California Appeals Court Gives New Life to High-Speed Rail Plan

Spending for California’s high-speed rail program is back on. An appeals court reversed the decision of the Superior Court, allowing the state to sell nearly $9 billion in bonds.

A 3-judge panel of the 3rd District Court of Appeals vacated a ruling issued last year by Superior Court Judge Michael Kenny which had put spending on hold. At issue is whether California can begin the project without having a clear idea where the full cost to complete it will come from.

Proposition 1A, which passed in 2008, gave California the right to sell bonds worth nearly $10 billion dollars. Last August, Judge Kenny ruled that the California High-Speed Rail Authority “abused its discretion by approving a funding plan that did not comply with the requirements of the law.” Specifically, the state had no plan to close a funding gap of $30 billion. Currently, the cost of the project is estimated to be $68 billion.

In November, Kenny put a stop to spending intended to fund the first part of the project, once again saying the state had not lived up to the requirements built into Prop. 1A. At the time, some observers suggested the ruling could be a “fatal” blow to the project. With the Appeals Court ruling yesterday, the project is back from the dead.

Stuart Flashman, an attorney representing farmers in Kings County whose case was effectively overturned, told the San Jose Mercury News, “The point of this (lawsuit)was to prevent the state from moving forward and starting constructionon a project they couldn’t finish.” “Today, the court reducedthe requirements of the ballot measure to something that’s meaningless– and that’s not what voters intended,” he added.

But the Appeals Court, in reversing the earlier ruling, chose not to look at whether Prop 1A had been violated. Flashman told the Mercury News, “The authority went right around the requirements agreed upon by the voters, and they got away with it.”