High-Speed Rail delays in Merced, Central Valley cost some as agency pushes to Gilroy

The family that owns the El Bajio Market in downtown Merced says it invested more than $1 million in a new location with plans to help pay for the move using buyout money from the California High-Speed Rail Authority.

But now the agency has pitched delaying construction to Merced so it can work with private investors to build more profitable routes, such as toward Gilroy. So, the Rodriguez family is unsure its store’s current space on 16th Street — which the rail authority wants for its future Merced station — will be bought anytime soon.

“It makes us angry,” said Fernando Rodriguez, the market’s chief financial officer and son of its founders.

To him, the problem is rail authority’s “back and forth” when it comes to its Merced plans. It’s not the first time the rail authority has floated delaying construction to Merced in favor of first building to the Bay Area, and the Merced station location it wants today is different from the one it approved in 2012.

Merced Mayor Matthew Serratto told The Bee the family’s situation is “emblematic” of what businesses in the area are going through. He said several businesses that will have to move have begun looking for new locations. But it’s difficult for them to plan for the future because they are uncertain when the train will arrive.

The rail authority spent the past year planning ways to save money and speed construction so it can move the project forward without some of the cost overruns and delays that have plagued its past. The agency in September secured $20 billion from the state’s Cap-and-Invest program through 2045, a financial commitment that’s helping it secure a deal with private investors who can use their own money to build train segments faster.

Landing the best deal could depend on whether the rail authority is allowed to build more profitable routes, such as a connection between Madera and Gilroy. State law currently restricts rail authority spending to $500 million on work outside the required initial route from Merced to Bakersfield.

Rail authority CEO Ian Choudri recently told The Bee he will be asking California’s Legislature to change the law so he and the private sector can move forward on work outside the Central Valley. That’s why people in Merced are worried construction to their city will be delayed.

In a statement to The Bee, a rail authority spokesperson said it’s still in talks with the city of Merced to find the construction order that meets the needs of the project and the city, and “minimizes disruptions to the community.”

Merced business waiting for high-speed rail buyout

Rodriguez said he once supported high-speed rail and thought it would be good for businesses in Merced.

He said he learned in 2022 the rail authority wanted to build its downtown Merced station in a space different from the one authorized in 2012. The city of Merced suggested the proposed new station location in 2016, which includes the space where El Bajio Market stands today.

“We would argue, we would go to town halls and meetings, but no help,” Rodriguez said.

Eventually, the family “gave in” and started looking at other locations to build a new grocery store. Late last year, they were told the rail authority was coming to appraise their current property, so Rodriguez said the family decided to initiate a six-month process to buy a new space they had found on the south side of town.

Rodriguez said his family chose to start the purchase of the new space before having secured buyout money because they had been primed to plan ahead for several years.

“When you have different agencies and a city telling you ‘this is going to happen,’ you feel like you have to prepare,” he said. “So, we went on and made the purchase.”

He said the rail authority visited El Bajio’s current location in March to run an appraisal and that the agency told the family it would get back to them with a figure in four weeks. But the family has still not heard back despite its attempts to reach the agency, Rodriguez said.

Rodriguez believes that’s because the rail authority is planning to delay construction to Merced.

The rail authority did not respond specifically to The Bee’s questions about why it has not returned an appraisal figure to the Rodriguez family or how changing the Merced construction schedule could impact the timing of its plans to buy downtown Merced properties.

A report the agency released in August projects the agency will have finished acquiring the land it needs to build in Merced by mid-2027.

Rodriguez said, even if the rail authority buys El Bajio’s land soon, he’s afraid it’ll become another “empty shell” in the downtown area if Merced is not in the train’s initial segment.

Merced ‘in limbo’ as high-speed rail seeks construction re-sequencing

Serratto, Merced’s mayor, said he knows a lot of other businesses owners in the area that “feel the same way” as Rodriguez.

“A significant amount of the city is in limbo,” he said. “There’s a lot of uncertainty about how to plan, relocate and build.”

Ernie Ochoa, a long-time commercial real estate agent in the area, said the uncertainty also “diminishes investor confidence” for those who are looking to move into the area.

He said multiple lots for sale and buildings for lease on 16th street have been sitting on the market for quite some time.

“Investors are not going to pull the trigger on any property until there is certainty with the downtown high-speed rail station,” he said.

This story was originally published November 20, 2025 at 12:41 PM.

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.