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Tuesday, Nov 26 2013 07:15 PM

Locals participated in high-speed rail court case

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    By California High Speed Rail Authority

    An artist's conception of the bullet train speeding under the Tehachapi Pass.

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BY JOHN COX Californian staff writer jcox@bakersfield.com

When a Sacramento judge issued dual rulings Monday that will pose indefinite delays for California High-Speed Rail, most of the credit, or blame, went to a pair Kings County property owners.

But Kern County played a role as well.

Three local litigants -- the Kern County Board of Supervisors, Bakersfield oilman Gene Voiland and First Free Will Baptist Church on East California Avenue -- all took part behind the scenes.

Each of the parties participated in strategic phone conferences and contributed court filings that, though not central to Monday's rulings, may be critical if the case is appealed by the California High-Speed Rail Authority, as some expect will happen.

"They're still lurking. All of these issues can be raised again," said Stuart Flashman, an Oakland lawyer who represented two parties in the lawsuit, Kings County landowners Aaron Fukuda and John Tos.

Also, he said the fact that the county, Voiland and the church joined as parties to the case may have helped defeat the rail authority's lawsuit to validate the sale of $8.5 billion in voter-approved bonds to pay for the project's initial stages.

Such a lawsuit is normally an uncontested, procedural matter.

But, Flashman said, "The more defendants that answered, the more significant the challenge becomes."

CONGRESSIONAL RESPONSE

Fallout from the court rulings came Tuesday as Rep. Jeff Denham, R-Turlock, called for a review of the rail authority's financial agreements with the federal government.

In a letter to U.S. Comptroller General Gene Dodaro, Denham and Rep. Tom Latham, R-Iowa, noted that Monday's ruling eliminated the only source of state money identified as a required match to an existing grant by the Federal Railroad Administration.

Denham, chairman of the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines and Hazardous Materials, asked that the General Accounting Office make a determination on whether the lack of a state match means the rail authority is violating, or on the verge of violating, the federal grant agreement.

"The (high-speed rail) Authority has already spent hundreds of millions of federal taxpayer dollars, and now has no identified state matching funds," Denham said in a news release. "I am requesting that the GAO review the Authority's grant agreement with the FRA to ensure that taxpayer dollars are not wasted."

In addition to ruling Monday against the rail authority's request for a blanket validation for the bond sale, Sacramento Superior Court Judge Michael Kenny also ordered the rail agency to redo its 2011 funding plan.

In doing so, he sided with the Kings County Board of Supervisors and other parties who accused the rail authority of violating terms of the Proposition 1A, the 2008 measure that California voters approved to provide $9 billion in bond money for the project.

Exactly what effect those two rulings will have is unclear.

Kenny did not bar the state from selling the bonds, nor did he order the agency to rescind its approval of contracts for work on the first 29-mile construction stretch from northeast Madera to the south edge of Fresno.

He also did not block the state from spending federal stimulus or transportation money on the project -- something Denham hopes the GAO will address.

COUNTY ACTION

Kern County Deputy Counsel Nicole Misner said Tuesday her team that represented the Board of Supervisors chose to limit its involvement in the case because so many other parties were involved -- at least 12, according to Sacramento Superior Court records.

The county ultimately decided to become a co-defendant against the rail authority by filing what is known as a "joinder." That decision was made, Misner said, because it seemed "a little silly to repeat what everyone else is doing."

That action was authorized by a 4-1, closed-session vote of the county Board of Supervisors on May 7. The dissenting board member was Supervisor Leticia Perez.

Misner said the county's position was that the rail authority had asked for $8.5 billion without providing evidence that the bonds were "necessary or desirable."

"The bond was going to be used to fund additional Amtrak, additional regular diesel train lines (and) would not ensure that there would be high-speed rail that would make it from San Francisco to Los Angeles," she said.

"It was Kern County stepping in on behalf of taxpayers and citizens, saying, 'Wait a minute, you're not doing this right. This isn't what we agreed to.'"

The filing by First Free Will Baptist could not be retrieved from the Sacramento Superior Court's website Tuesday, and church representatives could not be reached for comment.

However, at least one proposed rail alignment would have crossed church property.

Flashman, the Oakland lawyer who has seen First Free Will's filing, said it largely echoed arguments made by other defendants in the case.

The filing made on behalf of Bakersfield oilman Voiland, however, presented unique technical arguments, Flashman said.

Voiland's case claimed that plans for the rail project's "initial operating segment" from Madera to the San Fernando Valley violated Proposition 1A because they do not clearly identify sources of money to complete the project.

It also alleged that the rail authority has no concrete plan for spending the bond proceeds, that it has not met reporting requirements and that its failure to state when the money would be spent threatens the bonds' tax-exempt status.

Until last month, Voiland was co-owner of the Bakersfield Blaze and part of a team trying to develop a baseball stadium as part of the Bakersfield Commons retail, office and residential project at Brimhall and Coffee roads. Roughly a sixth of the Commons project would be lost to the proposed rail alignment through Kern County. The baseball stadium project, which has been abandoned for lack of financing, was not directly endangered by the proposed alignment.

Voiland could not be reached for comment Tuesday. But his attorney, Thomas Feher, stated in an email that his client continues to have "serious concerns" about the project's proposed alignment from Madera to roughly Bakersfield's northern border.

"We hope that the High Speed Rail Authority will see this ruling as an opportunity to take a close look at its plans and come forward with rational solutions to the significant problems that have been raised by Bakersfield residents," he wrote.

Fresno Bee staff writer Tim Sheehan contributed to this report

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