CA High-Speed Rail Project Lost 17 Months, $63 Million Tied Up In Court

SACRAMENTO (CBS/AP) -- Another $63 million was added Tuesday to the cost of California's high-speed rail project and the completion date for the first 29-mile leg was pushed back 17 months to August 2019, after the state won a lawsuit that had tied up land needed for construction for 4 1/2 years.

Landowners in the Central Valley sought to block the controversial $64 billion project there, but a Sacramento County Superior Court judge ruled in March that plans for the system do not violate promises made to voters who approved selling nearly $10 billion in bonds for the project, allowing planning and financing to proceed.

The lead plaintiff in the suit, Kings County, announced last month that it would not appeal, ending the lawsuit.

"Opponents of major infrastructure projects have long used legal maneuvers and other tactics to try to stop construction - practices that hurt local businesses, delay hiring and waste taxpayer dollars," high-speed rail spokeswoman Lis Marie Alley said in a statement. "Fortunately, we've prepared and accounted for these sorts of situations by building in a prudent reserve - as reflected in our business plan - and the project's overall budget and schedule will not be impacted."

The lawsuit had tied up access to the financing for years, and officials said nearly 500 appraisals for land along the route became outdated during that time. The board that oversees the project approved a $160 million reserve when when it approved its original $985.1 million contract with construction consortium Tutor Perini-Zachry-Parsons. Officials said the additional cost would come from that.

Alley said the agency now has 63 percent of the parcels needed along the 29-mile route from Fresno to Madera.

Ron Tutor, chairman of the lead company, Sylmar-based Tutor Perini Corp., said both sides compromised to get the project going again.

"Unfortunately this was hanging over the job from the beginning, where we were unable to go to work because litigation was tying up all the properties," he said in an interview. "Finally, bless high-speed rail, they've got the properties. ... We compromised a lot to put it behind us and get going."

Still, beyond the voter-approved financing, money and political support for what would be the nation's first high-speed rail project has lagged. California has secured another $3.2 billion in federal matching funds and the project is supposed to receive money each year from the state's greenhouse gas emission fund, which sold only a fraction of the credits expected in an auction this month.

California faces a September 2017 deadline to spend the federal stimulus money. High-speed rail Chairman Jeff Morales told the board Tuesday that the state is "projecting that we will meet the deadline and be in advance of it."

In the Central Valley lawsuit, the Sacramento County judge agreed with landowners and the county that the California High-Speed Rail Authority has not proven the rail system will be financially viable or can meet the travel times voters were promised, but he said their lawsuit was premature because the system continues to evolve.

The Central Valley section is now scheduled to be finished in August 2019, rather than March 2018 as was originally forecast.

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