CA high-speed rail breaks ground

Updated: 2015-01-07 12:37

By Jack Freifelder(China Daily USA)

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A groundbreaking ceremony for a California high-speed railway project is a symbolic moment for the state, but there are significant obstacles for the project, according to an urban planning expert.

"They have overcome quite a lot," Martin Wachs, a UCLA professor emeritus of urban planning, said in an interview with the Los Angeles Times, but "they certainly have enormous hurdles ahead of them".

"The largest is locating adequate funding to start a statewide system," he said.

California voters approved $10 billion in bonds for the railway in 2008, and the Obama administration added grants of $3.2 billion in 2012, but skepticism has surfaced as cost estimates have risen.

If the project follows the usual path of cost growth for large government projects, experts say it could easily suprass the $68 billion cost estimate, according to a story in the Times on Tuesday.

Officials in the construction industry said the delayed start for the project would require spending to be ratcheted up in order to comply with a federal funding stipulation. The requirement states that $2 billion in grants from Washington and $2 billion in state funding be spent by Oct 1, 2017.

Any unspent federal funds would have to be returned. In a 2013 trade mission to Shanghai, Governor Jerry Brown courted Chinese investment.

Dan Richard, chairman of the California High-Speed Rail Authority, said a bridge over the Fresno River would be the first piece of major construction, but work might not start until April.

He also said billions of dollars more would be needed to complete the system, adding that real estate development rights along the route could provide some future cash flow for the project.

Brown helped break ground on a 29-mile segment of the railway Tuesday, the first high-speed rail stretch attempted in the United States.

The groundbreaking was at the future site of the high-speed train station in downtown Fresno. The initial segment will run from Madera to Fresno. "The high-speed rail links us from the past to the future; from the south to the north," Brown said.

The high-speed line will eventually extend to Sacramento and San Diego.

Robbie Hunter, director of California's building trades union council, said the project would generate 66,000 jobs a year over the next 16 years.

Requirements include trains that can maintain speeds over 200 mph, minimum seating capacity for 450 people, and a "buy America" provision, the authority said.

US-based SunGroup USA said in October that it had teamed with China's CNR Corp Ltd and its Tangshan Railway unit for a pitch. The group said it could supply California with up to 95 trains that can travel as fast as 220 mph.

CNR, and CSR Corp Ltd of China, which makes the CRH380A train engine - the fastest in the world at 302 mph - recently confimed merger plans.

Stocks of the two railway giants soared by the daily 10 percent limit after resuming trading on Dec 31.

Under the merger, CSR will acquire CNR through a swap of the Hong Kong and Shanghai shares of the two companies - each share of CNR will be exchanged for 1.1 shares of CSR, the companies announced late Dec 30 on the Shanghai Stock Exchange website.

The new company will be called CRRC Corp Ltd. Trading of shares in the two companies had been suspended since Oct 27.

Xinhua and the AP contributed to this story.

 CA high-speed rail breaks ground

California Governor Jerry Brown (center) and his wife, Anne Gust, sign a section of rail during a ceremony for the California High Speed Rail in Fresno, California, on Tuesday. California officials broke ground on the ambitious but controversial project, marking another milestone for the governor and for foreign manufacturers, including merging CNR and CSR of China, who are waiting to bid on the project. Reuters / Robert Galbraith

(China Daily USA 01/07/2015 page2)