1 00:00:02,290 --> 00:00:11,709 [Music] 2 00:00:18,950 --> 00:00:15,140 so thank you so much for coming into our 3 00:00:20,689 --> 00:00:18,960 beautiful studio here and yeah I know 4 00:00:22,340 --> 00:00:20,699 it's a super busy time for you for you 5 00:00:24,109 --> 00:00:22,350 to make the time to be on our show is 6 00:00:26,269 --> 00:00:24,119 very much appreciated oh my pleasure 7 00:00:31,009 --> 00:00:26,279 thank you so let me guess you're in Los 8 00:00:32,179 --> 00:00:31,019 Angeles to meet with Elon Musk no you 9 00:00:34,280 --> 00:00:32,189 have other guesses that are probably 10 00:00:36,380 --> 00:00:34,290 better than that one but no I was 11 00:00:38,569 --> 00:00:36,390 actually down here to meet with some 12 00:00:40,340 --> 00:00:38,579 infrastructure transportation leaders 13 00:00:42,610 --> 00:00:40,350 but I've spent a fair amount of time in 14 00:00:45,410 --> 00:00:42,620 the Southland recently because we just 15 00:00:48,350 --> 00:00:45,420 adopted a preferred alignment which is a 16 00:00:50,389 --> 00:00:48,360 big step for us to figure out how we're 17 00:00:52,250 --> 00:00:50,399 going to get from the high desert down 18 00:00:54,560 --> 00:00:52,260 into the Burbank area through the 19 00:00:58,729 --> 00:00:54,570 mountains so we just had a meeting last 20 00:01:00,319 --> 00:00:58,739 week or two weeks ago on that and you 21 00:01:02,319 --> 00:01:00,329 know we've we've been interacting with 22 00:01:04,579 --> 00:01:02,329 Mayor Garcetti's administration on 23 00:01:06,469 --> 00:01:04,589 issues that are important to Los Angeles 24 00:01:08,780 --> 00:01:06,479 so I do spend a fair amount of time down 25 00:01:10,429 --> 00:01:08,790 here so I think our listeners are going 26 00:01:12,289 --> 00:01:10,439 to want to know the answer though to 27 00:01:14,090 --> 00:01:12,299 this question which is speaking of Elon 28 00:01:16,820 --> 00:01:14,100 Musk have you met with him have you 29 00:01:18,920 --> 00:01:16,830 spoken to him about his Hyperloop I've 30 00:01:22,370 --> 00:01:18,930 not spoken directly with Elon Musk but 31 00:01:24,800 --> 00:01:22,380 several years ago we met with people in 32 00:01:27,260 --> 00:01:24,810 in SpaceX in his organization when they 33 00:01:29,840 --> 00:01:27,270 were talking about Hyperloop and I 34 00:01:32,539 --> 00:01:29,850 participated in a meeting in Governor 35 00:01:34,399 --> 00:01:32,549 Brown's office with them and you know I 36 00:01:36,350 --> 00:01:34,409 started my career at NASA I'm not an 37 00:01:38,749 --> 00:01:36,360 engineer but I I'm somebody who's worked 38 00:01:41,330 --> 00:01:38,759 around engineers my whole life and and I 39 00:01:44,420 --> 00:01:41,340 have a deep belief in technology and we 40 00:01:45,700 --> 00:01:44,430 encourage them to build a prototype you 41 00:01:48,170 --> 00:01:45,710 know I see some of these things is not 42 00:01:50,660 --> 00:01:48,180 necessarily directly competitive but I 43 00:01:52,999 --> 00:01:50,670 you know we're we're here in California 44 00:01:55,069 --> 00:01:53,009 this is a state that values innovation 45 00:01:57,440 --> 00:01:55,079 and and I think we should welcome all 46 00:01:58,880 --> 00:01:57,450 innovations like that so I'm interested 47 00:02:01,639 --> 00:01:58,890 in seeing you know where that technology 48 00:02:04,700 --> 00:02:01,649 could go yeah well and we have a new 49 00:02:08,020 --> 00:02:04,710 governor now who comes from that area 50 00:02:10,130 --> 00:02:08,030 and from from high tech background etc 51 00:02:13,250 --> 00:02:10,140 what is your understanding as to what 52 00:02:14,240 --> 00:02:13,260 his view is of something like Elon Musk 53 00:02:23,000 --> 00:02:14,250 I 54 00:02:24,470 --> 00:02:23,010 will tell you that we're in the process 55 00:02:27,679 --> 00:02:24,480 right now meeting with the transition 56 00:02:30,050 --> 00:02:27,689 team for governor elect Newsome and I 57 00:02:34,369 --> 00:02:30,060 think that one of the things that I'm 58 00:02:36,349 --> 00:02:34,379 very encouraged by is he has the new 59 00:02:38,319 --> 00:02:36,359 governor has recognized the need to deal 60 00:02:41,089 --> 00:02:38,329 with California's housing crisis and 61 00:02:42,410 --> 00:02:41,099 actually transportation and housing are 62 00:02:44,569 --> 00:02:42,420 inextricably linked 63 00:02:46,399 --> 00:02:44,579 so setting aside the technology for a 64 00:02:48,140 --> 00:02:46,409 moment I think the important thing is 65 00:02:50,360 --> 00:02:48,150 we've got to connect our communities in 66 00:02:53,000 --> 00:02:50,370 new ways we've got a situation in the 67 00:02:55,490 --> 00:02:53,010 Bay Area where housing prices are just 68 00:02:57,860 --> 00:02:55,500 astronomical in the Silicon Valley area 69 00:03:00,589 --> 00:02:57,870 and there's a chance with a high-speed 70 00:03:02,780 --> 00:03:00,599 rail certainly to connect to the Central 71 00:03:06,409 --> 00:03:02,790 Valley where housing prices are much 72 00:03:09,879 --> 00:03:06,419 cheaper and we can have people in 42 73 00:03:12,199 --> 00:03:09,889 minutes from Madera to downtown San Jose 74 00:03:14,020 --> 00:03:12,209 from what I've seen of what the new 75 00:03:16,970 --> 00:03:14,030 governor has said on the campaign trail 76 00:03:19,280 --> 00:03:16,980 he understands the need to look at 77 00:03:21,170 --> 00:03:19,290 something like that and wants to see us 78 00:03:22,879 --> 00:03:21,180 complete that first segment that we're 79 00:03:25,099 --> 00:03:22,889 building from the Central Valley to 80 00:03:27,339 --> 00:03:25,109 Silicon Valley and then evaluate the 81 00:03:29,509 --> 00:03:27,349 private sector interest and so forth so 82 00:03:32,119 --> 00:03:29,519 while I've not met with him personally 83 00:03:34,129 --> 00:03:32,129 yet I do know him from past associations 84 00:03:36,979 --> 00:03:34,139 in life but in talking with his 85 00:03:40,429 --> 00:03:36,989 transition team you know I think that 86 00:03:41,659 --> 00:03:40,439 focus that he has on on housing fits 87 00:03:43,309 --> 00:03:41,669 very well with what we're trying to do 88 00:03:46,670 --> 00:03:43,319 at high-speed rail when do you expect to 89 00:03:48,409 --> 00:03:46,680 be able to meet with him you know I 90 00:03:50,149 --> 00:03:48,419 think he's pretty busy right at the 91 00:03:51,830 --> 00:03:50,159 moment and he's got a lot of things but 92 00:03:54,349 --> 00:03:51,840 I've been told that you know he'll sit 93 00:03:55,339 --> 00:03:54,359 down with us and and you know I would I 94 00:03:57,289 --> 00:03:55,349 would think that that's going to happen 95 00:03:59,809 --> 00:03:57,299 pretty quickly so you started under 96 00:04:01,969 --> 00:03:59,819 Governor Brown and was that in 2012 2011 97 00:04:04,909 --> 00:04:01,979 actually I was appointed in August of 98 00:04:07,640 --> 00:04:04,919 2011 so what was what was his first 99 00:04:09,229 --> 00:04:07,650 conversation with you about that high 100 00:04:12,080 --> 00:04:09,239 speed rail what were his thoughts about 101 00:04:14,809 --> 00:04:12,090 it well sadly the first conversation we 102 00:04:16,670 --> 00:04:14,819 had was me saying to him you know 103 00:04:18,379 --> 00:04:16,680 governor this high speed rail program 104 00:04:21,620 --> 00:04:18,389 seems to be fairly troubled at the 105 00:04:23,870 --> 00:04:21,630 moment and maybe I could help out you 106 00:04:26,089 --> 00:04:23,880 know it's a board position that kind of 107 00:04:26,790 --> 00:04:26,099 sounds like once a month how hard could 108 00:04:29,399 --> 00:04:26,800 it be I 109 00:04:32,700 --> 00:04:29,409 literally said those words to him and he 110 00:04:34,469 --> 00:04:32,710 gave me a chance to find out so how much 111 00:04:36,990 --> 00:04:34,479 time do you spend on this 112 00:04:38,820 --> 00:04:37,000 I spend I'd probably spend 70 or 80 113 00:04:41,430 --> 00:04:38,830 percent of my time on this and and which 114 00:04:43,110 --> 00:04:41,440 is unusual because I'm in a board 115 00:04:45,839 --> 00:04:43,120 position and we do have a full time 116 00:04:50,850 --> 00:04:45,849 staff and we have an excellent staff 117 00:04:53,369 --> 00:04:50,860 director our CEO but I think the key 118 00:04:56,760 --> 00:04:53,379 here is this is a big complicated 119 00:05:01,529 --> 00:04:56,770 difficult project and it's hard for 120 00:05:02,850 --> 00:05:01,539 people to to both imagine when this is 121 00:05:05,300 --> 00:05:02,860 going to get done how it's going to 122 00:05:07,860 --> 00:05:05,310 change their lives and with any project 123 00:05:10,619 --> 00:05:07,870 like this any infrastructure project 124 00:05:12,600 --> 00:05:10,629 like this you're going to have you're 125 00:05:14,430 --> 00:05:12,610 going to have growing pains or gonna 126 00:05:17,159 --> 00:05:14,440 have missteps we've had our share of 127 00:05:19,290 --> 00:05:17,169 missteps but we're constantly trying to 128 00:05:23,040 --> 00:05:19,300 improve and evaluate what we're doing so 129 00:05:26,850 --> 00:05:23,050 it's a very dynamic process and there 130 00:05:29,580 --> 00:05:26,860 are all kinds of aspects to it so one 131 00:05:31,350 --> 00:05:29,590 day I'll be trying to resolve an issue 132 00:05:33,269 --> 00:05:31,360 that we might have with a funding 133 00:05:36,089 --> 00:05:33,279 partner on another day it'll be meeting 134 00:05:39,029 --> 00:05:36,099 with a mayor to deal with local impact 135 00:05:40,350 --> 00:05:39,039 issues in their communities on another 136 00:05:43,589 --> 00:05:40,360 day we'll be sitting down and we'll be 137 00:05:45,209 --> 00:05:43,599 trying to think strategically about how 138 00:05:46,850 --> 00:05:45,219 we're going to move forward on another 139 00:05:49,230 --> 00:05:46,860 day we'll be trying to think about 140 00:05:53,640 --> 00:05:49,240 transit and land use you know so there's 141 00:05:55,019 --> 00:05:53,650 a variety of issues but it's I have to 142 00:05:56,600 --> 00:05:55,029 say it's been a privilege that the 143 00:05:59,490 --> 00:05:56,610 governor has put me in the position to 144 00:06:01,050 --> 00:05:59,500 to be part of this because it's the 145 00:06:02,279 --> 00:06:01,060 biggest infrastructure project in 146 00:06:04,769 --> 00:06:02,289 America it's the biggest one in 147 00:06:08,249 --> 00:06:04,779 California and I think in so many ways 148 00:06:12,320 --> 00:06:08,259 it's consequential we get caught up in 149 00:06:15,990 --> 00:06:12,330 the daily headlines and certainly our 150 00:06:18,089 --> 00:06:16,000 our our missteps are magnified our 151 00:06:20,820 --> 00:06:18,099 successes are probably you know not that 152 00:06:22,709 --> 00:06:20,830 worthy of page one that's just that's 153 00:06:25,140 --> 00:06:22,719 just the way of the world but we're 154 00:06:27,119 --> 00:06:25,150 making tremendous progress in building 155 00:06:29,040 --> 00:06:27,129 this right now and we're pretty proud of 156 00:06:30,510 --> 00:06:29,050 those achievements and we've got a lot 157 00:06:33,209 --> 00:06:30,520 of work to do people have described this 158 00:06:35,100 --> 00:06:33,219 as a legacy project for Governor Brown 159 00:06:36,209 --> 00:06:35,110 is that the way he sees it in your 160 00:06:38,459 --> 00:06:36,219 opinion 161 00:06:39,879 --> 00:06:38,469 I usually don't speak for him but I can 162 00:06:42,070 --> 00:06:39,889 tell you on in this 163 00:06:45,369 --> 00:06:42,080 that I know he does not see it in that 164 00:06:46,809 --> 00:06:45,379 way I mean he had a conversation with 165 00:06:48,399 --> 00:06:46,819 him recently where you know he was 166 00:06:50,499 --> 00:06:48,409 asking what does that word even mean and 167 00:06:52,089 --> 00:06:50,509 you know I point out to people cuz I 168 00:06:54,429 --> 00:06:52,099 came out to California 40 years ago to 169 00:06:56,140 --> 00:06:54,439 work for Jerry Brown the first time he 170 00:06:58,570 --> 00:06:56,150 was in office and I was you know much 171 00:06:59,800 --> 00:06:58,580 younger of course but I point out to 172 00:07:04,330 --> 00:06:59,810 people that he was governor for eight 173 00:07:06,219 --> 00:07:04,340 years from 74 to 82 and yet you don't 174 00:07:09,129 --> 00:07:06,229 look around and see Jerry Brown 175 00:07:11,890 --> 00:07:09,139 courthouses or Jerry Brown interchanges 176 00:07:14,080 --> 00:07:11,900 or Jerry Brown highways or parks he's 177 00:07:17,589 --> 00:07:14,090 not into personal legacy like that I 178 00:07:19,689 --> 00:07:17,599 think what motivates this governor was 179 00:07:23,559 --> 00:07:19,699 when you look at his father Pat brown 180 00:07:25,570 --> 00:07:23,569 the great builder of California I really 181 00:07:27,369 --> 00:07:25,580 believe that what motivates Governor 182 00:07:29,619 --> 00:07:27,379 Jerry Brown is this sense of obligation 183 00:07:31,510 --> 00:07:29,629 that we have to future generations and 184 00:07:32,920 --> 00:07:31,520 I've been in meetings with him where 185 00:07:35,379 --> 00:07:32,930 there was no press around or anything 186 00:07:36,550 --> 00:07:35,389 like that where he talks about we're you 187 00:07:38,079 --> 00:07:36,560 know we're not going to eat our seed 188 00:07:39,700 --> 00:07:38,089 corn I don't care if we're down to our 189 00:07:42,610 --> 00:07:39,710 last time we're gonna find a penny to 190 00:07:44,920 --> 00:07:42,620 invest in the future I think he sees it 191 00:07:47,079 --> 00:07:44,930 as his father