Latest news with #IanChoudri
Forbes
a day ago
- Business
- Forbes
How AI Data Centers Could Save California High-Speed Rail
W ith the clawing back of $4 billion in federal grants to support it, the Trump Administration seems hell bent on ensuring that California's high-speed rail project ends up as precisely the 'train to nowhere' the President lambastes it as. Gov. Gavin Newsom is suing to keep the money, but the train's new CEO has big ideas for saving the priciest U.S. infrastructure project. They include new long-term funding, private partnerships and even turning to one of California's newest 'natural' resources: The AI data center. Ian Choudri, who spent decades working on global mega-infrastructure projects for major engineering firms Bechtel, Alstom and Parsons before taking the high-speed rail job last September, is on a mission to convince skeptics that after years of slow progress, the Golden State's bullet train from San Francisco to Los Angeles can be built– perhaps for less than its $128 billion price tag and even without federal support. 'We're getting contacted by Silicon Valley investors now asking, 'Hey, can we move data centers into Fresno and plug into your power grid that's renewable?'' Ian Choudri 'We'll show that it becomes less cumbersome on taxpayers because it's generating revenue,' he told Forbes , without providing financial details. In addition to future ride revenue, he thinks the system can make money by letting tech firms build data centers on its land, powering them with solar farms that will also propel its trains. Other ideas include selling the rights to telecom companies to lay fiber optic cable along the train's path, and promoting real-estate development projects on its route, particularly in the lower-priced Central Valley region. 'We're getting contacted by Silicon Valley investors now asking, 'Hey, can we move data centers into Fresno and plug into your power grid that's renewable?'' Choudri said. 'If I combine all those ancillary revenue sources, roughly it's going to be 30% to 40% of the farebox revenue.' He's submitting a revised plan next week that maps out steps to complete an initial 119-mile segment through California's Central Valley by 2033, and then expand service north to San Francisco and San Jose and south to Palmdale in Southern California as soon as 2039, with Los Angeles to follow later. His focus is on sequencing construction phases to maximize revenue as quickly as possible, making the project less dependent on government money. Gov. Gavin Newsom speaks at the opening of a railhead facility in January, joined by CEO Ian Choudri, right. California High-Speed Rail Authority 'Build the initial sections where you can. Start using the service. Have the highest impact on the economic transformation of the towns and cities that are getting connected, and then add more value by monetizing all the assets you have along the corridor,' said Choudri, sitting in a conference room overlooking the copper-topped California Capitol building in Sacramento. 'That's so critical in our new approach because it offsets a lot of this demand for continuous funding–whether federal, state or a combination of both–because your system goes live and becomes a corridor of opportunities for everybody.' 'People are looking for new approaches, creative approaches, to deliver the project more efficiently and more quickly.' State Senator Scott Wiener The plan is a massive change from the project's past. But it hinges on critical legislation: a long-term funding plan proposed in May by Newsom would provide an additional $20 billion, or $1 billion a year through 2045, along with a bill to speed up permitting for High-Speed Rail Authority construction work and relocate portions of roads and utilities that are in the way. State Senator Scott Wiener of San Francisco, who authored the permitting bill, isn't certain the funding plan will be authorized in the current session that ends on Sept. 12. But he thinks support for the project is improving. 'People want to see a solid plan to deliver the project in a timely manner,' he said. 'And people are looking for new approaches, creative approaches, to deliver the project more efficiently and more quickly.' No Land, Fuzzy Plan Trump in May accused the long-maligned train of being '30,40 times' over budget, calling it 'the worst cost overrun I've ever seen. It's totally out of control.' The price tag for a bullet train operating at speeds over 200 miles per hour between San Francisco and Los Angeles has ballooned, though not nearly by the amount Trump falsely claims. It's tripled from an estimated $45 billion in 2008, when state voters approved a $10 billion bond measure for it (up from an initial $33 billion estimate), to as much as $128 billion as of the 2024 business plan. Approval of the train by voters 17 years ago was a leap of faith, because none of its backers, including then-Gov. Arnold Schwarzenegger, knew exactly how big a challenge it would be. In 2008, there was no fixed route, land or