Waste Watch: High Speed Rail Losing Bidders to Receive Millions

Some call it the train of the future.

Others call it the train to nowhere.

Anyway you call it, the topic of high-speed rail in California has people divided.

A decision Tuesday by the California High Speed Rail Authority isn't bound to help.

The board approved giving up to two million dollars to bidders whose designs for the second phase of high speed rail, are passed over.

That's right.

The winning bidder and those who are not given the job will get paid.

Scott Jarvis, the agency's Assistant Chief Program Manager told The Fresno Bee quote, "What we have seen here is that the actual costs are substantially in excess of $2 million to put together these proposals."

Supporters of the $68 billion project this will encourage more competitive bids.

But Jon Coupal, President of the Howard Jarvis Taxpayers Association, doesn't buy it.

He likened it to hiring a contractor to work on a house.

"If the contractor wants the job bad enough, they will invest the time and effort to make sure they submit a good bid," Coupal says.

So far, five teams have been pre-qualified to submit bids for the second stretch.

It would go from the south end of Fresno to the Tulare-Kern County line.

The window to actually submit proposals, won't open until later this spring.

"It's almost an incentive to submit a bid, any bid, just because of the two million dollars. That doesn't make any sense at all," says Coupal.

Jarvis defended the move by saying the authority will get something in return for paying the stipend.

"With a stipend, we essentially own the ideas in the proposals after they are submitted," he told the Bee.

The authority also issued stipends on the first phase of high speed rail.

That phase would go from Madera to Fresno.

Coupal says he wishes the rail project had been approached differently, with private backers.

He says taxpayers, deserve better.

"By getting free money, that's not in the best interest of getting quality bids, and not in the taxpayers best interest," Coupal said.

The $2 million per losing bid would only be a drop in the bucket compared to the cost of the second phase.

That is expected to run about $2 billion.

Construction on high speed rail is expected to begin later this year.

But money and legal issues have bogged down the project.

The state must be able to match billions in federal funding, including a $180 million payment due in April.

In November, a judge ordered the High Speed Rail Authority could not sell $8 million in bonds for the project.