California High-Speed Rail Authority closer to losing independence

The Senate passed legislation that would move the independent California High-Speed Rail Authority into the state’s Business, Transportation and Housing Agency, thereby increasing government oversight over the $43bn project.

Legislators in the California State Senate voted in favour last week of a bill that would transfer the California High-Speed Rail Authority (CHSRA), the governing body for the state’s $43 billion high-speed rail project, to the state’s Business Transportation and Housing Agency.

The legislation, authored by California State Senator Alan Lowenthal, a Democrat, would increase oversight over the CHSRA and introduce new conflict-of-interest rules. In order to become law, the bill must also pass the California Assembly and receive the approval of the governor.

The CHSRA, which was established in 1996 as an independent agency with a nine-member board appointed by the state’s governor and legislature, submitted a letter opposing the bill to the chair of the State Senate Committee on Housing and Transportation in March.

“Continuity in leadership is important at this critical stage of the project, and necessary to continue the relationships with our partners in the Federal Government, private businesses, and community members,” Curt Pringle, then-chair of the CHSRA , wrote in the letter.  “An overhaul of the Board during these next two years of securing private investment and beginning construction would send the wrong signal to those critical partners.”

Following the end of his two-year term as chair of the CHSRA board, Pringle was replaced last week by Thomas Umberg, an attorney at law firm Manatt, Phelps & Phillips.

Last year, Lowenthal, the former chair of the State Senate Committee on Transportation and Housing,  expressed concerns about a state audit that showed that $4 million in fees had been paid to contractors without sufficient documentation of work performed. He said in a statement that he had been “concerned for some time that the [CHSRA] has had trouble transitioning from a promotional agency to an organization that can manage a project of this magnitude”.

The senate bill is not the only threat to the CHSRA’s status as an independent body. Last month, California’s independent Legislative Analyst’s Office issued a report recommending that the CHSRA should be incorporated into the California Department of Transportation, arguing that the CHSRA was not looking out for the state’s fiscal concerns, among other considerations.

In response to the report, Roelof Van Ark, the CHSRA chief executive who has also had a career in the private sector, said he believed “this project has been successful thus far because it has strived to operate more like a private business than a typical government bureaucracy”.

California’s high-speed rail project aims to build 800 miles of track connecting the cities of San Francisco and Los Angeles/Anaheim with trains traveling up to 220 miles per hour, according to the CHSRA website. The planned rail line will travel through California's Central Valley and eventually be built out to connect the cities of Sacramento and San Diego as well.