California bullet train: Judge blocks sale of bonds

A judge has blocked the sale of bonds to build California's bullet train and rejected the state's funding plan.
November 25, 2013 12:00:00 AM PST
A judge has blocked the sale of bonds to build California's bullet train and rejected the state's funding plan, jeopardizing the future of the project.

The High Speed Rail Authority had hoped to break ground soon on the first 28 miles of a 130-mile stretch in the Central Valley.

In rulings issued Monday, Judge Michael Kenny rejected a request from the California High-Speed Rail Authority to sell $8 billion of the $10 billion in bonds approved by voters in 2008.

Kenny sad state officials were wrong to determine it was "necessary and desirable" to start selling the bonds. He reminded them they are supposed to be watching over the checkbook, which belongs to state taxpayers.

In a separate lawsuit, Kenny ordered the rail authority to redo its $68 billion funding plan before continuing construction, a process that could take months or years.The lawsuit claimed that the project's current plan no longer complies with what voters were promised, and the judge agreed.

Watchdogs for taxpayers applauded Monday's decision. They have disputed what the project would actually cost.

"It is better to stop this thing now than to spend 100 or 200 billion dollars on a project that does not reflect good transportation policy," said Jon Coupal of the Howard Jarvis Foundation.

According to a poll, California voters are against the bullet train project linking Los Angeles and San Francisco.

The head of the rail authority, Dan Richard, said he's looking at one positive sign.

"We are reviewing both decisions to chart our next steps, but it is important to stress that the court again declined the opposition's request to stop the high-speed rail project from moving forward," he said.

Richard says Prop 1a, allowing bond sales for high-speed rail, remains valid.

The rail authority may consider several options: It could appeal the judge's decision, seek another hearing to present new information to the judge or renew its hunt for funding sources. What's clear is that it still plans to press forward.

The Associated Press contributed to this report.


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