right of way and plans had to go through California's grueling environmental impact review process. The project has also had limited eminent domain authority when it came to things like getting utilities to move power lines and pipes. Negotiating terms to acquire thousands of parcels of land was an expensive, excruciating slog with repeated court challenges. In its early years, the project also relied heavily on outside consultants, instead of staffing up with megaproject experts–like Choudri. He's also built up his team with rail and infrastructure veterans, including Construction Chief Edward Fenn, who helped build Brightline's Florida system, and Soon-Sik Lee, chief of planning and engineering, who previously worked on the UAE's Etihad high-speed rail line and Caltrain. A high-speed rail bridge under construction in California's Central Valley. California High-Speed Rail Authority Despite its messy start, the project has made far more progress than Trump and Transportation Secretary Sean Duffy acknowledge. Some 2,300 parcels of land have been secured, environmental approvals are largely complete and active construction is underway, employing more than 15,000 people, on the 119-mile section between Fresno and Bakersfield, with preparations extended to Merced, Gilroy and Palmdale to tie into existing rail systems. 'High-speed rail will be a game-changer for Fresno and the Central Valley' Fresno Mayor Jerry Dyer After rocky years, 'we're now on the other side and we want to get this done,' Newsom said after his budget, including about $800 million this year for high-speed rail, was signed into law in May. 'Game-Changer' When fully built out, perhaps sometime in the 2040s, the railway is to be a 494-mile system, running from San Francisco in the north to Los Angeles and Anaheim in Southern California. The first step is completing the initial 119-mile section connecting the Central Valley cities of Fresno to Bakersfield. From there, the plan is to extend north from Fresno to Merced, connecting to Amtrak's service to Sacramento, and northwest to Gilroy and the Caltrain commuter system that feeds into San Jose and San Francisco. From Bakersfield, Choudri wants to build south to Palmdale, a high desert city served by the Metrolink commuter rail line that runs to Los Angeles and Orange County. Billionaire Wes Edens' Brightline West bullet train from Las Vegas to suburban Los Angeles may also link to Palmdale via a proposed segment funded mainly by Los Angeles County's Metro transit agency. Those extensions could be in place by 2039, Choudri estimates, giving the system significant utility as construction of high-speed tracks progresses further south. 'High-speed rail will be a game-changer for Fresno and the Central Valley' Fresno Mayor Jerry Dyer Critics have said it would have been cheaper and faster to build the system along Interstate 5, the main freeway linking San Francisco to L.A. (Brightline West is doing that with its 218-mile line from Las Vegas to suburban Los Angeles along Interstate 15, which could be running by 2028.) But the idea was scrapped long ago for a simple reason: It would exclude the state's interior cities. A newly completed grade separation for California's high-speed rail project in Fresno, California. California High-Speed Rail Authority 'High-speed rail will be a game-changer for Fresno and the Central Valley,' Fresno Mayor Jerry Dyer told Forbes . 'We're an ag-centric region, heavily reliant upon agriculture and commercial jobs that are associated with it. When Interstate 5 was built many, many years ago, it was built intentionally from Northern California to Southern California, and left the Central Valley out of the broader California economy.' He's convinced that links from his city, where median home prices are a third or less than in San Francisco or Los Angeles, to the state's main economic centers will bring profound changes. 'It will allow people who work in Silicon Valley to be able to commute and live in Fresno. That's exciting for us in Fresno because it would change our local economy,' Dyer said. Commute times between San Jose and Fresno could be as little as 45 minutes one day, according to Choudri. 'A colossal boondoggle' Transportation Secretary Sean Duffy In an op-ed last month, as the administration works to claw back funds, Duffy slammed the project as a 'colossal boondoggle.' But Newsom's office pushed back, arguing for the value the project will bring to heavily red districts in the middle of the state. 'Secretary Duffy continues to call this a 'train to nowhere.' It's another slap in the face for the Central Valley,' said Daniel Villaseñor, a spokesman for the governor. 