON'T EXPECT THEY WILL PLAY
MUCH IN THAT PROGRAM. SO THERE
ARE AT ALL HAS DIFFERENT
ELEMENTS TO IT. BUT IS IT IS IT
ALL FOR HIGH SPEED? OR IS IT
ALREADY STEADY PASSENGER RAIL,
SO IT DOESN'T HAVE TO ALL BE
HIGH SPEED, BUT IT HAS TO BE
INTERCITY PASSENGER RAIL. AND I
AGREE WITH YOU. I WOULD LOVE TO
SEE THE FEDERAL GOVERNMENT PUT A
LOT MORE MONEY INTO A RAIL
SYSTEM. I HAVE. I WOULD I AGREE.
I THINK THAT WE REALLY MISSED
THE BOAT. I WISH WE HAD DONE
WHAT OTHER COUNTRIES DID, AND
HAD INVESTED MORE HEAVILY IN
RAIL FOR THE PAST. 50 YEARS WILL
SAY THIS THAT I AM I'M STILL AM
A HUGE BOOSTER OF TRANSIT. I
DON'T THINK TRANSIT IS DESPITE
FOLLOWING RIDERSHIP NUMBERS. I
THINK THAT THERE'S A VARIETY OF
REASONS FOR THAT, NOT TO LEAST
OF WHICH IN OUR STATE THAT WE
JUST HAVEN'T DONE TRANSIT.
ALWAYS ALL THAT WELL MADE THE
INVESTMENTS WE NEED. BUT I
BELIEVE THAT THE FUTURE HAS TO
BE TRANSIT FOR A LOT OF REASONS,
AND I WILL DIE ON THAT HILL. SO
I'M ABSOLUTELY WITH YOU ON THAT,
AND I DO THINK THAT THERE I
ACTUALLY THINK THAT THERE'S
UTILITY IN THIS PROJECT. OF SAN
FRANCISCO TO BAKERSFIELD, SAN
FRANCISCO CENTRAL VALLEY. I
THINK EVEN WITHOUT THE
CONNECTION HAS A LOT OF VALUE
CONSIDERING WHERE PEOPLE ARE
LIVING AND WHERE THEY'RE MOVING.
I THINK THAT PALMDALE L. A HAS
TREMENDOUS VALUE EVEN FOR
HELPING METRO IMPROVE THEIR
SERVICE, BUT CERTAINLY MOVING
WHAT COULD BE THE NEXT SORT OF
SOUTHERN METROPOLIS INTO LOS
ANGELES AND OPENING UP THAT
OPPORTUNITY. COULD HAVE HUGE
UTILITY AS WELL. SO I AM BY NO
MEANS SAYING THAT I'M READY TO,
UH, I'M NOT IN FAVOR OF STOP
TRYING TO STOP THIS PROJECT, BUT
I AM IN FAVOR OF MAKING THE
DECISIONS THAT WE HAVE TO MAKE
TO KNOW HOW MUCH MONEY WE
RELIABLY HAVE. I THINK TO DO
ANYTHING LESS IS JUST NOT
RESPONSIBLE AT THIS POINT. AND
YOU KNOW WHETHER OR NOT WE'LL BE
ABLE TO ACCOMPLISH THAT THAT I
DON'T KNOW UNTIL WE START REALLY
LOOKING AT WHAT WE ACTUALLY NEED
. GIVEN THE FEDERAL, UH, VERY,
VERY SMALL AMOUNT OF FEDERAL
MONEY THAT'S OUT THERE QUITE
HONESTLY AND THE OTHER CHOICES
THAT WE HAVE ACROSS THE STATE,
YOU KNOW, AND THIS PROJECT IS
ALSO THERE ARE CO BENEFITS TO
OTHER TRANSIT AGENCIES. BUT IN
MANY WAYS YOU COMPETE AGAINST
TRANSIT AGENCIES FOR FUNDING. SO
THERE'S A LOT OF THERE'S A LOT
OF INTEREST HERE, BUT WE NEED TO
BE A LOT MORE SERIOUS AT THIS
POINT. OF MAKING THOSE TOUGH
DECISIONS BECAUSE CLEARLY YOU
CAN'T CONTINUE THIS WAY WE'RE
GOING TO JUST GET IT'S GOING TO
BE THE PROBLEMS ARE GOING TO GET
WORSE AND WORSE IF WE DON'T MAKE
THESE DECISIONS, SO I'M
COMMITTED TO HELPING YOU DO
THAT. I'VE LAID MY CARDS ON THE
TABLE AS TO WHAT I WOULD LIKE TO
SEE. UM BUT WELL, WE'VE GOT, YOU
KNOW SOMETIME TO HAVE THOSE
DISCUSSIONS, BUT WHAT WE CAN DO
IS NOT HAVE THEM. I APPRECIATE
THAT. THANK YOU, MADAM CHAIR. I
JUST WANT TO CLARIFY ONE THING
HERE, AND THAT IS THAT I DON'T
THINK YOU CAME HERE TODAY,
OFFERING FUNDING STREAM AS MUCH
AS WE HAVE. TODAY IT STARTED TO
EMPHASIZE THAT WHEN YOU GO TO GO
TO TALK TO THE FEDERAL
GOVERNMENT, WE WANT YOU TO START
TO HAVE MORE CONVERSATIONS ABOUT
FUNDING STREAM. CAN I JUST SAY I
LIKE I THINK THERE'S TWO THINGS
THAT HAVE TO HAPPEN IF THIS IS
GONNA GO FOR IN TERMS OF PHASE
ONE, SAN FRANCISCO TO LA AND
ANAHEIM WE DO HAVE TO HAVE
FEDERAL HELP. IN MY VIEW. AH AND
WE ALSO HAVE TO GET REAL HERE
ABOUT WHAT HAPPENS AFTER 2030.
