“The city has met with the HSRA to identify a locally-generated potential alignment alternative for an area within the Section extending from approximately north of Seventh Standard Road in Kern County to Oswell Street in the City of Bakersfield….”

The above map (bigger version here) shows the change in the route in Bakersfield, from the purple line to the green line.

The settlement also mentioned the project still is being challenged by “six other petitioners.” They are:

• Kern County;
• Kings County, Citizens for California High-Speed Rail Accountability and the Kings County Farm Bureau;
• City of Shafter;
• Coffee Brimhall, a development company;
• The Bakersfield First Free Will Baptist Church;
• Dignity Health.

In exchange for dropping the case, the CHSRA reopened the study of a new alignment that will be less damaging to the city of Bakersfield and will promote more public engagement.  In essence, the settlement reopens a previously project-level environmental impact report and study the CHSRA board certified on May 7.

Under the settlement, the CHSRA has the right to continue with the original train route. But Bakersfield retains the right to sue again if the same damaging route ultimately is selected.

Highlights

According to settlement highlights released by the city of Bakersfield (full document is below), the CHSRA agreed:

• To develop a conceptual alignment that generally parallels the Union Pacific Railroad through downtown Bakersfield with a station generally located in the area of F Street and Golden State Avenue;
• Work with Bakersfield to co-sponsor public workshops;
• Work with with local property owners impacted by the alignment to address those impacts;
• When the conceptual alignment is refined, in good faith evaluate the new alignment along with the route that was previously certified by the CHSRA;
• Agree not to pursue additional design work or expend funds or approve or construct the previously selected route while the study is being completed;
• When the study is complete and the CHSRA is ready to decide on the alignment and station location, it will meet in Bakersfield;
• Agree not to exclusively rely on its prior certification of the hybrid alignment to approve the ultimate alignment and station location in the city.

Surface Transportation Board 

As CalWatchdog.com reported last week, “the U.S. Surface Transportation Board ruled in favor of the CHSRA in a dispute over whether the STB’s authority to green-light the project takes precedence over the California Environmental Quality Act.” The CHSRA wanted, and got, construction stoppage off the table as a CEQA remedy – at least for now, pending actions in the other lawsuits.

The San Jose Mercury News reported the CHSRA-Bakersfield legal negotiations pre-dated the STB ruling. However, Recital H in the new agreement stipulated:

“HSRA asserts that the STB Order deprives the Sacramento Superior Court of jurisdiction over the CEQA and related causes of action in the Bakersfield Lawsuit, as well as in the related Lawsuits. The City disagrees with HSRA’s assertion concerning the effect of the STB Order.” 

And “Section 4.5 Waivers” of the agreement reads:

“The City agrees it will not challenge, contest or appeal the STB Order in any way, including but not limited to via the STB itself or via any other court, board or tribunal.”

So the STB ruling certainly was part of the legal atmosphere surrounding the last days of negotiations.

Bakersfield also agreed it will not file a National Environmental Quality Act lawsuit or challenge funding prior to the study of the alternate alignment.

In sum, Bakersfield gains a couple of things from the agreement. It gets a breather from the controversy that will follow the STB decision. It gains a fresh look at a less damaging rail alignment. And in engages its local community, while retaining the right to file another lawsuit if it doesn’t like the final outcome.

The CHSRA gets one of seven lawsuits off the train table.

The early conventional wisdom was that the clear favorite was Republican Kevin Faulconer, 47, the longest-serving council member and a community figure since his election as president of San Diego State University’s student body a quarter-century ago. Not only was Faulconer like the congenial moderate Republicans who have led San Diego for much of the last four decades, his opponent was a neophyte.

Democratic Councilman David Alvarez, 33, only became a public figure in 2010 when he beat out scions of two local political dynasties to win a seat representing a largely Latino district south of Interstate 8 — the dividing line in city politics between blue-collar communities nearer the Mexican border and the affluent neighborhoods from La Jolla to inland Rancho Bernardo.

That conventional wisdom has given way to a new assumption: Faulconer may win, but it will be very close — and he may be the last Republican that San Diego elects as mayor.