'Unlike the Trump Administration, we're not going to abandon the Central Valley.' Private Partnerships Losing $4 billion of federal funds would be a major setback, representing 14% of the $28 billion the project has raised, with the rest coming through state funding and a previous $3 billion federal grant. That's why Newsom hopes to finally stabilize the project with his $20 billion plan funded by California's Cap-and-Trade program, in which polluters pay for their carbon emissions. If approved, that would allow Choudri to make good on his vision and also create opportunities to bring in private infrastructure partners to assist with financing and construction, including companies like Bechtel, Meridiam and Plenary. 'Up to now, private investors, private equity, private operators really weren't interested in taking a look at or investing equity or participating in any kind of a risk transfer in the California project because they weren't sure of the commitment–the financial commitment to long-term funding on behalf of the state,' said Sia Kusha, head of business development for Plenary, which is working on transit and bridge projects across the U.S. and Canada. The likelihood that the state will approve a 20-year financing plan is 'probably the biggest impetus behind why there's new excitement in the private development community' about the rail project, he said. A guaranteed funding stream would allow Choudri to borrow against future revenue to accelerate the pace of construction. Already, the High-Speed Rail Authority, which has been building the embankments, bridges, tunnels and grade separations needed for the train over the last decade, like an overpass just completed in Fresno, has begun ordering steel and other materials needed to finally begin laying tracks. Choudri acknowledges past problems, which frustrated him as an outsider. 'It was micromanaged in the law – which said, 'it should be this many minutes from here to this station' – back in 2008, when we didn't even know where the alignment was going to go,' he said. The initial cost and service estimates weren't useful because there was no detailed plan. 'You can't put 10 carts in front of the horse, and then say, 'Why isn't it moving?' It wasn't moving because it wasn't set up the way other countries do this.' Rendering of a high-speed rail train entering Fresno's station. Craig Kohlruss/The Fresno Bee/Tribune News Service via Getty Images The approach seen in projects including Japan's shinkansen bullet train, to high-speed rail networks in China, Europe and dozens of other countries, focused on segment-by-segment plans to connect cities–and with full national government support. He thinks it was a mistake to estimate the cost of California's entire system long before thorough planning was done and routing was determined. 'That's why I left the private sector,' Choudri said. 'I'd been watching this program since 2012, and my mind was just going crazy.' That motivated him to take the job last year, thinking, 'I need to go in and just say, 'Alright, let's go fix this thing because we cannot fail.'' More from Forbes Forbes California Sues Trump To Hang Onto $4 Billion Of Bullet Train Funds By Alan Ohnsman Forbes Trump Could Derail California High-Speed Rail Project, Despite Billions Spent By Alan Ohnsman Forbes California's $100 Billion Electric Bullet Train Will Be Fully Solar Powered By Alan Ohnsman Forbes In Las Vegas, A Billionaire's Blueprint For Building Bullet Trains By Alan Ohnsman
Forbes
6 days ago
- Business
- Forbes
How AI Data Centers Could Save California's High-Speed Rail Project
W ith the clawing back of $4 billion in federal grants to support it, the Trump Administration seems hell bent on ensuring that California's high-speed rail project ends up as precisely the 'train to nowhere' the President has lambasted it as. Gov. Gavin Newsom is suing to keep the money, but the train's new CEO has big ideas for saving the priciest U.S. infrastructure project. They include new long-term funding, private partnerships and even turning to one of California's newest 'natural' resources: The AI data center. Ian Choudri, who spent decades working on global mega-infrastructure projects for major engineering firms Bechtel, Alstom and Parsons before taking the high-speed rail job last September, is on a mission to convince skeptics that after years of slow progress, the Golden State's bullet train from San Francisco to Los Angeles can be built– perhaps for less than its $128 billion price tag and even without federal support. 'We're getting contacted by Silicon Valley investors now asking, 'Hey, can we move data centers into Fresno and plug into your power grid that's renewable?'' Ian Choudri 'We'll show that it becomes less cumbersome on taxpayers because it's generating revenue,' he told Forbes , without providing financial details. In addition to future ride revenue, he thinks the system can make money by letting tech firms build data centers on its land, powering them with solar farms that will also propel its trains. Other ideas include selling the rights to telecom companies to lay fiber optic cable along the train's path, and promoting real-estate development projects on its route, particularly in the lower-priced Central Valley region. 'We're getting contacted by Silicon Valley investors now asking, 'Hey, can we move data centers into Fresno and plug into your power grid that's renewable?'' Choudri said. 