BECAUSE YOU WERE NOT GOING TO
FUND THIS WITHOUT SOMETHING
BEYOND 2030. AND SO I THINK WE
HAVE TO BE REAL ABOUT THAT AS
WELL. FINAL COMMENTS FROM EITHER
OF OUR OTHER TWO STEAMED JUST A
SHORT BIT OF PERSPECTIVE. I'VE
BEEN EITHER PRIVILEGED OR
CONDEMNED. I'M NOT SURE WHICH IT
IS. TO DEAL WITH THIS PROJECT
FOR THE LAST 14 YEARS ON THE
PEER REVIEW GROUP, AND IN THE
2008 BUSINESS PLAN. WE WERE
GOING TO DO SAN FRANCISCO TO
ANAHEIM. BY 2012. WE WERE NOT
GOING TO CONNECT THE SAN
FRANCISCO WE WERE GOING TO LEAVE
THAT FOR LATER. BY 2014. WE
CHANGED THEIR MINDS AND WE SAID
WE'RE NOT GOING TO DO L A
CONNECTION. WE'RE GOING TO DO
THIS IN FRANCISCO CONNECTION.
BECAUSE WE CAN'T AFFORD IT. AND
BY 2018. WE WERE AT THE POINT
WHERE WE WERE GOING TO FOCUS ON
THE CENTRAL VALLEY AND NOT DO
EITHER OF THE CONNECTIONS AND
NOW WE'RE ARGUING IN A SENSE
ABOUT PIECES OF THE CENTRAL
VALLEY. THE REASON FOR THIS IS
THAT THE SCOPE HAS HAD TO ADJUST
HAD TO BE ADJUSTED AS THE
BUDGET. DEMANDED AND IT HAS
CAUSED INSTABILITY IN THE PLANS
, INSTABILITY IN THE MANAGEMENT
AND INSTABILITY AND THE CONCEPT
OF THE PROJECT. WE DO NEED TO
STOP THAT. AH WE IN THE ONLY WAY
THAT WILL BE STOPPED, AS YOU
HAVE SAID, IS TO HAVE A GOOD
IDEA AND A GOOD CONCEPT OF HOW
ARE WE GOING TO PAY FOR WHATEVER
IT IS, WE ULTIMATELY THINK IS IN
OUR VISION AND GOOD FOR THE
CALIFORNIA THE PEER REVIEW GROUP
HAS CONSISTENTLY SAID THAT WE
THINK THERE SHOULD BE A ROLE FOR
HIGH SPEED RAIL IN CALIFORNIA,
BUT NOT THIS WAY. IT WILL BE. IT
WILL BE STABLE. IT WILL BE
DESIGNED PROPERLY AND IT WILL BE
CONCEIVED PROPERLY OR WE'RE
GOING TO CONTINUE WITH THE SAME
KIND OF PROBLEMS THAT WE'VE SEEN
. THERE'S NO REASON TO THINK IT
WILL CHANGE. YOUR CONTRIBUTION
HAS BEEN ENORMOUS TO THE STATE
OF CALIFORNIA, LEADING TO PEER
REVIEW COMMITTEE. AND I
SINCERELY MEAN THAT. NOT JUST
YOUR INSIGHTS, BUT THE WAY YOU
PRESENT THE INFORMATION HAS
CERTAINLY HELPED EVERYBODY. I
HAVE. GREATER CLARITY ABOUT
WHERE WE NEED TO GO. SO ONE ON
BEHALF OF THE STATE OF
CALIFORNIA. THANK YOU VERY AND I
THANK YOU FOR THE OPPORTUNITY TO
BE INVOLVED IN THIS DISCUSSION.