Given the Democrats’ hold on nearly all of California’s 10 largest cities, Faulconer might be the last big-city GOP mayor to be elected in the Golden State — barring a change in our political dynamics or demographics.

GOP held sway in San Diego not long ago

Although Democrats had long enjoyed a voter-registration edge in California’s second-largest city, Republicans did surprisingly well until 2012. It was that year that Filner, an abrasive 20-year paleoliberal congressman, edged out GOP Councilman Carl DeMaio, a small-government crusader who helped win huge changes in city compensation practices in his one term in office.

Many observers credited Filner’s 51 percent to 47 percent win to the strong turnout triggered by President Obama’s re-election campaign among Latinos and African Americans — 29 percent and 7 percent of the city’s population, respectively — and young people of all races. Also seen as a factor was DeMaio’s combative manner; the gay libertarian, the theory held, turned off the independent voters that Jerry Sanders attracted in his successful mayoral campaigns of 2005 and 2008.

So when Filner resigned in August, Republicans were confident after DeMaio decided instead to run for Congress and the well-liked Faulconer emerged as the sole credible GOP mayoral candidate. In the first special election, in November, Faulconer led with 42 percent, with Alvarez second with 27 percent, and Republican-turned-independent-turned-Democrat former Assemblyman Nathan Fletcher third with 24 percent. In this week’s runoff special election — runoffs typically have light turnout — the assumption was that reliably Republican absentee voters would carry the day.

Instead, the last published poll showed Faulconer only ahead 47 percent to 46 percent, within the margin of error. Millions of dollars in campaign spending by the national chapters of local unions — most of it for negative ads trashing the GOP candidate — had taken their toll.

But Republican insiders — and scores of business executives — are worried about much more than just this election.

The “Los Angelization” of America’s Finest City

It’s not just the usual concerns of GOP operatives in California: that the party’s hot-button social issues turn off young voters and that Latino voter turnout is steadily increasing. It’s that San Diego’s politics are undergoing what might be called a “Los Angelization.”

The city’s school board was taken over by the local affiliate of the California Teachers Association in 2008, when union muscle elected a new board majority that instituted policies that drove away an acclaimed reformer superintendent and yielded an operating budget in which an astonishing 92 percent of funds goes to employee compensation. The CTA control of the school board only increased with the 2010 and 2012 elections.

Now the same thing is happening with the City Council. Union-favored Democratic candidates — such as Alvarez — are increasingly likely to beat Democrats with independent streaks. As recently as 2011, there were Democrats on the council who occasionally would take on unions — politicians with backgrounds in engineering and small business, as well as party members who appeared eager to hear out business interests’ concerns.

But now the union muscle-flexing not only has Alvarez near an improbable mayoral victory, it has prompted hard-left decisions by the City Council in the months since Filner quit — decisions supported by formerly semi-independent Democrats who see the writing on the wall.

Last fall, on a party-line 5-4 vote, City Council Democrats approved increasing fees on commercial development by at least 377 percent to provide more funds for affordable-housing programs — even though the programs have a horrible record of actually getting people in homes.

And on another party-line 5-4 vote, council Democrats approved a restrictive new master plan for a job-rich shipyard industrial area adjacent to the Barrio Logan neighborhood in Alvarez’s district. They did so despite dire warnings from many CEOs and business owners that it would give leverage to environmentalists and community activists to shut them down.

No more independent Democratic voices

The contrast between the current council Democratic majority and past Democratic majorities was striking. In 2007, an effort to punish Wal-Mart for the sin of being anti-union died when then-Councilwoman Donna Frye — the most popular Democrat in San Diego — changed her mind and opposed an anti-“big box” ordinance. Frye candidly admitted that her constituents liked Wal-Mart and didn’t want it punished.

Present council Democrats appear incapable of such candor. In voting for the massive fee increase on commercial development, Council President Todd Gloria — the interim mayor since Filner’s resignation — repeatedly insisted that not only would there be no negative economic fallout from the hike, it would help the local economy.

The same Gloria once stood up to unions by backing a “managed competition” process in which groups of city workers vied against private businesses for the right to provide city services — a reform strongly endorsed by voters.

Alvarez has made clear he plans to nullify voter-backed reforms. Will Gloria stand up to him? Maybe he would have a year or two ago. But now that San Diego politics are becoming as union-dominated and doctrinaire as those of Los Angeles or the California Legislature, probably not.

