Newsletter

                  June 2018

The newsletter this month is a summary of a report written by Martin Bradley, an Engineer who has worked all over the world on many engineering projects.  A summary of his experience will be at the end of this report.  This report is about the California High Speed Passenger Train.

California Proposition 1A. – Safe, Reliable High-Speed Passenger Train Bond Act for the 21^st Century.

1. Approved by the voters in 2008 by a 53% to 47% margin.
2. Bond Act allowed for $9 Billion in bonds to be sold for high speed rail work.

      When approved by voters, estimated cost was $40 Billion for Phases 1 and 2,     San Francisco to San Diego including a spur line from Sacramento that would tie into  the main San Francisco to San Diego line north of Madera.

3. Phase 1, San Francisco to Los Angeles scheduled for completion by 2029.
4. No current estimate for completion of Phase 2 (Sacramento spur line and Los Angeles to San Diego via Riverside and San Bernardino).
5. 2016 – Business plan estimate was revised upward to $64 Billion, a 60% increase.

  24 stations are proposed and travel time between San Francisco and Los Angeles was promised not to exceed 2 hours and 40 minutes.

 Additional performance standards included a minimum of 200 miles per hour (320 kilometer per hour) “where conditions permit” (whatever that means).  Please note that the most current in-service European high-speed trains operate between 160 and 180 mph and only one, the Alstom-built Euroduplex, (in service since 2011) reaches the 200 mph speed over a large number of routes “where conditions permit.”

The train program is to be financially self-sustaining (operation and maintenance costs fully covered by ticket revenues).  The self-sustaining caveat ignores the 2016 estimated Capital Costs of $64 Billion.  It has been estimated that it will take 203.8 years of 10,000 passengers per day, paying $86 for a ticket, to break even with the current $64 Billion estimate. 

10,000 passengers per day sounds like a lot but Southwest Airlines offers 118 Monday through Friday round-trip flights carrying a maximum of 143 passengers per flight providing approximately 16,800 revenue seats per day between San Francisco/Oakland/San Jose and Los Angeles/Burbank.

So where will 10,000 a day rail passengers come from? 

1. Population growth
2. Central Valley boarding’s where air travel is limited and expensive
3. Reduction in US 99 and I-5 vehicular travel

The California High-Speed Rail Authority HSR insists that these cost numbers are something “you can take to your banker” except that neither bankers nor private inventors have even hinted at wanting to “invest” in such a wonderful, public interest project.  Skeptics who are much closer to the project laugh at the $64 Billion estimate and some believe that when all is said and done the taxpayers will be looking at a $140 Billion capital cost bill and will never attain financial self-sustainment.

In 2010 Phase 1 was in its infancy.  That means that general routings were being considered, track types (at-grade, elevated, just below grade and through tunnels) and station locations were also being reviewed.  A large train/track maintenance facility was under consideration to be located somewhere along the route’s mid-point possibly near Hanford or Visalia in the Central Valley.

The overall route was divided into approximately 80-120 mile segments so that a variety of different firms could bid on the Preliminary/Basic Engineering (P/BE) and Environmental Impact Study (EIS) portions of the project.  Once these were completed and approved, proposals could then be prepared for the actual Final Design-Build contract bidding.  The time frame for performing P/BE and EIS work can easily take up to 3+ years to perform. 

Alternate routes have to be made and then surveying and mapping have to be completed before full-blown Environmental field studies can be made, reports prepared including citizen outreach meetings/programs, large and small government reviews, changes and additions before the final report is issued and approved. 

You don’t want to spend hefty sums on EIS works only to abandon the routing and have to start all over again.  It happened anyway, because I was told that the company I was working for was “coerced” to significantly realign the route, not for better operational reasons but for political ones.  A political reason might be an influential person or politician who wants the train to run through their town so the person can be photographed and be part of the groundbreaking ceremony.

The P/BE and EIS  work has been completed on the 119 mile segment from Avenue 19, which is north of the proposed Fresno Station, to Popular Avenue, which is north of the proposed Bakersfield Station.  This segment is broken into four construction packages (CP), but CP 2-3 have been combined and awarded to one design/build firm: Dragados Flatiron Joint Venture.

CP1 was awarded to Tutor-Perini/Zachary/Parsons and CP4 was awarded to California Rail Builders.  In their 2018 Business Plan, which was approved on May 15, 2018 by the board tasked with oversight, the HSR Authority continues to tout that “We are going to deliver high-speed rail for the people of California.”  What is buried in the Approved Plan and only touched upon in the 100+ page document that in two years since the 2016 Plan was approved the project cost forecast is up 20.3% ($64B vs. $77B) and the estimated completion date for Phase 1 has been pushed out four years, 2029 to 2033, a 31% increase in project time completion.

Concurrently, the HS authority in their Business Plan continues to bloviate how well the first 119 miles of work is progressing against the overall 500 mile route.  When you read between the lines, you realize that the approximately 20% of the overall length is by far the easiest part of the construction.  This is like saying: “I’m going to climb Mt. Everest and 20% of the work is progressing very well just because I’ve flown in first class seated in a B747 from San Francisco to Katmandu, Nepal.”

Remember that this first work section can be likened to baiting a fishing hook.  The Authority figures getting this portion of the overall work done first while having it look pretty and somewhat operational so that train-sets can be tested at high-speed over limited distances (less than 100 miles) will make it possible to set the hook in the fishes mouth (taxpayers are the fish) and say that we can’t turn back now.

Let’s look at the different sections of the train.

