Fresno council members question high-speed rail's effect on business

The Fresno BeeMarch 7, 2012 

Three Fresno City Council members say they want immediate answers to more than two dozen questions about the potential effects of California's proposed high-speed trains on businesses and tax revenues in the city.

In a letter sent Wednesday to the California High-Speed Rail Authority, Council Members Andreas Borgeas and Lee Brand and Council President Clint Olivier said they want to know that the authority has "properly considered and evaluated" how the planned route through Fresno will disrupt businesses and other properties along the way; what efforts the authority will take to help businesses with relocation; and how the potential loss of property taxes, business taxes and sales taxes may affect the city's treasury.

The letter included 26 questions that the council members said they want answered in 60 days.

"There is a sense of urgency and there are unanswered questions," Borgeas said, noting that the authority recently approved terms under which would-be contractors can submit bids for the first phase of construction. Contractors are expected to provide bids by August or September, and work could begin in the city in early 2013.

Olivier said city businesses look "like little boxes" in aerial photo maps of the rail route. "But inside those buildings are hundreds, and perhaps thousands, of employees who could be affected by this," he said.

Other concerns include how the authority will determine fair-market value for property and businesses facing relocation, and how the authority can help the city deal with permits and other needs for relocating businesses.

The council members announced their concerns in a news conference at Alert-O-Lite, a company that provides safety equipment and barricades for traffic and construction work. The company, which has expressed interest in providing equipment for the massive construction project, is one of many along South Railroad Avenue south of downtown Fresno that could be relocated. The tracks would close a stretch of Railroad Avenue.

A 29-mile stretch from Madera to Fresno is projected to be the first built in a 520-mile high-speed rail system connecting San Francisco and Los Angeles.

Borgeas, Brand and Olivier stopped short of declaring opposition to high-speed rail, but each has previously expressed skepticism over the project and its business plan. While some cities along the line through the San Joaquin Valley have voted to oppose high-speed rail -- including Madera, Hanford and Bakersfield -- the Fresno City Council has not taken a formal position.

The three members said they could bring up high-speed rail for a vote if answers from the authority are not satisfactory.

A spokesman for the state rail authority issued a statement promising that the council members would get the answers they seek.

"We welcome the opportunity to address concerns of the Fresno City Council members, property owners and other stakeholders directly," said Lance Simmens, the authority's deputy director for communications. "And I will personally make sure we answer their questions."

While detailed environmental reports for the Valley sections still are being evaluated, they do indicate that businesses will be displaced and some property tax revenues will be lost.

In Fresno County, the rail authority estimates that 228 to 249 businesses could face relocation, affecting 6,500 to 6,900 employees. The potential property tax losses in Fresno County are predicted to be about $6,500 a year -- less than 1% of the estimated $1 million in property taxes assessed in 2010 for affected properties. The reports don't specify how many of those businesses -- and how much of the lost property tax revenue -- are from within the city.

Some sales taxes could also be lost, the authority reports said, if businesses couldn't relocate within the corridor or closed.

Fresno Mayor Ashley Swearengin said she is working with the rail authority and businesses that will be affected by the rail route.

"Minimizing the impact to businesses along the high-speed rail corridor is the city's top priority," she said. "We have been working on a weekly basis over the past three months ... to figure out the best ways to avoid businesses along the alignment."

Council Member Larry Westerlund said he is working on a proposal to establish a dedicated team or department of planning and engineering staff to work with property owners along the route -- to be paid for by the state rail authority.

"My concern," he said, "is that we have to protect these businesses and make it easy for them to relocate or rebuild without having to go through so many hoops."

Westerlund said he expects to bring the idea to the City Council by the end of March.

The reporter can be reached at tsheehan@fresnobee.com, (559) 441-6319 or on Twitter @tsheehan

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