Bay Area Elected Government Officials:

America Is Broke—Don’t Simitian/Eshoo “Get It”?

On the same day that US credit rating agency Standard & Poor’s made national news by
expressing concern over the creditworthiness of the United States government--lowering
its outlook on the federal debt position from 'stable' to 'negative'--because of concerns
that politicians will fail to agree on a plan to reduce long-term deficits, two long-time
Silicon Valley politicians, Anna Eshoo and Joe Simitian, announced their proposal to
somehow “merge” the money-losing, badly-managed, Caltrain commuter line with the
poorly-managed, but yet to emerge from the cocoon, High Speed Rail Line (HSR),
which could easily cost the California and US taxpayers $100B.

Eshoo, whose votes have added $10T to the US debt, and Simitian, whose Sacramento
presence has helped create a seemingly permanent deficit of $20B-$30B in the yearly
California budget,-are proposing somehow combining the HSR entity with the HSR
entity—believing naively that “two wrongs will make a right”.

Caltrain is almost a non-existent entity. Its Board is comprised of elected officials—none

generally associated with the transportation industry--and not be recalled by the
electorate. For the most part, it is a strictly a political creation, and seemingly not subject
to much in the way of actual accountability, or the expectation of cost-effective
operations. The HSR entity, is neither recallable, and while not a yet “force of nature”, it
has seemed very indifferent to public opinion most of the time.

Caltrain Costs Hard To Track

The total costs of the Caltrain operation are not clearly documented, as capital
expenditures often appear “hidden” in the Transportation budgets of other agencies, such
as VTA. Caltrain total-life-time costs are not tracked by either Caltrain, or VTA. Total
assets, while acknowledged in the yearly Comprehensive Annual Financial Report, are
not generally made available to the public. And future pension obligations for
Caltrain/Amtrak employees have most likely not been considered by anyone associated
with Caltrain. It would not be that difficult to believe that a $1B “surprise” pension
payout obligation will fall on the Joint Powers (JPA) membership at some inopportune
time in the future—reducing the general funds of every JPA member to fund these
promised pension obligations. Any “cost-sharing” of infrastructure expenditures, such as
at-grade crossings will be almost impossible to track, making Caltrain an even bigger
“money-pit” than it already is. Given the nature of the HSRA, and the general failure of
most “big-ticket” state capital projects (see link below), it is difficult to believe that there
will be any realistic auditing, and that steep cost-overruns, and fraud, will be common
place during the construction phase of this project.
Blending Caltrain and HSR?

Eshoo and Simitian are proposing spending perhaps $3B-$4B new dollars (including
financing costs of borrowed [presumably Chinese] money) on electrification, and some
poorly-specified safety upgrades, such as possibly grade separations along the line.
Grade separations could easily cost in the $40M-$80M range per intersection. Various
media reporting suggests that these upgrades somehow be achieved via a “blending” of
Caltrain and HSR—presumably meaning management.

Any belief that the Caltrain management and governance have the capabilities to design,
and negotiate the $40B-$100B HSR project is beyond delusional—but it does play well
on the state of California politics—at least until people look seriously at the proposal, and
see that it is all “fluff” and no substance.

To make matters worse, Caltrain’s pricing of Go-Passes shifts the costs of ridership from
large, institutional employers, like Stanford, directly onto the taxpayer’s backs. Currently
priced at 30 cents to 50 cents a ride, the rest of the $12.00-$16.00/ride cost-to-deliver-
service must be paid for by various taxes on those not riding the train. The recent
proposal by Stanford to pay for 50+ years Go-Passes as a traffic mitigation for its newly-
created Hospital traffic, will likely cost the taxpayers $3B-$4B over that period of time.

Also not discussed by the Simitian/Eshoo proposal is the funding of the Transbay Transit
Center and Caltrain Downtown Extension Program, estimated at $4.2 billion, which,
during the second phase of the project will, complete the 1.3-mile extension of the
Caltrain rail line from Fourth and King streets underground into the new Transit Center.
This undergrounding of the Caltrain line will doubtless add another $1B-$2B of capital
costs to the line, with little hope of increasing the ridership by significant numbers.

End Of The Line

America is broke—virtually every one in the world understands that—except America’s

permanent politicians—who have promised everything that they believe will guarantee
themselves another ticket to the seats of power in the state houses, and on DC’s Capitol
Hill. Spending another penny on Caltrain is lunacy. Merging the unsuccessful Caltrain
with the failing HSR, in any way, is just lunacy squared. It would not be hard to show
that it will possibly cost over $8B over the next 30 years (without “electrification”) to
operate Caltrain. The HSR, with unknown ridership, and unknown costs—will probably
cost upwards of $100B, given the history of large systems management in California.

Motorists traveled over 176B vehicle miles on California’s highway system in 2008. The
highway system is in dire need of refurbishment. The $8+B that will be spent on Caltrain
in the next thirty years would be better spent on rehabbing the Bay Area’s highways and
bridges, than to move 18,000-19,000 people up and down the steel tracks of Caltrain.

Both our state, and federal, spending must be downsized—and quickly--if there is any
hope of avoiding the unpleasant event of “sovereign default”. Terminating both of these
massive boondoggles is necessary to reduce both state, and federal, government
expenditures. This is obviously not going to be pleasant—but it is absolutely necessary
for the well being of our state, our country, and out children’s futures. Terminating both
Caltrain, and the California HSR, are two of the bad ideas that can start our state, and our
nation, on the road to sustainable government operation.
Wayne Martin
Palo Alto, CA
www.scribd.com/wmartin46
www.twitter.com/wmartin46
www.youtube.com/wmartin46

On-the-NET:

Government Handouts Exceed Tax Revenues:

http://www.foxbusiness.com/markets/2011/04/20/government-cash-handouts-
exceed-tax-revenues/

CA HSR: Peninsula Legislators Take Action:

http://www.examiner.com/transportation-policy-in-san-francisco/california-high-speed-
rail-peninsula-legislators-take-action

Transbay Transit Center:

http://transbaycenter.org/

Management Failures In Large Capital California Projects:

http://www.scribd.com/doc/32328489/CA-Large-Project-Failures-Articles

1 Trillion Vehicle Miles Traveled in 2009:

http://www.travelinlocal.com/1-trillion-vehicle-miles-traveled-in-2009/