If you’ve been following me on Twitter, you’ll know that I spent this afternoon on the phone with folks in California, looking into the recent SNCF-CHSRA bombshell. To summarize: SNCF, the highly experienced French national high-speed rail operator, apparently had a plan for California’s HSR network, but was turned off by the highly politicized routing. Namely, they wanted to make a straight shot from LA to San Francisco by running along the flat, government-owned I-5 corridor with spurs out to the eastern Central Valley, whereas the California High Speed Rail Authority (CHSRA) and state politicians wanted the main line to go through every little town in the Central Valley, directly. Now, all of this wouldn’t be a scandal, except for the fact that nobody at SNCF ever mentioned it to the public or the media.
That’s what the LA Times reported, but David Schonbrunn, a pro-HSR, anti-CHSRA activist, says there’s more to the story – SNCF not only advocated I-5, but they actually had private investors lined up! Here’s his letter to the LAT:
Your otherwise excellent story “High-speed rail officials rebuffed proposal from French railway” was far too kind to California High-Speed Rail Authority officials. At the time of its proposal, SNCF had the investment backing to actually build the LA-SF line, in a deal that sheltered the State from the risk of subsidizing an unprofitable project.
The Authority’s 2012 Business Plan covered up this offer, instead insisting that no private capital would be willing to invest until the first high-speed line showed a profit. The $6 billion Central Valley project approved last week by the Legislature thus exposes the State to unlimited operating losses. Worse yet, before that line can be completed, it will need an additional $27 billion from the federal government–quite unlikely in today’s political climate.
I’d sure like to understand the thinking behind the rejection of the French offer.
It’s unfortunate the story didn’t run earlier. It would have informed the Legislature’s debate.
I talked to David on the phone. He stuck by the story and said there was indeed a “secret meeting” between SNCF and CHSRA where such issues were discussed, and then I spoke to someone else – someone intimately knowledgeable about the SNCF side of things, who’s been quoted in the media before, but who requested anonymity – who confirmed David’s version of events. However, he said that CHSRA was so dismissive of SNCF’s plan that no formal proposal was ever requested or made, which tells me that there unfortunately may not be any written documents to request/FOIA from the CHSRA.
As to the identity of the private backers, my source wouldn’t go into specifics, but did hint that they were major, major US banks offering to fund the venture, and that they had experience funding SNCF projects in the past. But again, no formal proposal was ever made, since the CHSRA refused to consider the only alignment – I-5 – that private backers felt was financially viable. (When I pushed him on which banks offered to finance SNCF’s California plan, he downplayed the importance of the identify of the individual would-be investor, saying that it was a plan that would have had no problem attracting private capital, given SNCF’s past expertise and proven good judgment.)
Some have been dismissive of the LAT’s SNCF story because of a PDF leaked to Yonah Freemark in 2009 in which SNCF specifically gave its approval to the CHSRA’s more circuitous route following Highway 99 through Bakersfield, Fresno, etc. In response to this, my source said that that document was very preliminary and was intended only for the FRA, and was in fact drafted before SNCF established SNCF America. In other words, it was nothing close to their ultimate proposal, and the I-5 proposal that the LAT cites was the most recent and most serious one. (Indeed, it appears that SNCF America wasn’t created until 2010, a year after that PDF leaked, lending credence to my source’s claim that it was much more preliminary than the one cited yesterday by the LAT.)
So, what does all this mean? It means that the CHSRA very well might have been offered private funding for the plan, but turned it down because it didn’t fulfill desired political objectives of going through towns in the Central Valley onto the main trunk line (again: SNCF’s I-5 proposal would have connected Bakersfield, Fresno, etc., just through spurs rather than the main line, not on every single LA-SF trip). This would be okay if the CHSRA was public about it, but they stand accused – by the LAT and by David Schonbrunn – of covering it up. (Obviously it would also have been in Parsons Brinckerhoff’s interest to ditch the SNCF plan, and of course there are many people who have been employed both at PB and CHSRA.)
I’ve reached out to SNCF America for an official comment but my call wasn’t returned today (I’ll update if I hear later). I didn’t bother to try to contact CHSRA – if they wouldn’t talk to the LA Times about a well-sourced claim, I’m sure they won’t talk to some freelance reporter about anonymously sourced accusations appearing on blogs.
But I know for a fact that there are other reporters more experienced than I am on the case, and I’m sure it’s only a matter of time before the truth comes out. But so far, it ain’t lookin’ good for the CHSRA.
If you know more about any of this, even if it’s off the record, please don’t hesitate to contact me – [email protected], or +1-484-995-8479.