California High-Speed Rail Vote Clears Way for Bond Sale
LOS ANGELES — The California High-Speed Rail Authority approved two funding plans Tuesday that will clear the way for it to sell $4.7 billion in bonds for construction projects in the Central Valley and on the San Francisco Peninsula.
Board members approved funding plans for the Central Valley and San Francisco-San Jose segments at their meeting in Sacramento. They also authorized issuance of a request for qualifications from prospective train-operating companies for the bullet train system between the Central Valley and San Francisco area.
The Authority had to approve the two funding plans before it could use any money from Proposition 1A, the $9.9 billion high-speed rail bond act approved by voters in 2008. Under the bond act provisions and subsequent 2012 legislation that provide construction funds for the project, the agency has to submit a funding plan that lays out the estimated construction costs for a usable segment of the system, identifies the sources of money to build it and provides an assessment of projected ridership and operating revenue.
The board's "action was one in a series needed to get to the point to ask the state treasurer to sell bonds," said Lisa Marie Alley, a rail authority spokeswoman.
Those actions included voter approval of Proposition 1A in 2008, the state legislature's allocation of $4.7 billion toward rail construction in 2012, bond validation, and now approval of the funding plan and acceptance of the independent auditor's report.
The board voted to approve the Central Valley piece and electrification of the corridor between San Francisco and San Jose. The rail project, estimated to cost $64.2 billion, is eventually supposed to stretch from San Francisco to San Diego.
The next step will be for the authority to submit the funding reports approved by the board and independent consultant reports to the state's Department of Finance at the beginning of the year, which starts a 60-day clock for DOF to approve them, Alley said. The reports would then be submitted to the Joint Legislative Budget Committee for comment, but Alley said the Authority does not need approval from the budget committee to move forward.
Once DOF approves it, then the Authority would work with the treasurer's office on organizing the hoped for spring bond sale, Alley said.
The authority estimates that it will cost $7.8 billion to build a fully electrified test line in the Central Valley to conduct trials of its electric trains at speeds above 200 mph. The federal government has contributed about $3 billion in American Recovery and Reinvestment Act stimulus funds and federal railroad transportation money. The state is required to provide matching funds. About $2.6 billion is expected to come from Proposition 1A, and another $2.2 billion from the state's Greenhouse Gas Reduction Fund.
Under the San Francisco Peninsula plan, the rail authority would operate its high-speed trains on a system that shares tracks with the 50-mile-long Caltrain commuter line that runs from San Jose to San Francisco. The Proposition 1A bond money would pay for the $2 billion to convert the current diesel trains to electric and upgrade the tracks and $600 million for the electrification project.