Feds deny early approval of Fresno-Bakersfield high-speed rail segment

The Fresno BeeDecember 4, 2013 

High speed rail

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A federal oversight board has turned down a request from the California High-Speed Rail Authority for conditional permission to build the Fresno-Bakersfield section of the proposed statewide bullet-train line.

In a decision announced Wednesday, the three-member Surface Transportation Board denied the state's request for an expedited decision on the 114-mile Fresno-Bakersfield route before environmental work is completed on the section.

Attorneys for the rail authority indicated that the decision could force a delay in designing and building a five-mile stretch of the route between downtown Fresno and the south edge of Fresno, for which a contract has already been awarded. But a spokeswoman for the agency said no delays are anticipated.

Earlier this year, the federal board approved the Merced-Fresno portion of the rail line, and the state in August awarded a contract for its first 29-mile construction segment, from Madera through Fresno. But the southernmost five miles of that $1 billion contract fall in the Fresno-Bakersfield section -- for which environmental work has yet to be completed.

Representatives of the rail authority said they anticipate adopting a final environmental report for the Fresno-Bakersfield section next spring.

The state is seeking an exemption from federal permit requirements for railway construction and in its petition filed Sept. 26 asked the board for a conditional decision "subject to the entry of a final decision after completion of environmental review" by the state rail agency and the Federal Railroad Administration.

Attorneys for the state also wanted a decision by Dec. 31 because "there is a possibility that the (federal) board will have a vacancy as of January 1, 2014."

The three members of the Surface Transportation Board are presidential appointees who are subject to confirmation by the U.S. Senate. They oversee rates, construction, mergers and other rail-related issues. The members are chairman Daniel R. Elliott III, Ann D. Begeman and Francis P. Mulvey. Elliot's term is due to expire Dec. 31.

In its petition, attorneys for the state said that if the contractor cannot be authorized to begin work south of downtown Fresno by July 2014, that section would be removed from the first construction contract. That, in turn, would force the state to renegotiate the price for the first 24 miles north of Fresno, and negotiate a separate contract for the southernmost 5 miles, potentially creating "a substantial aggregate increase in the cost of construction" for the two sections.

But in their unanimous decision, the STB members said the state "has not presented any unique or compelling circumstances" that require conditional approval before the environmental work is completed.

"The fact that the Authority contractually agreed to notify its contractor by a certain date that construction can proceed is not a sufficient basis for the Board to carry out its independent statutory obligation in a piecemeal fashion," the decision read. "Moreover, no construction may begin until after the environmental review is completed and the Board issues its final decision."

While the Surface Transportation Board refused to grant an early conditional approval on the permit exemption, the state's petition remains pending until the federal board can consider the transportation and environmental issues together for the Fresno-Bakersfield section. Replies to the petition, including objections by opponents to the project, are being accepted by the STB through Dec. 24.

Jeff Morales, CEO of the state High-Speed Rail Authority, described Wednesday's decision as consistent with the federal board's procedures on the Merced-Fresno section.

"As we did with the previous filing with the Surface Transportation Board, we presented them with two options to move the process forward," Morales said. "With their decision today, the board opted for the same process used in their approval of the Merced to Fresno project section and all of our ongoing work and contracts proceed as they have been."

Authority spokeswoman Lisa Marie Alley said Wednesday that the STB's vote "does not change anything in our contract -- no contract change, no price change" for its construction firms. "We believe there is nothing to suggest that we can't make the July 2014 deadline."

"If we get to June and we still haven't gotten the environmental clearances, then we'll take another look and see what that means for us," Alley added.

Rep. Jeff Denham, R-Turlock, declared the STB decision "another major blow in a series of setbacks" to the California project.

Denham, a vocal critic of the rail authority, noted that the decision comes on the heels of a court ruling last week in Sacramento that requires the rail agency to re-do its finance and business plan to comply with Proposition 1A, a $9.9 billion bond measure approved by California voters in 2008. Until it submits a plan that complies with Prop. 1A, Sacramento County Superior Court Judge Michael Kenny ruled, the rail authority cannot spend any state bond money on rail construction.

Another San Joaquin Valley Republican congressman, Rep. David Valadao, R-Hanford, successfully attached an amendment to a House appropriations bill in June that would bar the Surface Transportation Board from approving individual construction segments of the state project. Instead, the board would be allowed only to consider the statewide high-speed train network -- from San Francisco through the Valley and down to Los Angeles -- in its entirety. But that appropriations bill with Valadao's amendment remains hung up in the federal budget stalemate between the Republican-controlled House of Representatives and the U.S. Senate, which is in the hands Democrats.

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

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