What will Merced lose if it’s cut from CA’s Central Valley high-speed rail line?

For the second time in a decade, the city of Merced is grappling with the possibility that it could be excluded from the California high-speed rail project’s initial operating segment in the Central Valley.

A recent report by the California High-Speed Rail Authority suggests delaying an extension to Merced to, instead, connect the bullet-train system to San Francisco or Los Angele faster. The report said the system needs to reach those population hubs to become profitable.

The idea caught local leaders in Merced off guard and comes after the city has already invested years of planning for housing and development in its downtown that would be supported by a bullet-train station. Gov. Gavin Newsom in 2019 directed the rail authority to prioritize construction of the project’s Merced-to-Bakersfield segment. The Central Valley segment could open for revenue service by the beginning of 2032.

Leaving Merced out of those plans could dash local leaders’ plans of revitalizing the city’s downtown.

“There’s a lot of planning and development around the station, a lot of planning and development we could lose out on from just sitting and waiting,” said Merced Mayor Matthew Serratto. “That’s the hard part.”

The high-speed rail report included scenarios that favor connecting the Fresno-Madera area to Gilroy, where the system is more likely to achieve profitability by linking to Silicon Valley and San Francisco via the Caltrain commuter rail’s electrified tracks.

The situation is reminiscent of 2016, when a draft of a plan pitched building toward Silicon Valley from Bakersfield without a Merced extension in the initial Central Valley route. That idea fell through later that year after backlash from local and Los Angeles officials who saw the project moving away from their areas.

A Merced high-speed rail station is mandated by Proposition 1A, the $9.95 billion bond measure California voters approved in 2008 to help build a bullet-train system connecting Los Angeles and San Francisco through the Central Valley. A 2022 state law mandated the rail authority prioritize the completion of a Merced-to-Bakersfield line and placed a $500 million spending cap on work outside of that focus.

Lawmakers representing Merced in the state Legislature said they will oppose any efforts to delay the construction of Merced’s high-speed rail station.

“We have no credibility if, at the drop of the hat, we can change plans and leave communities high and dry that have made plans on the promise that the train is going to go from Bakersfield to Merced,” said state Sen. Anna Caballero.

The rail authority said in an email that it is “committed to building to Merced in the sequence determined by state law — and under current law we’re prioritizing Merced-Bakersfield.”

“We’re also providing options to the legislature and administration to consider going forward,” the agency said.

Why does high-speed rail report suggest delaying Merced station?

According to the rail authority’s report, the Merced-to-Bakersfield segment, which is projected to cost $36.75 billion to build, will not be able to cover its total operational costs. The report presented four profitable scenarios for the Legislature’s consideration that the rail authority could build by 2039.

Two scenarios include a Merced station and two don’t.

The most profitable scenario connects high-speed rail to Gilroy from Madera and to Palmdale from Bakersfield without extending to Merced. The scenario that’s most affordable and profitable is a Gilroy-to-Bakersfield route that bypasses Merced, which would cost about $54 billion to build.

The report says the state “could re-sequence the Merced extension” to generate savings. Building to Gilroy sooner would result in greater ridership and revenue that could help pay for an extension to Merced, “where farebox recovery is insufficient to cover operations and maintenance costs,” the rail authority said.

Stacie Guzman, executive director of the Merced County Association of Governments, said it’s long been known that ridership in the Central Valley would not be as high as in the state’s urban areas. But she said the report reduced the value of a Merced connection to “just a return on investment.”

“There needs to be a reminder that the decision to include Merced in the initial operating segment was not based originally on a solely financial criteria,” she said. “There was a commitment to make this investment in the San Joaquin Valley.”

The rail authority said in an email that Merced remains “a critical hub for the Phase I high-speed rail system.” But the agency added that the report shows it’s focused on creating a commercially viable system as soon as possible by extending the rail system to Los Angeles and San Francisco.

Along with a stronger funding commitment from the state, this focus could help the project begin to attract the private investment and partnerships “with the potential to build and finance the full system as envisioned,” the rail authority said.

How has high-speed rail shaped Merced plans?

With the help of a $500,000 rail authority grant, Merced has begun to re-shape what its downtown will look like once it has its station.

Serratto, Merced’s mayor, said local businesses and organizations that will have to move to accommodate future high-speed rail construction have already started looking at replacement facilities. Others are looking to move into the area with the hope of benefitting from high-speed rail’s arrival, he said.

“A lot of people have bought properties with the expectation of developing high-speed rail-oriented, transit-oriented businesses,” Serratto said. “But with high-speed rail in limbo, it either inhibits or prevents development.”

The Merced County Association of Governments, which is the county’s transportation planning authority, has also planned for the high-speed rail station to connect to other transit systems.

The Yosemite Area Regional Transportation System, which shuttles to Yosemite National Park from the Central Valley, would connect to Merced’s high-speed rail station along with Altamont Corridor Express, a Bay Area-bound commuter rail. Amtrak plans to realign its track to connect to the high-speed rail station, as well.

Guzman said it’s difficult to quantify what could be lost if high-speed rail to Merced is delayed. She said local planners have had a good working relationship with the rail authority.

“The looser the commitment is, the harder it is for us to make decisions on projects we have funding for,” Guzman said. “We have been a champion of this project and have invested so many years of time and effort — hundreds of thousands of dollars, if not more.... We certainly don’t want to invest in projects that are built on the foundation of a future with a high-speed rail station being here by 2033 if that is remaining in question.”

Legislators from Merced to oppose high-speed rail delay

State Assemblymember Esmeralda Soria, who represents Merced, said she “cannot support any piece of legislation that would take away (or delay) local resources, and investments from my district.”

The rail authority has reported that the project has created more than 15,000 jobs in the Central Valley. Soria said those jobs have paid out more than $2.5 billion in wages to Central Valley workers.

“The greatest impact of High-Speed Rail has been in the Central Valley, where many communities are economically disadvantaged,” Soria said in an email. “We cannot afford to lose momentum.”

Caballero, Merced’s state senator, said the Legislature should focus instead on securing long-term financing for the project. She said the Legislature is now negotiating an extension of California’s cap-and-trade program that could provide $1 billion annually for the high-speed rail project through 2045. The program generates public dollars from companies that buy credits at state auctions to offset their greenhouse gas emissions.

“We need to re-up the commitment to fund high-speed rail at a sufficient rate to be able to meet the deadlines,” she said.

This story was originally published September 9, 2025 at 5:00 AM.

Erik Galicia

The Fresno Bee

Erik is a graduate of the Missouri School of Journalism, where he helped launch an effort to better meet the news needs of Spanish-speaking immigrants. Before that, he served as editor-in-chief of his community college student newspaper, Riverside City College Viewpoints, where he covered the impacts of the Salton Sea’s decline on its adjacent farm worker communities in the Southern California desert. Erik’s work is supported through the California Local News Fellowship program.