'If I combine all those ancillary revenue sources, roughly it's going to be 30% to 40% of the farebox revenue.' He's submitting a revised plan this week that maps out steps to complete an initial 119-mile segment through California's Central Valley by 2033, and then expand service north to San Francisco and San Jose and south to Palmdale in Southern California as soon as 2039, with Los Angeles to follow later. His focus is on sequencing construction phases to maximize revenue as quickly as possible, making the project less dependent on government money. Gov. Gavin Newsom speaks at the opening of a railhead facility in January, joined by CEO Ian Choudri, right. California High-Speed Rail Authority 'Build the initial sections where you can. Start using the service. Have the highest impact on the economic transformation of the towns and cities that are getting connected, and then add more value by monetizing all the assets you have along the corridor,' said Choudri, sitting in a conference room overlooking the copper-topped California Capitol building in Sacramento. 'That's so critical in our new approach because it offsets a lot of this demand for continuous funding–whether federal, state or a combination of both–because your system goes live and becomes a corridor of opportunities for everybody.' 'People are looking for new approaches, creative approaches, to deliver the project more efficiently and more quickly.' State Senator Scott Wiener The plan is a massive change from the project's past. But it hinges on critical legislation: a long-term funding plan proposed in May by Newsom would provide an additional $20 billion, or $1 billion a year through 2045, along with a bill to speed up permitting for High-Speed Rail Authority construction work and relocate portions of roads and utilities that are in the way. State Senator Scott Wiener of San Francisco, who authored the permitting bill, isn't certain the funding plan will be authorized in the current session that ends on Sept. 12. But he thinks support for the project is improving. 'People want to see a solid plan to deliver the project in a timely manner,' he said. 'And people are looking for new approaches, creative approaches, to deliver the project more efficiently and more quickly.' No Land, Fuzzy Plan Trump in May accused the long-maligned train of being '30,40 times' over budget, calling it 'the worst cost overrun I've ever seen. It's totally out of control.' The price tag for a bullet train operating at speeds over 200 miles per hour between San Francisco and Los Angeles has ballooned, though not nearly by the amount Trump falsely claims. It's tripled from an estimated $45 billion in 2008, when state voters approved a $10 billion bond measure for it (up from an initial $33 billion estimate), to as much as $128 billion as of the 2024 business plan. Approval of the train by voters 17 years ago was a leap of faith, because none of its backers, including then-Gov. Arnold Schwarzenegger, knew exactly how big a challenge it would be. In 2008, there was no fixed route, land or right of way and plans had to go through California's grueling environmental impact review process. The project has also had limited eminent domain authority when it came to things like getting utilities to move power lines and pipes. Negotiating terms to acquire thousands of parcels of land was an expensive, excruciating slog with repeated court challenges. In its early years, the project also relied heavily on outside consultants, instead of staffing up with megaproject experts–like Choudri. He's also built up his team with rail and infrastructure veterans, including Construction Chief Edward Fenn, who helped build Brightline's Florida system, and Soon-Sik Lee, chief of planning and engineering, who previously worked on the UAE's Etihad high-speed rail line and Caltrain. A high-speed rail bridge under construction in California's Central Valley. California High-Speed Rail Authority Despite its messy start, the project has made far more progress than Trump and Transportation Secretary Sean Duffy acknowledge. Some 2,300 parcels of land have been secured, environmental approvals are largely complete and active construction is underway, employing more than 15,000 people, on the 119-mile section between Fresno and Bakersfield, with preparations extended to Merced, Gilroy and Palmdale to tie into existing rail systems. 'High-speed rail will be a game-changer for Fresno and the Central Valley' Fresno Mayor Jerry Dyer After rocky years, 'we're now on the other side and we want to get this done,' Newsom said after his budget, including about $800 million this year for high-speed rail, was signed into law in May. 