Will Elaine Chao ax federal funding for Caltrain?

If Elaine Chao Axes This Bay Area Rail Funding, We’ll Know She’s Politicizing Transportation

If Elaine Chao Axes This Bay Area Rail Funding, We’ll Know She’s Politicizing Transportation

Moneybox
A blog about business and economics.
Feb. 16 2017 11:24 AM

If Elaine Chao Axes This Bay Area Rail Funding, We’ll Know She’s Politicizing Transportation

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Caltrain's diesel locomotives standing by.

Paul Kim/Flickr

For the past 20 years, as Silicon Valley workers have invented the apps and devices that define this young century, system engineers have sought to bring the Caltrain rail corridor up to date with the last one.

Henry Grabar Henry Grabar

Henry Grabar is a staff writer for Slate’s Moneybox.

Transforming the Caltrain, which runs between San Francisco and San Jose, into an electric railway would be expensive, but it would bring benefits like cleaner, quieter trains (compared with today’s diesel locomotives), more efficient schedules, and increased passenger capacity. The last piece has come to seem especially necessary: The system’s ridership, which now tallies 62,000 riders a day, has doubled since 2009 and nearly tripled since 2004.

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The $2 billion modernization project draws its funding from local, regional, and state revenues, plus a federal grant, two years in the making, that planners thought was all but approved. On Friday, this Core Capacity grant becomes eligible for a signature from U.S. Transportation Secretary Elaine Chao. It’s supposed to be a formality capping a long period of review at the Federal Transit Administration; contractors are in place to start work on electrification on March 1.

But that was before the California’s 14 GOP U.S. representatives asked Chao not to give the state the money, citing the connection between Caltrain electrification and the state's larger, politically tempestuous high-speed rail project. The representatives want an audit of the state's high-speed rail project before Caltrain can move forward.

For Californians, it’s an early test of a simmering fear that the state’s outspoken political opposition to the Trump administration might come with a price. More broadly, Chao’s decision will show the extent to which she—considered the most qualified of Trump’s Cabinet picks but also the one closest to the GOP power structure—will politicize DOT’s billions of dollars in grants. The letter, sent to Chao on Jan. 24, a week before her confirmation, is the rare effort by congressional representatives to deprive their own state of federal money.

It’s true that the high-speed trains between Los Angeles and San Francisco are currently slated to run over Caltrain’s soon-to-be-electrified tracks and that Caltrain’s state funding was made available by the Legislature’s 2012 grant of high-speed rail funds. But the Caltrain project has been part of the railway’s strategic plans since 1999 and has its own environmental review. In September, a judge in Silicon Valley ruled the projects were separate, calling electrification a “project of independent utility.”

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Mimi Walters, one of the representatives who signed the letter, said in a statement provided to Slate that the letter did not oppose electrifying the corridor but “instead expresses serious concerns about the use of taxpayer funds for a project that is tied to high speed rail. ... Taxpayers deserve accountability and transparency, which is why all high-speed rail funding should be put on hold, until a thorough audit of the entire project is completed.”*

For Walters and her fellow representatives, a project “tied to high-speed rail” is effectively the same thing as high-speed rail itself. The letter to Chao mistakenly claims that the California High Speed Rail Authority, or CHSRA, is seeking the electrification grant. It is Caltrain, not the CHSRA, that has applied for the electrification grant from the FTA.

High-speed rail has been a target of GOP politicians nationwide for the past decade, and the California project is no exception. The cause for the letter to Chao, though, was a Jan. 13 article by the Los Angeles Times reporter Ralph Vartabedian that alleged, citing a confidential Federal Railroad Administration report, that the project “could cost taxpayers 50 percent more than estimated,” just on the route’s first 118 miles of track.

In its response, the CHSRA wrote that Vartabedian mischaracterized both the document—which, as a risk analysis, was supposed to outline potential overruns and problem scenarios—and its conclusions about ongoing spending of stimulus funds.

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But the L.A. Times “bombshell,” if overblown, was enough for the state’s Republicans to take their case to Washington in the hopes of finding a friendly face at the head of the DOT. Chao can sign off on $647 million for electric trains in Silicon Valley on Friday. She has two weeks. “Everything is ready to go,” said Seamus Murphy, the chief communications officer for Caltrain. Contracts have been issued. “All of the other boxes have been checked for the approval of the project. If we don’t get the grant finalized by March 1, then the project itself is in jeopardy of not being viable.”

The political calculus for Chao is complicated. Her boss, of course, campaigned on a platform of infrastructure improvement and just last week lamented America’s lack of high-speed trains. In a joint press conference last week with Trump, Japanese Prime Minister Shinzo Abe praised his stance on the transportation mode. “With President Trump taking on the leadership, I'm sure there will be major scale infrastructure investments will be made, including the high-speed train.” (Abe is trying to sell Japan’s maglev technology to the Northeast Corridor.) As the transportation writer Alon Levy observes, the Caltrain project is actually a bargain as far as Trump's wish list of U.S. rail projects go, and would allow the railroad to serve up to 100,000 weekday riders by 2040, enabling population growth without stress on the region's highways.

On the other hand, Trump has revealed nothing of his proposed infrastructure plan beyond vague talk of public-private partnerships, whose impact would be limited. One of the representatives who wrote the letter, Kevin McCarthy, is the House majority leader and a Trump favorite. (“Where’s Kevin? There’s my Kevin.”) Chao’s husband is Senate Majority Leader Mitch McConnell, who has been a foremost opponent of Trump’s big infrastructure spending proposal. Wary of federal spending, McConnell also doubted that an infrastructure bill would be a good use of the party’s time and resources.

Caltrain electrification doesn’t really belong in the same breath as pie-in-the-sky infrastructure improvements—its signature from Chao at this stage is supposed to be assured. But it could be the administration’s first opportunity to fulfill one of the president’s fantasies: taking money away from California.

*Correction, Feb. 16, 2017: This post originally misspelled Rep. Mimi Walters’ last name.