Rail Projects Take Twists and Turns : Commerce: Officials say the $535 million pledged for the Alameda Corridor is only 30% of what they need to link downtown L.A. with the ports. The scramble is on for the rest.

Talks resumed Thursday over an agreement on the ambitious Alameda Corridor rail-and-truck proposal, with federal, state and local officials turning their attention to a new and potentially staggering obstacle for the massive transportation project:

Money.

Only about 30% of the $1.8-billion price tag has been pledged by government agencies for the project, which would link downtown Los Angeles and its conflux of rail lines with the ports of Los Angeles and Long Beach. As a result, a state hearing on the proposed 20-mile corridor focused almost entirely on how, where and when the remaining hundreds of millions of dollars will be collected.

“The good news is that there is some money available today for the project,” Los Angeles Deputy Mayor Mike Keeley told the Assembly Select Committee on the Alameda Corridor during a meeting in Huntington Park.

“However, the bad news is the ports have estimated . . . the total cost of the project is approximately $1.8 billion. And the funds that have been earmarked to date are a small drop in the bucket,” Keeley said.

His assessment came near the start of a hearing that lasted almost three hours.

Under plans that have been in development for years, 20 miles of Southern Pacific Transportation Co. track lines along Alameda Boulevard would be sold to a new multi-agency authority so the route could be transformed into a rail-and-truck transportation corridor. That corridor, with new traffic lanes and other transportation improvements such as grade crossings, would streamline cargo shipments and eliminate an estimated 15,000 hours of traffic delays per day for cars waiting at train crossings. And the improved efficiency of traffic, officials say, would also cut air emissions from vehicles now stuck on congested streets.

Two months ago, progress on the project came to a halt when the Los Angeles Harbor Commission withdrew from an agreement to purchase the Southern Pacific property for $260 million. Officials took the action, later followed by Long Beach, because of questions about the project, including who owns the title to the property needed for the corridor.

While the ports’ action had been the focus of attention in recent weeks, the cost of the Alameda Corridor took center stage at Thursday’s hearing when officials from Los Angeles, Long Beach and Southern Pacific disclosed that new talks had begun only hours before the hearing. And those talks, officials said, seemed certain to end in a new accord.

“We are both accessible. We are both sincere about this,” Los Angeles Harbor Commissioner Steve Soberoff said of the ports and Southern Pacific.

But no sooner had that cloud lifted than the nagging issue of financing the undertaking arrived. During more than three hours of often repetitive testimony at Huntington Park City Hall, officials of various agencies cautioned that new sources of funding the project must be found--and found quickly--if it is to become reality.

Huntington Park Councilman Thomas E. Jackson, who chairs the Alameda Corridor Transportation Authority, noted that of the “whopping” $1.8 billion needed for the project, only $535.5 million has so far been committed to its completion. The funding includes $400 million from the two ports, $80 million from the state, $47 million from the federal government and $8.5 million from the local Metropolitan Transportation Authority, Jackson said.

Despite a commitment to the project, the U.S. Department of Transportation will have difficulty earmarking more than it already has because it would jeopardize other transportation endeavors, said Frank Pennte, a deputy director of the department. The problem, Pennte said, is a serious shortage of “existing resources.”

While Pennte also told the hearing that a federal environmental review of the project could take up to two years, it was his remarks about the lack of federal funds that set the tone for the hearing’s focus on money.

California Transportation Commissioner Jerry Epstein, for example, warned the Assembly panel and others that no one should expect the Alameda Corridor project to move forward anytime soon unless new and substantial revenue sources are developed. Otherwise, he said, officials will find themselves “robbing Peter to pay Paul” by siphoning hard-won funds from other transportation projects to the Alameda Corridor.

During the hearing, Epstein and others outlined a range of possible funding options, including pressure for new federal appropriations, state or local bond measures and user fees for shippers and others who would benefit from the transportation corridor.

But all of the options have questions or risks, officials acknowledged. New federal funds may be hard to come by, bond measures can be hard to sell to voters, and user fees, if too high, could discourage business, leading shippers and others to bypass Los Angeles/Long Beach harbors for other West Coast ports.

But hearing participants voiced optimism that ways will be found to build and operate the Alameda Corridor.

“I don’t have any question the project will happen,” Keeley said. “It’s just a question of the timing.”