The state’s senior U.S. Senator, Democrat Dianne Feinstein, said in a statement that she backed Newsom’s decision.
“Congress appropriated these funds and the president obligated them. They can’t be legally withdrawn without good cause,” Feinstein said.
But earlier Thursday, FRA Administrator Ronald Batory announced that the grant was being revoked because he says there is good cause: The project has changed since the grant was made in 2010 by the Obama administration and there have been dozens of instances when the California High-Speed Rail Authority failed to file adequate reports to fulfill the grant’s requirements.
“There is nothing in the FRA’s long working relationship with CHSRA to suggest that CHSRA would likely be able to initiate and complete the necessary corrective actions,” Batory’s letter said.
Loss of the grant would be a major blow to the project, said authority chief financial officer Russell Fong, but it might be possible to make up the deficit with high-speed rail’s share of revenue from California’s cap-and-trade market if they continue to run above projections. Budgeted at $500 million a year, cap-and-trade produced $767 million for high-speed rail in 2018.
The Trump administration and the rail project have been in full feud mode since February when Newsom said in his State of the State speech that there was only enough money on hand to build an operating railroad between Merced and Bakersfield, Calif., 171 miles apart in the Central Valley.
It was the fifth time since voters approved almost $10 billion in state Proposition 1A bonds for the project in 2008 that the initial operating segment — though not the total project — had been redefined. But it was the first under the Trump administration, which immediately announced that it would try to “claw back” $2.5 billion in federal grants that had already been spent and said it planned to revoke the $928.6 billion awarded in 2010 but unspent so far. That’s what happened Thursday.
Project CEO Brian Kelly wrote letters in March to both Batory and FRA program delivery director Jamie Rennert urging them to reconsider.
“The FRA’s threat to terminate funding under the (2010 grant) on two weeks’ notice is a sharp departure from the productive, collaborative relationship previously enjoyed by the FRA and the CHSRA,” Kelly wrote to Rennert.
Nevertheless, the grant reporting inadequacies in the funding revocation letter date back to the Obama administration, which awarded all of the federal funding.
Beginning in the third quarter of 2016, the FRA’s letter said quarterly budget reports were inadequate and the FRA had rejected those quarterly reports since Q2 2017. Quarterly reports on state spending have been inadequate since Q4 2016 and rejected since Q2 2017. Annual deliverables reports on program management plans, work plans and the financial plan in the Central Valley have been either inadequate or rejected since 2016.
“Indeed, since 2014, CHSRA has not submitted a single satisfactory and acceptable (project management plan),” Batory’s letter said.
The rail authority foreshadowed the possibility of grant revocation two weeks ago in a project update report to the California legislature. It labeled “the FRA’s lack of engagement” with the project as “a major risk” in several areas including environmental clearances, funding to complete the first construction segment in the Central Valley, development of an operational contingency plan and certification of work and operations.
The federal engagement primarily concerns how to expedite environmental reviews for construction north of Madera to Merced and south of Shafter to Bakersfield, segments added to the Central Valley as a result of Newsom’s redefinition of it after taking office this year.
Ever since President Trump, who then was pressing for a huge federal infrastructure program, asked states in February 2017 to submit a list of infrastructure projects to be speeded up, high-speed rail has been on California’s list.
That summer, the rail authority suggested a mechanism to accomplish that: Let California do the federally required environmental clearance work under NEPA — the National Environmental Policy Act — at the same time it does environmental work to comply with state law. The state already builds highways with what’s known as “NEPA reassignment.”
That permission was never granted, adding cost and delaying the project, the rail authority’s report to the legislature said.
“The FRA’s environmental staff would not provide direction, participate in meetings, review documents nor act on critical decisions. These inactions have affected documentation progress in nearly all project sectors,” according to the state report.
Germany must definitely does NOT generate electricity solely with wind and solar. Since they unwisely decided to start prematurely decommissioning their nuclear power plants, they rely considerably on Russian natural gas and are reopening a lignite coal mine. They also have the most expensive electricity in Europe and need to pay other countries to take their excess power during wind and solar peaks. Meanwhile their CO2 emission reduction has flatlined even as they install more wind and solar.