saw it as a moral 192 00:07:49,929 --> 00:07:47,089 obligation of one generation to make 193 00:07:51,579 --> 00:07:49,939 investments for future generations part 194 00:07:54,490 --> 00:07:51,589 of the problem as I look at this is 195 00:07:56,019 --> 00:07:54,500 we've been living off of the investments 196 00:07:58,269 --> 00:07:56,029 that our parents and grandparents made 197 00:08:00,369 --> 00:07:58,279 in our highway system in our water 198 00:08:03,070 --> 00:08:00,379 system in our schools and we've been 199 00:08:04,929 --> 00:08:03,080 kind of coasting for a long time this 200 00:08:07,119 --> 00:08:04,939 state's gonna have 50 million people in 201 00:08:09,010 --> 00:08:07,129 it what are we doing now to get ready 202 00:08:10,450 --> 00:08:09,020 for that what are we doing now to make 203 00:08:12,570 --> 00:08:10,460 sure that our children and their 204 00:08:15,369 --> 00:08:12,580 children the next generations after that 205 00:08:16,899 --> 00:08:15,379 have the kind of supporting 206 00:08:19,409 --> 00:08:16,909 infrastructure that they need in 207 00:08:22,469 --> 00:08:19,419 education and transportation and water 208 00:08:25,119 --> 00:08:22,479 it really is a moral obligation and 209 00:08:26,589 --> 00:08:25,129 again I don't generally speak for him 210 00:08:28,629 --> 00:08:26,599 but I've been around him long enough 211 00:08:31,029 --> 00:08:28,639 that I believe that it's not about 212 00:08:34,000 --> 00:08:31,039 personal legacy it's about what you're 213 00:08:35,889 --> 00:08:34,010 supposed to do when you're given the 214 00:08:38,170 --> 00:08:35,899 opportunity by the people to be a leader 215 00:08:40,209 --> 00:08:38,180 but he also seems to fancy himself a bit 216 00:08:42,009 --> 00:08:40,219 of a fiscal conservative certainly 217 00:08:44,650 --> 00:08:42,019 compared to his fellow Democrats up in 218 00:08:46,960 --> 00:08:44,660 Sacramento that's right so he must be 219 00:08:48,550 --> 00:08:46,970 extremely concerned about the cost of 220 00:08:52,390 --> 00:08:48,560 this thing and how it continues to go up 221 00:08:55,720 --> 00:08:52,400 he is we all are 222 00:08:58,650 --> 00:08:55,730 but keep in mind and one of the things 223 00:09:01,750 --> 00:08:58,660 that I know that he has in mind is that 224 00:09:03,910 --> 00:09:01,760 we can't do nothing I mean that this is 225 00:09:05,170 --> 00:09:03,920 the problem is a lot of times I'm asked 226 00:09:07,300 --> 00:09:05,180 well why should we build high speed rail 227 00:09:09,220 --> 00:09:07,310 in California and I say with all due 228 00:09:10,570 --> 00:09:09,230 respect I think there's a different 229 00:09:13,000 --> 00:09:10,580 question that needs to be asked which is 230 00:09:14,860 --> 00:09:13,010 if we're going to have 50 million people 231 00:09:17,740 --> 00:09:14,870 in this state by the middle of this 232 00:09:19,390 --> 00:09:17,750 century how are they going to get around 233 00:09:22,240 --> 00:09:19,400 what are what are we going to do to 234 00:09:23,710 --> 00:09:22,250 accommodate that if you don't modernize 235 00:09:24,940 --> 00:09:23,720 the rail system and it's not just high 236 00:09:26,830 --> 00:09:24,950 speed rail under the brown 237 00:09:29,470 --> 00:09:26,840 administration we're doing all kinds of 238 00:09:31,450 --> 00:09:29,480 things to modernize rail across the 239 00:09:35,620 --> 00:09:31,460 state and including here in Los Angeles 240 00:09:36,990 --> 00:09:35,630 with La Union Station and Metrolink and 241 00:09:40,240 --> 00:09:37,000 and the metro system 242 00:09:43,270 --> 00:09:40,250 Amtrak this administration has been 243 00:09:45,670 --> 00:09:43,280 really out there pushing for a broader 244 00:09:47,290 --> 00:09:45,680 rail modernization because that's going 245 00:09:49,390 --> 00:09:47,300 to help us move in the future in a 246 00:09:51,130 --> 00:09:49,400 sustainable way but if you don't do 247 00:09:53,140 --> 00:09:51,140 those investments you got to do 248 00:09:56,560 --> 00:09:53,150 something else and that looks like more 249 00:10:00,430 --> 00:09:56,570 than 4,000 Lane miles of freeways more 250 00:10:02,320 --> 00:10:00,440 airport runway complexes 115 gates and 251 00:10:04,990 --> 00:10:02,330 airports you add up the cost of those 252 00:10:06,910 --> 00:10:05,000 things it's a hundred and forty to a 253 00:10:10,060 --> 00:10:06,920 hundred and seventy five billion dollars 254 00:10:12,040 --> 00:10:10,070 so you have to start with the notion 255 00:10:13,660 --> 00:10:12,050 that you can't just do nothing and then 256 00:10:15,700 --> 00:10:13,670 it's a question of investment choices 257 00:10:16,750 --> 00:10:15,710 and what do you get back yeah I think 258 00:10:18,880 --> 00:10:16,760 there's kind of brakes on to two 259 00:10:22,030 --> 00:10:18,890 questions as one is was this a wise 260 00:10:23,590 --> 00:10:22,040 project to begin with and then as we sit 261 00:10:25,750 --> 00:10:23,600 here today considering a lot of the 262 00:10:27,250 --> 00:10:25,760 problems that it's arisen is it 263 00:10:29,130 --> 00:10:27,260 something that should be continued so if 264 00:10:31,570 --> 00:10:29,140 we start with the original question of 265 00:10:33,160 --> 00:10:31,580 you know is this the proper type of 266 00:10:35,260 --> 00:10:33,170 project to be doing considering all the 267 00:10:37,330 --> 00:10:35,270 issues that California has my initial 268 00:10:40,000 --> 00:10:37,340 reaction to it when I heard about it was 269 00:10:43,000 --> 00:10:40,010 okay bullet train LA to San Francisco 2 270 00:10:44,770 --> 00:10:43,010 hours and 40 minutes my my problem is 271 00:10:46,900 --> 00:10:44,780 not getting to San Francisco I can run 272 00:10:49,330 --> 00:10:46,910 Southwest Airlines it takes an hour to 273 00:10:51,760 --> 00:10:49,340 200 bucks roundtrip that's not an issue 274 00:10:55,780 --> 00:10:51,770 flights every half hour my problem is 275 00:10:57,850 --> 00:10:55,790 getting to work so R is a my question is 276 00:10:59,940 --> 00:10:57,860 where we perhaps tackling a problem that 277 00:11:02,530 --> 00:10:59,950 doesn't exist with this bullet train 278 00:11:03,490 --> 00:11:02,540 well it's a fair question and you know 279 00:11:05,610 --> 00:11:03,500 one of the things I appreciate about 280 00:11:07,800 --> 00:11:05,620 questions like that is that a lot of 281 00:11:09,720 --> 00:11:07,810 dialog around a bullet train gets into a 282 00:11:11,490 --> 00:11:09,730 lot of political stuff when in fact 283 00:11:12,990 --> 00:11:11,500 there are legitimate public policy 284 00:11:16,440 --> 00:11:13,000 questions like the one that you just 285 00:11:19,470 --> 00:11:16,450 posed and I think my answer to that is 286 00:11:22,019 --> 00:11:19,480 to say well here's the argument for why 287 00:11:24,480 --> 00:11:22,029 it was and I think still continues to be 288 00:11:27,090 --> 00:11:24,490 a good idea I mean first of all yes you 289 00:11:29,250 --> 00:11:27,100 can get on Southwest as I did today and 290 00:11:31,320 --> 00:11:29,260 come from the bay area down here but in 291 00:11:33,300 --> 00:11:31,330 fact that's the most delayed air 292 00:11:34,590 --> 00:11:33,310 corridor in the state forty percent of 293 00:11:37,500 --> 00:11:34,600 the flights are delayed into San 294 00:11:39,120 --> 00:11:37,510 Francisco and air travel is going to get 295 00:11:42,120 --> 00:11:39,130 if anything more complex and more 296 00:11:43,800 --> 00:11:42,130 difficult but what we're building with 297 00:11:46,470 --> 00:11:43,810 high-speed rail is not just a 298 00:11:48,120 --> 00:11:46,480 point-to-point project and frankly this 299 00:11:50,040 --> 00:11:48,130 is an area where we've run into a lot of 300 00:11:52,079 --> 00:11:50,050 political controversy but I think that 301 00:11:54,060 --> 00:11:52,089 the people who created the program which 302 00:11:57,000 --> 00:11:54,070 were before I was on the scene were 303 00:11:59,460 --> 00:11:57,010 right it's really about connecting parts 304 00:12:01,650 --> 00:11:59,470 of the state many of which are isolated 305 00:12:03,930 --> 00:12:01,660 and have been difficult to connect so 306 00:12:05,700 --> 00:12:03,940 for example people say why didn't you 307 00:12:09,540 --> 00:12:05,710 just run this up I five 308 00:12:12,390 --> 00:12:09,550 well because Fresno Bakersfield those 309 00:12:14,430 --> 00:12:12,400 valley towns people don't think much 310 00:12:16,829 --> 00:12:14,440 about him but that middle part of the 311 00:12:19,350 --> 00:12:16,839 state has suffered from extreme levels 312 00:12:22,320 --> 00:12:19,360 of poverty and underinvestment and if 313 00:12:23,490 --> 00:12:22,330 you wanted to go from LA to Fresno it 314 00:12:25,140 --> 00:12:23,500 probably cost you seven or eight hundred 315 00:12:29,490 --> 00:12:25,150 dollars and it would not be an easy 316 00:12:31,920 --> 00:12:29,500 thing to do and so this was really about 317 00:12:34,350 --> 00:12:31,930 creating a rail network that connected 318 00:12:37,350 --> 00:12:34,360 parts of the state together and we we 319 00:12:40,079 --> 00:12:37,360 had Spain's ambassador to the United 320 00:12:43,290 --> 00:12:40,089 States came to visit us and he said I 321 00:12:45,030 --> 00:12:43,300 like your slogan connecting California 322 00:12:47,430 --> 00:12:45,040 and he said and you should also say 323 00:12:50,250 --> 00:12:47,440 connecting Californians because he then 324 00:12:52,350 --> 00:12:50,260 talked about how in Spain they used 325 00:12:53,640 --> 00:12:52,360 their high-speed rail network to bring 326 00:12:56,540 --> 00:12:53,650 all of their different cities and 327 00:12:59,880 --> 00:12:56,550 communities together so that's one thing 328 00:13:01,560 --> 00:12:59,890 there of course we need to be making 329 00:13:04,470 --> 00:13:01,570 investments that it makes it easier for 330 00:13:07,680 --> 00:13:04,480 you to get to work but again being part 331 00:13:09,360 --> 00:13:07,690 of a network so yes it's an investment 332 00:13:12,480 --> 00:13:09,370 in high-speed rail but high-speed rail 333 00:13:14,370 --> 00:13:12,490 has also been investing in local rail 334 00:13:16,680 --> 00:13:14,380 systems that would connect to us so we 335 00:13:17,840 --> 00:13:16,690 have put money into some of these local 336 00:13:19,939 --> 00:13:17,850 projects 337 00:13:21,740 --> 00:13:19,949 and that's where I think if we step back 338 00:13:23,420 --> 00:13:21,750 and look at it as a broader investment 339 00:13:26,360 --> 00:13:23,430 in a future transportation system it 340 00:13:29,329 --> 00:13:26,370 makes more sense why in your view is 341 00:13:31,610 --> 00:13:29,339 California the only one doing this other 342 00:13:33,800 --> 00:13:31,620 states looked at at Florida looked at it 343 00:13:37,340 --> 00:13:33,810 I forget the other states maybe Texas I 344 00:13:39,680 --> 00:13:37,350 mean there is no high-speed rail in the 345 00:13:41,120 --> 00:13:39,690 entire United States why is it that 346 00:13:41,990 --> 00:13:41,130 California is the only state that thinks 347 00:13:44,720 --> 00:13:42,000 it's a good idea 348 00:13:46,910 --> 00:13:44,730 well actually Texas now is proposing a 349 00:13:48,920 --> 00:13:46,920 direct high-speed rail line from Dallas 350 00:13:50,960 --> 00:13:48,930 to Houston so they're they're coming 351 00:13:52,939 --> 00:13:50,970 along with that it's a it's a different 352 00:13:56,180 --> 00:13:52,949 program but we're talking to them 353 00:13:57,710 --> 00:13:56,190 watching what they're doing Florida and 354 00:13:59,660 --> 00:13:57,720 I'm heading off to Florida tomorrow for 355 00:14:01,519 --> 00:13:59,670 my brother's wedding but I'm gonna ride 356 00:14:03,800 --> 00:14:01,529 the new bright line train there which is 357 00:14:05,170 --> 00:14:03,810 not our high-speed rail it's about 120 358 00:14:07,879 --> 00:14:05,180 miles an hour but it's the same idea 359 00:14:09,829 --> 00:14:07,889 they're wanting to put in more advanced 360 00:14:14,120 --> 00:14:09,839 rail between Miami all the way up to 361 00:14:16,730 --> 00:14:14,130 Orlando as a matter of fact I just heard 362 00:14:19,360 --> 00:14:16,740 that in the Northwest Microsoft is 363 00:14:21,470 --> 00:14:19,370 funding a study for high-speed rail from 364 00:14:25,189 --> 00:14:21,480 Vancouver British Columbia through 365 00:14:28,939 --> 00:14:25,199 Seattle to Portland so in fact I think 366 00:14:32,629 --> 00:14:28,949 that people are looking at this we're a 367 00:14:35,120 --> 00:14:32,639 little farther along it's difficult 368 00:14:37,850 --> 00:14:35,130 we're talking about a transformation of 369 00:14:40,249 --> 00:14:37,860 a country and a culture that has been 370 00:14:42,470 --> 00:14:40,259 primarily based on roads and interstate 371 00:14:44,300 --> 00:14:42,480 highways - one that would have a rail 372 00:14:45,470 --> 00:14:44,310 network but I think you're starting to 373 00:14:47,569 --> 00:14:45,480 see those things happen in different 374 00:14:50,650 --> 00:14:47,579 places are we hamstrung here in 375 00:14:53,780 --> 00:14:50,660 California by this prop 1a that dictated 376 00:14:56,389 --> 00:14:53,790 high-speed rail certain speeds certain 377 00:14:59,540 --> 00:14:56,399 just uh you know travel time from from 378 00:15:01,129 --> 00:14:59,550 San Francisco to LA that now you being 379 00:15:02,300 --> 00:15:01,139 the guy in charge of it now are stuck 380 