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Earlier this week, it was announced that the California high-speed rail (CAHSR), a project that has been plagued with hurdles, will need an additional US$7 billion in funding. The project was initially supposed to be completed in 2020 at a cost of US$33 billion. Today, there are only 22 miles out of the 494-miles planned rail track constructed. Furthermore, the cost of the project has ballooned to US$105 billion, more than triple the initial projected cost. Hellen Kerstein, the California Legislative Analyst also stated that the need for the additional funding was pretty urgent and not a “future funding gap”. The California High-Speed Rail is set to connect San Francisco to Los Angeles and Anaheim through the Central Valley. It was authorised in 2008 after a statewide ballot and construction began in 2015 on the first phase. At the moment, the US$7 billion was announced as crucial for the completion of the Merced-to Bakersfield section of the project. Another reason the funding is crucial is because there is a potential loss of federal funds. Inflation and other construction costs have also increased which is another cause for the additional funding. Furthermore, there is a great uncertainty about the assumed future revenues. Construction equipment Project Overview Location: California, United States Total Cost: Over US$105 billion Completion date: 2030 Contractors: Tutor Perini, Zachry, Parsons (TPZP), California Rail Builders for Construction Package 4Construction equipment Developers: California High-Speed Rail Authority So far US$15 billion has been spent on the project by the state. An additional US$2.7 billion has been spent by the federal government on the project. The Biden and Trump administration also caused major hurdles for the project with President Trump cancelling US$1 billion in assistance to the project during his first term and President Biden reinstating the aid with an additional US$3.3 billion in funding. Now it is looking like the US$4.3 billion is in jeopardy with President Trump back in office and the project being placed under compliance review. |