A Faulconer victory in Tuesday’s mayoral election may quiet GOP worries about the radicalization of San Diego City Hall — but not for long.

By Chris Reed

The nervousness is growing in Bakersfield as the California High-Speed Rail Authority moves toward locking into a route that will disrupt the lives of thousands of people — and maybe for no reason.

The rail line into and through Bakersfield won’t be built in the first bullet-train segment that is supposed to begin construction in 2013. And there is vast reason to think the second segment will never be built because the state government is cash-strapped and the federal government is unlikely to borrow billions and billions for high-speed rail for one and only one state.

So what happens? Something reasonable.  As Bakersfield Californian columnist Lois Henry reports, there is growing interest in a “time out” to resolve unsettled issues and unanswered questions:

“[It] would give the authority, city and other groups time to come up with a more amenable alignment and avoid lawsuits. Court action is almost certain if the pending EIR is certified with its current proposed route cutting through downtown Bakersfield on an 80-foot elevated track in some places.

“Most importantly, a time-out for property owners would mean we wouldn’t have a certified EIR looming over our heads making it impossible to sell our homes or businesses for any decent money and with no prospect of the state buying us out either.

“‘Why select a route and set it in stone when you don’t know when, or even if, you’ll have the money to go all the way into Bakersfield?’ asked Ahron Hakimi, director of the Kern Council of Governments, which oversees transportation projects in Kern.”

But Henry’s conclusion is that a time out isn’t likely for the worst possible reason imaginable. She notes that authority officials refuse to engage on the issue, and then cites a very sharp observation by Jeff Taylor of the Save Bakersfield Committee:

“‘But what would happen if they said this was a reasonable request?’ he wondered. ‘They’d basically be admitting to the fact that it was poorly planned. And what would that say about the rest of their plan, which also sucks?'”

We’ve heard of “too big to fail.” We’ve heard of bureaucratic inertia keeping stupid projects chugging toward completion. But with the California bullet train, we are witnessing a new kind of government fiasco: Fanatics who have to pretend their plan is perfect, because if they acknowledge any of the big flaws — such as the absurdity of throwing a city into upheaval for a rail line that may never come to pass — than all of a sudden the whole thing looks ridiculous.

$69 billion project. About $10 billion in hand. No prospects for the rest.

What the hell, let’s paralyze Bakersfield anyways.

This is Part 4 of a series on Medium-Speed rail alternatives to California’s High-Speed Rail project. Click to read Part 1, Part 2, Part 3, Part 4, Part 5 and Part 6.

Dec. 14, 2012

By Stan Brin

How much does it cost to lay an additional pair of tracks beside an existing line?

A lot, but not as much as you would think. According to spokesmen for the various railroads, it costs between $5 million and $10 million per mile to double-track an existing line, depending on the cost of land required for the additional tracks and the number of obstacles that have to be crossed.

Urban tracks tend cost on the high end due to land acquisition costs. Amtrak is currently working on a 10-mile, triple-tracking project in the highly urbanized San Gabriel Valley. The final cost is expected to be slightly above $10 million per mile.

Other sections will cost considerably less because the right of way and infrastructure are already in place. Twenty years ago, I lived less than 200 yards from a section of the Los Angeles-to-San Diego line as it was being doubled, but not one home or business was taken, or even disturbed. Railroad workers laid the new steel rails on their modern, concrete crossties right beside the old ones, and no one in the neighborhood even noticed.

That new section of double-tracking allowed faster and more frequent commuter traffic from Laguna Niguel in South Orange County into Los Angeles, but that’s it. From San Juan Capistrano south into San Diego County, a distance of roughly 60 miles, the rails are still essentially as they were in the days of buggy whips, gas lamps, bustles and derby hats.

How much would it cost to completely double-track this line? Split roughly evenly between urban and rural areas, this stretch is mostly level, with a lot of gullies. About half of it is federally owned, part of the Marine Corps Base Camp Pendleton, so there is no need to compensate private owners.

