Audit cites flaws, poor management in costly California bullet train project
SACRAMENTO, Calif. — Flawed decision-making and poor contract management contributed to billions in cost overruns and years of delays in the as-yet unbuilt California’s high-speed rail line between Los Angeles and San Francisco, state auditors said Thursday.
The project is now estimated to cost $77 billion and is 15 years from completion.
State Auditor Elaine Howle faulted the California High-Speed Rail Authority for starting limited construction in 2013 before it completed critical tasks like buying land, relocating utilities or obtaining agreements from outside groups, including local governments and other railroad operators.
That led to numerous contract changes, project delays and overruns that have led to a nearly doubling of the original cost estimate of $40 billion.
The audit cited more than $2 billion in current or expected contract changes on three active Central Valley projects that were expected to cost about $3 billion. Meanwhile, delays have pushed completion estimates on those projects from this year to 2022.
Republican Assemblyman Jim Patterson of Fresno sought the audit with Democratic Sen. Jim Beall of San Jose.
“Insurmountable funding shortfalls, continued mismanagement and hugely flawed assumptions mean this project is dead in the water,” Patterson said. “There will never be a completed track from the Bay Area to Los Angeles. … The best we can hope for is a rump railroad running from Bakersfield to Madera.”
The project, backed by thenGov. Arnold Schwarzenegger and approved by voters in 2008, has been the subject on many lawsuits and strident opposition from Republicans and some Democrats, who see it as an unnecessary money pit.
But Gov. Jerry Brown has been steadfast with his support even as costs ballooned and the completion estimate drifted past the 2029 target.
Gov.-elect Gavin Newsom, a fellow Democrat, was strongly for it in 2008, turned lukewarm later as costs rose and now says he supports it but is concerned there’s no plan in place to pay for the increased cost.
The audit criticized the project’s convoluted management system in which 56 people manage hundreds of contracts worth more than $5 billion, yet just three contract managers have that role full time and there is high turnover and little oversight of the others.
Many of the others are outside consultants who “may not have the best interests of the state as their primary motivation,” auditors said, noting that the authority often “relied on the contractors’ own estimates and projections of the associated costs and delays.”
It recommended hiring fullstime, experienced state employees to manage the contracts.