New CA HSR Obstacle: Lack of Private Funding

In another major blow to the struggling rail project, the High Speed Rail Authority has written the state legislature that private financing, which they had counted on to fund 1/3 the capital cost, may not be available until the train is running.

1 minute read

October 21, 2011, 9:00 AM PDT

By Irvin Dawid


On Nov. 1, the authority is due to present the state legislature a revised business plan.

"The letter (written by the authority to the legislature) gives a preview of the authority's upcoming business plan, a critical document that is supposed to address long-standing concerns that it lacks a credible blueprint for building and operating the system... Originally, the authority hoped to build the system based on three sources of funding: federal, state and private money. The letter by the authority, sent Friday (Oct. 14), said for the first time that private investors are unlikely to put up cash before the system is operating."

If the House of Representatives approves the bill by House Majority Whip Kevin McCarthy, R-Bakersfield and nine additional House members, all California Republicans, the authority would receive no federal funding through September 2012. Without federal funding or private funding, the authority will not be able to spend the remaining $6 billion in the 2008 bond measure that authorized the project as those bonds must be applied as matching funds.

"One option appears to be a financing tool, being considered in a U.S. Senate subcommittee, in which the federal government would provide tax credits to holders of bonds used to help build the system, according to the authority's letter to the Legislature's budget committees."

Thanks to California League of Conservation Voters

Tuesday, October 18, 2011 in Los Angeles Times: Environment

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Cover CM Credits, Earn Certificates, Push Your Career Forward

Logo for Planetizen Federal Action Tracker with black and white image of U.S. Capitol with water ripple overlay.

Planetizen Federal Action Tracker

A weekly monitor of how Trump’s orders and actions are impacting planners and planning in America.

July 16, 2025 - Diana Ionescu

Green vintage Chicago streetcar from the 1940s parked at the Illinois Railroad Museum in 1988.

Chicago’s Ghost Rails

Just beneath the surface of the modern city lie the remnants of its expansive early 20th-century streetcar system.

July 13, 2025 - WTTV

Blue and silver Amtrak train with vibrant green and yellow foliage in background.

Amtrak Cutting Jobs, Funding to High-Speed Rail

The agency plans to cut 10 percent of its workforce and has confirmed it will not fund new high-speed rail projects.

July 14, 2025 - Smart Cities Dive

Worker in yellow safety vest and hard hat looks up at servers in data center.

Ohio Forces Data Centers to Prepay for Power

Utilities are calling on states to hold data center operators responsible for new energy demands to prevent leaving consumers on the hook for their bills.

July 18 - Inside Climate News

Former MARTA CEO Collie Greenwood standing in front of MARTA HQ with blurred MARTA sign visible in background.

MARTA CEO Steps Down Amid Citizenship Concerns

MARTA’s board announced Thursday that its chief, who is from Canada, is resigning due to questions about his immigration status.

July 18 - WABE

Rendering of proposed protected bikeway in Santa Clara, California.

Silicon Valley ‘Bike Superhighway’ Awarded $14M State Grant

A Caltrans grant brings the 10-mile Central Bikeway project connecting Santa Clara and East San Jose closer to fruition.

July 17 - San José Spotlight