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May 3, 2019

California high-speed rail project cost increases to $79bn

The cost of a high-speed rail project in California, US, has increased by nearly $2bn to $79bn, according to a report published by the state's High-Speed Rail Authority.

The cost of a high-speed rail project in California, US, has increased by nearly $2bn to $79bn, according to a report published by the state’s High-Speed Rail Authority.

The report stated that the segment currently under construction in the Central Valley is now projected to cost $12.4bn, significantly more than the earlier estimate of $10.6bn.

The High-Speed Rail Authority attributed the increase to multiple factors, including changes to the project scope and higher allocation to contingencies.

Last year, the estimated cost of the project was raised from $64bn to $77bn.

The California high-speed rail project was originally planned to connect San Francisco and Los Angeles to reduce travel times and support the state economy.

“We have the funding to deliver fully electrified, high-speed trains connecting 171 miles from Merced to Fresno to Bakersfield.”

However, the project came under public criticism over delays, increasing costs and lack of transparency.

In February, California Governor Gavin Newsom decided to scale back the project saying the overall project ‘would cost too much and take too long’.

Announcing his plan, he said only the Central Valley section connecting Merced, Fresno and Bakersfield will be completed.

According to the latest report, this section would be completed by the end of 2028.

California High-Speed Rail Authority CEO Brian Kelly told Bloomberg: “We have the funding to deliver fully electrified, high-speed trains connecting 171 miles from Merced to Fresno to Bakersfield, while we complete our important environmental work statewide and continue to make key investments in the Bay Area and Southern California.”

After the Californian Governor reduced the scope, US President Donald Trump criticised the project, calling it wasteful.

The federal government also announced plans to cancel $929m in funding for the project and claim back the already awarded money.

However, the state government urged the US Federal Railroad Administration (FRA) to reconsider its decision, calling the move to cancel and seek the return of funds as ‘disastrous’.

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