The state Treasurer’s Office is expected to sell about $1.4 billion in high-speed rail bonds next month – the first sale of Proposition 1A bonds for construction of California’s embattled bullet-train project in the San Joaquin Valley.
Another $1 billion bond sale could come in the second half of the year, according to Gov. Jerry Brown’s preliminary budget for 2017-18.
California High-Speed Rail Authority CEO Jeff Morales told the agency’s board of directors Wednesday in Sacramento that the state Department of Finance gave a green light to a financing plan adopted by the authority in December for construction of segments in the San Joaquin Valley. That approval, issued March 3, cleared the way for the sale of the bonds despite fiscal and legal challenges that continue to confront the project.
“After a lot of years and a lot of challenges, the Treasurer will sell bonds and we’ll be able to spend bond funds as intended,” Morales said. “It’s a very important milestone for us in the program.”
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Proposition 1A is the $9.9 billion high-speed rail bond measure approved by California voters in 2008. Construction in the Valley is estimated to cost about $6.7 billion, while the cost of the entire statewide line from San Francisco to Los Angeles and Anaheim is projected at about $64 billion.
“I find that the Central Valley funding plan submitted by the authority is likely to be successfully implemented as proposed,” state finance director Michael Cohen wrote in his March 3 letter. “The authority may therefore enter into commitments to expend bond funds and accept offered commitments from private parties in support of the Central Valley segment.”
After a lot of years and a lot of challenges, the Treasurer will sell bonds and we’ll be able to spend bond funds as intended.
Jeff Morales, California High-Speed Rail Authority CEO
The Valley portion of the would-be statewide rail line stretches from Madera on the north end to the Kern County community of Shafter to the south – a stretch of about 119 miles. The authority has awarded three different construction contracts for the Valley line, and major construction is under way in Fresno and Madera counties. The agency is continuing to secure all of the property it needs for the railroad right of way throughout the Valley.
Still on hold, however, is the financing plan proposed by the rail authority for construction along the San Francisco Peninsula between San Jose and San Francisco. Cohen said his deferral on approval of that segment is the result of the Federal Transit Administration delaying its approval of a grant agreement to help the Caltrain commuter rail system from San Jose to San Francisco electrify and upgrade its tracks. The authority plans to contribute $600 million from Proposition 1A bonds, but the decision by the Trump administration to hold off on a federal grant for another $647 million for the electrification project has put the brakes on that effort.
“What that means right now is that the Central Valley moves forward,” Morales said. “The treasurer will sell bonds this spring, and we will spend them over the course of the year.”
According to the Department of Finance, the state expects to sell the high-speed rail bonds along with other state bonds during the week of April 17.
The authority’s finance committee, which met earlier Wednesday in Sacramento, also received an update on construction progress in the Valley, where a rainy winter managed to slow some of the work.
In Madera County, crews have completed building the superstructure of the Fresno River viaduct, which will carry tracks up and over the Fresno River, Highway 145 and Raymond Road; at Cottonwood Creek southeast of Madera, work is on hold but will resume in the spring.
In Fresno County, foundation work is continuing at two sites: at the San Joaquin River for a new bridge to span the river at the north end of Fresno near Highway 99, and for the Fresno Trench, which will carry the high-speed tracks under Highway 180 north of downtown Fresno. Work on the trench also includes construction of temporary shoring on the Highway 180 embankments. At the south end of Fresno, workers are building forms for the superstructure of a viaduct that will take the trains up and over Cedar and North avenues and Highway 99, and additional support columns for the bridge are being built east and west of the freeway.
In the meantime, crews have fallen behind the anticipated schedule for completion of the Tuolumne Street bridge, over the existing Union Pacific Railroad tracks and the future high-speed train line in downtown Fresno. When demolition of the old bridge began more than a year ago, representatives of the authority expected that construction would be done by the end of 2016.
But about 10 percent of the Tuolumne bridge structure itself remains to be completed on the east end, near Broadway Street, and Fresno city officials have expressed concern about whether the bridge itself – and the necessary work to convert Tuolumne Street from a one-way eastbound street to two-way traffic between P and E streets – will be done by the time the city’s Fulton Street restoration project terminating at Tuolumne Street is completed.
In central Fresno, the state Department of Transportation is working on a project to relocate a two-mile stretch of Highway 99 to make room for high-speed rail tracks between the freeway and the adjacent Union Pacific tracks. Caltrans reports that the Clinton Avenue overpass is due to be closed for about six months, starting in the first week of April, as part of the project. The freeway realignment will nudge Highway 99 about 100 feet to the west between Ashlan and Clinton avenues.