Dan Walters: Money could spell doom for two big California projects
10/06/2013 12:00 AM
10/06/2014 7:12 PM
Jerry Brown – publicly, at least – rejects any suggestion that he returned to the governorship to establish a more favorable legacy for himself.
But it’s evident that Brown, now the state’s longest-serving governor, intends for two massive public works projects to become lasting memorials – not unlike the State Water Project that was so closely identified with his father and gubernatorial predecessor, Pat Brown.
One would, in effect, complete the Brown family’s water project by boring twin tunnels beneath the Sacramento-San Joaquin Delta to ease water deliveries southward. The other would link the northern and southern halves of the state with a high-speed-rail system.
Both are sheathed in intense controversy over their utility, their collateral impacts on the regions directly involved and their multibillion-dollar costs. And the fates of both are very uncertain.
Even were the other issues to be resolved, or sidestepped, the pecuniary aspects of the two projects could be their ultimate undoing because at this moment, Brown and other advocates cannot tell us how either will be financed.
The twin tunnels and ancillary habitat projects connected to them would cost at least $25 billion. While the tunnels themselves would presumably be financed by bonds repaid by sales of water, there’s no firm financing plan in place, and a recent USC/Los Angeles Times poll found that when the $25 billion cost is mentioned, voter support plummets to scarcely one-third.
The ancillary costs of the project would be financed by state bonds and federal funds, it’s assumed. But a water bond issue vote has been postponed twice due to fears of rejection, and there’s no consensus yet on what a substitute should contain.
There’s even less financial certainty about the even more expensive bullet-train project, whose current cost estimate is $68 billion.
Brown et al want to build an initial segment in the San Joaquin Valley with state bonds and federal funds, but a court has already ruled that their plan violates the state bond’s parameters. Even if built, the segment would not be high-speed operational, and after that, there’s no money on the horizon.
Meanwhile, the same USC/Los Angeles Times poll that found scant support for the water project also found that 52 percent of state voters now want to derail the bullet train.
A recent report by the University of the Pacific’s economic forecasting unit suggested that building the bullet train might take another state bond issue of about $35 billion to replace the $9.95 billion bond that won narrow voter approval in 2008.
However, the USC/L.A. Times poll indicates that odds disfavor voter approval of another bond issue.
The very cloudy financial aspects of both projects bring to mind the famous movie line, “Show me the money.”
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