California High Speed Rail Authority Changes Track on Plans for $64 Billion Bullet Train

New Strategy Sets Sights on Central Valley Property Owners

PASADENA, Calif.— California’s High-Speed Rail Authority has changed track over plans to start construction of its high-speed rail line in Los Angeles. Earlier this month,, the State Assembly Transportation Committee heard a review of the draft 2016 business plan for the Authority. The status report included a dramatic shift that would relocate the first leg of the system between the Central Valley and San Jose, rather than locating the inaugural terminus in Southern California.
Funding is at the crux of the change in plans, which is expected to reduce the project cost by $4 billion. The project’s funding was also the focus of a report delivered by the nonpartisan Legislative Analyst’s Office, which issued concerns about its $64 billion finance plan. These include the lack of a full funding plan for Phase I of the project and no resources identified to meet the shortfall, and projected reduced ridership totals resulting from beginning the line in the Central Valley rather than more heavily populated Southern California.

As the High-Speed Rail Authority navigates the political and economic issues surrounding a project of this magnitude, it can also expect more eminent domain lawsuits. “We’ve already seen many private properties taken in the wake of this project, and we expect many more to come,” observes Daniel Pranata, a partner with Sullivan, Workman & Dee, LLP (SWD) in Pasadena.

Since 2013, the State has amassed 305 parcels of land equaling more than 1,100 acres for the project.* Thousands of land parcels must be acquired to complete the project, and only two-thirds of the land required for the first 29 miles in the Central Valley has been obtained.** Residential, business, and farming property owners with land in the path of the project might be surprised to see low appraisals of their property as they are approached about a sale.

“Unexpectedly low valuations of gas stations, motels, churches and other properties are not uncommon when the government decides to take private property, which is why veteran eminent domain attorneys are in high demand,” according to Karyn Jakubowski, a partner in the firm’s San Diego office who represented a property owners in Madera County whose property rights were not going to be compensated by the State in an eminent domain proceeding. A verdict in favor of the property owners exceeded $1.2 million.

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*Fresno Bee, 1/18/16
More Properties Up for Condemnation for High-Speed Rail by Tim Sheehan

**San Jose Mercury News, 2/11/16
California High-Speed Rail: Landowners Lawsuit Goes Before Judge by Juliet Williams, Associated Press

High-Speed Rail Authority Statewide Alignment