LEO. ANY FINAL COMMENTS? NO
ADDITIONAL COMMENTS FOR ME.
THANK YOU SO MUCH. THIS HAS BEEN
A REALLY HELPFUL CONVERSATION.
REALLY APPRECIATE YOU INCLUDING
US. AND YES, MR THOMPSON IS
DEFINITELY A GEM AND VERY
APPRECIATIVE OF THAT HIS EFFORTS
OVER THE YEARS SO HOPEFULLY WE
CAN GET HIM TO CONTINUE THIS FOR
I JOKED WITH HIM RECENTLY. I WAS
LIKE, DID YOU REALIZE YOU WERE
SIGNING UP FOR THIS KIND OF
LENGTH OF SERVICE HERE, SO WE'VE
BEEN VERY LUCKY TO HAVE HIS. I
THINK HE'S PROBABLY BEEN ON THIS
PROJECT LONGER THAN THE REST OF
US. SO I REALLY APPRECIATE YOU
HOLDING THIS HEARING. TODAY THE
VALUE OF L A O, UH COMBINED WITH
PURE REVIEW HAS HAS HAS BEEN
REALLY IMPORTANT AND THE VALUE
OF MR KELLY'S COMING IN AND
FIXING AND ADDRESSING SO MANY OF
THE PROBLEMS I CRINGE AT WHERE
WE WOULD BE IF WE DIDN'T HAVE
THAT. UH SO WE'RE CHALLENGED. I
THINK WE ALL HAVE TO FIND A WAY
TO, UH UPFRONT, DIRECTLY DEAL
WITH THE CHALLENGES IN AND KEEP
OUR OUR PERSONAL RESPECT FOR
EVERYBODY HIGH AS WE DO THAT,
BECAUSE I SEE A LOT OF PEOPLE
WANTING TO TRY TO DO THE RIGHT
THING HERE AND TRYING TO FIGURE
THAT OUT, AND WE MAY DISAGREE ON
THAT. BUT WE HAVE TO KEEP
WORKING TOGETHER TO TRY TO KEEP
OUR EYE ON THE BALL. SO MR KELLY
AND THE REST OF THE PEOPLE IN
THE AUTHORITY KEEP UP. MAKE THE
SAME IMPROVEMENT OVER THE NEXT
FIVE YEARS THAT YOU'VE DONE DONE
NOW. THAT WILL BE GOOD FOR ALL
OF US. THANK YOU VERY MUCH. AND
WITH THAT ANYTHING ELSE FROM
ANYBODY? YEAH, WE HAVE PUBLIC
COMMENT. ALRIGHTY. UM AND WE'RE
ACCEPTING PUBLIC COMMENT AT THE
END OF THIS HEARING BOTH IN THE
HEARING ROOM AND ON THE PHONE,
UH, PHONE NUMBER TO CONNECT IS
ON THE COMMITTEE WEBSITE AND
SHOULD ALSO BE ON THE SCREEN. IF
YOU'RE WATCHING THE NUMBER IS
87769289. AND THE ACCESS CODE IS
18501 100. UM AND WE'LL DO THAT
RIGHT AFTER WE DO THE PUBLIC
TESTIMONY. SO, UH, SO THE HARDY
PEOPLE WHO WERE ABLE TO STAY IN
HERE FOR THE 3.5 HOURS. UH,
WE'RE READY TO HEAR FROM YOU.
THANK YOU, MR CHAIR, MADAM
CHAIR, ONE MINUTE. KEITH DINING
HERE ON BEHALF OF THE
ASSOCIATION OF CALIFORNIA HIGH
SPEED TRAINS ITSELF UP COUNTIES
COALITION, THE DISTRICT COUNCIL
OF IRON WORKERS IN THE STATE OF
CALIFORNIA. I REALLY APPRECIATE
THE DISCUSSIONS THAT TOOK PLACE
HERE TODAY. I CAN STAND HERE AND
TALK TO YOU ABOUT THE 80,000
HOURS AND JOBS CREATED. THE
10,000 EMPLOYED MEN AND WOMEN OF
THE CONSTRUCTION TRADES OR THE
OVER 700 SMALL BUSINESSES THAT
HAVE BENEFITED FROM THIS PROJECT
AND SAID, I'D LIKE TO TALK A
LITTLE BIT ABOUT SOME OF THE
DISCUSSION HERE TODAY. ENCOURAGE
ALL VIEWS. WE GET THE
OPPORTUNITY AND THE HIGH SPEED
RAIL AUTHORITY PUTS IN THEIR
APPLICATION FOR THOSE GRANT
FUNDS TO REMIND ALL OF US THAT
CALIFORNIA REMAINS A DONOR STATE
, BUT I HOPE THAT EACH AND EVERY
ONE OF YOU WOULD SEND LETTERS IN
SUPPORT OF THE HIGH SPEED RAILS
APPLICATION FOR THOSE GRANT
FUNDS. IT IS CRITICALLY
IMPORTANT AS MENTIONED TODAY WE
ARE COMPETING WITH OTHER STATES.
