Controversy puts federal rail grant to state in limbo

Ex-official OKd funds for Bay Area project before taking a job with L.A. firm doing work on the project.

A top Obama administration executive at the U.S. Department of Transportation approved a $647-million grant for a California rail project in mid-January and less than two weeks later went to work for a Los Angeles-based contractor involved in the project, The Times has learned.

The grant provides a significant part of the money required to install a $2-billion electrical power system on the Bay Area’s Caltrain commuter rail system, allowing the rail to retire its diesel locomotives.

The power equipment will eventually be used by the state’s bullet train from Los Angeles to San Francisco, making it a critical part of the $64-billion program. The California HighSpeed Rail Authority has pledged about $713 million to help install the system, according to state records.

The grant was handled by Carolyn Flowers, who was the acting chief of the Federal Transit Administration. Flowers announced the grant approval in a letter, dated Jan. 18, to congressional leaders. The Times obtained a copy of the letter.

Thirteen days later, Flowers went to work for Aecom, a Los Angeles-based engineering firm. The company news release announcing her hiring says she will head its North American transit practice. Aecom provides program management services to Caltrain for the electrification project, according to Caltrain documents. It was formerly a regional consultant to the high-speed rail project as well.

On Friday, the federal transit agency said it had “deferred” a decision on the grant and said it would look at the matter in the next federal budget cycle. The decision may be an early sign of the Trump administration's view of the bullet train project. The line is already under construction and will need significant federal funding moving forward.

The delay follows a letter from every Republican member of the California House delegation to Transportation Secretary Elaine Chao, asking that the grant be put off until an audit of the high-speed rail project is completed.

Aecom did not respond to a request for comment. Flowers did not return a call left at her office.

Fourteen Republican members of the House wrote a letter last month to Chao, who was appointed by President Trump, asking that she delay awarding the Caltrain grant until the bullet train’s finances can be audited. The House members expressed concern that the bullet train project is behind schedule and over budget.

Rep. Jeff Denham (RTurlock), chairman of the House rail subcommittee, was bluntly critical of Flowers for approving the grant and then accepting a job at a company whose work would be supported by the grant money.

“This is exactly what America hates about Washington, D.C.,” he said in a statement. “Taxpayers deserve transparency, and it’s time for an audit. Period.”

Seamus Murphy, a spokesman for Caltrain, said his agency had worked on the grant with the transit administration for more than two years. Murphy said the agency had given the proposal a solid rating and was ready to recommend approval. Not many projects had applied for such a grant, he said, “so the decision to move Caltrain’s forward would have been an easy one.”

The decision to defer the grant evoked a strong protest by California’s senators on Saturday.

“We very much regret that the Trump administration [Friday] decided to delay a grant agreement to modernize the Caltrain corridor between San Francisco and San Jose,” Sens. Dianne Feinstein and Kamala Harris said in a joint statement.

“This decision is incomprehensible and will cause delays and millions of dollars of additional costs that could jeopardize the entire project. Unfortunately, some mistakenly believe this project is part of the HighSpeed Rail project, which it is not. It’s a separate project that will create more than 9,600 jobs, expand our economy, and allow Caltrain’s ridership to double by 2040.”

But House Republicans dispute the assertion that the electrification is not a key part of the high-speed rail project, because bullet trains will use the same tracks and electrical system. The California High-Speed Rail Authority has pledged $713 million to help in the electrification, money it plans to take from a bond issue that was specifically designated for bullet trains.

It is unclear when Flowers began talking with Aecom about the job.

High-level corporate jobs typically require extensive interviews, vetting and negotiations, leading House staffers to question whether Flowers had begun the process while she was still chief of the FTA.

‘This is exactly what America hates about Washington, D.C.’ —Rep. Jeff Denham criticizing the moves by former transportation official Carolyn Flowers