In contrast France and Sweden have much lower electricity prices and a much lower CO2 emission footprint from electricity generation. The reason? A decades old strategic push for nuclear electric power generation (with a strong hydroelectric component in Sweden).
https://www.forbes.com/sites/realspin/2013/03/14/germanys-green-energy-disaster-a-cautionary-tale-for-world-leaders/#1cfde8c854e9
Charles, they just don’t get it. Once you drink the kool-aid, you are forever addicted to it. A few years ago I stopped to have lunch near one of Michigans wind mill growing areas, at the table next was the const. mgr. for the wind mills. What he said was that the wind mills have an expected life span, (before needing major rework), of approx. 10 years. During those 10 years they will not produce enough electricity to even offset their construction. He was happier then cat in catnip because he gets paid alot of money to put the things up, and it’s someone else’s problem to fix them.
The problem for you guys is anyone can google and get both sides of the story, so there’s no point in cherry picking the conversations and bits that suit your beliefs.
So there’s no subsidy to coal and oil/gas ???. A solar panels life is more like 40 years, most have a 25 – 30 year warranty, they wouldn’t do that if they only lasted 25 years, The toxic elements are minute , and sandwiched in the panel .
At the moment , the thermal “pollution” of fossil or nuclear power ( up to 70 % heat wasted) is not counted, if it was , Solar/ wind would be way ahead, as far as reducing warming was concerned.
Ben,
Why is socialism now the topic of discussion?
David,
What subsidy do you think there is for oil/gas?
Mr Landely — perhaps your a “Lite-Socialist”!
Medicare has public insurance replace private insurers — a government takeover of healthcare — “socialism”.
Ben,
I’m not Ronald Reagan who described Medicare as Socialism. I’m me. Medicare is not socialized medecine. The various porposals labeled “Medicare for All” would vary substantially from Medicare, much more resembling Medicaid. They Dems use “Medicare” in their proposal because it’s a much more popular program than Medicaid.
Charles Landey,
When Medicare was introduced as a congressional bill in 1961 Ronald Reagan called it “Socialism” on a LP called “Ronald Reagan Speaks Out Against Socialized Medicine”. If Medicare for people 65 and older is NOT socialism then “Medicare for Everyone” (like in Canada) would also not be “socialism” despite Mr. Trump calling it “socialism” along with the rest of the GOP and Fox News.
Gerald – Would I care to describe how Deutchsland and Koninkrijk Nederland run off renewables? The answer is quite simple: THEY DON’T.
Charles Landey,
Would you care to explain then how both Germany and the Netherlands have been able to produce an entire days output of the necessary electricity to run those respective countries with only renewable sources(primarily wind but also some solar)…that did not include any fossil or nuclear fueled electric plants?
David – In wind/ solar the toxic items are minute. The land use (from farmland) is minute. The environmental impact is minute. The noise is minute. Everything about wind and solar is: MINUTE !!!
You know what is minute? The output. A flea has less envirnomental footprint than an elephant. Add up the footprints of all the solar and wind generators needed to replace coal plants, we’d have no country left to live in.
BTW, David, solar power is DC. Have you ever stopped to think of the environmental footprint (and the wasted energy) of the apparatus to convert DC to AC on a production scale???? No, you haven’t. Wind and solar advocates always compare their flea to coal’s or nuclear’s elephant. And frankly I’m getting very tired of hearing their unscientific nonsense.
I agree with Charles Landey on the topic of wind and solar. It’s only “cheap” because of subsidy and not counting the “all in” cost of necessary upgrades to transmission lines to wheel that decentralized power from where it’s produced to where it’s needed, the necessary gas fired backup for when the wind isn’t blowing or the sun isn’t shining, and the highly toxic disposal of solar panels and rare earth metals inside wind turbines when their 20-25 year lifecycle is up. Similar issues exist with battery powered cars (where’s all the cobalt supposed to come from?).
But I agree with David Peterson on everything else he said. In my view nuclear is the only short to mid term choice to produce sufficiently cheap energy to maintain and grow middle class standards of living without cooking the planet. Fuel for decarbonizing transportation (much more challenging than decarbonizing electricity generation) can down the road be produced in a carbon neutral way using high temperature nuclear process heat while still using internal combustion or turbojet technology already in place.
In the meantime it’s important to realize that per passenger mile or freight ton mile, rail is 3-4x more fuel efficient than cars and trucks and is easier to electrify (but not cheaply). And cars and trucks are about an order of magnitude more fuel efficient than airplanes. Noticed that Bezos is building new air hubs for Amazon Prime Logistics. Not good for rail intermodal prospects. But what’s the hurry? And yes I know that inventory costs money but so do the negative externalities. Maybe the insurance vertical will be the one to cry uncle on those costs.
