Construction of California’s high-speed rail network is supposed to start in just six months, but the state hasn’t acquired a single acre along the route and faces what officials are calling a challenging schedule to assemble hundreds of parcels needed in the Central Valley.
The complexity of getting federal, state and local regulatory approvals for the massive $68-billion project has already pushed back the start of construction to July from late last year. Even with that additional time, however, the state is facing a risk of not having the property to start major construction work near Fresno as now planned.
It hopes to begin making purchase offers for land in the next several weeks. But that’s only the first step in a convoluted legal process that will give farmers, businesses and homeowners leverage to delay the project by weeks, if not months, and drive up sales prices, legal experts say.
One major stumbling block could be valuing agricultural land in a region where prices have been soaring, raising property owners’ expectations far above what the state expects to pay.
“The reality is that they are not going to start in July,” said Anthony Leones, a Bay Area attorney who has represented government agencies as well as property owners in eminent domain cases.
State high-speed rail officials say it won’t be easy, but they can acquire needed property and begin the project on time.
“It is a challenge,” said Jeff Morales, the rail agency’s chief executive. “It is not unlike virtually any project. The difference is the scale of it.”
Quickly acquiring a new rail corridor is crucial to the project, which Gov. Jerry Brown touted last week as the latest symbol of California’s tradition of dreaming big and making major investments in its future.
Delays in starting construction could set in motion a chain reaction of problems that would jeopardize the politically and financially sensitive timetable for building the $6-billion first leg of the system. Under its deal with the Obama administration, which is pushing the project as an integral part of its economic and transportation agenda, the state must complete the first 130 miles of rail in the Central Valley by 2018, an aggressive schedule that would require spending about $3.6 million every day.
California voters in 2008 approved plans for a 220-mph bullet train system that would initially link the Bay Area and Southern California at a cost of $32 billion, less than half the estimated cost of the project.
If the construction schedule slips, costs could grow and leave the state without enough money to complete the entire first segment. Rail agency documents acknowledge initial construction may not get as close to Bakersfield in the southern Central Valley as planned.
In addition to property, the rail authority still needs permits from the Army Corps of Engineers and approval by the San Joaquin Valley Air Pollution Control District, two more potential choke points that Morales says can be navigated.
The land purchases are waiting on the hiring of a team of specialized contractors, but they cannot start their work until the rail agency gets approval from another branch of the state bureaucracy. About 400 parcels are needed for the first construction segment, a 29-mile stretch from Madera to Fresno.
The formal offers will start an eminent domain action, the legal process for seizing land from private owners. The owners have 30 days to consider the offer, and then the state must go through a series of steps that can add 100 more days of appeals and hearings, assuming the state can get on the court calendar, according to Robert Wilkinson, an eminent domain litigator in Fresno. If the state fails to convince a judge that a quick takeover of property is justified, formal trials could stretch on for 18 months, he added.
“I would think a lot of these are going to end up in litigation,” he said. “It is a tight schedule, no question about it.”
Indeed, the rail authority’s formal right-of-way plan indicates it does not expect to acquire the first properties until Sept. 15, despite other documents that indicate construction would start in July. Rail officials said they padded the schedule to avoid claims for additional payments by construction contractors should land not be available by July.
Last month, the federal Government Accountability Office reported that about 100 parcels were at risk of not being available in time for construction.
That assessment was based on information the office collected last August. Susan Fleming, a GAO investigator, testified at a House hearing last month: “Not having the needed right of way could cause delays as well as add to project costs.”
Morales said in a recent interview that he would not argue with the warning in the GAO report but still sees nothing that would delay the start of construction. Technically, the rail authority could meet the July target date by beginning demolition or other construction on a single piece of property, he said.
Anja Raudabaugh, executive director of the Madera County Farm Bureau, which is suing to halt the project under the California Environmental Quality Act, said the rail authority will face strong opposition to condemnation proceedings in the Central Valley. The bureau has hired a condemnation expert to help battle the land seizures.
“It is a harried mess,” she said.
She noted that agricultural land prices rose rapidly last year across the nation. In the Central Valley, the average price of farmland is $28,000 per acre, while the rail authority’s budget anticipates an average price of $8,000 per acre, she said.
Kole Upton, an almond farmer who leads the rail watchdog group Preserve Our Heritage, questioned the rail agency’s expertise in conducting complex appraisals of agricultural land that has orchards, irrigation systems and processing facilities.
“I am not sure this thing has been well thought out by people who have a deep understanding of agriculture,” Upton said. “I live on my farm, and my son lives on my farm. My dad started it after World War II. This is our heritage and our future.”
Morales said he believes the agency’s budget for property acquisitions is adequate and he did not want to negotiate prices publicly.
“We don’t think we are wildly off,” he said.