Let’s split the difference between the $5 and $10 million per-mile cost and guestimate that it might cost around $400 million to double-track the remaining 60 miles of single-track between Laguna Niguel and San Diego. Let’s err on the maximum to account for some extra sidings to allow non-stop travel, and adding four or five yards of sand to some public beach areas, and we have $600 million.

That’s well under one percent of the expected cost of the HSR to travel between Los Angeles and San Deigo, non-stop, downtown to downtown, at up to 100 miles per hour, free of traffic and the Transportation Safety Administration; and about a quarter of the cost of the 20-mile-long Alameda Corridor.

The Central Valley

Similar improvements of the 300-mile Central Valley route from Bakersfield to Sacramento would cost on the low end per mile since the route is entirely flat and mostly through farming country. And unlike that of the planned HSR, we can assume that much of the right of way is already owned by the railroad.

But let’s err again on the safe side and assume that passing through Fresno, Merced and other cities would cost $10 million per mile, and we still have a total cost of well under $2 billion. Let’s double it so that passenger trains wouldn’t have to compete with freight traffic, anywhere, and we have well under $4 billion.

All together, the cost of double-tracking the existing portion of the Sacramento to San Diego line is likely to be about double the cost of the Alameda Corridor.

And that’s perhaps 5 percent of the estimated cost of the HSR.

What the hell, let’s add another billion for extra tracks around Central Valley cities so that express trains can barrel through at full throttle the whole length of the line, without stopping, and we’re still well under 7 percent of the HSR.

By Wayne Lusvardi

Those desperately in search of a cure for cancer will often try apricot pits bought in Mexico, exotic herbs or light therapy treatments. None has been proven to be effective.

In an action with direct implications for California, the Federal Reserve Bank is conducting a third desperate round of “quantitative easing” as the therapy of last resort, what it’s calling QE3.

Quantitative easing is a sophisticated indirect way to print more money without having to use a printing press.  This process was once described as similar to dropping dollar bills from a helicopter by no less than Ben Bernanke, the Fed’s chairman.  Thus his nickname, Helicopter Ben.

Wise voters know that any nostrum or treatment peddled right before an election is often likely to be snake oil.

QE3 is hospice care for the terminal debt crisis. It will get money flowing around the economy when the conventional economic stimulus method of cutting interest rates no longer works because the Fed already cut interest rates close to zero, and so can’t cut them any more.

Quantitative easing magically creates new money.  The Fed just increases the size of the accounts of in its member banks.  It then buys mortgage assets of banks so that the banks have more money to put into circulation.

Ben’s QE3 a boom for Bakersfield and Berkeley….

QE3 will push up the price of any commodity, whether it is houses, gold, food, or oil.  By weakening the purchasing power of the dollar, it boosts demand for hard financial assets and essential goods.

This means that communities in oil rich Kern County are experiencing a boom.  Bakersfield is already reported to be experiencing an economic “recovery” because of QE1, QE2, and now QE3, which is already four months old.

It also pumps up demand for housing with near-zero interest rates and escalating home prices occurring at the same time.  Bakersfield home prices are up 7.0 percent since last year. The 30-year mortgage rate for Freddie Mac was 3.55 percent last week, with monetary inflation for the past year running 2.4 percent.  The effective mortgage rate after inflation is about 1 percent. But after QE3, it may be a net zero percent, which is effectively free money.

According to Ruchir Sharma of Morgan Stanley Bank, in 2009 the lowest income groups had to spend 41 percent of their after-tax income on gasoline and food, with little money left over for luxuries.  Conversely, the top income brackets spent only 2 percent of their incomes on gasoline alone, which was only 25 percent of what the poorest income bracket spent.  All that QE1 and QE2 did was boost the stock market, which benefited the wealthiest 10 percent of the population that hold 75 percent of all common stocks.

This means that wealthy communities along the California coastline, such as Berkeley, are likely to be less damaged by the effects of QE3.  And cities like Berkeley have a higher percentage of homes with built-up equity that can be used to downsize into more affordable housing or serve as collateral for small business loans.

Those who have an oil-related economic base, like Bakersfield, and a low percentage of underwater mortgages and trust fund wealth like Berkeley are able to weather the storm of inflation better.