SO UNITED EFFORT FROM THIS
LEGISLATURE WOULD SEND A VERY
STRONG MESSAGE. THE FR A
CALIFORNIA REMAINS SERIOUS ABOUT
DELIVERING THE FIRST HIGH SPEED
RAIL IN OUR NATION. ANOTHER
COMMENT I'D LIKE TO MAKE IS THAT
THE 100 MILE TRACK? UH 119 MILE
TRACK IS ALSO GOING TO BE USED
AS A TEST TRACK WE FORGET, AND
SOME OF YOU MAY HAVE SEEN SOME
OF THE RECENT INCIDENTS THAT
TAKE PLACE ON TRAINS THAT STILL
REMAINS SOMEWHAT DANGEROUS. WE
NEED TO HAVE A TEST TRACK. THIS
WILL BE THE FIRST IN THE NATION.
IT WILL HELP FEDERALIZE THIS
PROGRAM. IT WILL HELP ENCOURAGE
THE FEDERAL GOVERNMENT TO
CONTINUE TO INVEST IN THIS
PROGRAM. I LOOK FORWARD TO THE
OPPORTUNITY TO LOOK TOWARDS THAT
FUNDING STREAM. THANK YOU. THANK
YOU, MR CHAIR, MADAM CHAIR
JEREMY SMITH, YOU ON BEHALF OF
THE STATE BUILDING AND
CONSTRUCTION TRADES COUNCIL, UM
, WANTED TO REMIND EVERYBODY WHO
MAY NOT HAVE BEEN AROUND AS LONG
AS THE TWO OF YOU HAVE BEEN
AROUND. I MEAN THAT RESPECTFULLY
THAT WE HAD TO DO THESE THIS
CONSTRUCTION IN THE CENTRAL
VALLEY. TO BEGIN WITH LAND IS
CHEAPER, EASIER, ER COSTS. THERE
ARE REAL REASONS WHY THEY DID
THAT. THEY STARTED THE CENTRAL
VALLEY JUST TO REMIND EVERYBODY
OF THAT. UH WE BELIEVE THIS
SHOULD BE THE NUMBER ONE
PRIORITY WAS SAID EARLIER. THIS
SHOULD NOT BE THE NUMBER ONE
PRIORITY. UM THE ONLY WAY TO
MEET THE GHD GOALS THAT MANY OF
YOU HAVE, UH, PUT INTO STATUTE
IS BY GETTING MILLIONS OF CARS
OFF THE ROAD, AND THAT'S WHAT
THAT'S WHAT HIGH SPEED RAIL
DOES. IT HELPS US MEET OUR VERY
AMBITIOUS GOALS. I WANNA REMIND
EVERYBODY TO ABOUT AN L. A
REPORT FROM SEVERAL YEARS AGO
NOW THAT SAID, FOR THE LOW COST
OF $100 BILLION THAT WOULD GET
US 3000 NEW LANE MILES OF
FREEWAY FIVE. AIRPORT RUNAWAYS
90 NEW DEPARTURE GATES. THAT'S
WHAT WILL BE NEEDED TO MEET THE
DEMANDS FOR TRAVEL IN THE STATE
BY 2030. THAT WAS A REPORT FROM
THE L. A. IN 2011. I FINALLY
JUST WOULD END WITH THIS. WE ALL
TALK ABOUT JUST TRANSITION. THIS
IS ONE OF THOSE JUST TRANSITION
PROJECTS AN OPERATING ENGINEER.
BY THE WAY, TIM CREMINS CAN'T BE
HURT GABBY REECE FORCES PROJECT
AS WELL. YOU CAN HAVE AN OPERA
ENGINEER, AN IRONWORKER GO FROM
OIL AND GAS JOB TO A HIGH SPEED
RAIL JOB. THIS IS A JUST
TRANSITION. THIS PROJECTS A JUST
TRANSITION. THANK YOU FOR YOUR
SUPPORT. THANK YOU. HI THERE.