00:15:04,819 --> 00:15:02,310 having to meet those requirements 381 00:15:06,439 --> 00:15:04,829 whereas Florida looked at it and said 382 00:15:07,759 --> 00:15:06,449 that well gee you know what maybe we 383 00:15:10,910 --> 00:15:07,769 don't need it to be that high-speed 384 00:15:12,079 --> 00:15:10,920 we're ok with 120 miles an hour well 385 00:15:13,400 --> 00:15:12,089 I've been giving long answers to your 386 00:15:16,699 --> 00:15:13,410 questions so let me give a short answer 387 00:15:20,300 --> 00:15:16,709 yes we we are somewhat hamstrung by the 388 00:15:22,610 --> 00:15:20,310 way it was well intentioned the way that 389 00:15:24,650 --> 00:15:22,620 the drafters of prop 1a put it together 390 00:15:26,600 --> 00:15:24,660 they wanted to make sure that if they 391 00:15:29,329 --> 00:15:26,610 raised ten billion dollars it was not 392 00:15:30,650 --> 00:15:29,339 bled off on things that where somebody 393 00:15:31,140 --> 00:15:30,660 just slapped a coat of paint on an 394 00:15:33,750 --> 00:15:31,150 Amtrak 395 00:15:35,760 --> 00:15:33,760 Lokomotiv and said oh it's golden blue 396 00:15:37,050 --> 00:15:35,770 so it must be high-speed train they 397 00:15:38,660 --> 00:15:37,060 wanted to make sure that it was true 398 00:15:41,010 --> 00:15:38,670 high-speed and so they put in 399 00:15:44,010 --> 00:15:41,020 essentially engineering standards into 400 00:15:47,670 --> 00:15:44,020 the bond act and that has been a source 401 00:15:50,340 --> 00:15:47,680 of some difficulty not because the 402 00:15:52,770 --> 00:15:50,350 ultimate goal but we've been sued and 403 00:15:54,540 --> 00:15:52,780 having to prove that nothing we've done 404 00:15:58,500 --> 00:15:54,550 so far would mean we couldn't meet those 405 00:16:00,810 --> 00:15:58,510 standards and as you said there may be 406 00:16:04,980 --> 00:16:00,820 some places where a different technology 407 00:16:06,510 --> 00:16:04,990 solution would make sense but the the 408 00:16:08,580 --> 00:16:06,520 people in their wisdom voted for the 409 00:16:10,530 --> 00:16:08,590 proposition and and we're honor bound to 410 00:16:13,080 --> 00:16:10,540 to carry it off so what about trying to 411 00:16:14,250 --> 00:16:13,090 modify that in some way well why would 412 00:16:15,750 --> 00:16:14,260 it require would have require another 413 00:16:18,450 --> 00:16:15,760 vote of the people it would because it 414 00:16:19,860 --> 00:16:18,460 was an initiative and you know I I I've 415 00:16:22,410 --> 00:16:19,870 told people I'm open to those 416 00:16:23,850 --> 00:16:22,420 conversations I mean as we as we go 417 00:16:25,650 --> 00:16:23,860 forward well cuz it seems to me that's 418 00:16:27,120 --> 00:16:25,660 where you guys are taking a lot of the 419 00:16:28,800 --> 00:16:27,130 heat from including from people like 420 00:16:30,780 --> 00:16:28,810 Quentin Kopp who we were talking about 421 00:16:32,280 --> 00:16:30,790 saying that hey this is not what the 422 00:16:33,840 --> 00:16:32,290 voters approved what you guys are doing 423 00:16:35,190 --> 00:16:33,850 between San Francisco and San Jose 424 00:16:36,900 --> 00:16:35,200 that's not what the voters approved 425 00:16:38,340 --> 00:16:36,910 you're not going to be able to break 426 00:16:40,800 --> 00:16:38,350 even it you know certain things that was 427 00:16:43,890 --> 00:16:40,810 in that bond requirement but hey you 428 00:16:45,480 --> 00:16:43,900 gotta just as you see certain things you 429 00:16:48,270 --> 00:16:45,490 know we can't keep marching down a road 430 00:16:50,070 --> 00:16:48,280 that that if it's not going to be able 431 00:16:51,630 --> 00:16:50,080 to comply with that prop 1a with me but 432 00:16:53,460 --> 00:16:51,640 we got to look at modifying that prop 1a 433 00:16:56,130 --> 00:16:53,470 yeah and I don't have any problem with 434 00:17:01,020 --> 00:16:56,140 that and and but what I would say is 435 00:17:03,300 --> 00:17:01,030 that all due respect to to judge cop all 436 00:17:05,610 --> 00:17:03,310 of our studies show that we are gonna be 437 00:17:09,300 --> 00:17:05,620 operating and meeting the break-even and 438 00:17:11,190 --> 00:17:09,310 as a matter of fact you know and and 439 00:17:13,650 --> 00:17:11,200 I've just had I've had respectful 440 00:17:16,380 --> 00:17:13,660 disagreements with him on this by 441 00:17:22,380 --> 00:17:16,390 sharing the track between San Jose and 442 00:17:26,130 --> 00:17:22,390 San Francisco in even even under what he 443 00:17:29,400 --> 00:17:26,140 imagined back at the beginning the 444 00:17:32,220 --> 00:17:29,410 difference in time is one minute and 20 445 00:17:34,440 --> 00:17:32,230 seconds against two hours and forty 446 00:17:37,230 --> 00:17:34,450 minutes total travel time there is 447 00:17:40,020 --> 00:17:37,240 essentially no issue there the 448 00:17:43,200 --> 00:17:40,030 difference in cost is fifteen billion 449 00:17:44,670 --> 00:17:43,210 dollars less to share the tracks than to 450 00:17:47,100 --> 00:17:44,680 try to build new tracks 451 00:17:48,570 --> 00:17:47,110 some of the wealthiest communities in 452 00:17:50,190 --> 00:17:48,580 the state but he also raises the concern 453 00:17:53,070 --> 00:17:50,200 that you're not going to be able to run 454 00:17:57,090 --> 00:17:53,080 enough high speed trains per hour in 455 00:17:59,130 --> 00:17:57,100 order to break even as a result of 456 00:18:02,970 --> 00:17:59,140 sharing the tracks with commuter and 457 00:18:05,700 --> 00:18:02,980 what I would say to that is that that's 458 00:18:07,950 --> 00:18:05,710 mostly wrong in the sense that we will 459 00:18:11,010 --> 00:18:07,960 be able to break even sharing the tracks 460 00:18:13,170 --> 00:18:11,020 will mean some loss of capacity not 461 00:18:15,750 --> 00:18:13,180 speed but there will be more than enough 462 00:18:18,120 --> 00:18:15,760 trains to be able to break even but with 463 00:18:19,860 --> 00:18:18,130 all due respect to you your organization 464 00:18:22,050 --> 00:18:19,870 you know you're you're telling us that 465 00:18:24,180 --> 00:18:22,060 hey we are gonna break even we are gonna 466 00:18:26,220 --> 00:18:24,190 meet the numbers but the track record 467 00:18:28,350 --> 00:18:26,230 thus far has not been very good as far 468 00:18:31,590 --> 00:18:28,360 as projections so you know we're behind 469 00:18:33,180 --> 00:18:31,600 schedule or over budgets you know 470 00:18:35,550 --> 00:18:33,190 there's a lot of questions out there 471 00:18:37,080 --> 00:18:35,560 about this project right now based on 472 00:18:39,150 --> 00:18:37,090 what was originally put out there sure 473 00:18:43,860 --> 00:18:39,160 and that's fair what I would say though 474 00:18:46,140 --> 00:18:43,870 is there's a couple different ways to 475 00:18:47,520 --> 00:18:46,150 look at those capital cost numbers and 476 00:18:49,020 --> 00:18:47,530 the project delays and we've had a lot 477 00:18:50,580 --> 00:18:49,030 of things thrown at us I'm not trying to 478 00:18:53,510 --> 00:18:50,590 make excuses with it but I mean we had a 479 00:18:56,130 --> 00:18:53,520 judge shut us down for a year so it's 480 00:18:57,900 --> 00:18:56,140 not quite on us that some of the things 481 00:18:59,580 --> 00:18:57,910 have gotten delayed but I mean we're way 482 00:19:01,620 --> 00:18:59,590 behind schedule right the original 483 00:19:03,510 --> 00:19:01,630 schedule is 2020 that's right but I will 484 00:19:05,850 --> 00:19:03,520 also tell you that what's shocking to me 485 00:19:08,220 --> 00:19:05,860 is that we hope to finish the 486 00:19:10,440 --> 00:19:08,230 environmental analysis on this system by 487 00:19:12,080 --> 00:19:10,450 2021 that means we've been doing 488 00:19:13,770 --> 00:19:12,090 environmental work for nine years 489 00:19:16,800 --> 00:19:13,780 welcome to California 490 00:19:20,150 --> 00:19:16,810 yeah I know I I understand and and so 491 00:19:24,450 --> 00:19:20,160 but but I want to come back to one thing 492 00:19:28,290 --> 00:19:24,460 on the on the on the very important 493 00:19:30,840 --> 00:19:28,300 issue of breaking even and and let me 494 00:19:32,190 --> 00:19:30,850 just take a moment on this I was kind of 495 00:19:34,050 --> 00:19:32,200 stunned when I first got the high-speed 496 00:19:35,130 --> 00:19:34,060 rail because I had spent 12 years on the 497 00:19:37,440 --> 00:19:35,140 board of the Bay Area Rapid Transit 498 00:19:40,440 --> 00:19:37,450 District you're running helping to run a 499 00:19:41,820 --> 00:19:40,450 local transit system and we were very 500 00:19:45,330 --> 00:19:41,830 efficient but we were still subsidized 501 00:19:47,400 --> 00:19:45,340 and most let's be clear most rail is in 502 00:19:49,740 --> 00:19:47,410 fact am I correct that the only rail it 503 00:19:52,080 --> 00:19:49,750 is and is is that New York to DC in the 504 00:19:54,060 --> 00:19:52,090 u.s. you are correct okay so when I came 505 00:19:55,920 --> 00:19:54,070 in I said I don't understand this the 506 00:19:57,510 --> 00:19:55,930 law says that we have to break even and 507 00:19:58,530 --> 00:19:57,520 I don't have any experience with anybody 508 00:20:01,080 --> 00:19:58,540 breaking even 509 00:20:03,630 --> 00:20:01,090 and the answer I got was that's because 510 00:20:07,080 --> 00:20:03,640 you've only dealt with urban systems in 511 00:20:09,780 --> 00:20:07,090 the US but around the world high-speed 512 00:20:12,870 --> 00:20:09,790 rail systems which go city to city and 513 00:20:14,730 --> 00:20:12,880 compete against airlines in virtually 514 00:20:15,960 --> 00:20:14,740 every case and when I say virtually we 515 00:20:18,570 --> 00:20:15,970 don't really have insight into the 516 00:20:21,690 --> 00:20:18,580 numbers in China but in every case that 517 00:20:24,480 --> 00:20:21,700 we've seen once the system is built the 518 00:20:27,900 --> 00:20:24,490 capital cost is expended they operate 519 00:20:30,210 --> 00:20:27,910 throwing off excess cash I've got two 520 00:20:32,610 --> 00:20:30,220 colleagues on my nine-member board who 521 00:20:33,960 --> 00:20:32,620 are bankers one was the vice chairman of 522 00:20:35,390 --> 00:20:33,970 Bank of America the other runs the 523 00:20:37,530 --> 00:20:35,400 biggest bank in the Central Valley 524 00:20:40,200 --> 00:20:37,540 they've dug through these numbers 525 00:20:41,550 --> 00:20:40,210 they've tightened down the ridership 526 00:20:44,280 --> 00:20:41,560 projections they've done all that 527 00:20:47,640 --> 00:20:44,290 they've stressed tested it and no matter 528 00:20:49,530 --> 00:20:47,650 how high they set the bar we're showing 529 00:20:51,360 --> 00:20:49,540 all our projections are that we will not 530 00:20:54,270 --> 00:20:51,370 only be generating income but that the 531 00:20:56,430 --> 00:20:54,280 numbers are in the twenty billion dollar 532 00:20:58,410 --> 00:20:56,440 net present value range in the first 533 00:21:00,780 --> 00:20:58,420 thirty years that will help pay for 534 00:21:03,350 --> 00:21:00,790 about a third the cost of the system so 535 00:21:06,360 --> 00:21:03,360 we are highly confident in those numbers 536 00:21:07,800 --> 00:21:06,370 construction numbers and so forth yes 537 00:21:10,620 --> 00:21:07,810 they've gone up there are a number of 538 00:21:11,640 --> 00:21:10,630 reasons for that not the reasons that 539 00:21:13,770 --> 00:21:11,650 necessarily you read about in the 540 00:21:15,690 --> 00:21:13,780 newspaper but yeah I'll admit those 541 00:21:18,330 --> 00:21:15,700 numbers are higher and it does call into 542 00:21:20,130 --> 00:21:18,340 question but we've also had our 543 00:21:22,110 --> 00:21:20,140 ridership numbers looked at by peer 544 00:21:24,060 --> 00:21:22,120 review groups the government accounting 545 00:21:25,530 --> 00:21:24,070 office and so forth and nobody's 546 00:21:26,940 --> 00:21:25,540 questioned our methodology there and 547 00:21:28,800 --> 00:21:26,950 what kind of ticket costs are we talking 548 00:21:30,450 --> 00:21:28,810 about San Francisco to LA well you got 549 00:21:32,190 --> 00:21:30,460 to compete against Airlines in order to 550 00:21:35,220 --> 00:21:32,200 attract people to this so what we 551 00:21:37,290 --> 00:21:35,230 assumed as we do our projections is that 552 00:21:40,440 --> 00:21:37,300 the tickets should be about eighty-five 553 00:21:42,660 --> 00:21:40,450 percent of a discounted fare that you 554 00:21:44,820 --> 00:21:42,670 would get on Southwest so we're looking 555 00:21:48,030 --> 00:21:44,830 at something like you know 87 bucks or 556 00:21:49,590 --> 00:21:48,040 something like that it's gonna have to 557 00:21:50,970 --> 00:21:49,600 compete with the airline's I can tell 558 00:21:53,340 --> 00:21:50,980 you that is not what you pay when you go 559 00:21:55,680 --> 00:21:53,350 from New York to DC in New York to DC is 560 00:21:58,230 --> 00:21:55,690 150 bucks two hundred dollars to 50 561 00:21:59,760 --> 00:21:58,240 depending on the 300 yeah 300 is what I 562 00:22:04,230 --> 00:21:59,770 paid last time on that and you know why 563 00:22:06,330 --> 00:22:04,240 because 80% of the airline traffic in 564 00:22:09,330 --> 00:22:06,340 the last 30 years has moved over onto 565 00:22:11,570 --> 00:22:09,340 that onto that rail it is totally and 566 00:22:13,760 --> 00:22:11,580 completely at capacity and 567 00:22:16,520 --> 00:22:13,770 and they're talking about a hundred and 568 