'Game-Changer' When fully built out, perhaps sometime in the 2040s, the railway is to be a 494-mile system, running from San Francisco in the north to Los Angeles and Anaheim in Southern California. The first step is completing the initial 119-mile section connecting the Central Valley cities of Fresno to Bakersfield. From there, the plan is to extend north from Fresno to Merced, connecting to Amtrak's service to Sacramento, and northwest to Gilroy and the Caltrain commuter system that feeds into San Jose and San Francisco. From Bakersfield, Choudri wants to build south to Palmdale, a high desert city served by the Metrolink commuter rail line that runs to Los Angeles and Orange County. Billionaire Wes Edens' Brightline West bullet train from Las Vegas to suburban Los Angeles may also link to Palmdale via a proposed segment funded mainly by Los Angeles County's Metro transit agency. Those extensions could be in place by 2039, Choudri estimates, giving the system significant utility as construction of high-speed tracks progresses further south. 'High-speed rail will be a game-changer for Fresno and the Central Valley' Fresno Mayor Jerry Dyer Critics have said it would have been cheaper and faster to build the system along Interstate 5, the main freeway linking San Francisco to L.A. (Brightline West is doing that with its 218-mile line from Las Vegas to suburban Los Angeles along Interstate 15, which could be running by 2028.) But the idea was scrapped long ago for a simple reason: It would exclude the state's interior cities. A newly completed grade separation for California's high-speed rail project in Fresno, California. California High-Speed Rail Authority 'High-speed rail will be a game-changer for Fresno and the Central Valley,' Fresno Mayor Jerry Dyer told Forbes . 'We're an ag-centric region, heavily reliant upon agriculture and commercial jobs that are associated with it. When Interstate 5 was built many, many years ago, it was built intentionally from Northern California to Southern California, and left the Central Valley out of the broader California economy.' He's convinced that links from his city, where median home prices are a third or less than in San Francisco or Los Angeles, to the state's main economic centers will bring profound changes. 'It will allow people who work in Silicon Valley to be able to commute and live in Fresno. That's exciting for us in Fresno because it would change our local economy,' Dyer said. Commute times between San Jose and Fresno could be as little as 45 minutes one day, according to Choudri. 'A colossal boondoggle' Transportation Secretary Sean Duffy In an op-ed last month, as the administration works to claw back funds, Duffy slammed the project as a 'colossal boondoggle.' But Newsom pushed back, arguing for the value the project will bring to heavily red districts in the middle of the state. 'Secretary Duffy continues to call this a 'train to nowhere.' It's another slap in the face for the Central Valley,' he said in an email. 'Unlike the Trump Administration, we're not going to abandon the Central Valley.' Private Partnerships Losing $4 billion of federal funds would be a major setback, representing 14% of the $28 billion the project has raised, with the rest coming through state funding and a previous $3 billion federal grant. That's why Newsom hopes to finally stabilize the project with his $20 billion plan funded by California's Cap-and-Trade program, in which polluters pay for their carbon emissions. If approved, that would allow Choudri to make good on his vision and also create opportunities to bring in private infrastructure partners to assist with financing and construction, including companies like Bechtel, Meridiam and Plenary. 'Up to now, private investors, private equity, private operators really weren't interested in taking a look at or investing equity or participating in any kind of a risk transfer in the California project because they weren't sure of the commitment–the financial commitment to long-term funding on behalf of the state,' said Sia Kusha, head of business development for Plenary, which is working on transit and bridge projects across the U.S. and Canada. The likelihood that the state will approve a 20-year financing plan is 'probably the biggest impetus behind why there's new excitement in the private development community' about the rail project, he said. A guaranteed funding stream would allow Choudri to borrow against future revenue to accelerate the pace of construction. Already, the High-Speed Rail Authority, which has been building the embankments, bridges, tunnels and grade separations needed for the train over the last decade, like an overpass just completed in Fresno, has begun ordering steel and other materials needed to finally begin laying tracks. Choudri acknowledges past problems, which frustrated him as an outsider. 'It was micromanaged in the law – which said, 'it should be this many minutes from here to this station' – back in 2008, when we didn't even know where the alignment was going to go,' he said. The initial cost and service estimates weren't useful because there was no detailed plan. 