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State revs up the plan to build high-speed-rail system faster by focusing on the Valley

California's beleaguered high-speed rail agency, mired in delays in property acquisition and construction in the Valley and environmental clearances elsewhere in the state, hopes to pick up the pace of its work in the coming year.

Over the past two years, the amount of construction taking place in the Valley has not kept pace with the California High-Speed Rail Authority's budgets allocated for the work. In 2016-17, the authority had more than $1.8 billion budgeted for project construction, but managed to spend less than $1.1 billion – only about 58 percent. Similarly, as of April the authority had spent less than 64 percent of the $1.2 billion that was allocated for the current fiscal year that ends Saturday.

"We've got a lot of work to do in a short amount of time," Brian Kelly, the rail authority's CEO, told The Bee. "I'm not intentionally being critical of predecessors, but a lot of time went by without fundamental decisions being made (and) key actions being taken so we can get over the hump on things and keep moving."

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California High-Speed Rail Authority CEO Brian Kelly talks about a new work plan at the agency's board meeting in Sacramento on June 19, 2018. California High-Speed Rail Authority Photo capture from video

Authority leaders hope an aggressive new work plan and budget adopted by the board in Sacramento last week will be a step toward getting the rail project back on track by focusing efforts only on issues that directly advance work in the Valley and on the San Francisco Peninsula – without spinning their wheels on extraneous activities.

The new budget calls for spending more than $1.4 billion just on construction in 2018-19.

One component of the plan is to examine prospects for using about 119 miles of the route now under construction in the Valley between Madera and Bakersfield once it's completed, potentially as a way to improve the existing Amtrak San Joaquin passenger rail service in the Valley. But Kelly said his preference, if consultants can find a way for it to pencil out, would be to establish a stand-alone, interim high-speed train service through the Valley until tunnels can be bored through Diablo Range and Pacheco Pass to connect to the San Francisco Peninsula at Gilroy.

The work plan adopted last week by the rail agency's board is being dubbed a new "baseline" of costs, scheduling and decision-making. It is linked to the 2018 business plan that was approved in May, and reinforces the agency's expectations for a project that costs more and will take longer to build than previous plans adopted over the past eight years.

What was optimistically pitched in 2008 as a complete 800-mile program that could be built for about $35 billion and conceivably up and running by as early as 2020 has confronted obstacles including engineering, litigation and politics.

Over the past decade, the projected price tag has ranged from the original $35 billion for 800 miles to a mind-numbing $98 billion for just the first 520-mile phase from San Francisco to Los Angeles/Anaheim. For the past six years, the estimate for the San Francisco-Los Angeles/Anaheim phase has wobbled in the mid-$60 billion range, with no forecast offered on the price tag for future Phase 2 extensions to Sacramento and San Diego.

The 2018 business plan estimates the cost of the 520-mile Phase 1 at about $77.3 billion, but allows that the costs could ultimately land somewhere between $63.2 billion and $98.1 billion.

Using what gets built

The ability to demonstrate tangible progress and deliver will, Kelly said, be key to improving public attitudes toward the project. "We have to put our heads down and deliver," he said.

Through a combination of stimulus and railroad grants from the Obama administration, money from the 2008 high-speed rail bond measure Proposition 1A, and funds from the state's greenhouse gas-reduction program, the authority believes it has the $10.6 billion needed to complete construction in the Valley as well as $1.3 billion for work on what it calls the "bookends" of the statewide system, including electrifying the Caltrain commuter rail corridor on the San Francisco Peninsula and improvements to rail corridors in Southern California.

"The issue is, how do you get to the Bay Area? How do you get to L.A? How do you do it in a funding-constrained environment? We have to do it in pieces," Kelly said. "We're doing further analysis about where we start those pieces and get trains on the ground as soon as possible. I'm very eager to put the assets were building into use and not let them just sit there."

That means potentially – and "potentially" is the key word – running trains in the Valley after the infrastructure, tracks and electrification are completed, possibly starting in 2025. That would put tracks to use while the authority tries to figure out where it will get the money and how to technically accomplish the task of tunneling through the Pacheco Pass.

"My driving push is, how do we get fast trains on the ground as soon as possible? I think it's really important," Kelly added. "We have to do a thorough analysis and be creative in how we do it and meet our obligations. (But) I think Californians would say, 'We welcome it, and sooner rather than later.'"

A Valley segment would offer the rail authority the ability to connect with existing rail services in northern California, including the ACE, or Altamont Corridor Express, trains that run between San Jose and Stockton with plans to extend the line south to Merced.

"What we've laid out is the possibility of whether we can operate an interim service in the Valley," Kelly said. "While we scope and design the tunnel, do the geotechnical work, get the right of way … can we get an operational segment going on two sides (of the mountain range)?"