00:22:18,680 --> 00:22:16,530 fifty billion dollars to upgrade the 569 00:22:23,090 --> 00:22:18,690 Northeast Corridor to full high-speed 570 00:22:24,680 --> 00:22:23,100 rail but right now that which is as you 571 00:22:27,830 --> 00:22:24,690 said the only train line that's throwing 572 00:22:29,600 --> 00:22:27,840 off extra cash part of the reason is 573 00:22:31,940 --> 00:22:29,610 they can pretty much charge what they 574 00:22:33,350 --> 00:22:31,950 want because it is highly popular it's 575 00:22:36,740 --> 00:22:33,360 much better way to get between those 576 00:22:38,860 --> 00:22:36,750 cities than air and they're at capacity 577 00:22:42,920 --> 00:22:38,870 but your projections for break-even 578 00:22:45,080 --> 00:22:42,930 involve ticket prices as low as $85 ZL 579 00:22:47,090 --> 00:22:45,090 late December yes yes because otherwise 580 00:22:48,860 --> 00:22:47,100 we'd be kidding ourselves if you if you 581 00:22:50,330 --> 00:22:48,870 posit some number that nobody's gonna 582 00:22:51,680 --> 00:22:50,340 buy because it's cheaper to go on the 583 00:22:53,960 --> 00:22:51,690 airlines you're not going to get the 584 00:22:56,900 --> 00:22:53,970 ridership so speaking of your guys track 585 00:22:59,450 --> 00:22:56,910 record as you well know assembly 586 00:23:02,390 --> 00:22:59,460 transportation chairman Jim Fraser was 587 00:23:04,190 --> 00:23:02,400 very critical of you recently and he 588 00:23:07,670 --> 00:23:04,200 flat out said that they have continually 589 00:23:09,320 --> 00:23:07,680 lied to us about performance politicians 590 00:23:13,100 --> 00:23:09,330 say a lot of things I will tell you when 591 00:23:14,780 --> 00:23:13,110 we came in the first thing we did was we 592 00:23:16,220 --> 00:23:14,790 stood up and we told people that the 593 00:23:18,380 --> 00:23:16,230 projections that they'd seen were way 594 00:23:21,350 --> 00:23:18,390 too low and I remember standing there in 595 00:23:23,450 --> 00:23:21,360 November 2011 and saying you know this 596 00:23:25,310 --> 00:23:23,460 thing if we don't find ways to cut costs 597 00:23:27,080 --> 00:23:25,320 like blending the service in the 598 00:23:29,030 --> 00:23:27,090 peninsula which you were talking about 599 00:23:31,400 --> 00:23:29,040 before we were criticized for it could 600 00:23:33,440 --> 00:23:31,410 be a hundred billion dollars and one of 601 00:23:35,930 --> 00:23:33,450 the reporters at that point said what do 602 00:23:38,030 --> 00:23:35,940 you tell people who thought it was going 603 00:23:41,150 --> 00:23:38,040 to cost 40 billion I said you tell them 604 00:23:44,480 --> 00:23:41,160 the truth and we have we have been out 605 00:23:46,280 --> 00:23:44,490 there every time we've got an update we 606 00:23:48,530 --> 00:23:46,290 are the ones who come out and say that 607 00:23:50,960 --> 00:23:48,540 so for example there was a recent audit 608 00:23:52,130 --> 00:23:50,970 by the state auditor well there were a 609 00:23:54,350 --> 00:23:52,140 lot of numbers that were thrown around 610 00:23:56,540 --> 00:23:54,360 all of those capital numbers were 611 00:23:59,360 --> 00:23:56,550 numbers that we ourselves had put out 612 00:24:01,250 --> 00:23:59,370 last January there were no new numbers 613 00:24:03,410 --> 00:24:01,260 in terms of capital cost and the audit 614 00:24:06,170 --> 00:24:03,420 report it was a little confusing but 615 00:24:07,820 --> 00:24:06,180 that is the fact so we've been very 616 00:24:10,520 --> 00:24:07,830 forthright and we've been very 617 00:24:13,070 --> 00:24:10,530 transparent we have a finance and Audit 618 00:24:15,350 --> 00:24:13,080 Committee its meeting is are open 619 00:24:19,580 --> 00:24:15,360 anybody can come and see that and they 620 00:24:20,840 --> 00:24:19,590 can see how we're doing so I'm sure why 621 00:24:23,330 --> 00:24:20,850 is he making a statement like that 622 00:24:25,019 --> 00:24:23,340 though well I I'm I I can't comment on 623 00:24:29,470 --> 00:24:25,029 his motor 624 00:24:31,180 --> 00:24:29,480 Minoo I will say that I've been in this 625 00:24:33,159 --> 00:24:31,190 situation several times in my life and 626 00:24:36,430 --> 00:24:33,169 I've worked on a number of controversial 627 00:24:37,330 --> 00:24:36,440 things and usually what happens is and 628 00:24:39,640 --> 00:24:37,340 when something comes out that's 629 00:24:42,760 --> 00:24:39,650 controversial people tend to pile on but 630 00:24:46,810 --> 00:24:42,770 beyond that I I can't I can't challenge 631 00:24:49,360 --> 00:24:46,820 it but let me I will say that there is a 632 00:24:51,220 --> 00:24:49,370 strong role for legislative oversight in 633 00:24:53,710 --> 00:24:51,230 this program that we have always 634 00:24:57,039 --> 00:24:53,720 supported because whether it seems this 635 00:24:59,440 --> 00:24:57,049 way or not our view is that public 636 00:25:01,299 --> 00:24:59,450 support depends on confidence that 637 00:25:04,120 --> 00:25:01,309 somebody is looking over our shoulder on 638 00:25:06,010 --> 00:25:04,130 this and so we welcome the audit we have 639 00:25:08,769 --> 00:25:06,020 a peer review group that that's in the 640 00:25:11,230 --> 00:25:08,779 statute that meets with us our own 641 00:25:15,279 --> 00:25:11,240 proceedings are open our reports are 642 00:25:18,130 --> 00:25:15,289 public it's not that we're not in a 643 00:25:21,940 --> 00:25:18,140 controversial area here but our goal is 644 00:25:24,010 --> 00:25:21,950 to give the public confidence not that 645 00:25:26,950 --> 00:25:24,020 there won't be screw-ups let me be clear 646 00:25:28,419 --> 00:25:26,960 there will be and what I'm hoping is 647 00:25:31,840 --> 00:25:28,429 that people hold us to a different 648 00:25:34,389 --> 00:25:31,850 standard you're building a 520 mile 649 00:25:36,610 --> 00:25:34,399 project there's all kinds of issues 650 00:25:38,740 --> 00:25:36,620 wetlands communities all that they're 651 00:25:40,330 --> 00:25:38,750 going to be things that go wrong what I 652 00:25:42,310 --> 00:25:40,340 hope is that the public holds us to a 653 00:25:44,799 --> 00:25:42,320 standard of a were you honest with us 654 00:25:46,810 --> 00:25:44,809 and be when you recognized a mistake did 655 00:25:49,389 --> 00:25:46,820 you move to fix it and I think our 656 00:25:52,000 --> 00:25:49,399 record has been very good that when 657 00:25:53,919 --> 00:25:52,010 we've seen things that have the the 658 00:25:57,100 --> 00:25:53,929 problem of getting the the property 659 00:25:58,930 --> 00:25:57,110 along the right-of-way that was very 660 00:26:01,029 --> 00:25:58,940 difficult it took us a long time to get 661 00:26:03,519 --> 00:26:01,039 that right I think now we've got it 662 00:26:05,049 --> 00:26:03,529 right we've been clear about our 663 00:26:06,820 --> 00:26:05,059 challenges in that area since the 664 00:26:09,000 --> 00:26:06,830 beginning so what I hope is that people 665 00:26:11,710 --> 00:26:09,010 look at this and ultimately say well 666 00:26:14,110 --> 00:26:11,720 yeah okay I wish it were less and I wish 667 00:26:15,820 --> 00:26:14,120 it were faster but at least they're 668 00:26:17,380 --> 00:26:15,830 telling us what's going on and when they 669 00:26:19,870 --> 00:26:17,390 see something is wrong they move to fix 670 00:26:23,919 --> 00:26:19,880 it he thinks you should resign do you 671 00:26:25,419 --> 00:26:23,929 think you should resign well again I got 672 00:26:27,610 --> 00:26:25,429 a pretty tough skin after seven and a 673 00:26:30,220 --> 00:26:27,620 half years in this and people say a lot 674 00:26:32,789 --> 00:26:30,230 of things in a political environment all 675 00:26:35,310 --> 00:26:32,799 I can say is 676 00:26:37,710 --> 00:26:35,320 I think his was a minority view very 677 00:26:39,450 --> 00:26:37,720 distinctly but directly answer him 678 00:26:41,159 --> 00:26:39,460 you know regarding this audit and some 679 00:26:42,359 --> 00:26:41,169 of the things that came out I mean do 680 00:26:44,399 --> 00:26:42,369 you accept some personal responsibility 681 00:26:47,279 --> 00:26:44,409 for things that were found in the audit 682 00:26:49,169 --> 00:26:47,289 and if so what what things sure I mean 683 00:26:53,249 --> 00:26:49,179 look I'm the chair of the authority 684 00:26:56,789 --> 00:26:53,259 board we set up the finance and Audit 685 00:26:59,399 --> 00:26:56,799 Committee we set up a lot of things to 686 00:27:01,109 --> 00:26:59,409 to govern the program to have an auditor 687 00:27:02,340 --> 00:27:01,119 come in and say well you may have 688 00:27:03,810 --> 00:27:02,350 thought you were doing well but here's a 689 00:27:06,480 --> 00:27:03,820 number of areas of deficiency that 690 00:27:08,399 --> 00:27:06,490 doesn't feel good I wish that those 691 00:27:12,690 --> 00:27:08,409 things you know hadn't occurred that way 692 00:27:14,879 --> 00:27:12,700 and let me be very clear we cooperated 693 00:27:16,109 --> 00:27:14,889 fully with the auditors I at in front of 694 00:27:17,999 --> 00:27:16,119 the audit committee last year and said 695 00:27:21,419 --> 00:27:18,009 we welcome the audit we cooperated fully 696 00:27:23,159 --> 00:27:21,429 and we have also committed that all of 697 00:27:25,769 --> 00:27:23,169 their recommendations will be promptly 698 00:27:28,680 --> 00:27:25,779 implemented so I think we're doing our 699 00:27:30,330 --> 00:27:28,690 job in that respect and do I wish we had 700 00:27:33,509 --> 00:27:30,340 been more perfect to go you know going 701 00:27:35,310 --> 00:27:33,519 through this absolutely we're human and 702 00:27:39,749 --> 00:27:35,320 people make mistakes and you learn from 703 00:27:41,359 --> 00:27:39,759 them but I will tell you that I think 704 00:27:43,889 --> 00:27:41,369 we've got a very committed very 705 00:27:47,180 --> 00:27:43,899 professional board of directors we've 706 00:27:50,430 --> 00:27:47,190 got an outstanding staff leadership now 707 00:27:51,659 --> 00:27:50,440 we've made changes along the way one of 708 00:27:53,460 --> 00:27:51,669 the most difficult things was 709 00:27:58,379 --> 00:27:53,470 transitioning from a planning 710 00:28:00,149 --> 00:27:58,389 organization to a to an organization 711 00:28:02,389 --> 00:28:00,159 that was managing billions of dollars of 712 00:28:05,730 --> 00:28:02,399 contracts and had to deliver projects 713 00:28:07,409 --> 00:28:05,740 anybody would look back and say oh I 714 00:28:08,970 --> 00:28:07,419 wish I had seen this or I wish I'd done 715 00:28:11,190 --> 00:28:08,980 that differently or I wish I'd done this 716 00:28:13,470 --> 00:28:11,200 better I'll take my share of personal 717 00:28:17,669 --> 00:28:13,480 responsibility for that but what I would 718 00:28:21,989 --> 00:28:17,679 also say is none of those decisions that 719 00:28:24,239 --> 00:28:21,999 we made were in any way reckless or 720 00:28:26,220 --> 00:28:24,249 thoughtless I mean we we were sitting 721 00:28:28,769 --> 00:28:26,230 there making very deliberate decisions 722 00:28:31,859 --> 00:28:28,779 against some very tough things do you 723 00:28:33,779 --> 00:28:31,869 start now and risk delay damages because 724 00:28:35,850 --> 00:28:33,789 you don't have all the parcels or do you 725 00:28:37,499 --> 00:28:35,860 wait and risk losing nine hundred 726 00:28:39,090 --> 00:28:37,509 million dollars of federal funds that's 727 00:28:42,029 --> 00:28:39,100 on a deadline that turns into a pumpkin 728 00:28:45,299 --> 00:28:42,039 we spent a lot of time balancing that 729 00:28:46,440 --> 00:28:45,309 risk and managing the risk sometimes you 730 00:28:48,960 --> 00:28:46,450 make decisions to turn 731 00:28:51,060 --> 00:28:48,970 to be right sometimes not but I think 732 00:28:54,240 --> 00:28:51,070 they were always well considered and 733 00:28:56,250 --> 00:28:54,250 always done diligently so from that 734 00:28:57,540 --> 00:28:56,260 standpoint I'll take responsibility for 735 00:29:00,840 --> 00:28:57,550 the things that didn't turn out the 736 00:29:03,210 --> 00:29:00,850 right way but I don't think in any way 737 00:29:05,130 --> 00:29:03,220 we sure cower responsibilities or didn't 738 00:29:06,600 --> 00:29:05,140 do our jobs to the best of our ability 739 00:29:08,280 --> 00:29:06,610 one of the problems is it's such a big 740 00:29:10,350 --> 00:29:08,290 project that when errors are made 741 00:29:12,810 --> 00:29:10,360 they're magnified by the sheer number of 742 00:29:14,880 --> 00:29:12,820 dollars right sure we're talking about 743 00:29:20,670 --> 00:29:14,890 how much has been spent approximately 744 00:29:22,350 --> 00:29:20,680 today well the problem we've got money 745 00:29:25,230 --> 00:29:22,360 that was spent on environmental analysis 746 00:29:26,700 --> 00:29:25,240 and money that was spent on so forth I 747 00:29:29,100 --> 00:29:26,710 would say the direct answer to your 748 00:29:31,080 --> 00:29:29,110 question is about three billion dollars 749 00:29:33,390 --> 00:29:31,090 is being spent on the construction right 750 00:29:37,380 --> 00:29:33,400 now in the Central Valley okay in total 751 00:29:41,040 --> 00:29:37,390 expenditures to date I'm gonna say maybe 752 00:29:43,320 --> 00:29:41,050 twice that it might not be that high but 753 00:29:44,670 --> 00:29:43,330 there's a lot of environmental work a 754 00:29:46,500 --> 00:29:44,680 lot of engineering work that was done 755 00:29:48,330 --> 00:29:46,510 and so