MICHAEL KIESLING FROM SAN
FRANCISCO, UH, THROUGHOUT MY
NOTES, AND I'LL BE GOING ON FROM
WHAT I SAW FROM THE MEETING
TODAY. UH WHAT? THIS I THINK YOU
HAVE AN IDEA OF THE SCOPE OF
WHAT WE'RE TRYING TO DO HERE.
AND THE QUESTION IS NOT, UM DO
WE BUILD THIS PART OF HIGH SPEED
RAIL? THE QUESTION IS, DO WE
GIVE OURSELVES A CHOICE BETWEEN
HOW WE GET AROUND THE STATE?
IT'S NOT A TRANSIT PROJECT. THE
MARKET YOU'RE COMPETING WITH OUR
IS THE AIRPORT GOING TO GET
BETTER. IS THE HIGH WE'RE GOING
TO GET BETTER. IT DOESN'T MATTER
WHETHER OR NOT YOU'RE IN A TESLA
OR YOU'RE IN A CAMARO. YOU'RE
STILL GOING TO BE STUCK IN
TRAFFIC. AND WHAT WE'RE LOOKING
AT, WHICH IS A GREAT UNKNOWN IS
WE DON'T HAVE ANY PLANNING FOR
ALL THESE NEW LANES OF FREE OF
FREEWAY. ARE WE GOING TO WIDEN
THE GRAPEVINE? WE DON'T KNOW
WHAT ANY OF THOSE COSTS ARE. AND
THOSE ARE ALL LITTLE THINGS THAT
ARE MORE UP IN THE AIR THAN THE
HIGH SPEED RAIL PROJECT. I THINK
THE GREAT FRUSTRATION HERE THAT
I CAN EXPRESS BECAUSE I DON'T
HAVE TO GO WITH A SMILE ON MY
FACE TO WASHINGTON TO ASK FOR
MONEY. IS THAT IN THE NEAR PAST
PROJECTS LIKE THE ATLANTA SUBWAY
, THE BALTIMORE SUBWAY, THE
MIAMI METRO RAIL. THEY WERE
BUILT WITHIN 80% FEDERAL MATCH.
I BELIEVE THE INITIAL PART OF
THE SUBWAY WAS BUILT WITH A 50%
MATCH VERY MUCH, AND NOW THERE'S
NO PROBLEM. WE'RE INVENTING A
NEW PROJECT. THERE'S NO SUCH
THING AS A FULL FUNDING
AGREEMENT FOR HIGH SPEED RAIL
BECAUSE IT'S SUCH A LARGE
PROJECT. I THINK WE HAVE THE
POINT. BUT I'M SORRY. YOU'RE ONE
MINUTE IS UP. THANK YOU VERY
MUCH. THANK YOU, MR CHAIR, GUS
COURT ON BEHALF OF THE SAN
JOAQUIN VALLEY REGIONAL POLICY
COUNCIL, JUST VERY BRIEF
COMMENTS ON BEHALF OF THE POLICY
COUNCIL WERE VERY SUPPORTIVE OF
THE HIGH SPEED RAIL PROJECT
BECAUSE IT'S IMPORTANT IN
ADDRESSING OUR AIR QUALITY
ISSUES THAT YOU KNOW, SAN
JOAQUIN VALLEY IS IN A NON
INTIMIDATING DISTRICT. IT ALSO
HELPS WITH OUR MOBILITY CALLS.
THERE ARE SOME CHALLENGES AND WE
DO WANT TO WORK WITH THIS BODY
TO BE ABLE TO ADDRESS THEM TO
MAKE SURE THAT THE PROJECT DOES
COME TO FRUITION. UH IN ADDITION
ON BEHALF OF THE CENTRAL COAST
MEMBER HEART MENTIONED SOME
THINGS ABOUT HAVING COAST RAIL
SERVICE BE AN OPTION. CALTRAIN
STOPS IN GILROY AND LAUSANNE
STOPS AND ST LOUIS OBISPO.
THERE'S A 153 MILE GAP IN KHOST.