Jim,
You were great on statistics until you got to your last sentence. How many wind turbines or solar collectors will it take to power the train? And the second half of your sentence, whose ox is gored by renewables except for the consumers who will pay more much money for much less power when the coal plants are shut down.
When I drive Indiana I-65 Crown Point to Lafayette, turbines as far as the eye can see. And not one article I read has told me what fraction of the traffic on I-65 (let alone the other consumers of electricity) these turbines would power.
I have several 2 megawatt wind turbines on my fields and with a 2012 blade profile, I really don’t know that they are working. The only time that they make noise is when it is very windy outside and you also have to be close to hear them.
We have not seen any dead birds in the past 7 years. Three years of bird studies have been performed on three of the wind turbines and the researchers tell us “no birds” when we encounter them, but I haven’t seen the reports.
When we deep till, plant, spray for weeds, and harvest, we do have to slow down to go around the turbines and over the driveways. The monster crane for erecting the tower, did compact the ground and flattened some drainage tiles. Plowing in the electric wires did cut the drainage tile, but these were repaired.
We have 2 wind turbines on 150 acres, and 2 driveways of 800 feet by 10 feet or 16000 square feet. The towers take about 400 square feet each, so we lose 0.386 total acres of crop land or 0.257% on this field. Different fields will have different numbers as follows: one turbine with 600 feet driveway on 90 acres, one turbine with 800 ft drive on 135 acres, two turbines with 2200 ft of drive on 240 acres, two turbines with 1500 ft drive on 200 acres, and two turbines with 2000 ft drive on 155 acres. You can figure the average crop loss.
The wind farm pays $2 million in lease payments to the farmers each year, and $2.6 million to the two counties which use it mostly for schools and highways, and some administration.
High Speed Rail has a lot of opposition, because when built, it will use electricity powered by renewables such as wind and solar, and this disturbs the status quo of many industries.
When my company built a coal power plant in 2002 it was subsided by the Federal Government as a ‘Clean Coal’ project costing $400 million in subsidies. For proof that Coal is going out as a power plant fuel look at Florida Power and Light – they are decommissioning their Coal plants and have the fourth lowest price electricity in the US. Coal mines reopening or opening are due the export market to India and China. The US electric production has shifted from Coal to Natural Gas and renewables. You’re fighting a losing battle if you believe Coal will regain its dominance in the US. Texas high speed rail may provide the proof that private high speed rail can make a profit. But like Republicans in Florida even if there is a guarantee of 20 years to cover losses they block private industry initiatives that don’t fit their agenda. It’s not pro-business but helping your political friends.
David, I live in the fringes of coal country. Those shut downs of power plants were caused by actions of the Obama administration, even if they took place in the beginning of the Trump administration. The main reason Trump won PA is the democratic voters in the coal regions either stayed home or voted for him. Even the overwhelming democratic voters in Philly couldn’t make up the difference. Actually, one new coal mine opened up not to far from here last year which wouldn’t have been possible under the Obama administration
Two other things. The residents of the rural areas around here are rebelling against the wind farms which drive them nuts with their constant noise. Also, the wind farms only exist because they have been exempted from the Federal laws governing the killing of raptors and other birds. If Obama hadn’t granted the wind farms a 15 year extension of the exemption from the laws and their stiff fines, wind farms would be in big financial trouble. There are both transmission and environmental issues with solar power.
As far as I know, just about all the current Dem presidential candidates want to stop fracking which is the only reason natural gas is so plentiful and cheap. None of them say anything about nuclear power so I assume they don’t want that.
As for true high speed rail, if it was such a money maker private capital in the USA would have been involved with it awhile ago. There really aren’t that many corridors where it can be built cheap enough and all of them are basically flat terrain in a few areas (terrain is CA’s biggest problem). You also have to have two very, very large population end cities for profitable true high speed rail. That’s why Chicago-St. Louis and Detroit-Chicago aren’t workable for true HSR but Dallas-Huston and Miami-Orland-Tampa are. NYC-Chicago might work if it followed a direct path with an average speed of around 200 mph but it would cost a huge fortune to get it through the mountains in PA and western NJ. The environmental reviews alone would take 10-15 years under current law.
David – Your company is moving toward wind and solar because the government says so and because the government subsidizes it.
Electric cars will turn out to be, for a number of reasons, the worst technological decision in the entire history of human civilization.