forth so so it could be 756 00:29:50,100 --> 00:29:48,340 approximately six billion spent yeah and 757 00:29:53,760 --> 00:29:50,110 then you have to also add in money that 758 00:29:57,390 --> 00:29:53,770 we've spent with local transit districts 759 00:29:58,830 --> 00:29:57,400 on things so I I'm making a guess when 760 00:30:00,300 --> 00:29:58,840 you put all there's a lot of cats and 761 00:30:03,690 --> 00:30:00,310 dogs to try to put together and in her 762 00:30:06,780 --> 00:30:03,700 findings you know arguably as much as by 763 00:30:10,350 --> 00:30:06,790 her report a billion of that was wasted 764 00:30:13,130 --> 00:30:10,360 am i putting a general ballpark on the 765 00:30:15,120 --> 00:30:13,140 number that she's suggesting let me I 766 00:30:17,430 --> 00:30:15,130 think that's probably her number let me 767 00:30:19,530 --> 00:30:17,440 just say we we vigorously dispute that 768 00:30:21,510 --> 00:30:19,540 and there was a lot of misunderstanding 769 00:30:23,100 --> 00:30:21,520 about this so one of the things that 770 00:30:25,980 --> 00:30:23,110 they said and this was a problem on our 771 00:30:28,170 --> 00:30:25,990 side was that there wasn't documentation 772 00:30:30,480 --> 00:30:28,180 in place and so they had to make some 773 00:30:31,740 --> 00:30:30,490 decisions about what was spent and what 774 00:30:34,500 --> 00:30:31,750 was not spent well we went back and 775 00:30:36,180 --> 00:30:34,510 looked at this yes there's been a lot of 776 00:30:38,750 --> 00:30:36,190 cost growth that was identified in the 777 00:30:42,450 --> 00:30:38,760 auditor's report eighty percent of that 778 00:30:45,300 --> 00:30:42,460 related to changes in scope that was not 779 00:30:47,160 --> 00:30:45,310 money that was anyway wasted it meant 780 00:30:48,360 --> 00:30:47,170 that we were building some things in the 781 00:30:51,680 --> 00:30:48,370 first phase that might have been 782 00:30:55,440 --> 00:30:51,690 originally intended for a later phase so 783 00:30:56,910 --> 00:30:55,450 no look here's the thing about the audit 784 00:30:59,520 --> 00:30:56,920 report there were really two pieces of 785 00:31:00,240 --> 00:30:59,530 it one piece was to look at our 786 00:31:02,190 --> 00:31:00,250 procedures and 787 00:31:04,860 --> 00:31:02,200 processes and make recommendations as I 788 00:31:05,850 --> 00:31:04,870 said before we accept all those as valid 789 00:31:07,580 --> 00:31:05,860 and we're implementing the 790 00:31:10,080 --> 00:31:07,590 recommendations as quickly as possible 791 00:31:11,970 --> 00:31:10,090 the other piece was an attempt to look 792 00:31:13,830 --> 00:31:11,980 back at history and I'll say kind of 793 00:31:17,340 --> 00:31:13,840 second-guessed decisions that we made 794 00:31:20,280 --> 00:31:17,350 when we started the program and there we 795 00:31:22,860 --> 00:31:20,290 absolutely dispute what the conclusion 796 00:31:27,210 --> 00:31:22,870 was because I sat in those meetings and 797 00:31:29,840 --> 00:31:27,220 we we knew that if we did not start when 798 00:31:32,100 --> 00:31:29,850 we did in fact the LA Times wrote 799 00:31:33,810 --> 00:31:32,110 article back at that time saying they'll 800 00:31:36,720 --> 00:31:33,820 never be able to spend all the federal 801 00:31:39,240 --> 00:31:36,730 money in time that was that was the view 802 00:31:42,660 --> 00:31:39,250 back then opponents were suing us saying 803 00:31:44,280 --> 00:31:42,670 the federal money expires in 2017 if we 804 00:31:47,220 --> 00:31:44,290 can delay them long enough they lose 805 00:31:49,500 --> 00:31:47,230 their federal funding we had to decide 806 00:31:51,570 --> 00:31:49,510 to start and we did that knowing that 807 00:31:54,180 --> 00:31:51,580 yeah we were going to get some delay 808 00:31:55,860 --> 00:31:54,190 damage costs from the the vendors but we 809 00:31:58,590 --> 00:31:55,870 balanced that that was am i right that 810 00:32:01,170 --> 00:31:58,600 that's 600 million no it was not 600 811 00:32:03,500 --> 00:32:01,180 million we with the number if anything 812 00:32:05,880 --> 00:32:03,510 might have turned out to be half that 813 00:32:08,700 --> 00:32:05,890 but I'm not even sure that that number 814 00:32:10,440 --> 00:32:08,710 is is not too high yeah I think I'm 815 00:32:13,020 --> 00:32:10,450 reading from well I understand that but 816 00:32:16,320 --> 00:32:13,030 I'm just saying are what you're reading 817 00:32:18,570 --> 00:32:16,330 correctly or accurately depicts what was 818 00:32:20,460 --> 00:32:18,580 said in the audit but as I said the 819 00:32:21,930 --> 00:32:20,470 audit had two pieces one was 820 00:32:24,180 --> 00:32:21,940 recommendations that we agree with 821 00:32:25,800 --> 00:32:24,190 another was this attempt to go back and 822 00:32:27,360 --> 00:32:25,810 look at history that we think that they 823 00:32:29,910 --> 00:32:27,370 got very wrong so is it fair to say that 824 00:32:33,000 --> 00:32:29,920 but for the federal dollars being at 825 00:32:35,040 --> 00:32:33,010 stake and at risk you probably would 826 00:32:36,720 --> 00:32:35,050 have delayed the commencement of the 827 00:32:38,850 --> 00:32:36,730 project a bit well here was the other 828 00:32:40,470 --> 00:32:38,860 problem though so when we got the when 829 00:32:41,910 --> 00:32:40,480 we opened the first bid and this is the 830 00:32:43,260 --> 00:32:41,920 kind of decision I mean it's easy for 831 00:32:44,760 --> 00:32:43,270 people to look back and second-guess but 832 00:32:46,980 --> 00:32:44,770 let me tell you a part of the decision 833 00:32:49,800 --> 00:32:46,990 we had when we opened the very first bid 834 00:32:51,780 --> 00:32:49,810 it was 200 million dollars below what 835 00:32:55,470 --> 00:32:51,790 our engineers estimate was for that 836 00:32:58,590 --> 00:32:55,480 segment that bid expired in 90 days if 837 00:32:59,670 --> 00:32:58,600 we didn't go with it so and the next bid 838 00:33:03,630 --> 00:32:59,680 was several hundred million dollars 839 00:33:05,880 --> 00:33:03,640 higher than that so again do you start 840 00:33:07,590 --> 00:33:05,890 knowing that well maybe we won't be able 841 00:33:09,000 --> 00:33:07,600 to deliver all the parcels in time and 842 00:33:11,820 --> 00:33:09,010 the contract will come back and hit us 843 00:33:13,950 --> 00:33:11,830 with something or do you not start that 844 00:33:15,539 --> 00:33:13,960 bid expires then you go back out to 845 00:33:18,000 --> 00:33:15,549 do it again at hundreds of millions of 846 00:33:21,149 --> 00:33:18,010 dollars of higher cost these were the 847 00:33:22,769 --> 00:33:21,159 kind of decisions that we faced and that 848 00:33:25,919 --> 00:33:22,779 we had to make and I will tell you I 849 00:33:28,440 --> 00:33:25,929 will tell you unequivocally if you 850 00:33:31,139 --> 00:33:28,450 rolled me back to 2012 and 2013 and 851 00:33:32,610 --> 00:33:31,149 looked at the same set of facts I and my 852 00:33:35,190 --> 00:33:32,620 colleagues would have made exactly the 853 00:33:37,620 --> 00:33:35,200 same decisions that same way we put 854 00:33:38,970 --> 00:33:37,630 people to work there are 2500 people 855 00:33:41,340 --> 00:33:38,980 working now those people are paying 856 00:33:42,810 --> 00:33:41,350 taxes we have reduced the unemployment 857 00:33:44,909 --> 00:33:42,820 rate in the Central Valley that's the 858 00:33:47,370 --> 00:33:44,919 other reason not to wait this money was 859 00:33:50,430 --> 00:33:47,380 intended to put people to work and we 860 00:33:51,570 --> 00:33:50,440 did we have reduced it but to address 861 00:33:52,919 --> 00:33:51,580 that that money the federal money 862 00:33:54,539 --> 00:33:52,929 because yeah that was stimulus money 863 00:33:57,060 --> 00:33:54,549 back when we were in a big recession 864 00:33:58,529 --> 00:33:57,070 we're no longer in a recession so is the 865 00:34:02,039 --> 00:33:58,539 goal of putting people to work really a 866 00:34:03,990 --> 00:34:02,049 proper goal these days well I have to 867 00:34:05,700 --> 00:34:04,000 say I think the goal of putting people 868 00:34:07,919 --> 00:34:05,710 to work never goes out of favor right 869 00:34:10,079 --> 00:34:07,929 but as far as using federal monies to 870 00:34:11,399 --> 00:34:10,089 stimulate the economy but which now is 871 00:34:13,919 --> 00:34:11,409 not the time to be doing that arguably 872 00:34:17,869 --> 00:34:13,929 we spent we spent the requisite money in 873 00:34:20,790 --> 00:34:17,879 the time frame so we did that but it's 874 00:34:22,379 --> 00:34:20,800 beyond just the point of putting people 875 00:34:25,649 --> 00:34:22,389 to work remember what I said about the 876 00:34:27,300 --> 00:34:25,659 Central Valley maybe people in Los 877 00:34:29,190 --> 00:34:27,310 Angeles and frankly I didn't really 878 00:34:30,540 --> 00:34:29,200 realize this one of the one of the great 879 00:34:31,919 --> 00:34:30,550 blessings of being able to work on this 880 00:34:34,200 --> 00:34:31,929 project is I've been up and down the 881 00:34:36,119 --> 00:34:34,210 state I've been here for 40 years and 882 00:34:38,579 --> 00:34:36,129 I've got a new appreciation for 883 00:34:41,310 --> 00:34:38,589 California that I never had because you 884 00:34:46,230 --> 00:34:41,320 know I'd never been in Acton before or 885 00:34:47,399 --> 00:34:46,240 in Palmdale or in Merced but the Central 886 00:34:50,040 --> 00:34:47,409 Valley of California 887 00:34:52,470 --> 00:34:50,050 with 4 million people if it words owned 888 00:34:54,060 --> 00:34:52,480 state it would be the 26 largest state 889 00:34:56,339 --> 00:34:54,070 and it would supplant Mississippi is the 890 00:34:58,680 --> 00:34:56,349 poorest state in the United States the 891 00:35:02,339 --> 00:34:58,690 poverty level there is 25 percent in 892 00:35:04,349 --> 00:35:02,349 Fresno so we are making investments in 893 00:35:06,870 --> 00:35:04,359 an area that's been under invested and 894 00:35:10,680 --> 00:35:06,880 as I said before this opportunity to 895 00:35:11,849 --> 00:35:10,690 connect the housing and jobs is 896 00:35:14,070 --> 00:35:11,859 something is going to be tremendously 897 00:35:16,079 --> 00:35:14,080 important some of these towns I think 898 00:35:17,970 --> 00:35:16,089 perhaps they like it this way I've been 899 00:35:19,620 --> 00:35:17,980 being remote I mean you know they don't 900 00:35:21,450 --> 00:35:19,630 identify with Los Angeles and Hollywood 901 00:35:23,849 --> 00:35:21,460 they don't identify with liberal San 902 00:35:25,410 --> 00:35:23,859 Francisco they're farmers and so on so 903 00:35:27,300 --> 00:35:25,420 this whole idea of connecting them with 904 00:35:29,220 --> 00:35:27,310 LA in San Francisco 905 00:35:30,680 --> 00:35:29,230 we sure they want that um actually I'm 906 00:35:33,180 --> 00:35:30,690 pretty sure that they want that because 907 00:35:36,210 --> 00:35:33,190 we've worked with two successful mayor's 908 00:35:38,160 --> 00:35:36,220 in Fresno both of whom particularly 909 00:35:40,080 --> 00:35:38,170 mayor Ashley Swearengin before believed 910 00:35:43,830 --> 00:35:40,090 that this was going to transform her 911 00:35:46,410 --> 00:35:43,840 town Fresno is the eighth largest tech 912 00:35:47,940 --> 00:35:46,420 incubator in the United States I've been 913 00:35:51,150 --> 00:35:47,950 meeting and talking with the mayor of 914 00:35:52,560 --> 00:35:51,160 Merced they were upset when they didn't 915 00:35:53,790 --> 00:35:52,570 feel that they were being included in 916 00:35:57,060 --> 00:35:53,800 the opening of the first leg of 917 00:35:59,160 --> 00:35:57,070 high-speed rail the mayor of the former 918 00:36:01,020 --> 00:35:59,170 mayor of Palmdale laid out his whole 919 00:36:03,660 --> 00:36:01,030 city's future development around the 920 00:36:05,220 --> 00:36:03,670 high speed rail station so frankly in 921 00:36:07,980 --> 00:36:05,230 most of these communities what we're 922 00:36:09,330 --> 00:36:07,990 seeing is they see high-speed rail as a 923 00:36:11,970 --> 00:36:09,340 tool for development of their 924 00:36:14,340 --> 00:36:11,980 communities in in very important ways 925 00:36:15,930 --> 00:36:14,350 and we've been pleased to have strong 926 00:36:18,030 --> 00:36:15,940 partnerships there up and down the 927 00:36:19,920 --> 00:36:18,040 valley yeah I just don't like a defense 928 00:36:22,050 --> 00:36:19,930 for the project being the jobs because 929 00:36:23,250 --> 00:36:22,060 the project has to make sense right 930 00:36:25,710 --> 00:36:23,260 because there's a thousand things you 931 00:36:28,260 --> 00:36:25,720 could do to put people to work I agree 932 00:36:30,330 --> 00:36:28,270 with that I was only responding excuse 933 00:36:33,120 --> 00:36:30,340 me before when you were asking about the 934 00:36:35,760 --> 00:36:33,130 decisions we made in 2012 and getting 935 00:36:38,700 --> 00:36:35,770 started also included putting people to 936 00:36:42,330 --> 00:36:38,710 work which was as you said the the 937 00:36:47,010 --> 00:36:42,340 purpose then but yes I never tried to I 938 00:36:48,300 --> 00:36:47,020 never start off my defense if you will 939 00:36:49,560 --> 00:36:48,310 of high-speed rail by talking about the 940 00:36:51,780 --> 00:36:49,570 jobs I talk about the future of 941 00:36:53,490 --> 00:36:51,790 California and what we need to do to 942 00:36:56,580 --> 00:36:53,500 connect our areas and to transform 