California’s biggest boondoggle just broke the bank.
Not only is the massive high-speed rail project 11 years behind schedule and billions in the red, managers are now saying they will need to ramp up spending to hit a 2033 deadline.
California’s money pit cost taxpayers $3.1 million a day last year. But that’s small potatoes compared to what they’ll have to shell out over the next four if they want to meet their deadline and budget, estimated most recently at $100 billion in a report last month by the New York Times.
The California High Speed Rail Authority will have to increase its daily spending by nine times.
“It’s a very aggressive spending rate,” Russell Fong, the authority’s chief financial officer told The Los Angeles Times, admitting that future goals may be difficult to achieve.
If the rail authority misses its 2033 target, inflation will likely raise the project’s pricetag by as much as $2 billion a year. That’s because billions of dollars of work would be shifted to the future when costs will be higher. Not hitting the deadline means the state will have to keep employees, contractors and consultants on the payroll much longer than anticipated.
Fong said that the agency’s estimates for future inflation are based on a composite of figures from Moody’s, the California Department of Transportation, the Bureau of Labor Statistics and the Department of Energy.