… and a bust for San Bernardino …

Even though home prices are also up 7.0 percent in San Bernardino, the effect of high gasoline and food prices from QE3 will make it hard for a housing recovery without an accompanying increase in jobs and incomes.  San Bernardino County doesn’t have the oil jobs boom that Kern Count does.  And it has a high percentage of home foreclosures and underwater mortgages.

All that QE3 will likely do in places like San Bernardino is penetrate through the inflated price of housing and stocks to higher prices for gasoline and essential goods.  This will result in less money to save up a down payment for a home.

According to Richard Green, director of the U.S.C. Lusk Center of Real Estate, “The constraint that is keeping people out of the housing market is absence of equity [down payment].  The drop in house prices means that many borrowers are underwater on their houses, and high unemployment has prevented potential first-time buyers from accumulating down payments.”

… as well as a bust for Gov. Brown’s Tax Increase Proposition

Sharma also said, “Inflated prices for commodities like oil carry the seeds of their own destruction, because the higher they rise, the more likely they are to stall the economy.”

Sharma reported that speculators are betting on QE3 diluting the dollar and driving up oil prices, thus putting the United States right back into another economic recession in 2013.

More inflation of gasoline and essential goods may spell doom for Brown’s Proposition 30 tax increase proposal on the November ballot.  Prop. 30 mainly would hit taxpayers making $250,000 or more a year. But voters aren’t likely to vote for a tax increase that doesn’t reduce their higher gasoline and foods costs and provides new private sector jobs.

As economist Michael S. Rozeff noted, QE3 is driving up government bond rates and the cost of government borrowing: Higher government bond yields are “a far larger negative to the government than any minuscule decline in mortgage yields” from lower interest rates or QE3-induced inflation.

QE3 is a treatment for the debt cancer that continues to spread in California. But it would only make the bottom-line economy worse for most households.

Politicians should be reminded that those afflicted with the QE3 debt cancer will still vote with their pocketbooks and don’t want political placebos.

(Editor’s note: The paragraphs in boldface were corrected from earlier versions.)

April 23, 2012

By John Seiler

A couple of weeks ago Peter Douglas died. For 25 years he was the head of the California Coastal Commission. In an article, I pointed out that he was an elitist who was obsessed with hyper-regulating California for the enjoyment of elitists like himself — all under the guise of happy-slappy environmentalism. The result was the that the middle-class effectively was banned from owning property anywhere near California’s beautiful coasts.

Many commentators responded:

“Are you that jaded that you couldn’t wait his grave is cold to speak ill of the dead?…. You deserve ZERO.”

“This is completely unprofessional. You should be ashamed of yourself.”

“This is completely insensitive.”

“This is a cowardly post John. Very fitting of your character if you ask me.”

“Thank you,  John.  Guess you aren’t in the decency business either. There is just no limit to where you go and what you will say to make a political point.”

To quote Orange County native Steve Martin:

Fortunately, demographer and “Truman Democrat” Joel Kotkin has made similar points to what I did. Kotkin even voted for Gov. Jerry Brown in the 2010 election. Kotkin is an old-style liberal Democrat who is concerned about the working people of California — the old middle class that’s being driven into poverty our out of the state. He has nothing but disdain for the elitists.

Adios, Taxifornia

Here are some excerpts from a recent interview:

“as Mr. Kotkin notes, Californians are increasingly pursuing happiness elsewhere.

“Nearly four million more people have left the Golden State in the last two decades than have come from other states. This is a sharp reversal from the 1980s, when 100,000 more Americans were settling in California each year than were leaving. According to Mr. Kotkin, most of those leaving are between the ages of 5 and 14 or 34 to 45. In other words, young families.

“The scruffy-looking urban studies professor at Chapman University in Orange, Calif., has been studying and writing on demographic and geographic trends for 30 years. Part of California’s dysfunction, he says, stems from state and local government restrictions on development. These policies have artificially limited housing supply and put a premium on real estate in coastal regions.”

That’s the point I made in my article on Douglas. In particular, Douglas’ CCC (whose initials are a lot like CCCP) made coastal development almost impossible. In Huntington Beach, some local developers spent 35 years trying to put up housing projects. At first, they wanted to put up regular middle-class neighborhoods that most folks could afford. (A similar development was put up there a few years earlier in 1970, with houses selling for $20,000.)