REAL SERVICE THAT WE THINK WOULD
BE VERY VIABLE FOR FOLKS ALONG
THE COAST TO TAKE THEIR AND THEN
THE VALUE LINK SYSTEM AS WELL
CONNECTING ALAMEDA TO SAN
JOAQUIN TO ELIMINATE SOME OF
THAT TRAFFIC GOING OVER THE
ULTIMATE PAST. AND SO, ASIDE
FROM CAPTAIN TRADE REVENUE THEIR
SENATE BILL ONE COMPETITIVE
PROGRAM FUNDS, LOCAL SALES TAX
MEASURE DOLLARS AS WELL AND THEN
WE'RE HOPING THROUGH THE WORK
THAT'S BEING INITIATED THROUGH
SELLING MEMBER FRIEDMAN THROUGH
HER WORKING GROUP THAT THAT
WOULD ALSO YIELD SOME FRUIT. AND
TRYING TO CRACK THE NUTS. WE
APPRECIATE YOUR CONSIDERATION.
THANK YOU. THANK YOU VERY MUCH.
GOOD AFTERNOON AND THANK YOU
ALL. MATT CERRADO MAYOR CITY OF
MERCED. I REALLY APPRECIATE THE
DISCUSSION. APPRECIATE ALL THE
CHALLENGES THAT YOU GUYS FACE. I
JUST WANTED TO GIVE YOU A LITTLE
PERSPECTIVE. WHAT WE SEE FROM
MERCED MICHELLE, OBVIOUSLY BEING
THAT THE POTENTIALLY THE
NORTHERN TERMINUS OF THE
ORIGINAL 170 MILE OPERATING
SEGMENT, AND WE ARE OUR COUNTY
IS WHAT LAST YEAR WAS THE SECOND
FASTEST GROWING COUNTY. IN THE
STATE BY PERCENT, FOURTH FASTEST
GROWING BY A TOTAL NUMBER, EVEN
THOUGH WE'RE RELATIVELY SMALL TO
MIDSIZE COUNTY HOUSING IS STILL
PROBABLY LESS THAN HALF OF WHAT
IT IS IN THE STATE AVERAGE. AND
WHAT POTENTIALLY THIS WHAT WOULD
THAT NEEDS IS TO REALLY, UM TO
MAKE EVERYTHING EXPAND. EVEN
FASTER IS INFRASTRUCTURE AND
WITH RIGHT ON THE 99,
POTENTIALLY TO WITH ACES, AMTRAK
HIGH SPEED RAIL ALL COMING
TOGETHER IN OUR CITY, REALLY
CREATING A LOT OF OPPORTUNITIES
FOR TRANSITORY IN DEVELOPMENT,
DENSER DEVELOPMENT AROUND OUR
DOWNTOWN, WHICH IS A REALLY
EXCITING OPPORTUNITY FOR US. AND
JUST IN US, YOU HAVE A WILLING
PARTNER. AND I AND ALSO U C.
MERCED. PROXIMITY DO YOU SAMITY?
TENS AND TENS OF THOUSANDS OF
PEOPLE LEAVE OUR COUNTY EVERY
DAY TO GO COMMUTE TO THE AREAS
OF A LOT OF OPPORTUNITIES HERE
AND I THANK YOU FOR YOUR TIME.
THANK YOU VERY MUCH. OPERATOR
WE'RE NOW READY TO, UM TAKE
PHONE COMMENTS, SO WE'LL OPEN
THIS UP. TO THE PHONE LINES.
CERTAINLY, LADIES AND GENTLEMEN,
ON THE PHONE LINES IF YOU WISH
TO QUEUE UP, PLEASE PRESS 10 ON
YOUR TELEPHONE KEYPAD. IT LOOKS
LIKE WE HAVE ONE ALREADY IN. Q.
WE'RE GOING TO GO TO LINE NUMBER
38 38. YOUR LINE IS OPEN. GOOD
AFTERNOON, MADAM. REMEMBER THIS
IS JAMES THROW ACTOR WITH THE
CALIFORNIA STATE COUNCIL LABORS
AND JUST WANT TO EXPRESS OUR
SUPPORT. AND I LIKE TO JUST FOR
PURPOSES OF TIME. MY COMMENTS
WITH JEREMY MESSAGE STATE DOZEN
TRADES. THANK YOU. THANK YOU.
WE'LL GO TO LINE NUMBER 25.
THAT'S 25. YOUR LINE IS OPEN.
GOOD AFTERNOON. THANK YOU FOR
THE OPPORTUNITY. THIS IS ROLL
UNDER BRANDS AND JOSE. EVERY
COUNTRY IN THE WORLD STARTED
WITH REAL ELECTRIFICATION AT
LEAST HALF A CENTURY BEFORE HIGH
SPEED RAIL. MR FANG SPOKE
EXACTLY TO THE ROOT CAUSE OF THE
PROBLEMS, WHICH IS THAT HIGH
SPEED LINES AND LIKE THAT ABOUT
DOWNTOWN ANYWAY, LIKE THE PLAGUE
BECAUSE IT IS PRETTY MUCH
IMPOSSIBLE TO LIVE OR WORK
WITHIN A COURT ALBA MILE OF THE
LINE OPERATING AT 200 MILES AN
HOUR IN CLOSING, OUR IMMEDIATE
FOCUS SHOULD BE ON STATIONS
CONNECTED BY ELECTRIFIED U P AND
BNSF LINES, STARTING WITH A £2
RAIL AND EURO TO SAN FRANCISCO.