943 00:37:00,150 --> 00:36:56,590 cities because lots of different things 944 00:37:01,110 --> 00:37:00,160 can create jobs but I will say this one 945 00:37:03,690 --> 00:37:01,120 of the things that I think people don't 946 00:37:05,760 --> 00:37:03,700 realize is it's not just any job and yes 947 00:37:06,990 --> 00:37:05,770 there are a lot of construction jobs but 948 00:37:09,120 --> 00:37:07,000 high-speed rail is a very high-tech 949 00:37:11,580 --> 00:37:09,130 system they're gonna be ancillary 950 00:37:14,700 --> 00:37:11,590 industries that start up to support this 951 00:37:16,650 --> 00:37:14,710 that I think are going to be somewhat 952 00:37:18,090 --> 00:37:16,660 akin to the way that the aircraft 953 00:37:20,490 --> 00:37:18,100 industry started or the high-tech 954 00:37:24,750 --> 00:37:20,500 industry started these are high 955 00:37:27,480 --> 00:37:24,760 technology devices and acoustic research 956 00:37:30,090 --> 00:37:27,490 and material structures and all those 957 00:37:31,890 --> 00:37:30,100 things really become very important so I 958 00:37:33,810 --> 00:37:31,900 think we're also talking about creating 959 00:37:36,240 --> 00:37:33,820 a whole new industrial base here but 960 00:37:38,790 --> 00:37:36,250 that's just an aside so looking at it 961 00:37:39,550 --> 00:37:38,800 from afar as I am as a lay person but 962 00:37:41,830 --> 00:37:39,560 longtime Cal 963 00:37:43,150 --> 00:37:41,840 you know just my gut feeling and looking 964 00:37:45,430 --> 00:37:43,160 at it from afar is just like you know 965 00:37:47,740 --> 00:37:45,440 what these guys are just gonna keep 966 00:37:50,230 --> 00:37:47,750 going and keep going and keep going it 967 00:37:51,850 --> 00:37:50,240 doesn't matter how much is delayed how 968 00:37:54,310 --> 00:37:51,860 expensive it gets this night they're on 969 00:37:55,600 --> 00:37:54,320 a mission to do this one way or the 970 00:37:57,010 --> 00:37:55,610 other doesn't matter what information 971 00:37:59,920 --> 00:37:57,020 you put in front of them they're gonna 972 00:38:01,660 --> 00:37:59,930 keep going so my question for you is is 973 00:38:03,220 --> 00:38:01,670 that correct and is there anything that 974 00:38:04,570 --> 00:38:03,230 would call it give you pause to decide 975 00:38:06,220 --> 00:38:04,580 you know what I think I'm gonna go to 976 00:38:08,740 --> 00:38:06,230 the governor with this and just say you 977 00:38:10,450 --> 00:38:08,750 know governor I have real concerns about 978 00:38:14,290 --> 00:38:10,460 this I'm not sure that we should be 979 00:38:16,690 --> 00:38:14,300 continuing with this so in 2011 when I 980 00:38:18,730 --> 00:38:16,700 was appointed and just after I was 981 00:38:20,380 --> 00:38:18,740 appointed this fellow Mike Rossi who was 982 00:38:23,140 --> 00:38:20,390 the former vice chair Bank of America 983 00:38:24,790 --> 00:38:23,150 was appointed and I'd known Jerry Brown 984 00:38:26,680 --> 00:38:24,800 for a number of years and Mike Rossi was 985 00:38:29,620 --> 00:38:26,690 also serving as an economic adviser to 986 00:38:31,360 --> 00:38:29,630 the governor and we looked at each other 987 00:38:33,760 --> 00:38:31,370 and said we need to look at this and see 988 00:38:36,040 --> 00:38:33,770 if this does work will it in fact pay 989 00:38:38,620 --> 00:38:36,050 for itself will it will it break even 990 00:38:40,450 --> 00:38:38,630 and both of us knew that at that moment 991 00:38:42,190 --> 00:38:40,460 we would walk into Jerry Brown's office 992 00:38:44,560 --> 00:38:42,200 and say governor this thing does not 993 00:38:47,850 --> 00:38:44,570 make sense if we did not in our bones 994 00:38:50,350 --> 00:38:47,860 feel that the case was there for it 995 00:38:52,870 --> 00:38:50,360 there have been times when we've looked 996 00:38:54,970 --> 00:38:52,880 at this and asked the question if it's 997 00:38:58,240 --> 00:38:54,980 going to take this long if it's going to 998 00:39:00,790 --> 00:38:58,250 cost this much is this the best thing to 999 00:39:03,040 --> 00:39:00,800 continue to do so the answer to your 1000 00:39:04,690 --> 00:39:03,050 question is I'd be prepared to do that 1001 00:39:08,020 --> 00:39:04,700 with this governor or the next governor 1002 00:39:10,090 --> 00:39:08,030 or any governor so far what we've seen 1003 00:39:12,430 --> 00:39:10,100 is yes the cost is higher 1004 00:39:14,890 --> 00:39:12,440 yes it's taking longer but we believe 1005 00:39:16,840 --> 00:39:14,900 it's still worth it both in terms of the 1006 00:39:19,750 --> 00:39:16,850 alternative investment costs and what 1007 00:39:21,280 --> 00:39:19,760 the benefits are going to be so is there 1008 00:39:23,620 --> 00:39:21,290 do you have a number in mind because you 1009 00:39:25,750 --> 00:39:23,630 know I'm hearing now that according to 1010 00:39:27,010 --> 00:39:25,760 your I think was 2018 business plan that 1011 00:39:29,590 --> 00:39:27,020 cost could go as high as a hundred 1012 00:39:31,420 --> 00:39:29,600 million is there a number that you would 1013 00:39:32,080 --> 00:39:31,430 say you know what that's a breaking 1014 00:39:35,500 --> 00:39:32,090 point for me 1015 00:39:36,580 --> 00:39:35,510 well I'm sure there is I mean I I can't 1016 00:39:39,010 --> 00:39:36,590 sit here today and tell you that I've 1017 00:39:40,510 --> 00:39:39,020 thought about that number right now what 1018 00:39:41,980 --> 00:39:40,520 we're looking at is sorry to interrupt 1019 00:39:43,330 --> 00:39:41,990 it I mean it's kind of important thing 1020 00:39:45,910 --> 00:39:43,340 to think about isn't because as we talk 1021 00:39:47,680 --> 00:39:45,920 about breaking even okay let's say even 1022 00:39:50,140 --> 00:39:47,690 hypothetically it could break even from 1023 00:39:52,060 --> 00:39:50,150 an operational standpoint but if it cost 1024 00:39:53,319 --> 00:39:52,070 you a trillion dollars to build sure 1025 00:39:55,749 --> 00:39:53,329 look at the cost per citizen 1026 00:39:57,609 --> 00:39:55,759 you would say no way so knowing what 1027 00:40:00,339 --> 00:39:57,619 that number is seems to be pretty 1028 00:40:01,749 --> 00:40:00,349 important it does and it's a fair 1029 00:40:03,789 --> 00:40:01,759 question and I'm sure there's a little 1030 00:40:05,019 --> 00:40:03,799 bit of a boiling the Frog issue here 1031 00:40:06,309 --> 00:40:05,029 where you know you're in the middle of 1032 00:40:08,709 --> 00:40:06,319 it and it's a little hard to see because 1033 00:40:11,589 --> 00:40:08,719 the cost numbers tend to be incremental 1034 00:40:14,289 --> 00:40:11,599 I don't mean to sound like a Pollyanna 1035 00:40:15,789 --> 00:40:14,299 on this but I'm still hopeful that we 1036 00:40:18,880 --> 00:40:15,799 can find a number of ways to bring costs 1037 00:40:21,039 --> 00:40:18,890 down a little bit part of our problem 1038 00:40:23,589 --> 00:40:21,049 is that because the way we build 1039 00:40:26,289 --> 00:40:23,599 infrastructure in this country we're on 1040 00:40:28,870 --> 00:40:26,299 kind of a pay-as-you-go basis and so 1041 00:40:31,299 --> 00:40:28,880 that means more time more time means 1042 00:40:34,120 --> 00:40:31,309 more cost if we could find ways to 1043 00:40:36,609 --> 00:40:34,130 finance some of this so we could 1044 00:40:37,709 --> 00:40:36,619 accelerate construction one of the 1045 00:40:40,420 --> 00:40:37,719 things we're going to be exploring 1046 00:40:44,109 --> 00:40:40,430 particularly in the north but ultimately 1047 00:40:45,819 --> 00:40:44,119 here in the south a big part of our cost 1048 00:40:48,009 --> 00:40:45,829 increase that we reported in the last 1049 00:40:52,569 --> 00:40:48,019 business plan was because uncertainty 1050 00:40:54,249 --> 00:40:52,579 around tunneling and tunneling is a big 1051 00:40:57,279 --> 00:40:54,259 challenging issue particularly in 1052 00:40:58,509 --> 00:40:57,289 seismic areas like this but one of the 1053 00:41:00,339 --> 00:40:58,519 things that we're talking about doing 1054 00:41:02,799 --> 00:41:00,349 very quickly is bringing in the world's 1055 00:41:04,329 --> 00:41:02,809 great tunnel builders and sitting down 1056 00:41:06,249 --> 00:41:04,339 with them both collectively and 1057 00:41:08,469 --> 00:41:06,259 individually and saying okay how much 1058 00:41:11,370 --> 00:41:08,479 risk would you take to come in and do 1059 00:41:13,689 --> 00:41:11,380 some of this can we find some different 1060 00:41:15,519 --> 00:41:13,699 mechanisms to do this a public-private 1061 00:41:18,339 --> 00:41:15,529 partnership for the tunnels in the north 1062 00:41:19,930 --> 00:41:18,349 or things like that so we're not just 1063 00:41:21,999 --> 00:41:19,940 sitting here watching the costs go up 1064 00:41:24,880 --> 00:41:22,009 and up and up I mean we're aggressively 1065 00:41:28,390 --> 00:41:24,890 trying to find areas where we can bring 1066 00:41:30,699 --> 00:41:28,400 costs back down in in this world it's 1067 00:41:33,939 --> 00:41:30,709 called value engineering and there are 1068 00:41:36,400 --> 00:41:33,949 ways to do things that in fact combine 1069 00:41:38,439 --> 00:41:36,410 things or change how things are done or 1070 00:41:41,109 --> 00:41:38,449 change the sequence that can actually 1071 00:41:42,969 --> 00:41:41,119 reduce cost so on the one hand we're 1072 00:41:46,479 --> 00:41:42,979 being honest about what we think the 1073 00:41:47,410 --> 00:41:46,489 upper bounds could be but that doesn't 1074 00:41:49,029 --> 00:41:47,420 mean that we're just going and sitting 1075 00:41:50,890 --> 00:41:49,039 in a corner sucking our thumb and saying 1076 00:41:52,959 --> 00:41:50,900 well too bad that's what it is we're 1077 00:41:55,870 --> 00:41:52,969 actively trying to manage this to see if 1078 00:41:58,329 --> 00:41:55,880 there are ways to offset those forces 1079 00:42:00,339 --> 00:41:58,339 that tend to drive costs up and frankly 1080 00:42:01,959 --> 00:42:00,349 it's impossible to really predict the 1081 00:42:03,819 --> 00:42:01,969 cost of it right there's just too many 1082 00:42:05,769 --> 00:42:03,829 unknowns which is why we've started 1083 00:42:06,700 --> 00:42:05,779 stating these things as ranges instead 1084 00:42:11,320 --> 00:42:06,710 of single point 1085 00:42:12,640 --> 00:42:11,330 because as my best friend who happens to 1086 00:42:14,980 --> 00:42:12,650 be the head of the California Energy 1087 00:42:16,960 --> 00:42:14,990 Commission says you know we don't want 1088 00:42:19,599 --> 00:42:16,970 to fall into the illusion of precision 1089 00:42:21,940 --> 00:42:19,609 and so I don't think we want to fall 1090 00:42:23,800 --> 00:42:21,950 into the illusion of precision and we 1091 00:42:26,710 --> 00:42:23,810 haven't acquired all the land yet no 1092 00:42:28,780 --> 00:42:26,720 we're better at other routes necessarily 1093 00:42:30,010 --> 00:42:28,790 we're pretty close on the routes but yes 1094 00:42:32,589 --> 00:42:30,020 you're right I mean there are still 1095 00:42:34,089 --> 00:42:32,599 uncertainties and and and the tunneling 1096 00:42:35,290 --> 00:42:34,099 costs I mean in the North we're saying 1097 00:42:37,329 --> 00:42:35,300 well that could be between four and 1098 00:42:40,420 --> 00:42:37,339 seven or eight billion dollars that's a 1099 00:42:43,570 --> 00:42:40,430 pretty big range so we do need to narrow 1100 00:42:45,250 --> 00:42:43,580 those things but it's better to tell 1101 00:42:46,870 --> 00:42:45,260 people what the high-end number is and 1102 00:42:49,270 --> 00:42:46,880 then try to come in and with something 1103 00:42:52,000 --> 00:42:49,280 under that so people have used the term 1104 00:42:53,380 --> 00:42:52,010 bullet train to nowhere and I think what 1105 00:42:56,050 --> 00:42:53,390 they're referring to is what you're 1106 00:42:58,839 --> 00:42:56,060 building as we speak sure you know and 1107 00:43:00,339 --> 00:42:58,849 and there's the argument that no but 1108 00:43:01,960 --> 00:43:00,349 nobody would would want to call that 1109 00:43:03,760 --> 00:43:01,970 nowhere obviously they're they're 1110 00:43:05,890 --> 00:43:03,770 beautiful places and so on but in the 1111 00:43:08,650 --> 00:43:05,900 sense that it's being built in an area 1112 00:43:10,599 --> 00:43:08,660 where you if it was if if that's where 1113 00:43:11,680 --> 00:43:10,609 we left off and that's all we had was 1114 00:43:13,060 --> 00:43:11,690 the stretch you guys are building right 1115 00:43:14,920 --> 00:43:13,070 now 119 miles that would be a disaster 1116 00:43:17,800 --> 00:43:14,930 is that fair to say it wouldn't be a 1117 00:43:20,230 --> 00:43:17,810 disaster by any means but it wouldn't be 1118 00:43:21,339 --> 00:43:20,240 what we want to deliver to the public 1119 00:43:23,470 --> 00:43:21,349 and it wouldn't be what the public 1120 00:43:29,560 --> 00:43:23,480 expects yeah I mean could you just you 1121 00:43:31,510 --> 00:43:29,570 know well highlight here sure beginning 1122 00:43:36,310 --> 00:43:31,520 in the end of it well right now it's 1123 00:43:37,870 --> 00:43:36,320 from its from Madera to Bakersfield but 1124 00:43:40,720 --> 00:43:37,880 30 miles short of Bakersfield isn't it 1125 00:43:42,280 --> 00:43:40,730 not quite all the way to Bakersfield we 1126 00:43:43,930 --> 00:43:42,290 just cleared environmentally into 1127 00:43:46,359 --> 00:43:43,940 Bakersfield so it will go into Baker's 1128 00:43:49,300 --> 00:43:46,369 okay and then Madero