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Health & Fitness

Palomar Airport: Field of Dreams, Blog #45

For two weeks, we have asked whether the County’s website FAQs and answers accurately discuss a Palomar runway extension.  Today, a history and economics reminder.  What happens when politicians fail to critically exam consultant reports?   

The California “Bullet Train” [Hi-Speed Rail from Los Angeles to San Francisco]

Last month, Judge Kenny granted a challenge to the State’s high-speed rail program.  [Sacramento Superior Court Case # 34-2011-00113919-CUY-MC-GDS.]   The court found that the State had not met funding requirements – even though politicians have been saying for months that all was well.

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For details on the “bullet train” problems, see “California High Speed Rail: An Updated Due Diligence Report,” April 2013 by the Reason Foundation. 

Key fibs to the voters in 2008 included: (1) a SF to LA estimated construction cost of $35 billion (in 2011$) compared to a 2011 estimated cost of $66 to $76 billion; (2) a 2008 expected ridership of 65.5 to 117 million compared to a 2011 expected ridership of 19.5 to 21.1 million, and (3) an estimated per person ridership cost from LA to SF of $50 per person v. an $81 per person currently.

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If a private promoter solicited money from investors with such faulty information, the state would likely prosecute the promoter for fraud.  When the state promotes, it simply pushes forward.

The Orange County Toll Road System

In a classic case of “Do as I say, not as I do” – while itself promoting wasted billions on the bullet train – the State probed Orange County toll roads in 2012. 

Toll roads are those “private roads” built with bond funds that allow you to bypass freeway rush hour traffic.  Just pay the tab.   On your way to Los Angeles from San Diego?  Take the 13-mile Route 73 bypass near Newport for $6.00+.

A 2012 study on the Orange County Route 241 and 73 toll roads reported that they have unsustainable debt levels, cost overruns, financial mismanagement, and $1.7 billion in taxpayer subsidies. … The former California Finance Director stated that the operations of these toll roads “presently appear to be unsustainable and may have been unworkable from their inception.”  [TOLLROADnews, thetollroads.com]

The Former Long Beach Aquarium

In 1998, the “Long Beach Aquarium of the Pacific” proudly opened.  By 2005, the city quietly dropped its name from the title even though Long Beach constituents pay millions of dollars annually to repay the Aquarium bondholders because the facility has failed revenue forecasts.   [LBReport.com, Oct. 1, 2005 article]

San Diego City Pension Crisis

Last year the San Diego UT reported: “The gap between promised pension benefits for San Diego city employees and available money to pay them has ballooned to $2.7 billion … . [T]he amount owed to retirees over the next couple of decades has grown to $6.5 billion … while the market value of the assets slid to $3.8 billion … .” [“San Diegeo’s Pension Crisis,” Nov 12, 2012]

The UT also reported that 18 cities in San Diego County had only funded their pensions at levels ranging from 59% to 69%.  [See “Pensions fall well below 80 percent funding level,” by Matt Clark, Sept. 22, 2012]

Lessons NOT Learned

Politicians have a Kevin Costner Field of Dreams movie-mindset.  “Build it and they will come.” 

Surely people will ride a multi-stop train through Bakersfield to San Francisco.  Surely drivers will pay to flee clogged roads.  Surely people will flock to see fish swim.  Surely we can ignore pension-funding requirements even as financial markets flounder   After all, we have consultant reports showing reasonable costs and rising revenues.

Consultants have a Tom Cruise Jerry Maguire movie-mindset. “Show Me the Money.”  Consultants are not dumb.  They know they are hired to justify projects, not to fault them.  If consultants want future work from the government, toe the line.

Taxpayer do not need  “Field of Dreams”/”Show Me the Money” analysis.   In a law suit, plaintiffs and defendants pay opposing experts to duke it out.  Usually, the truth prevails.  In the political arena, there is little effective opposition.

Next week: Is the County runway extension study data more credible than the data politicians relied on for the above projects? 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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