INTRODUCTION: HSR AND THE PURPOSE OF IT

The High Speed Rail is a project that is planned by the California High-Speed Rail Authority.

The California High-Speed Rail Authority was created in 1996 and is responsible for planning,

designing, building and operation of the first high-speed rail system in the nation. The California

high-speed rail will connect with mega regions of the state to contribute a cleaner environment,

create jobs, and preserve agricultural lands. This study is to analyze the benefits of the High-

Speed Rail on the city of Fresno and to California. This study seeks answers to these questions:

How will the High-Speed Rail Authority fund the project?

What other countries have the HSR system?

What are the benefits of the HSR train to California and to the city of Fresno?

BACKGROUND: THE HSR AUTHORITY’S PLAN TO IMPLEMENT THE PROJECT

SYSTRA are planners and experts in developing master plans, grant management and review,

program management, strategic planning and facilitation. By using their skills in data collection

and assessment, conceptualization, prioritization, and implementation they will help bring this

project of the High Speed rail to a successful completion. “SYSTRA prepared a multi-decade

implementation plan for the $37 billion, 800-mile California high-speed rail line.

Recommendations included the state and private sector organization, timing, segment phasing,

and specific actions to complete environmental permitting, project financing, procurement and

federal safety approval of high-speed rail vehicles and systems, acquisition of right-of-way,

design and construction of the high-speed rail line, tunnels, stations and related facilities, and

operation of the services” (CAHSRA Implementation Plan par. 1). “SYSTRA recommended an

organizational structure led by the Authority directing the project management and specialty

consultants to ensure the state’s interests were protected while allowing flexibility as staffing

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needs evolved during the project implementation. SYSTRA’s recommended procurement

strategy helped California maintain high-speed technology competition among suppliers while

facilitating federal and state approvals for the specific high-speed systems selected” ( CAHSRA

Implementation Plan par. 2).

In a plan developed by the CAHSRA, the federal commitment was expected to be $12 to $16

billion while private sectors would invest 7.5 billion, leaving an additional of $10 billion to come

from the local government. “On January 28, 2010, the White House announced that California

would receive $2.35 billion of its request, of which $2.25 billion was allocated specifically for

California High Speed Rail, while the rest was designated for conventional rail improvements.

On October 28, 2010, the federal government awarded the Authority a further $900 million for

passenger rail improvements, including $715 million specifically for the high speed rail project,

but with the requirement that it be used for the Central Valley segments from Merced to Fresno,

or Fresno-to-Bakersfield. While the CHSRA recognizes the federal government's desire for the

initial segment to be built in the Central Valley, the Authority states that it will evaluate the

starting segment according to its own criteria. This announcement brings the federal

government's funding commitment to high-speed rail projects in California to $4.3 billion. On

December 10, 2010, the Department of Transportation reallocated $1.2 billion in federal high

speed rail funding from states that had rejected the stimulus funds, including Wisconsin and

Ohio. Nearly half of this funding, $624 million was redirected to the Authority for use on the

initial Central Valley leg of the project. On May 9, 2011, the Department of Transportation

reallocated $2 billion in federal high speed rail funding from Florida, which had rejected the

funding. The DOT awarded $300 million to the Authority for a 20-mile (32 km) extension along

the Central Valley Corridor. The work funded in this round will extend the track and civil work

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from Fresno to the Chowchilla Wye, which will provide a connection to San Jose to the West

and Merced to the North. The California High Speed Rail Authority issued a draft Business Plan

on November 1, 2011, for public review and comment. The Business Plan will shape the

financial and operational implementation of the HSR project, and must be adopted and submitted

to the Legislature by January 1, 2012 and every two years thereafter” (Wikipedia par. 9). The

continents of Africa, Asia, and Europe are all under construction for the high speed rail project.

DISCUSSION: BENEFITS THAT ARE FINANCIAL, ENVIRONMENTAL, AND

SOCIAL TO CALIFORNIA AND THE CITY OF FRESNO BY HAVING A HSR TRAIN

This research presented here falls into four categories: (a) financial, (b) funding’s (c)

environmental, and (d) social benefits of the HSR train.

FINANCIAL

“California voters approved a $9.95 billion bond to support high-speed rail, the entire project

cost was $33 billion. In the 2009 business plan, the cost increased to $43 billion, and then

increased again in the draft 2012 business plan to $98.5 billion. The final 2012 business plan

reduces the cost to $68.7 billion. It focuses on beginning construction in the Central Valley while

simultaneously making investments in the “bookends” — the urban areas in the Los Angeles

Basin and the Bay Area — to improve regional rail service and take a blended system approach

to the construction and operations by putting initial high-speed service on existing (and

upgraded) commuter rail facilities. This approach saves both time and resources, as it has fewer

environmental impacts” (Terplan & GAO par.4). Figure one shows the construction cost by

geographic segment in 2011 connecting the high desert town of Palmdale into Los Angeles and

from Merced in the Central Valley over the Pacheco Pass into San Jose account for over half the

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cost of the rail system. The long stretch from Merced to Bakersfield in the Central Valley

accounts for less than 1/5 of the total cost.

