Is High Speed Rail on Track Approaching a Fork in the Road?

In 2010, California State Auditor Elaine Howle indicated that the financing for high speed rail, California’s most expensive infrastructure project ever, was “incredibly risky”, adding that the oversight for this massive project was lacking. Responding to such criticisms, the California High Speed Rail Authority (Authority) was tasked with drafting another business plan that took a more realistic look at the fiscal costs for the project. Released in November, Howle has stated that even the newer, revised version depends on ambiguous sources for capital and that “the program’s overall financial situation has become increasingly risky.”

It isn’t just Howle who has been raising concerns about the nearly $100 billion High Speed Rail (HSR) project.  Since the passage of Prop 1A, which allocated nearly $10 billion of general fund money toward HSR in California, several critiques have come out. The Legislative Analyst’s Office (LAO) recommended withholding nearly all funding until the Authority distributed a comprehensive business plan and ridership study; meanwhile, the Authority’s own peer review group just released its own report that suggested the project be reconsidered and funding not be authorized by the Legislature.

Despite this mounting criticism…or perhaps because of it…the Governor has redoubled his support of the HSR project. Even with myriad of critical issues facing California, he spent significant time discussing the need for California to be a leader on high speed rail in his State of the State address.

He is also starting to put his stamp on the project in a major way – while not confirmed, many speculate that the change in leadership at the Authority over the past few weeks is, in fact, a move by the Brown Administration to take more ownership of HSR and address the concerns that have been plaguing this project. This month has seen the resignation of the Authority’s CEO Roelof Van Ark and Deputy Director Dan Leavitt, while Thomas Umberg announced he is stepping down as Chairman, though he will remain on the Authority’s Board. Dan Richard, who has been Brown’s point-person on HSR (and is a featured panelist at PCL’s upcoming Symposium), will be stepping into the role as Chair.

Governor Brown taking leadership of HSR is viewed by many (including PCL) as a positive development, and it is our hope that he will be open to addressing concerns raised by environmental and community groups to ensure we move forward with a project that will achieve its touted benefits of lessening Californians’ dependence on highways and air travel; reducing greenhouse gas emissions and other impacts to our lands, air and water; and providing critically-needed jobs in this state.

As the 2012 legislative session picks up, we can expect to see a myriad of HSR bills brought by the Governor as well as legislative proponents and opponents of the project, and the Planning and Conservation League will keep you up to speed with all the developments as they occur.

January 28th Symposium Awards Focuses on Legislative Leadership

Register now to join with the Planning and Conservation League and PCL Foundation as we celebrate three great leaders in the California Legislature.  During an Awards Luncheon at our Annual Environmental Legislative Symposium, we will honor Senator Kevin de León, Assemblymember Jerry Hill and Assemblymember Jared Huffman.

The awards will be presented because of their exceptional work in 2011:

Senator Kevin de León for leading the fight to ensure that all Californians have equal access to clean air and water, as well as his ongoing efforts to establish the California Communities Healthy Air Revitalization Trust that would bring funds to address climate change impacts to the state’s most impacted and disadvantaged communities.

Assemblymember Jerry Hill for his dedication to safeguarding California’s environment, as well as his commitment to ensure AB 320, the League’s “recipients of approval” bill, made it across the Governor’s desk to become an example of positive CEQA reform.

Assemblymember Jared Huffman for his long-time environmental leadership, as evidenced by 2011 legislation he carried that ranged from promoting renewable energy and sustainable water policies to protecting wildlife and state parks, as well as for his outspoken defense of CEQA against repeated attacks.

The Annual Environmental Legislative Symposium and Awards Ceremony is Saturday, January 28, 2012 at the Sacramento Convention Center.  Register now to reserve your spot!

State Controller John Chiang to Keynote January 28th Environmental Legislative Symposium

The Planning and Conservation League and PCL Foundation are pleased to announce the 2012 Symposium keynote is State Controller John Chiang. John Chiang was first elected in November 2006 to serve as Controller of the State of California, the ninth-largest economy in the world.  He was elected to serve a second term in November 2010.

Controller Chiang took immediate action to make the State’s finances more transparent and accountable to the public and to weed out waste, fraud and abuse of public funds.  The Controller’s aggressive audits have identified more than $3 billion in taxpayer dollars that were denied, overpaid, subject to collection, or resulted in revenues, savings and cost avoidance.

As Controller during the worst economic downturn since the Great Depression, Chiang was forced to delay payments and issue IOUs in order to preserve cash to meet obligations to education and bond holders.  His cash management was cited by rating agencies as a benefit to the State.  Fitch Ratings lauded the Controller for using “several strategies, including payment deferrals and IOUs, to ensure continuation of priority payments.”  Standard & Poor’s said the Controller’s “extraordinary cash management maneuvers” protected the state’s priority payments, and California Municipal Bond Advisor noted, “State Controller Chiang has been a hero of sorts to us during California’s recent distress because he did just what he was supposed to do to protect bondholders.”

Join the League and Foundation as we welcome Controller Chiang to our event.  His keynote address is titled “Shared Value: Environmental Policy As Core Business Economics.”

We encourage you to register now to reserve your seat as we can’t guarantee space for same day (walk-in) registrations.

How Environmental Protection Fares in Governor’s Budget

Last week, due to a technical glitch, the Brown Administration unintentionally released the Governor’s proposed budget a few days earlier than expected. Through $10.3 billion in cuts and increased revenues, the proposed budget would close a $9.2 billion deficit, compared to last year’s $26 billion gap, and build a $1.1 billion reserve. The most severe cuts will be inflicted on CalWORKs, Medi-Cal, child care, and the Cal Grant Program. The budget is contingent on voters approving a temporary increase in the sales tax and a higher levy on wealthy residents. If voters reject the ballot initiative in November, the state would be forced to cut another $4.8 billion from schools and community colleges; a cut equivalent to 3 weeks of instruction. ‘Trigger cuts’, as they’re called, would also strip funds from courts, public safety officers and flood protection.

So how did the environment fare in the proposed budget? Overall, environmental protection did better than many other programs, though there are significant cuts to key programs, and much of the funding that has been allocated is for projects that are controversial even within the environmental community. The Department of Parks and Recreation will see $22 million in cuts, twice the reduction from last year’s budget, which would result in the closure of up to 70 state parks. Additionally, if the Governor’s tax initiative does not pass, it will trigger the elimination of all seasonal lifeguards on state beaches and a 20% reduction of the Park Rangers workforce.

Programs that will see more funding in 2012 include highly contentious projects, like California High Speed Rail and the Delta conveyance program. The budget allocates $15.9 million to usher along the development of a high speed rail system, which is under increasing scrutiny due to governance, routing and financing issues. The budget would also allocate more funding to the Department of Water Resources for its work on the highly controversial Bay-Delta conveyance research and planning processes; specifically, for 135 positions for preliminary engineering work to support the Delta Habitat Conservation and Conveyance Program.

The budget also earmarks $1 billion that are to be received by auctioning pollution credits to California companies to be used to “create jobs and deliver public health, economic and environmental benefits” as part of the state’s effort to curb global warming. Businesses have complained that this cap-and-trade program, a critical piece of California’s landmark legislation aimed at cutting greenhouse gas emissions to 1990 levels by 2020, represents an unfair tax. Cap-and-trade is also controversial among the environmental and environmental justice communities, some of whom believe it merely commoditizes dangerous pollution rather than directly and more aggressively curbing it.

The governor’s proposal still needs to be debated by the Legislature, and the Brown Administration will release an updated version in May. The deadline to have a budget passed by lawmakers and signed by the governor is June 30.