UNTIL WE COMPLETE AND
ELECTRIFIED BACKBONE CAPABLE OF
SERVICING BECAUSE AS WELL AS THE
CENTRAL VALLEY, AND THEN THAT
RIDERSHIP INFORMED DECISIONS
FEELING THAT DETECTIVE HIGHER
SPEED SECTIONS BETWEEN EILEEN
SAN FRANCISCO, WITH SOME
SUBMITTED FRENCH EXAMPLES IN
WRITING. THANK YOU. THANK YOU.
THANK YOU. WE'LL GO TO LINE
NUMBER 43. THAT'S 43. YOUR LINE
IS OPEN. THANK YOU, MR. CHAIR
MATT ROBINSON WAS SHOT HER AND
HE SMELLS APPLYING ON BEHALF OF
CULTURING. CALTRAIN HAS LONG
BEEN A PARTNER OF HIGH SPEED
RAIL AND FACILITATING THE
CALTRAIN ELECTRIFICATION PROJECT
AND BUILDING THE FOUNDATION FOR
HIGH SPEED RAIL SERVICE BETWEEN
SAN JOSE AND SAN FRANCISCO. WE
LOOK FORWARD TO THE PROJECT
CONTINUING AND ARE HAPPY TO
ANSWER ANY QUESTIONS ABOUT OUR
ELECTRIFICATION PROJECT ON THE
PENINSULA. THANK YOU. THANK YOU.
WILL NOW GO TO LINE NUMBER 39.
THAT'S 39. YOUR LINE IS OPEN.
HI. MY NAME IS ANDY COHEN'S
FOUNDER AND PRESIDENT OF THE US
HIGH SPEED RAIL ASSOCIATION. THE
FIRST THING I WANT TO SAY IS,
WE'RE IN SUPPORT OF THIS
VISIONARY PROJECT AND DOING
EVERYTHING IN OUR POWER AND
LOBBYING MIGHT TO GET YOU A
LARGE FEDERAL GRANT FEAR PROJECT
AS WELL AS SETTING UP CONSISTENT
FUNDING FOR YOUR PROJECT AS AND
OTHERS ACROSS AMERICA. TODAY
OVER 26 NATIONS ACROSS THE WORLD
CARRY BILLIONS OF PASSENGERS
EVERY YEAR ON HIGH SPEED RAIL
OVER THE PAST 60 YEARS,
COUNTRIES FROM SPAIN, JAPAN,
MOROCCO AND CHINA HAVE MADE HIGH
SPEED RAIL, THE BACKBONE OF
THEIR TRANSPORTATION SYSTEMS IN
A COMPETITIVE CLIMATE FRIENDLY
ALTERNATIVE TO DRIVING AND
FLYING. THE CHINESE GOVERNMENT
IS NOW SPENDING ANOTHER. THEY
SPENT OVER $1.4 TRILLION
BUILDING THEIR SYSTEM AND THEIR
ENLARGING IT BY DOUBLE OVER THE
NEXT 10 YEARS. HIGH SPEED RAIL
IS CATCHING ON ALL ACROSS THE
PLANET. NUMEROUS NATIONS ARE
DOING THIS AND THE REASON
THEY'RE DOING IT IS BECAUSE IT'S
HAVING SUCH A TRANSFORMATIVE
EFFECT ON THEIR NATIONS. IT'S
THE BACKBONE OF A SUSTAINABLE
FUTURE WITH ELECTRIFIED
TRANSPORT AND IS THE BASIS OF A
RENAISSANCE OF A NETWORK OF
WALKABLE COMMUNITIES. THANK YOU
VERY MUCH FOR SMART GROWTH
PLANNING SYSTEM FOR THE THANK
YOU. WE'RE NOT GONNA LINE NUMBER
40. THAT'S 40. YOUR LINE IS
OPEN. THIS WAS YOU. LINE 40.
YOUR LINE IS OPEN. PLEASE
PROCEED. HI THIS IS PETE VARMA.