As for gas, we need it to heat our homes and for the production of polymers. Burning it for electricity is nonrenewable and a disaster for the next generations.
I have not seen an honest account of the environmental impact of wind and solar when wind and solar move from a niche industry to a mass supplier.
Here’s what I do know about wind and solar. They take up a lot of land, and they require a lot of wire to connect to the substation and from their to market. There is an impact on wildlife (birds esp[ecially) and on other segments of the ecosphere. To think that wind and solar are an environmental free lunch is absurdity.
Maybe the best application and the least environmental impact is on rooftops at the point of use. I don’t have any problem with that, provided it is not subsidized with tax money or tax credits.
The wind farms in Indiana are built on productive farmland. Yes, farmers plow and harvest between the turbines. No they don’t have 100% use of their land for crops. Let’s call wind farms, to pick a number, a 5% to 10% reduction in crop. Isn’t that an impact in a world where every stalk of wheat or bushel of soy is needed? Let’s figure that in to any comparison with coal, gas or nuclear.
I work in electric utility industry and I get fuel cost reports daily. Coal is in areas not near mines is uneconomic when considering transportation costs, employee costs, and equipment wear and tear. A combined cycle gas turbine run by 25 employees is much more efficient and less costly to operate than a coal plant requiring 200-400 employees. The company I work for closed and is dismantling 1600 mW Coal power plant due to costs.
‘More coal-fired power plants closed during Trump’s first two years in office than during Barack Obama’s entire first term, according to Reuters. A total of 23,400 megawatts of coal-fueled generation shut down in 2017 and 2018.’-Fortune 1/14/19
My company expects by 2025 to have at least 25% solar and wind power because they are now cheaper than burning Coal. The electric power industry is rapidly moving away from Coal towards Natural Gas and renewables not due to environmental costs but due to lower total cost of producing power.
High speed rail where routed through secondary cities to be an efficient mode of transportation can and is profitable – look at JR Central or even JR East profits almost all from running High Speed Rail.
Interesting (if surely one-sided) article in today’s washingtonexaminer.com. Author makes the point that Gavin should be grateful that The Donald, by cutting off funding, is giving Gavin the way out that Gavin needs.
David,
Actually you understate the cost of roads – they cost even more than what you post, typically. However roads carry lots of people. High speed rail does not. Passenger mile by passenger mile, HSR is an economic dud. There may be reasons to support HSR but cost reduction over roads is decidedly not among them.
I don’t know why you state that coal plants are uneconomic. If so why are there so many of them? Actually the competition in the form of wind and solar is what is grossly uneconomic which is why wind and solar are heavily subsidized.
If HSR contributes to local economic development as you state, then funding it locally should not be a problem.
The Trump and the Republicans wail about costly projects that would benefit and be useful to grow the economy particularly if those projects are in Democrat controlled city and states. When I see expressway interchanges costing $400-500 million and 6 lane expressways exceeding $12 million per mile the price of high speed rail is very reasonable.
Why is America falling behind? All the insults from Trump are proof that America can’t succeed but only bully. A prime example is keeping Coal power plants open – ancient technology that is no longer cost effective or wanted by electric utility industry. High speed rail for Central California is needed to connect those communities to San Francisco and Los Angeles for economic development just as the building of the interstate highway system helped America grow. https://www.fdot.gov/programmanagement/estimates/lre/costpermilemodels/cpmsummary.shtm
The problem todayin politics is a lack of a political centre. To quote someone else, Can’t we all just get along?
This is not 1960 with the ICC misregulating railroads. This is not 1880 with railroads running rampant over the average citizen.
BEN – Your logic escapes me – has Trump defunded Medicare? I’m still covered.
Medicare is not socialized medicine. It’s insurance that reimburses private-sector medical providers.
California has the money necessary (or can raise it) to get the Central Valley segment built and extended north so that ideally ACE and San Joaquin trains running on it to Bakersfield. Amtrak in the Northeast is looking for 125-mph dual-mode diesel-electric train-sets to eliminate engine changes for service beyond electric territory — so California could use these sets to provide one-seat service from Bakersfield and Fresno to San Jose, Oakland, and Sacramento. Hopeful Mr. Trump (who is not at all like LBJ or John Kennedy who supported “socialized medicine” in the form of Medicare and big government infrastructure projects as part of the New frontier and Great Society agenda) will be gone so that some federal money can be had for transport infrastructure including passenger rail.