The CCC nixed that.

The developers came back with a proposal for housing that was less dense — and more expensive.

The CCC nixed that too.

On it went. Until about three years ago, when the CCC finally approved the development. Here it is: The Bungalows at Pacific Shores gated community. I drove over there and looked around. The sales lady said the cost for the home I checked was $1.2 million. Times are tough, so you probably could steal it for $1.1 million.

The Website enthuses:

“Imagine waking up every day at the beach. That’s the essence of the Pacific Shores lifestyle. Surfing, swimming and sunbathing on the sand are all just a short three-block walk from the community. And all of the other attractions that have made Huntington Beach famous – the world-renowned pier and the shops, restaurants and nightlife along Main Street – are only minutes away. At Pacific Shores, you’ll be surrounded by the unique coastal culture that has earned Huntington Beach renown as Surf City USA.”

That’s a lifestyle once enjoyed by California’s middle class. Now, thanks to the late Douglas limiting the coast to himself and his rich, elitist friends, the coast can be enjoyed only by the “1 percent” — or maybe the “0.1 percent.”

Notice in the picture how one of the housing styles is called “Plantation.” That’s appropriate. The Elite, whose fortunes the late Douglas promoted, lives on a plantation — and you’re the taxpayer-slave who lives in a shack.

Back to Bakersfield

Sure, you still can live in Bakersfield and drive a couple of hours to the beach, and buy a year-round state parks pass for $195. But the pass price and the high cost of gas, averaging $4.17 a gallon today in California, is going to make that really expensive. Better take a bath and put Merle on the iPod:

Let’s get back to the Kotkin interview:

“‘Basically, if you don’t own a piece of Facebook or Google and you haven’t robbed a bank and don’t have rich parents, then your chances of being able to buy a house or raise a family in the Bay Area or in most of coastal California is pretty weak,” says Mr. Kotkin.

“While many middle-class families have moved inland, those regions don’t have the same allure or amenities as the coast. People might as well move to Nevada or Texas, where housing and everything else is cheaper and there’s no income tax.”

Then there’s AB 32, the Global Warming Solutions Act of 2006. It was signed into law by then-Gov. Arnold Schwarzenegger to give him a legacy, which he’s now exploiting on his globetrotting for extreme environmentalism. It was supposed to encourage other states and countries to follow suit by killing their industries for absurd reductions in greenhouse gas emissions. But nobody is following California into economic folly.

The main result is that AB 32 will kill 1 million jobs.  It doesn’t matter to Arnold, who is worth $700 million, a fact that came out last year when his wife filed for divorce after it was revealed that Arnold was promoting global warming with the family maid. (Or half that, if Maria goes through with the divorce.)

Since he signed AB 32 in 2006, even the term “global warming” has been frozen out by environmentalist fanatics, who now use the term “climate change” — a nebulous phrase that could mean anything, and does.

Arnold also signed into law the lesser known SB 375, whose aim is to jam poor and middle-class Californians, ant-like, into high-rises, while Arnold and the others in the mega-millions Elite frolick in the depopulated coastal areas.

The ‘new regime’

Kotkin interview:

“And things will only get worse in the coming years as Democratic Gov. Jerry Brown and his green cadre implement their “smart growth” plans to cram the proletariat into high-density housing. “What I find reprehensible beyond belief is that the people pushing [high-density housing] themselves live in single-family homes and often drive very fancy cars, but want everyone else to live like my grandmother did in Brownsville in Brooklyn in the 1920s,” Mr. Kotkin declares.

“‘The new regime’—his name for progressive apparatchiks who run California’s government—’wants to destroy the essential reason why people move to California in order to protect their own lifestyles.'”

“Housing is merely one front of what he calls the ‘progressive war on the middle class.’ Another is the cap-and-trade law AB32, which will raise the cost of energy and drive out manufacturing jobs without making even a dent in global carbon emissions. Then there are the renewable portfolio standards, which mandate that a third of the state’s energy come from renewable sources like wind and the sun by 2020. California’s electricity prices are already 50% higher than the national average.”

So, is there a solution for the survival of the California middle class?

Yes. Click here.