WITH THE INTERLINE INCORPORATED
. UH I WOULD LOVE TO HAVE THIS
PROJECT FUNDED AS SOON AS
POSSIBLE. SO MR KELLY CAN
CONTINUE ON TO HIS, UM, PROJECT
AND CREATE JOBS IN THE COMMUNITY
IN THIS PROJECT IS NOT FUNDED
AND IF THE LEGISLATORS AND THE
HIGH SPEED RAIL ON THAT ABLE TO
COME TO ANY KIND OF DECISION
THIS IS A DISASTER FOR STATE OF
CALIFORNIA. THANK YOU. THANK
YOU. WE'LL GO TO LINE NUMBER 42.
THAT'S FOUR TO YOUR LINE IS
OPEN. THANK YOU. GOOD AFTERNOON,
EVERYBODY. CHUCK REAL HAS
REPRESENTING THE BUILDING TRADES
IN FRESNO MADERA SINCE LARRY
KING'S THAT WE HAVE THE GOOD
FORTUNE OF THE HIGH SPEED RAIL
STARTING IN THE CENTRAL VALLEY
WERE HIGHLY SUPPORTIVE OF THIS
CONSTRUCTION PROJECT AND THESE
ENDEAVORS MOVING FORWARD AND
DOING EVERYTHING WE CAN TO
SECURE THE FUNDING ON THE
FEDERAL AND STATE LEVEL FOR IT.
I CANNOT EVEN BEGIN TO TELL YOU
THE POSITIVE IMPACT THAT THIS
PARTICULAR PROJECT HAS HAD ON
THEIR WORKFORCE DEVELOPMENT IN
THE CENTRAL VALLEY, THE JOB
CREATIONS AND THEN THE THOUSANDS
. THE APPRENTICESHIP
OPPORTUNITIES ARE IN THE
THOUSANDS. I HAVE THE GOOD
FORTUNE OF RUNNING THE SELMA PRE
APPRENTICESHIP TRAINING CENTER,
THE CENTRAL VALLEY TRAINING
CONSORTIUM. FOR HIGH SPEED RAIL
AND HOPE TO CONTINUE TO DO IT IN
THE FUTURE. SO AGAIN, WE ARE
HIGHLY SUPPORTIVE OF THIS
PROJECT IN THE CENTRAL VALLEY
AND DO EVERYTHING WE CAN TO
SUPPORT IT. THANK YOU. THANK
YOU. LOOKS LIKE WE HAVE ONE MORE
. THAT IS JUST KILLING UP.
PLEASE ALLOW US A MOMENT TO
PROVIDE A LINE NUMBER. AND WE'LL
GO TO LINE NUMBER 44. THAT'S 44.
YOUR LINE IS OPEN. HI. THIS IS
MARGARET JACKSON FROM THE
VARIOUS OF BUSINESS ASSOCIATION
IN SILICON VALLEY BAY AREA, AND
FIRST OF ALL, I APPRECIATE
LISTENING IN ON THE, UM THE
CONFERENCE TODAY AND WE WANT TO
SUPPORT WHAT THE HIGH SPEED RAIL
IS DOING. WHAT PART OF THE
BUSINESS ADVISORY COUNCIL AND WE
WILL BE SUPPORTING THE HIGH
SPEED BROWN IN THEIR NEXT COMING
UP HERE SOON AND IN ONE OF THE
THINGS THAT I DID NOT HERE IN
THE COMMENTS TODAY IS REALLY THE
VALUE OF THE HIGH SPEED RAIL.
AND THE WORKFORCE DEVELOPMENT
AND THE ABILITY Tð TRANSFERS AND
OPPORTUNITIES THAT WOULD BE
WITHIN THE STATE HAVING A HIGH
SPEED RAIL. SO UM, I WAS A
LITTLE CONCERNED ABOUT SILLY
MEMBER ITALY'S COMMENTS IN AND
HOPEFULLY, UM, SHE WILL SEE THE
VALUE OF WHAT THE HIGH SPEED
RAIL WILL BRING TO THE STATE OF
CALIFORNIA WORKED WITH YOUR
DOING AND ADDITIONALLY UM WHEN
YOU'RE DOING SOMETHING NEW,
THERE'S GOING TO BE ABSENT.
FLOWN IN. WE JUST NEED TO COME
TOGETHER AND WIN TOGETHER AND
SUPPORT SOMETHING THAT IS, UH,
HISTORY MAKING QUITE FRANKLY IN
THE UNITED IN THE ENTIRE COUNTRY
, SO THANK YOU VERY MUCH. THANK
YOU. AND THANK YOU, EVERYONE FOR
YOUR PARTICIPATION, AND WITH
THIS, WE WILL ADJOURN THIS
MEETING.