is this town you're 1129 00:43:51,280 --> 00:43:49,310 worth of Fresno okay and then the next 1130 00:43:53,550 --> 00:43:51,290 thing is to connect over to the but but 1131 00:44:01,120 --> 00:43:53,560 I mean let me answer your your question 1132 00:44:02,530 --> 00:44:01,130 two ways first the you you always have 1133 00:44:03,700 --> 00:44:02,540 to start somewhere before I got on the 1134 00:44:05,170 --> 00:44:03,710 high speed rail authority and I heard 1135 00:44:07,599 --> 00:44:05,180 they were gonna build this thing in the 1136 00:44:09,460 --> 00:44:07,609 Central Valley I I thought why in the 1137 00:44:13,089 --> 00:44:09,470 world would they do that I mean and and 1138 00:44:14,740 --> 00:44:13,099 I mean the first one by the way was they 1139 00:44:16,750 --> 00:44:14,750 announced was going to be Borden to 1140 00:44:18,140 --> 00:44:16,760 Corcoran which I had not heard of either 1141 00:44:20,300 --> 00:44:18,150 of those towns 1142 00:44:22,130 --> 00:44:20,310 but as I got on to the high speed rail 1143 00:44:24,740 --> 00:44:22,140 authority I realized that in fact this 1144 00:44:26,810 --> 00:44:24,750 is this is the best place to start and 1145 00:44:29,210 --> 00:44:26,820 it's the best place to start for several 1146 00:44:31,820 --> 00:44:29,220 reasons one we get more track mile per 1147 00:44:33,950 --> 00:44:31,830 dollars there than other places number 1148 00:44:35,870 --> 00:44:33,960 two there's no real alignment in that 1149 00:44:37,730 --> 00:44:35,880 area we have to get that and the longer 1150 00:44:39,680 --> 00:44:37,740 you wait the harder it is because you 1151 00:44:42,530 --> 00:44:39,690 know growth the houses come up that you 1152 00:44:45,140 --> 00:44:42,540 then have to take but also you have to 1153 00:44:47,450 --> 00:44:45,150 test the trains at up to 250 miles an 1154 00:44:49,490 --> 00:44:47,460 hour trying to do that say between LA 1155 00:44:53,150 --> 00:44:49,500 and Anaheim would be kind of challenging 1156 00:44:55,040 --> 00:44:53,160 so it gives us essentially a national 1157 00:44:57,350 --> 00:44:55,050 test track for high-speed rail in the 1158 00:45:00,440 --> 00:44:57,360 Central Valley but the second part of 1159 00:45:02,870 --> 00:45:00,450 your question is and again this is not 1160 00:45:04,520 --> 00:45:02,880 what we're trying to build but part of 1161 00:45:05,870 --> 00:45:04,530 our policy is to always say no matter 1162 00:45:08,030 --> 00:45:05,880 what we're building it has to have 1163 00:45:09,980 --> 00:45:08,040 independent utility it's like a 1164 00:45:11,390 --> 00:45:09,990 tinkertoy set where each piece you 1165 00:45:15,350 --> 00:45:11,400 connect is going to be more and more 1166 00:45:19,280 --> 00:45:15,360 valuable if heaven forbid for a while 1167 00:45:21,530 --> 00:45:19,290 that was all we built that route between 1168 00:45:23,600 --> 00:45:21,540 Bakersfield and Sacramento and Oakland 1169 00:45:25,640 --> 00:45:23,610 is the sixth busiest in Prak Quarter in 1170 00:45:28,190 --> 00:45:25,650 the United States there's 1.1 million 1171 00:45:30,770 --> 00:45:28,200 riders per year it's a five to six hour 1172 00:45:33,530 --> 00:45:30,780 trip what we're building would allow the 1173 00:45:35,750 --> 00:45:33,540 Amtrak trains to go onto our tracks at 1174 00:45:38,450 --> 00:45:35,760 least temporarily and cut an hour and 1175 00:45:40,910 --> 00:45:38,460 fifteen minutes off of that time so it's 1176 00:45:42,530 --> 00:45:40,920 not going to be useless that's not what 1177 00:45:45,350 --> 00:45:42,540 we're trying to build but there's a 1178 00:45:48,020 --> 00:45:45,360 backstop capability in every decision we 1179 00:45:49,460 --> 00:45:48,030 make so that if we get delayed or 1180 00:45:51,410 --> 00:45:49,470 something it's not just sitting there 1181 00:45:53,120 --> 00:45:51,420 rusting with weeds growing up through it 1182 00:45:55,010 --> 00:45:53,130 there's some use for it so that makes 1183 00:45:57,770 --> 00:45:55,020 sense to me as to why you started in the 1184 00:46:01,400 --> 00:45:57,780 Central Valley but you also took a huge 1185 00:46:03,080 --> 00:46:01,410 risk by starting it without knowing for 1186 00:46:04,910 --> 00:46:03,090 sure that we could complete the whole 1187 00:46:06,530 --> 00:46:04,920 thing for instance funding we don't know 1188 00:46:08,600 --> 00:46:06,540 where the funding is gonna come from and 1189 00:46:11,600 --> 00:46:08,610 I will tell you from having worked on 1190 00:46:12,770 --> 00:46:11,610 the BART project or others people never 1191 00:46:15,020 --> 00:46:12,780 know where all the funding is coming 1192 00:46:18,110 --> 00:46:15,030 from it took 30 years to build 1193 00:46:20,810 --> 00:46:18,120 interstate 5 from San Diego to the 1194 00:46:23,030 --> 00:46:20,820 Oregon border 30 years they built it in 1195 00:46:25,340 --> 00:46:23,040 pieces nobody was sure when the whole 1196 00:46:27,680 --> 00:46:25,350 thing was going to be done the BART 1197 00:46:29,570 --> 00:46:27,690 system the BART system in San Francisco 1198 00:46:30,740 --> 00:46:29,580 people here in Los Angeles may not be as 1199 00:46:34,790 --> 00:46:30,750 familiar 1200 00:46:36,950 --> 00:46:34,800 the first BART line that opened up when 1201 00:46:39,680 --> 00:46:36,960 Lyndon Johnson came out and stood with 1202 00:46:42,980 --> 00:46:39,690 Pat Brown to cut the ribbon was from 1203 00:46:44,870 --> 00:46:42,990 Concord to Walnut Creek so if you want 1204 00:46:46,820 --> 00:46:44,880 to talk about a train to nowhere now 1205 00:46:48,590 --> 00:46:46,830 there's a hundred and four miles of BART 1206 00:46:50,150 --> 00:46:48,600 lines throughout the Bay Area it carries 1207 00:46:52,310 --> 00:46:50,160 the same amount of traffic every day as 1208 00:46:54,350 --> 00:46:52,320 the Bay Bridge absolutely essential for 1209 00:46:54,800 --> 00:46:54,360 the infrastructure up there starting 1210 00:46:56,150 --> 00:46:54,810 point 1211 00:46:58,820 --> 00:46:56,160 nobody knew where all the money was 1212 00:47:01,970 --> 00:46:58,830 coming from and I've just seen this in 1213 00:47:03,950 --> 00:47:01,980 every project that I've ever been 1214 00:47:06,110 --> 00:47:03,960 involved with that's just the way 1215 00:47:08,960 --> 00:47:06,120 transportation funding happens that's 1216 00:47:10,700 --> 00:47:08,970 why when we build a segment we want to 1217 00:47:13,370 --> 00:47:10,710 make sure the segment has independent 1218 00:47:16,550 --> 00:47:13,380 value and with each segment we add that 1219 00:47:18,350 --> 00:47:16,560 value grows exponentially but it's just 1220 00:47:20,720 --> 00:47:18,360 a reality and transportation funding you 1221 00:47:23,240 --> 00:47:20,730 just you I've never seen a project well 1222 00:47:25,040 --> 00:47:23,250 look at LA the red line when the red 1223 00:47:27,020 --> 00:47:25,050 line came in here people said what are 1224 00:47:29,120 --> 00:47:27,030 we doing what's this this line doesn't 1225 00:47:32,030 --> 00:47:29,130 connect anybody to anything la is not 1226 00:47:33,860 --> 00:47:32,040 gonna have Subway's look at today young 1227 00:47:35,660 --> 00:47:33,870 people are very expensive but we have 1228 00:47:37,010 --> 00:47:35,670 them you have them and and and people 1229 00:47:38,480 --> 00:47:37,020 are proud of them and they and they 1230 00:47:40,460 --> 00:47:38,490 carry an awful lot of people and it's 1231 00:47:42,350 --> 00:47:40,470 been a good decision but nobody knew at 1232 00:47:44,690 --> 00:47:42,360 the day one what that was gonna look 1233 00:47:47,120 --> 00:47:44,700 like a so where is the funding gonna 1234 00:47:49,310 --> 00:47:47,130 come from to complete the entire bullet 1235 00:47:50,960 --> 00:47:49,320 train as envisioned by the voters well 1236 00:47:52,790 --> 00:47:50,970 of course my first part of the answer is 1237 00:47:55,600 --> 00:47:52,800 I can't sit here and tell you that today 1238 00:47:58,850 --> 00:47:55,610 but I can give you some general ideas 1239 00:48:02,060 --> 00:47:58,860 the most important thing is when we get 1240 00:48:05,210 --> 00:48:02,070 to we we have almost enough funding to 1241 00:48:07,450 --> 00:48:05,220 complete the the first piece from 1242 00:48:09,980 --> 00:48:07,460 Bakersfield up to San Jose San Francisco 1243 00:48:12,080 --> 00:48:09,990 that is probably a twenty eight twenty 1244 00:48:14,600 --> 00:48:12,090 nine billion dollar piece if we look at 1245 00:48:16,670 --> 00:48:14,610 the federal and state funding sources we 1246 00:48:18,500 --> 00:48:16,680 have today or that we anticipate that 1247 00:48:19,970 --> 00:48:18,510 the legislature has given us the revenue 1248 00:48:21,290 --> 00:48:19,980 stream from okay I have to stop you 1249 00:48:23,000 --> 00:48:21,300 there because my understanding of the 1250 00:48:25,250 --> 00:48:23,010 numbers is that the bond was just short 1251 00:48:27,440 --> 00:48:25,260 of ten million California bonds right 1252 00:48:29,330 --> 00:48:27,450 sorry billion so that gives us just a 1253 00:48:30,650 --> 00:48:29,340 tenant right federal money is how much 1254 00:48:32,540 --> 00:48:30,660 three and a half billion three and a 1255 00:48:34,610 --> 00:48:32,550 half billion right where's the rest is 1256 00:48:35,930 --> 00:48:34,620 coming so we get twenty five percent of 1257 00:48:38,240 --> 00:48:35,940 the proceeds of the cap-and-trade 1258 00:48:40,100 --> 00:48:38,250 program that's running about seven 1259 00:48:42,200 --> 00:48:40,110 hundred million dollars a year so if we 1260 00:48:44,140 --> 00:48:42,210 look out the next 12 years you know 1261 00:48:46,359 --> 00:48:44,150 that's another almost nine 1262 00:48:48,730 --> 00:48:46,369 ten billion so we're in about the 21 1263 00:48:51,579 --> 00:48:48,740 billion dollar range so we're probably 1264 00:48:53,650 --> 00:48:51,589 short four to seven billion to be able 1265 00:48:54,910 --> 00:48:53,660 to complete the segment from Bakersfield 1266 00:48:57,099 --> 00:48:54,920 to San Francisco 1267 00:48:59,559 --> 00:48:57,109 that's not pocket change I'm not going 1268 00:49:02,170 --> 00:48:59,569 to find it in my sofa but it's not an 1269 00:49:04,569 --> 00:49:02,180 insurmountable amount of money once we 1270 00:49:06,640 --> 00:49:04,579 get that done we look at giving a 1271 00:49:10,569 --> 00:49:06,650 concession to the private sector to come 1272 00:49:13,660 --> 00:49:10,579 in and to help us build the rest of it 1273 00:49:16,029 --> 00:49:13,670 they would be writing us a check of some 1274 00:49:18,549 --> 00:49:16,039 amount which ultimately could be up to 1275 00:49:19,210 --> 00:49:18,559 20 billion for the whole system now let 1276 00:49:21,069 --> 00:49:19,220 me say this 1277 00:49:22,690 --> 00:49:21,079 people always say let's go back to the 1278 00:49:25,720 --> 00:49:22,700 bond act and say well the public was 1279 00:49:27,640 --> 00:49:25,730 promised XY and Z the public was told in 1280 00:49:30,579 --> 00:49:27,650 2008 that a third of the money was going 1281 00:49:31,990 --> 00:49:30,589 to come from the state a third from the 1282 00:49:35,620 --> 00:49:32,000 federal government and a third from the 1283 00:49:37,210 --> 00:49:35,630 private sector our analysis shows that 1284 00:49:38,859 --> 00:49:37,220 about a third could come from the 1285 00:49:41,170 --> 00:49:38,869 private sector maybe a little less as 1286 00:49:42,819 --> 00:49:41,180 the project costs have come up the state 1287 00:49:44,890 --> 00:49:42,829 has certainly put up a huge amount of 1288 00:49:45,910 --> 00:49:44,900 money problem is the federal government 1289 00:49:49,269 --> 00:49:45,920 the three and a half billion has been 1290 00:49:52,059 --> 00:49:49,279 vital but if that's all we get that's 1291 00:49:53,859 --> 00:49:52,069 less than five percent of the project 1292 00:49:56,920 --> 00:49:53,869 normally the federal government is 1293 00:49:58,680 --> 00:49:56,930 funding 80 percent of transportation 1294 00:50:01,870 --> 00:49:58,690 projects even the Trump administration 1295 00:50:05,109 --> 00:50:01,880 which wants to slash federal funding and 1296 00:50:07,180 --> 00:50:05,119 put more burden on the states says 20 1297 00:50:09,309 --> 00:50:07,190 percent of project funding would come 1298 00:50:11,109 --> 00:50:09,319 from projects so we're going to need 1299 00:50:12,460 --> 00:50:11,119 more federal funding I mean I'm just 1300 00:50:13,750 --> 00:50:12,470 gonna sit here and tell you that we're 1301 00:50:15,700 --> 00:50:13,760 gonna need more federal funding to 1302 00:50:17,380 --> 00:50:15,710 complete this project but that may be a 1303 00:50:19,539 --> 00:50:17,390 challenge at this point because have we 1304 00:50:21,760 --> 00:50:19,549 burned our relationship with the federal 1305 00:50:23,230 --> 00:50:21,770 government on this project no we have 1306 00:50:24,430 --> 00:50:23,240 not burned our relationship with the 1307 00:50:26,859 --> 00:50:24,440 federal government I was just back 1308 00:50:28,510 --> 00:50:26,869 meeting with me the funny thing is is 1309 00:50:30,039 --> 00:50:28,520 that people would assume that oh because 1310 00:50:31,329 --> 00:50:30,049 California is fighting with the Trump 1311 00:50:33,789 --> 00:50:31,339 administration on so many issues 1312 00:50:35,769 --> 00:50:33,799 important issues like immigration and 1313 00:50:39,220 --> 00:50:35,779 climate change that we must be fighting 1314 00:50:41,019 --> 