Figure 1

Funding’s

Funding sources include the federal, state and local governments as well as private sources,

particularly a potential operator of the train system. The plan is for $13 billion investment comes

from a private operator who will invest once the trains begin operation around 2022. If the

business plan is correct then the private operator will not require any additional operating

subsidy and could provide more than $230 million from net cash flow for further investment in

finishing the construction of the system. The remaining $38 billion would come from the federal

government in the form of grants, loans and other financing support. Figure 2 will compare the

funding sources in the latest business plan with those in the SPUR plan.

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Figure 2

“Paying for California's high-speed rail system California can afford high-speed rail without

future federal support. The sources of funding for high-speed rail identified here can generate

over $43 billion towards the state's $68 billion high-speed rail project. The most significant

sources of revenue are a dedicated six cent per gallon gas tax, a 15 percent share of the state's cap

and trade auctions and the creation of $4 tolls on a few of California's highways” ( Terplan &

Goa par. 5)

Environmental

The high speed rail can improve the environment and save money. “When analyzing the

environmental effects of planes, trains or automobiles, the normal approach is to measure

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tailpipe emissions. Researchers can estimate these emissions with a variety of methods, and then

combine the emissions data with information about typical vehicle occupancy. The

environmental costs of cars, for example, will vary with drive cycles, technology, age, and the

composition of the fleet. So while it may be tempting to say that one mode is simply better than

another, environmental policy should recognize that no mode is universally good or bad, and that

environmental impacts will depend heavily on context. Second, the conventional approach to

evaluating modes depends heavily on estimates of ridership or occupancy. But calculating

ridership is always hard, and for an entirely new system, such as California's high speed rail, the

task is particularly challenging. Because the system doesn't exist yet, ridership estimates are less

certain, forecasted from surveys and travel demand models rather than extrapolated from existing

data. But even small adjustments to ridership estimates (or, for cars, occupancy estimates) can

substantially change an environmental impact analysis” (Chester & Horvath par.3). Figure 3

illustrates the Life Cycle Energy Consumption for On-Road, Rail, and Air Modes.

Figure 3

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Social

The 2012 business plan to create the HSR train estimates that this construction will generate

20,000 over the next five years. In 2009 the Authority project created 450,000 permanent jobs

through the commuters that will use this system and by 2023 the revenue would rise to $2.23

billion. Fast trains are profitable than slow trains since traveling a short distance will reduce staff

costs and customers would be willing to pay higher ticket prices for traveling in a short amount

of time. “Since the trains will be completely grade-separated, there is no threat of interfering with

automobile and pedestrian traffic. The project also involves grade-separation for existing rail

lines with which it will share rights-of-way along part of its length, further improving safety on

these lines and eliminating car traffic delays. By 2040, the system will reduce vehicles miles of

travel in the state by almost 10 million miles of travel every day. Over a 58 year period (from the

start of operations in 2022 through 2080), the system will reduce auto travel on the state’s

highways and roads by over 400 billion miles of travel.” (Wikipedia par.6).

CONCLUSIONS AND RECOMMENDATIONS

Analysis of financial, funding’s, environmental, and social research leads to the following

conclusions and recommendations about the impact of the High-Speed Rail on California and the

city of Fresno.

1. To support high-speed rail the entire project cost is $68.7 billion, which it focuses on

beginning construction in the central valley.

2. Funding sources that can contribute to this project of the train system include the federal,

state and local governments as well as private sources.

3. Improvement in the environment and saving money can come from the completion of the

high-speed rail.

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4. The high-speed rail in 2009 created 450,000 permanent jobs and by 2023 the revenue

would rise to $2.23 billion.

Based on these findings, it is recommended that California and the city of Fresno authorize the

development of the high-speed rail because it will stimulate the economy and bring a cleaner

environment. It will also create more jobs, which is beneficial for the people.

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REFERENCES

"California High-Speed Rail." Wikipedia. Wikimedia Foundation, 11 Dec. 2013. Web. 12 Nov.

2013.

Chester, Mikhail, and Arpad Horvath. "Fall 2010 ACCESS #37." University of California

Transportation Center. N.p., 2010. Web. 12 Nov. 2013.

Jacobs, Jim, and Katie Daniels. "Getting High-Speed Rail On Track." SPUR. N.p., 2013. Web.

12 Nov. 2013.

"Strategic Business & Master Planning." California High Speed Rail Authority (CAHSRA)

Implementation Plan. SYSTRA NET, n.d. Web. 12 Nov. 2013.

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