Friday, February 1, 2013

The Land Acquisition and Construction Process is Very Slow for the $68 Billion Cal High Speed Rail

The LA Times recently reported that the land acquisition has not even started, yet construction is set to begin in July of this year. If the State doesn’t own any land how can they begin at all? The eminent domain process is very long a convoluted. Most of the land needed for the rail line will be agricultural land, but even then it will be similar to highway right of way acquisition. Hence a farmer would have to give up a portion of their land for the trains right of way, and cutting their own land in half. It is very likely most if not all of the High Speed Rail’s land acquisition will have to go via eminent domain which means court ordered sale of real estate. The state hopes to make purchase offers in the next several weeks, but expect farmers, homeowners, and businesses to ask top dollar for their land. In addition, agricultural land prices have risen the last year. The LA Times notes that Central Valley agricultural land can sell for $28k/acre, but the state land purchase budget is only $8k/acre. Yikes!! Once California hires their land buyers then offers will go out and the property owner has about a month to reply. They need to buy about 400 parcels. The state has rules regarding their eminent domain process which will extend the process by at least 90 days more. The eminent domain process could take another 18 months via the court system. Much of this agricultural land is family owned for generations. I don’t see many farmers giving up the land so easily. According to the LA times article , the initial 130 miles of rail in the Central Valley must be completed by 2018. The budget for this phase is $6 billion which requires spending about $3.6 million every day. This is voter approved as well. Californians sure loves to spend, if the state has the money or not. The major problem will be further delays increase the overall costs. Contractors are lined up, but they might even get paid without working based on their contracts.

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