00:50:39,230 everywhere but in fact not only have 1315 00:50:42,279 --> 00:50:41,029 both the current governor and the 1316 00:50:44,319 --> 00:50:42,289 governor-elect expressed appreciation 1317 00:50:46,480 --> 00:50:44,329 about the support we're getting on 1318 00:50:48,130 --> 00:50:46,490 wildfire recovery but I will tell you 1319 00:50:49,960 --> 00:50:48,140 that all of my conversations with 1320 00:50:52,269 --> 00:50:49,970 transportation officials in the Trump 1321 00:50:54,069 --> 00:50:52,279 administration have been positive we've 1322 00:50:55,690 --> 00:50:54,079 had very good working relationship with 1323 00:50:57,130 --> 00:50:55,700 them but you know the overall view of 1324 00:50:59,380 --> 00:50:57,140 California from the rest of the 1325 00:51:01,630 --> 00:50:59,390 as far as I can glean is they're not 1326 00:51:03,910 --> 00:51:01,640 real fond of us they think that you know 1327 00:51:06,310 --> 00:51:03,920 we have plenty of money and we spend it 1328 00:51:08,350 --> 00:51:06,320 frivolously so the idea of the federal 1329 00:51:10,360 --> 00:51:08,360 government helping out California on 1330 00:51:11,980 --> 00:51:10,370 this highfalutin the high-speed rail 1331 00:51:14,740 --> 00:51:11,990 project I don't think that would sell 1332 00:51:17,500 --> 00:51:14,750 too well in the Midwest until you remind 1333 00:51:19,540 --> 00:51:17,510 them that if we buy rail cars made by 1334 00:51:22,960 --> 00:51:19,550 Kawasaki they'll be built in Lincoln 1335 00:51:24,610 --> 00:51:22,970 Nebraska if we buy steel from a certain 1336 00:51:27,040 --> 00:51:24,620 steel manufacturer it'll come from 1337 00:51:29,500 --> 00:51:27,050 Indiana I mean these dollars are not 1338 00:51:31,660 --> 00:51:29,510 just spent in California we're very 1339 00:51:33,190 --> 00:51:31,670 proud of the fact that we're supporting 1340 00:51:36,220 --> 00:51:33,200 a lot of small businesses in California 1341 00:51:38,170 --> 00:51:36,230 because 30% of our dollars by our own 1342 00:51:39,790 --> 00:51:38,180 policies go to small business but 1343 00:51:41,920 --> 00:51:39,800 there's a lot of money when you look at 1344 00:51:44,140 --> 00:51:41,930 the map and and this is what people do 1345 00:51:45,730 --> 00:51:44,150 when you go to Congress is you walk into 1346 00:51:48,610 --> 00:51:45,740 the office of a Congress member from 1347 00:51:51,520 --> 00:51:48,620 Illinois and say oh these caterpillar 1348 00:51:53,020 --> 00:51:51,530 tractors tr4 diesels most advanced in 1349 00:51:55,450 --> 00:51:53,030 the world that we're hiring to build our 1350 00:51:58,530 --> 00:51:55,460 project yeah they're made in Peoria 1351 00:52:01,360 --> 00:51:58,540 Illinois and so if fact of the matter is 1352 00:52:04,450 --> 00:52:01,370 even though our politics don't always 1353 00:52:06,250 --> 00:52:04,460 show this we are one nation and there 1354 00:52:08,200 --> 00:52:06,260 are pieces of this project that are 1355 00:52:10,150 --> 00:52:08,210 being built and dollars that are flowing 1356 00:52:11,980 --> 00:52:10,160 to the various parts of the country and 1357 00:52:13,330 --> 00:52:11,990 and that's our discussion that we have 1358 00:52:15,010 --> 00:52:13,340 we know hasn't the federal government 1359 00:52:17,290 --> 00:52:15,020 already moved to cut off additional 1360 00:52:20,620 --> 00:52:17,300 funding for the bullet train what they 1361 00:52:23,770 --> 00:52:20,630 did was there were two members of 1362 00:52:26,280 --> 00:52:23,780 Congress who were putting resolutions in 1363 00:52:28,660 --> 00:52:26,290 in every budget for the last seven years 1364 00:52:32,050 --> 00:52:28,670 saying that there'd be no more federal 1365 00:52:33,160 --> 00:52:32,060 money for high-speed rail both of those 1366 00:52:39,720 --> 00:52:33,170 members were defeated in the last 1367 00:52:45,550 --> 00:52:43,030 not do in the sense that there's no 1368 00:52:48,310 --> 00:52:45,560 stimulus dollars is there still so no 1369 00:52:50,770 --> 00:52:48,320 wait we we spent there was we spent 2.5 1370 00:52:52,510 --> 00:52:50,780 five billion dollars of stimulus dollars 1371 00:52:54,490 --> 00:52:52,520 within the time frame that the federal 1372 00:52:57,280 --> 00:52:54,500 government required there is an 1373 00:52:59,400 --> 00:52:57,290 additional almost a billion dollars that 1374 00:53:02,500 --> 00:52:59,410 was appropriated in fiscal year 2010 1375 00:53:04,360 --> 00:53:02,510 that will be available to us once the 1376 00:53:06,730 --> 00:53:04,370 state matches that two and a half 1377 00:53:08,170 --> 00:53:06,740 billion which were in the process of 1378 00:53:10,400 --> 00:53:08,180 doing now with our bond money and cap 1379 00:53:11,930 --> 00:53:10,410 and trade so 1380 00:53:13,720 --> 00:53:11,940 a total of three and a half billion 1381 00:53:17,180 --> 00:53:13,730 dollars of federal money was 1382 00:53:19,550 --> 00:53:17,190 appropriated we've spent two and a half 1383 00:53:21,170 --> 00:53:19,560 billion we have a grant agreement with 1384 00:53:24,040 --> 00:53:21,180 the federal government that gives us the 1385 00:53:26,270 --> 00:53:24,050 timing of when we can access that up I 1386 00:53:27,560 --> 00:53:26,280 know you got a flight to catch so let me 1387 00:53:30,590 --> 00:53:27,570 just wrap up with this question it seems 1388 00:53:33,320 --> 00:53:30,600 like Murphy's Law Brian Kelly your CEO 1389 00:53:34,910 --> 00:53:33,330 yeah went on a medical leave of absence 1390 00:53:36,500 --> 00:53:34,920 he did he okay and is he still on the 1391 00:53:41,150 --> 00:53:36,510 leave what can you tell us he's still on 1392 00:53:43,610 --> 00:53:41,160 the leave he he had something that was a 1393 00:53:45,860 --> 00:53:43,620 serious but not permanent and so we 1394 00:53:49,130 --> 00:53:45,870 expect him back I'm hoping in the first 1395 00:53:51,920 --> 00:53:49,140 quarter of next year he's an extremely 1396 00:53:56,090 --> 00:53:51,930 talented guy he's the right CEO for us 1397 00:53:59,330 --> 00:53:56,100 at this point he has a lot of contacts a 1398 00:54:00,710 --> 00:53:59,340 lot of experience we do miss him and a 1399 00:54:03,050 --> 00:54:00,720 number of us have had to spend even more 1400 00:54:06,620 --> 00:54:03,060 time to try to you know step in behind 1401 00:54:08,000 --> 00:54:06,630 him but we do expect him back it seems 1402 00:54:12,170 --> 00:54:08,010 like this job could jeopardy be 1403 00:54:14,960 --> 00:54:12,180 jeopardize your health so yeah I suggest 1404 00:54:17,510 --> 00:54:14,970 you look out for your own no thank you I 1405 00:54:21,110 --> 00:54:17,520 I actually do appreciate that and I 1406 00:54:23,510 --> 00:54:21,120 think that that that's wise but you know 1407 00:54:24,860 --> 00:54:23,520 look as a board member I do one 1408 00:54:27,860 --> 00:54:24,870 appointment point out I get paid five 1409 00:54:30,080 --> 00:54:27,870 hundred bucks a month but Governor Brown 1410 00:54:31,790 --> 00:54:30,090 believes a lot in psychic income so he 1411 00:54:34,850 --> 00:54:31,800 has showered me with psychic income 1412 00:54:36,920 --> 00:54:34,860 dollars which don't exactly pay the rent 1413 00:54:40,280 --> 00:54:36,930 but I've been fortunate enough I can I 1414 00:54:42,680 --> 00:54:40,290 can do this and I have to say with all 1415 00:54:45,800 --> 00:54:42,690 the difficulties and the brickbats and 1416 00:54:47,390 --> 00:54:45,810 everything else this this has been the 1417 00:54:49,610 --> 00:54:47,400 greatest privilege of my life to work on 1418 00:54:52,130 --> 00:54:49,620 this because I truly believe it's going 1419 00:54:53,390 --> 00:54:52,140 to be transformative for the state it's 1420 00:54:56,840 --> 00:54:53,400 going to have all kinds of challenges 1421 00:54:59,030 --> 00:54:56,850 but I think when we're done just as with 1422 00:55:00,230 --> 00:54:59,040 Bart or the Golden Gate Bridge or any of 1423 00:55:02,330 --> 00:55:00,240 these things that were highly 1424 00:55:03,500 --> 00:55:02,340 controversial people don't realize it 1425 00:55:05,590 --> 00:55:03,510 there were two thousand three hundred 1426 00:55:08,240 --> 00:55:05,600 lawsuits to stop the Golden Gate Bridge 1427 00:55:10,760 --> 00:55:08,250 Bart was called the train to nowhere I 1428 00:55:12,530 --> 00:55:10,770 mean all these things going back to the 1429 00:55:14,510 --> 00:55:12,540 Erie Canal have always been questioned 1430 00:55:16,640 --> 00:55:14,520 and yet we always tend to turn back and 1431 00:55:19,010 --> 00:55:16,650 say my gosh were happy that we did that 1432 00:55:21,230 --> 00:55:19,020 I I believe in my heart that's going to 1433 00:55:23,770 --> 00:55:21,240 be the situation here I do think it's 1434 00:55:26,780 --> 00:55:23,780 our obligation to future generations and 1435 00:55:29,720 --> 00:55:26,790 and I'm proud to be a part of it and you 1436 00:55:31,130 --> 00:55:29,730 know even though the vicissitudes and 1437 00:55:33,740 --> 00:55:31,140 the challenges and the setbacks and the 1438 00:55:36,740 --> 00:55:33,750 mistakes of the things that necessarily 1439 00:55:38,420 --> 00:55:36,750 capture public attention we're building 1440 00:55:40,520 --> 00:55:38,430 something extraordinary here I mean as 1441 00:55:42,830 --> 00:55:40,530 we sit here today 2500 people are 1442 00:55:45,760 --> 00:55:42,840 working on 21 different job sites across 1443 00:55:48,650 --> 00:55:45,770 120 miles of the Central Valley it's a 1444 00:55:51,260 --> 00:55:48,660 it's a huge accomplishment well I simply 1445 00:55:53,930 --> 00:55:51,270 ask as a citizen that you continue to 1446 00:55:57,830 --> 00:55:53,940 look at it with very realistic eyes and 1447 00:56:00,200 --> 00:55:57,840 if this thing can't be completed if it's 1448 00:56:01,850 --> 00:56:00,210 gonna you know continue to increase in 1449 00:56:04,190 --> 00:56:01,860 cost or continue to be pushed back or 1450 00:56:05,930 --> 00:56:04,200 whatever that we be realistic about that 1451 00:56:07,310 --> 00:56:05,940 that we let the people know that that 1452 00:56:08,750 --> 00:56:07,320 you inform the governor of that because 1453 00:56:10,490 --> 00:56:08,760 you know I just jotted down before you 1454 00:56:11,840 --> 00:56:10,500 walked in a couple all the priorities in 1455 00:56:14,210 --> 00:56:11,850 the state of California whether it be 1456 00:56:15,859 --> 00:56:14,220 police are universities homelessness the 1457 00:56:17,180 --> 00:56:15,869 fires that we've been having that we you 1458 00:56:20,420 --> 00:56:17,190 know we need protection against water 1459 00:56:22,550 --> 00:56:20,430 traffic schools earthquake risks and so 1460 00:56:24,290 --> 00:56:22,560 on you know there's so many issues that 1461 00:56:26,870 --> 00:56:24,300 need to be addressed in California and 1462 00:56:28,280 --> 00:56:26,880 our dollars are so precious that I just 1463 00:56:29,450 --> 00:56:28,290 don't want to see dollars go to waste on 1464 00:56:32,390 --> 00:56:29,460 something that's not gonna ultimately 1465 00:56:34,310 --> 00:56:32,400 pay off you know my name is associated 1466 00:56:34,790 --> 00:56:34,320 with this program I don't want that 1467 00:56:38,120 --> 00:56:34,800 either 1468 00:56:40,640 --> 00:56:38,130 and the last thing I want is my legacy 1469 00:56:43,099 --> 00:56:40,650 to be to have worked on something that 1470 00:56:44,870 --> 00:56:43,109 turned out to be some huge expensive 1471 00:56:47,000 --> 00:56:44,880 boondoggle I don't believe that's going 1472 00:56:49,120 --> 00:56:47,010 to be the case and I actually believe 1473 00:56:51,830 --> 00:56:49,130 that by putting people to work 1474 00:56:55,730 --> 00:56:51,840 strengthening communities helping to 1475 00:56:57,770 --> 00:56:55,740 build sustainable communities providing 1476 00:57:00,050 --> 00:56:57,780 training for people who are coming to 1477 00:57:02,540 --> 00:57:00,060 work on our program that we are in our 1478 00:57:04,010 --> 00:57:02,550 own way addressing a number not all but 1479 00:57:07,480 --> 00:57:04,020 a number of those things that you talked 1480 00:57:10,580 --> 00:57:07,490 about so I don't think it's an either/or 1481 00:57:12,340 --> 00:57:10,590 the new governor is going to face all 1482 00:57:15,109 --> 00:57:12,350 those challenges that you just laid out 1483 00:57:18,460 --> 00:57:15,119 governors and legislators make priority 1484 00:57:20,780 --> 00:57:18,470 decisions so far they've indicated that 1485 00:57:22,820 --> 00:57:20,790 building for the future in a modern 1486 00:57:24,590 --> 00:57:22,830 transportation system is going to be 1487 00:57:26,599 --> 00:57:24,600 important to keep in California 1488 00:57:29,240 --> 00:57:26,609 economically vibrant I really believe 1489 00:57:31,400 --> 00:57:29,250 that our job is to do it the best way we 1490 00:57:33,890 --> 00:57:31,410 can to learn from mistakes but to keep 1491 00:57:35,720 --> 00:57:33,900 driving forward and keep doing better 1492 00:57:38,240 --> 00:57:35,730 thank you so much well I have to say I 1493 00:57:39,710 --> 00:57:38,250 am mildly convinced and I didn't even 1494 00:57:42,050 --> 00:57:39,720 think I come out of this mildly 1495 00:57:43,760 --> 00:57:42,060 convinced so I really appreciate your 1496 00:57:45,170 --> 00:57:43,770 time and if you're spending the time I 1497 00:57:46,370 --> 00:57:45,180 think I appreciate I know the 1498 00:57:47,810 --> 00:57:46,380 Californians will appreciate it I