Calif. Gov. Brown rejects $100 billion high-speed rail estimate

The Sacramento BeeJanuary 30, 2012 

California's high-speed rail project will cost far less than the state's current estimate of nearly $100 billion and environmental fees paid by carbon producers will be a source of funding, Gov. Jerry Brown said in an interview aired in Los Angeles on Sunday.

The Democratic governor's remarks suggested Brown may make substantial changes to the rail plan before seeking legislative approval this year.

"It's not going to be $100 billion," Brown said on ABC 7's Eyewitness Newsmakers program. "That's way off."

It was the California High-Speed Rail Authority's own business plan – a document embraced by Brown's administration – that said the project could cost $98.5 billion over 20 years. Brown supported the project in his State of the State address and said further revisions to the plan would be released within weeks.

"Phase 1, I'm trying to redesign it in a way that in and of itself will be justified by the state investment," Brown said Sunday. "We do have other sources of money. For example, cap-and-trade, which is this measure where you make people who produce greenhouse gases pay certain fees – that will be a source of funding going forward for the high-speed rail."

Brown said, "It's going to be a lot cheaper than people are saying."

The annual spending plan Brown proposed this month included $1 billion in cap-and-trade revenue for programs to reduce greenhouse gas emissions. The budget document lacked detail, however, saying, "Further detail on specific program areas will be developed when there is more certainty of fees received from the Cap and Trade Program."

Brown's office declined to elaborate Sunday on the cap-and-trade funding plan or on how Brown might redesign the rail project.

Brown spokesman Gil Duran said in an e-mail, "The new leadership at the High-Speed Rail Authority is working hard to make sure California gets the maximum value at each stage of the project."

The rail authority plans to start construction in the Central Valley this fall. But public opinion has turned against the project since voters approved it in 2008, and the Legislature has become increasingly critical.

Brown suggested Sunday that he remains committed to starting construction in the Central Valley. The federal government, which is contributing billions of dollars to the project, is requiring construction to start in that area, controversial because it is far from California's population centers.

"The first phase, most of the money is coming from the federal government," Brown said. "If we don't spend it, they take it back." Brown said it is "silly" for critics to call the Central Valley starting point a "track to nowhere."

Last week, California's state auditor became the latest observer to criticize the project, saying its reliance on future federal funding is risky. The Legislative Analyst's Office and the rail authority's own peer review group previously criticized the plan.

The interview with Brown aired following his trip last week to Southern California, his second in two weeks as he begins campaigning for his ballot initiative to raise taxes.

"It isn't all, you know, going to football games and buying clothes and cars and gasoline and all the things people want to do in their private life," Brown said. "We also have a public investment, and that's part of the balance of a civilization."

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