'You can't put 10 carts in front of the horse, and then say, 'Why isn't it moving?' It wasn't moving because it wasn't set up the way other countries do this.' Rendering of a high-speed rail train entering Fresno's station. Craig Kohlruss/The Fresno Bee/Tribune News Service via Getty Images The approach seen in projects including Japan's shinkansen bullet train, to high-speed rail networks in China, Europe and dozens of other countries, focused on segment-by-segment plans to connect cities–and with full national government support. He thinks it was a mistake to estimate the cost of California's entire system long before thorough planning was done and routing was determined. 'That's why I left the private sector,' Choudri said. 'I'd been watching this program since 2012, and my mind was just going crazy.' That motivated him to take the job last year, thinking, 'I need to go in and just say, 'Alright, let's go fix this thing because we cannot fail.'' More from Forbes Forbes California Sues Trump To Hang Onto $4 Billion Of Bullet Train Funds By Alan Ohnsman Forbes Trump Could Derail California High-Speed Rail Project, Despite Billions Spent By Alan Ohnsman Forbes California's $100 Billion Electric Bullet Train Will Be Fully Solar Powered By Alan Ohnsman Forbes In Las Vegas, A Billionaire's Blueprint For Building Bullet Trains By Alan Ohnsman
Boston Globe
17-07-2025
- Business
- Boston Globe
Trump administration pulls $4b in federal funding for California's bullet train project
'The Railroad we were promised still does not exist, and never will,' Trump wrote on Truth Social. 'This project was Severely Overpriced, Overregulated, and NEVER DELIVERED.' Advertisement The loss marks the latest blow to California by the Trump administration, which has blocked a first-in-the-nation rule to phase out the sale of new gas-powered cars, launched investigations into university admission policies and threatened to pull funding over transgender girls being allowed to compete in girls sports. Get Starting Point A guide through the most important stories of the morning, delivered Monday through Friday. Enter Email Sign Up It also comes as rail project leaders are seeking private investment to help pay for its estimated price tag of more than $100 billion. Voters first approved the project in 2008 and it was supposed to be operating this decade. But cost estimates have consistently grown and its timeline pushed back. State officials are now focused on building a 119-mile (192-kilometer) stretch connecting the Central Valley cities of Bakersfield and Merced that is set to be operating by 2033. The California High Speed Rail Authority is slated to release a report this summer to state lawmakers with an updated funding plan and timeline for the project. Advertisement Authority officials wrote in a letter earlier this month that the Trump administration made up its mind about revoking funding before thoroughly reviewing the project. They noted that more than 50 structures have already been built, including underpasses, viaducts and bridges to separate the rail line from roadways for safety. 'Canceling these grants without cause isn't just wrong — it's illegal,' authority CEO Ian Choudri said in a statement Wednesday. 'These are legally binding agreements, and the Authority has met every obligation, as confirmed by repeated federal reviews, as recently as February 2025.' The authority has asked potential private investors to express their interest by the end of the month. Democratic Gov. Gavin Newsom said the state will keep 'all options on the table' to fight the revocation of federal funds. 'Trump wants to hand China the future and abandon the Central Valley. We won't let him,' he said in a statement. The state has 'no viable plan' to complete even the Central Valley segment, said Drew Feeley, acting administrator of the transportation department's Federal Railroad Administration, in a report released last month. He called the project a 'story of broken promises' and a waste of taxpayer dollars. California Democrats also have criticized project spending. Democratic Assemblymember Rebecca Bauer-Kahan said at a budget hearing earlier this year that her constituents 'overwhelmingly believe' high-speed rail spending 'has been irresponsible.' Newsom plans to extend the state's cap-and-trade program, a key funding source for the project which is set to expire at the end of 2030, through 2045. Advertisement The program sets a declining limit on the total amount of greenhouse gas emissions large emitters can release. Those polluters can buy allowances from the state needed to pollute, and about 45% of that money goes into what's known as the Greenhouse Gas Reduction Fund, according to the Independent Emissions Market Advisory Committee, a group of experts that reviews the program. The fund helps pay for climate and transportation projects, including high-speed rail. The bullet train project receives 25% of the money from the fund, which ends up being a little less or a little more than $1 billion annually, depending on the year. Newsom in May proposed guaranteeing $1 billion a year for the project from the fund, but lawmakers have not agreed to that.