Still an uphill climb

The initial construction segments in the Valley have proven to be lessons in how not to do a major infrastructure project like high-speed rail. Beyond the Valley, from Bakersfield south to Palmdale, Los Angeles and Anaheim and east from Chowchilla to Gilroy, San Jose and San Francisco, authority leaders vow to heed the lessons of the Valley.

On the first three construction contracts in the Valley, the authority was under a federal deadline of September 2017 to spend more than $2.5 billion in economic stimulus funds from the Obama administration. That forced the agency into an artificially compressed time frame to award construction contracts even before it had acquired the properties it needed for right of way. The contractors were tasked with not only designing and building the rail line, but also for securing some environmental permits and handling relocation of gas, electric and communications utilities along the route.

The less-than-ideal result is what chief engineer Scott Jarvis called "a shotgun marriage of project development and delivery."

In January 2014, a few months after signing a contract for the first 29-mile construction segment in Fresno and Madera counties in 2013, the rail authority and Amtrak issued a joint request for bids from manufacturers for electric-powered train sets – California with its eye on 220-mph trains for its system, Amtrak looking for slower 150-mph trains for its Acela Express service in the Northeast Corridor between Boston and Washington, D.C. That process was dropped in after a few months because the needs of the two rail lines were too different.

But it's an example of ancillary issues that sidetracked some of the rail authority's focus at the time – something the new budget-and-schedule baseline is intended to help the agency avoid. Joe Hedges, the agency's chief operating officer, described it as a matter of "doing our jobs" and making hard decisions and choices at the right time.

"We want to do stuff that is contributory. We want to be deliberate in our moves," he said. "We're not fully funded, so these moves have to be very strategic. … Let's stop chasing shiny ideas. Let's make prudent decisions when we need to make them."

Hedges cited right of way – the property the authority needs for its route and related structures – as an example of lack of focus. In the three Valley construction segments, "there are something like 1,900 parcels (needed), and we're at somewhere around 1,340 right now, and we're already three and a half years into this," Hedges said.

For future stages, leaders are determined not to award construction contracts until the property is in hand and other preliminaries out of the way. "The shared vision is a cleared alignment, utilities moved, right of way procured," Hedges said. "So when we award contracts, it's 'Go.'"

Another hang-up before even that can happen, however, will be environmental certification and approval of specific routes for those future route sections. In 2016, the authority's leadership optimistically forecast that it could select preferred alternatives and finish up a series of comprehensive environmental impact reports by the end of 2017.

The new baseline now estimates that the environmental work can be completed and approved for a section north of Bakersfield by this fall; for the area surrounding Chowchilla by next summer, and for portions in the Bay Area and Los Angeles by the spring of 2021.

And, of course, there remain legal concerns, including compliance with Proposition 1A, a $9.95 billion bond measure approved by California voters in 2008 to help finance high-speed rail planning, development and construction. A hearing is planned for October in a lawsuit filed in 2016 by Kings County and others challenging the constitutionality of a law dealing with how Proposition 1A bond funds can be used for construction.

New sense of purpose

As progress has languished compared to earlier optimistic projections, the agency's credibility has suffered not only in the Valley, but up and down the state. In some cases, even the authority's board shared a sense of concern about the slow pace of work, said Dan Richard, the board chairman.

"Over the past several years we've had pieces of things, but I've always had that disquieting feeling that we just didn't have our arms around the entirety of the program, that things were operating at cross purposes, that we didn't have a real sense of what was going on at the deep, deep level," Richard said.

Roy Hill, a consultant serving as the authority's chief program officer, said last week that the new work plan is a tool to provide "a very clear direction forward with how and what we are doing" to develop future program sections to increase the probability of delivering them on budget and on schedule.

"We have to make a number of decisions in the next six to 18 months regarding Bakersfield, regarding tracking systems, train procurement – and all of those are dependent upon funding," Hill added.

One big decision of interest to the Valley: where will the agency decide to build a heavy maintenance facility to handle major servicing of trains for the entire statewide system. The rail authority first asked cities and counties for proposals for sites 10 years ago, fueling a decade-long competition for what local leaders perceive as an economic golden goose because it could mean as many as 1,500 permanent jobs and serve as a magnet for rail-related industries in whichever community lands it.

But a decision has been pushed and delayed, much to the consternation of Fresno, Bakersfield, Merced and other communities vying to be selected, and the waiting is getting old.

Kelly acknowledged the extended wait for the competing communities, but "I do think that's going to be clarified in 2019."

"I think it's been a heavy political tool in the past, but to me it's an operational question," Kelly said. "It's where does it work for us to do what we need to deliver."

Tim Sheehan: 559-441-6319; Twitter: @TimSheehanNews.