San Francisco to San Jose

No one, especially Democrats running for office, talk about the train let alone this section.  This section runs down the Peninsula but where?  How is the construction work going to impact for years the current Caltrain system?  How is HSR going to integrate into the existing tracks or is new right-of-way required?

None of these questions have been addressed in the latest business report only to say, “The HSR understand there are problems along this section and we are working to mitigate the impact.”

A number of lawsuits have been filed relative to this section and others will undoubtedly be filed in the future increasing the section costs and delaying the overall schedule.

Silicon Valley to Central Valley Line

The approved 2018 HSR Business Plan addresses the need for a tunnel through the Pacheco Pass to tie Gilroy, CA into the Central Valley Line.  The Plan basically states the Authority has identified a “number” of tunnels over the entire 500 mile route of between 45 to 50 miles in total length will be required that they will draw upon “International Tunneling Expertise” and “Our tunnel design and construction approach involves taking advantage of international expertise and lessons learned on other high-speed rail programs world wide.”  The tunnel through the Pacheco Pass will have the Calaveras Earthquake Fault to contend with. 

The Authority has three routes currently identified between Palmdale and Burbank that will require tunnels.  The three routes potentially pass through three minor to major fault lines.

International Tunnels

The HSR Authority cites “Five high-speed rail tunnels of the same length and longer have been successfully completed worldwide and another six are currently in planning under construction.”

Unfortunately, all of these tunnels cited were seriously over budget and behind schedule.

The world’s lengthiest railway tunnel, the 35.5 mile Gotthard Base Tunnel was opened in December 2016.  It took 17 years of construction, involved nearly 2400 workers at peak workforce and cost $12.6 Billion.  The Swiss constructed this tunnel out of the granite/hard-rock materials found in the Alps.  California tunnels will have to be constructed in soft/unstable materials.

Burbank-LA Union Station-Anaheim

This 45-mile long segment is another nightmare to contend with that will most likely only provide slower train service similar to the SF Peninsula segment.  This segment intersperses itself with the Metrolink and freight lines.  It seems that the HSR Authority is just kind of ignoring this problem and hoping it goes away after some magic elixir is found.  Currently, they are only estimating approximately $5 Billion for this work or about $111 Million a mile.

Phase 1 – Summary

Phase 1 in a nut shell.  San Francisco to Anaheim currently with stations at Downtown San Francisco, San Francisco Airport, San Jose, Gilroy, Madera, Fresno, Kings/Tulare, Bakersfield, Palmdale, Burbank, Los Angeles Union Station, two more stations between Los Angeles and the southern terminus station at Anaheim.

Phase 1 project completion now scheduled for 2033.  The cost ranges from a low of $63.3 Billion with a high of $98.1 Billion and a current base estimate of $77.3 Billion. 

Phase 2

Phase 2 is barely mentioned in the Business Plan and is not included in the above estimated project costs.  The Sacramento-Central Valley line and the Los Angeles Union Station to San Diego are not considered a “current priority.”  The Plan states that it is important to advance Phase 2 planning so connectivity improvements are made in anticipation of future high-speed rail service.  The interpretation:  Don’t ask questions about Phase 2 because it’s only smoke and mirrors anyway.

Ridership

The 2033 Phase 1 Ridership has low, likely and high annual estimates.  Low is 17.8 million, likely is 23.6 million and high is 30.8 million annual riders.  The HSR is also factoring in ramp-up in ridership once confidence in the system is obtained as the system “matures, travelers become acquainted with the new rail service and trip behavior adjust to reflect the introduction of a new travel mode.” 

By 2055, Phase 1 ridership is estimated to be a low of 35.2 million, a likely of 46.4 million and a high of 60.0 million.

Financing

Retiring the initial debt assumes that the current cost estimate and current schedule are going to happen.  There are serious questions concerning ridership and revenue numbers.  For example:

how are riders going to get to various stations from more than 20 miles away? Where will they park; what about their luggage; what interconnection services are available?  If you live near the rail line you are lucky.  What about the rest of the people who have to commute?

Where is the money going to come from for the capital expenditure and the on-going operations and maintenance?  Taxes will have to go up in one form or another to cover all the anticipated shortfalls.  No private money has been promised and the federal government is hedging its bet under President Trump.  Therefore, all revenue sources that are left right now are $9 Billion in possible bond sales, taxes and cap and trade revenues.  Income, property, sales and use taxes are going to skyrocket very soon to pay for this boondoggle. 

Based on my experience in the industry this project is the quintessential military definition of a FUBAR (fouled up beyond any/all repair) project.  Costs will skyrocket, schedules will not be met and those currently in charge of the HSR will be spending their pensions sitting on the beach enjoying their retirement.

Biography

Martin Bradley is a retired engineer who has worked on small, medium, large and gigantic capital construction projects around the world and in the United States.   He has worked on capital improvement and infrastructure projects since the early 1970’s valued between $4 Billion and $2.2 Billion (in 2018 dollars).  The projects included mining/ore process plants, synthetic gas facilities, on/off shore oil/gas gathering installations, interstate highway type roadway projects including the requirement for large, dual-bore tunnels, large water/wastewater treatment plants, the BART extensions to SFO and to San Jose and various other smaller projects.  He has been a Project Manager, Project Engineer, Project Controls Engineer/Manager responsible for cost/scheduling/estimating these projects primarily working in a field environment.  He has worked in Zaire, Saudi Arabia, Turkey, Holland, Chile, Honduras, Alaska’s North Slope, Texas, West Virginia, Louisiana, Arizona, Nevada, Wyoming and California.  Martin believes the Train to Nowhere should be terminated with extreme prejudice as soon as possible.

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