Newsweek
08-07-2025
- Business
- Newsweek
California High-Speed Rail Reveals New Plan To Save Project
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. The California High-Speed Rail project, long beset by rising costs, delays, and political conflict, revealed a new plan led by its recently appointed CEO, Ian Choudri, that relies on $1 billion in annual state funding combined with private capital to help keep the project afloat. Choudri, who took charge of the High-Speed Rail Authority in August, explained during an interview at a transportation conference in San Francisco, according to the San Francisco Chronicle, emphasizing the potential of public-private partnerships to move the rail initiative forward. Why It Matters While the construction of the California high-speed rail advances across the Central Valley, it has faced growing doubts from the federal government. President Donald Trump has criticized the project, previously calling it a "waste" and a "green disaster." Transportation Secretary Sean Duffy has also expressed doubts, citing concerns over the escalating costs and extended timeline, both of which have exceeded initial projections. An aerial image shows construction workers building the Hanford Viaduct over Highway 198 as part of the California High Speed Rail (CAHSR) transit project in Hanford, California on February 12, 2025. An aerial image shows construction workers building the Hanford Viaduct over Highway 198 as part of the California High Speed Rail (CAHSR) transit project in Hanford, California on February 12, 2025. Patrick T. Fallon/AFP via Getty Images What To Know Choudri's proposal centers on securing $1 billion annually from the state's climate emissions program, a fund typically allocated to clean energy initiatives such as public transit and electric vehicles, the Chronicle reported. "We are looking at state-level commitments so that we can bring private equity partners in," Choudri said in San Francisco while attending the American Public Transportation Association conference. The approach aims to establish a stable base of government support that can attract private investors to finance the remaining costs as the project advances. Industry partners see several revenue opportunities, including ticket sales and commercializing long corridors of railway rights-of-way. "There are significant ways to monetize (and) commercialize long linear rights of way," said Sia Kusha, senior vice president of Plenary Americas, which has experience in public-private infrastructure projects. Another option presented by former chair of the U.S. High-Speed Rail Association Dan Richard was the possibility of auctioning operational rights for the Central Valley segment after attracting an initial customer base—a strategy that has precedent in Japan's Shinkansen rail privatization, the Chronicle reported. What People Are Saying U.S. High Speed Rail Association former chair Dan Richard said, according to the San Francisco Chronicle: "There's always been a desire to have the private sector involved at the right time, when the risk is understood." In a recent statement, the California High-Speed Rail Authority said: "Construction progresses every day on the California high-speed rail project. In addition to continued progress across the Central Valley, the Authority also announced the completion of four grade separations at Fargo Avenue and Whitley Avenue in Kings County, and at Belmont Avenue and Central Avenue in Fresno County... "Since the start of high-speed rail construction, the project has created more than 15,300 good paying construction jobs, a majority going to residents of the Central Valley. As many as 1,700 workers are dispatched to a high-speed rail construction site daily." What Happens Next The rail project is moving into its tracklaying phase this year, following the completion of most of its central infrastructure, Newsweek reported previously.
