Originally posted at Foxandhoundsdaily.com. Read more articles there.
The California High Speed Rail Authority this past week approved moving forward on the first segment of final design and construction, a $4.15 billion 65 mile segment from the Central Valley town of Corcoran to Madera, with stations to be built in Fresno and Hanford.
Despite the criticisms of building a Train to Nowhere, this was the only segment that made sense in terms of the requirements accompanying the federal funds and in terms of the community support and community investment in the Central Valley. Further, there is no question that the Valley should be focus of the next funds: completing the Merced to Fresno segment and Fresno to Bakersfield segment.
The two main Valley segments, Merced-Fresno and Fresno-Bakersfield total $8 billion in cost. The Authority estimates that these two segments will generate 32,807 job-years, mainly in construction jobs, with the bulk of the construction jobs coming in years two to six. The job estimates are in the range of 5000-6000 job years annually for these years-a conservative job estimate, especially against the overly optimistic numbers often associated with infrastructure projects. There is no question that the high speed rail will be a boost to the Valley economy starting in late 2011 and 2012, when final design and construction will begin in force
Yet, the main challenge for the Valley is beyond these jobs. It lies in how the high speed rail might be leveraged to help build the regional Valley economy in professional services and in cutting edge construction techniques. High speed rail systems now are being planned throughout the United States, following the federal government funding commitment to high speed rail. The Valley segment will be one of the first segments in the nation to go into construction, enabling professional services and construction firms that work on this segment to gain experience and expertise to compete on the other systems, and to compete on other systems throughout the world. High speed rail systems are up and running in Europe and Asia, but these systems will be expanding and modernizing, and be purchasing professional service and construction expertise. Additionally, the Central Valley will be the site of a high speed rail maintenance facility that is expected to employ 1500 workers on an on-going basis, and should enable professional services and construction firms that work on this facility to be competitive on maintenance facility projects nation-wide and world-wide.
The Valley has an active and sophisticated network of Workforce Investment Boards (WIBs). Earlier this year this network, led by the Tulare WIB, retained the veteran California economic development specialists Doug Svensson and Trish Kelly to analyze the jobs generated by High Speed Rail and other major infrastructure projects and how these jobs might be leveraged for broader economic growth. Svensson and Kelly and their team (on which I have a small role) have developed detailed occupational estimates for the $26 billion in various infrastructure already projected for the Valley in the next ten years, and are developing strategies for how the Valley might leverage these investments, in water infrastructure, school construction, prison construction and hospital construction, as well as rail.
More generally for California infrastructure, the first challenge is to deliver projects in a timely and most cost effective manner. Beyond this lies the second challenge: leveraging infrastructure to develop expertise among firms in California that adds value to projects in other states and other countries. Beyond the short-term job creation fixes, only by being able to compete nationally and globally-by developing services and products offered by California firms that others outside California want to purchase–will we have true employment growth in California.
Written by Michael Bernick, Former California Employment Development Department Director and Milken Institute Fellow