Fiona Ma for State Assembly
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Schwarzenegger Wants Guarantess of Support for High-Speed Rail

Gov. Arnold Schwarzenegger has dropped a request that lawmakers remove a $9.9 billion high-speed rail bond from the November ballot but wants legislation that could tie spending the money to guarantees of support from the federal government and private sector.

Such a requirement could delay the project indefinitely even if the bond measure is approved by voters.

Officials with the authority charged with overseeing the high-speed rail line say they expect the state, federal government and private investors to each cover about a third of the cost of building the project. But they say private companies will not commit until they see the state making a significant investment.

"I have been talking to a lot of high-speed rail folks and, yes, they would love to invest in the project or be a partner with the state," said Assemblywoman Fiona Ma, a San Francisco Democrat who is a leading supporter of the project.

"But they need to know the state is committed to this project and we have done certain things to minimize the risk by, for example, doing engineering studies, environmental studies and buying right of way."

A Schwarzenegger spokesman, H.D. Palmer, said administration officials were drafting legislation to spell out "the things we have to have in place in terms of commitment from the federal government and non-governmental entities in terms of funding."

"How that language is going to look I can't tell you right now, but that's the goal," he said Wednesday.

The changes would "basically fulfill" what the governor talked about in an op-ed piece he wrote for The Fresno Bee last May. In that article, Schwarzenegger extolled the virtues of high-speed rail but said he wanted the state's high-speed rail board to develop a financing plan that would "identify with confidence" where the rest of the funding would come from.

Palmer said he did not know whether the change sought by the governor would force the state to delay selling the bonds — if voters approve them — until it gets financial commitments from the federal government and private investors.

"That's getting ahead of the people who are going to be drafting it," he said.

The legislation would need to be approved in both houses of the Legislature before the ballot measure language would be changed.

Some supporters of the high-speed rail project said they think Schwarzenegger really wants to pull the bond measure off the ballot, as the state has done twice before and the governor asked lawmaker to do last year.

Schwarzenegger wants the November ballot to include many of his own spending proposals. They would include a $14 billion health care reform plan and $38.3 billion in new borrowing for school and university buildings, water projects and courthouse construction.

In addition, the state is facing a $14.4 billion budget deficit over the next year-and-a-half.

State Sen. Dean Florez, a Shafter Democrat whose mother is a member of the high-speed rail board, suggested Schwarzenegger is trying to kill the bond proposal despite his claims of supporting high-speed rail.

"The governor recognizes that he doesn't have the two-thirds vote necessary to pull it off the November ballot, so he's attempting to put a poison pill in this to say, in essence, if you don't have the federal or private funding for this, it's null and void...," Florez said. "Those kinds of modifications won't fly past the Legislature."

The state's high-speed rail board is recommending that California build a 700-mile rail system that would link the state's most populous cities with trains running at top speeds of 220 mph.

The bond measure would help pay for the first segment of the $40 billion project — a line between Los Angeles and the San Francisco Bay area.

Mehdi Morshed, the rail board's executive director, said legislation that put the bond measure on the ballot already imposes a limit on the state's involvement by allowing the bond funds to cover no more than half the cost of building the Los Angeles-to-San Francisco segment.

"We don't get to spend the money until we match the bond money, dollar for dollar, with other revenue, whether it's private or federal or something else," he said.

Rep. Jim Costa, a Fresno Democrat who has introduced legislation in Congress to finance high-speed rail, said he takes Schwarzenegger at his word that he supports the project. But Costa said spending on high-speed rail should not be held up until all funding is secured.

"This effort should not be treated any differently than other forms of transportation," he said. "When we're talking about financing and authorizing a freeway project, we never wait until we have all the funding, do we?" he said.