The Hill
30-04-2025
- Business
- The Hill
California high-speed rail leader pushes state to support private investment
SACRAMENTO, Calif. (AP) — A long-delayed project promising nonstop rail service between San Francisco and Los Angeles in under three hours may be able to secure the private funding it desperately needs if California agrees to pay the investors back, its chief executive told The Associated Press. Ian Choudri, who was appointed CEO of the California High-Speed Rail Authority in August, is tasked with reinvigorating the nation's largest infrastructure project amid skyrocketing costs and new fears that the Trump administration could pull $4 billion in federal funding. 'We started this one, and we are not succeeding,' Choudri said, describing what drew him to the job after work on high-speed systems in Europe. 'That was the main reason for me to say, let's go in, completely turn it around, and put it back to where it should have been. Fix all the issues, get the funding stabilized, and demonstrate to the rest of the world that when we decide that we want to do it, we actually will do it.' Voters first approved $10 billion in bond money in 2008 to cover about a third of the estimated cost with a promise the train would be up and running by 2020. Five years past that deadline, no tracks have been laid and Choudri acknowledges it may take nearly two more decades to complete most of the San Francisco-to-Los Angeles segment, even if funding is secured. Funding woes The project's price tag now exceeds $100 billion, more than triple the initial estimate. It has mostly been funded by the state through the voter-approved bond and money from the state's cap-and-trade program. A little less than a quarter of the money has come from the federal government. The authority has already spent about $13 billion. The state is now out of bond money, and officials need to come up with a financing plan for the Central Valley segment by mid-2026, according to the inspector general's office overseeing the project. 'The managers of the project were in trouble from the very beginning because they never had the financing – certainly not stable and predicting financing — that they would have needed to manage the project efficiently,' said Lou Thompson, who led a peer review group that analyzes the state's high-speed rail plans. Losing money from the federal government 'would require a real hard rethinking of what do we do to survive the next four years,' he said. Rail leaders are in talks with Gov. Gavin Newsom's administration and state lawmakers on what will be needed to secure private investment, Choudri said, adding that without the private sector money the state may have to take out federal loans or issue new bonds. At an industry forum in January, private investors expressed interest in the project but need some form of security, he said. Choudri is pushing Newsom and lawmakers to consider a program that would eventually commit the state to paying back private investors, possibly with interest. That would give the state more time to cover the cost. Legislative Democrats say they remain hopeful for the project's future. But they haven't unveiled any proposals yet this year in the state Legislature to set aside additional funding and have resisted spending more money on the project in the past. Choudri plans to provide lawmakers this summer with an updated timeline and price tag. An ambitious vision Choudri aims to fulfill the original vision of building a pioneering system — already common in Europe and Asia — that spurs economic growth, curbs planet-warming emissions from cars and planes, and saves drivers hours on the road. At speeds up to 220 miles (354 kilometers) per hour, it would be the nation's fastest way to travel by ground. Amtrak's Acela train transports passengers at speeds up to 150 miles (241 kilometers) per hour to major cities including New York, Boston and Philadelphia. Another rail line in Florida operating at speeds up to 125 miles (201 kilometers) per hour shuttles people from Orlando to Miami. Construction is underway for a mostly privately funded high-speed system to carry riders from Las Vegas to Southern California. California's construction is far from completion. Of the 119 miles (192 kilometers) of construction underway in the Central Valley, only a 22-mile (35-kilometer) stretch is ready for the track-laying phase, which isn't set to start until next year. Finishing the line in the Valley is just the first step. Next, the train has to extend north toward the San Francisco Bay Area and south toward Los Angeles. Choudri's goal within the next 20 years is to build to Gilroy, about 70 miles (113 kilometers) southeast of San Francisco. Under current public transit, it would then take at least one more train transfer to get into the city. Southward, he envisions building to Palmdale, 37 miles (60 kilometers) northeast of Los Angeles. From there, it takes more than one hour to drive or two hours on an existing train line to reach Los Angeles. 'In the ideal world, you can take the 500 miles, build it in your warehouse and then just drop it and everybody's happy,' Choudri said. 'But the programs are never built like that. You build incrementally and that's what we're doing right now.' Doubts for the future Critics say the project will never be completed and may leave towering and unusable infrastructure stretching through the state's agricultural heartland. More than 50 structures have already been built, including underpasses, viaducts and bridges to separate the rail line from existing roadways for safety. 'We've now spent billions of dollars and really no tracks have been laid,' said Republican state Sen. Tony Strickland, who is vice chair of the Senate Transportation Committee. Doug Verboon, chair of the Kings County Board of Supervisors, who has fought the High-Speed Rail Authority in court over farmers' loss of land due to the project, said the people who should be most upset by delays are its longtime supporters. 'It doesn't seem to me like the state government is in a hurry to finish it,' he said. ___
