clock menu more-arrow no yes

Filed under:

Likely cost of high-speed rail rises again

New, 6 comments

Estimate now more than $79.1 billion for SF-LA connection

Rendering of the California High-Speed Rail project in San Jose. Rendering courtesy of California High Speed Rail

The state’s plan to connect San Francisco to Los Angeles via bullet train—a project that is not, in fact, cancelled despite some confusion about Gov. Gavin Newsom’s intentions earlier this year—has most likely grown more expensive, although cost estimates remain within the parameters laid out in last year’s business plan.

That’s the latest from the state’s High Speed Rail Authority’s 2019 Project Update Report, issued Thursday.

The state hopes one day to run a line from San Diego all the way to Sacramento, but the present construction focuses only on “phase one” of the plan, connecting San Francisco and Los Angeles.

Currently, construction is happening on the first stretch of rail, through the Central Valley and connecting Merced to Bakersfield.

In 2008, when voters approved the project, the estimated budget was $40 billion. However, as the new update testifies, that was never a realistic notion. Here are some of the latest conclusions:

  • The original plan is impossible: “The initial cost projections and timelines were simply unrealistic. In 2008, voters were told the project would cost $45 billion. Now, the actual cost appears closer to $80 billion.”
  • Connecting SF to LA may cost nearly $100 billion by current estimates: The report’s “base” cost estimate for phase one now sits at $79.1 billion. The more optimistic low-end estimate is $63.2 billion, and worst-case scenario cost is $98.1 billion in this accounting.
  • The Central Valley portion has grown more expensive: The Merced to Bakersfield connection, which is currently under construction, was previously estimated to cost $10.6 billion, but the authority now says a $12.4 billion price tag is more likely. The highest end estimate is up to $13.5 billion.
  • But the planned Bay Area portion looks pricer: Connecting the Central Valley to Silicon Valley will likely cost around $31.3 billion, but could run as much as $36.8 billion.
State Environmental Laws Threaten To Slow CA High Speed Rail Project
Construction in Fresno in 2017.
Photo by California High-Speed Rail Authority via Getty Images
  • Note that all of these estimates are a little squishy: “Ranges are based on information known at this time, assuming all funding is available when needed. For example, the range for the Silicon Valley to Central Valley Line is wider because design is less advanced and some decisions are yet to be made.”
  • Only a little of the money needed is in hand: “The fact is that we do not have all the funding in hand to construct the full 520-mile system from San Francisco to Los Angeles/Anaheim or even the Silicon Valley to Central Valley segment. [...] To date, the Authority has secured approximately one third of the total funding needed for the current estimated cost of the statewide system.” Note that lack of cash on hand is one of the factors likely to drive cost estimates up in the future, as delays are by nature expensive.
  • Train service remains nearly a decade away: In 2012, the state estimated that the SF-LA corridor would be up and running by 2028. Now the current timeline has just the Central Valley segment completed by that date.

One thing worth noting is that the high-end $98.1 billion estimate for phase one is pretty much unchanged from the draft business plan released last year.

However, that plan included a lower base (i.e., most likely) cost of $77.3 billion. That’s now up to $79.1 billion. The low-end, optimistic estimate of $63.2 billion remains the same year over year.

To see the full report, including progress updates on Central Valley construction, go here.