Next stop for California’s high-speed rail: Finding private investors

Grist reports that California's high-speed rail project is turning to private investors after nearly two decades of taxpayer funding. The state has signed a twenty-five million dollar agreement with a consortium to explore funding strategies, potentially expanding beyond the Central Valley to reach San Francisco and Los Angeles. The original 2008 vision called for a thirty-three billion dollar system financed equally by the state, federal government, and private investors. But federal support proved inconsistent—California eventually called Washington "not a reliable, constructive, or trustworthy partner." Private capital largely stayed on the sidelines. Now the first phase, connecting Merced and Bakersfield, is underway, with sixty miles of guideway laid and dozens of bridges completed. The full San Francisco to Los Angeles system would cost one hundred twenty-six billion dollars with service slated for twenty forty. Experts remain skeptical that private capital will actually fund the rail itself; most see opportunities in ancillary ventures like real estate and merchandising around stations. With one billion dollars in annual state funding and a newly commercial-focused strategy, the rail authority is betting those partnerships will materialize.

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