ORANGE COUNTY PERSPECTIVE : Off Track With Vegas Train
If, as sole bidder, Bechtel International Inc. wants to build a high-speed magnetic-levitation train system between Anaheim and Las Vegas, well and good. But let it pay for the project without public subsidy.
Bechtel has just come in with a proposal to build a $5-billion system that would make seven or eight stops and pass through either Riverside or Ontario. The California/Nevada Super Speed Train Ground Transportation Commission will now review the proposal. Bechtel, the giant engineering and construction firm, was the only surviving bidder after other contenders said a lack of public financing would make the project too risky.
That question of a public role in this train has been lurking in the background all along.
Proponents have advanced the train as a purely private venture that would end up benefiting everyone in the end. But even as Bechtel submitted its proposal this week, and suggested that up to 5 million round-trip passengers a year could be expected by the year 2000, it opened the door to an expectation that there would be some public assistance.
Ervon Koenig, a Bechtel spokesman, said that there might have to be benefit assessment districts along the route, because projected fare- box revenues would not cover construction costs and loan interest. Tickets for the 75-minute ride are expected to cost between $100 and $120 per round trip.
In a benefit assessment district, government likely would have to agree to some sort of per-square-foot assessment on either new or existing private development along the route as a way of subsidizing the train. If that happens, so much for the concept of a privately financed high-speed train. The two state legislatures and local government units should be wary of getting drawn into such a plan.
There are a host of environmental hurdles that the train will have to clear, even assuming that the bistate panel awards Bechtel the franchise. The project requires legislative approval in both states and more study.
But clearing even formidable obstacles in the political process may not pose much of a problem for a firm as well-connected politically as Bechtel. Moreover, there are powerful developers and politicians in Orange County who are eager to get this project rolling, either because of the development potential it could open up or because of the business it could generate.
Bechtel says the project could add $370 million to $700 million a year to local economies and create thousands of jobs in Southern California. Sounds attractive, but beware of a stampede that would enlist the public’s pocketbook.
It’s fine if the high-speed magnetic-levitation train system really is a private venture. That’s what this project is supposed to be, by law.
