Santa Cruz, Calif., officials fret over rail line funding

County transportation leaders may need to postpone $5 million in scheduled repairs for the 32-mile local rail line that would occur soon after officials sign off on the pending purchase because of financing problems that still shadow the acquisition, the Santa Cruz Sentinel reports.

The Santa Cruz County
Regional Transportation Commission decided earlier this month not to ask for
additional repair money from the state as agency officials simultaneously
request $14.8 million to buy the line from Union Pacific, a purchase in the
works for two decades. That would delay line repairs until additional money
could be secured.

A full $21 million has been
promised by the state in recent years for both the line purchase and repair as
local commissioners moved toward a deal. The commission unanimously voted to
buy the line, which runs from Pajaro to Davenport, at a meeting earlier this
month. But the state’s ongoing budget woes continue to cloud the financing
picture for the rail line, as the state’s latest budget proposes deep cuts to
transportation funding.

"I’m not going to feel
that this purchase is a done deal or that it will be a done deal" until
the check is cut, said Luis Mendez, deputy director of the county
Transportation Commission.

While $11 million to buy
the line is expected from Proposition 116 funds — the initiative, approved by
voters in 1990, pays for rail projects — the balance of the purchase price,
about $3.8 million, and an additional $5 million for track upgrades has been
promised from California’s discretionary transportation funds. About $1 million
already has been spent on planning. But with the state budget in desperate
shape, transportation agencies around the state are being told it may be a
while before those promises are kept.

In an attempt to shake some
of the cash free sooner than later — specifically the $3.8 million needed for
the purchase — county transportation staffers have included in their
application the plans a private operator already has submitted for a dinner
train that would run from Santa Cruz to Davenport. Staffers hope the proposal
demonstrates that the line would provide passenger service, making it more
attractive to fund.

County staff also changed
their request that funding come from a state public transportation account that
is set to bear the brunt of the governor’s proposed cuts, to a state highways
fund, which is more flush with cash, Mendez said. Apparently the local rail
effort qualifies for funding from both funds. The request comes after state
commission staff earlier this month recommended not funding the repairs and the
remainder of the purchase price due to a lack of money in the public
transportation pot.

County commissioners began
negotiating with Union Pacific in late 2004 to buy the local rail line. The
commission’s long-term plans include the dinner train and building a hiking and
biking trail alongside the tracks.

At Union Pacific, spokesman
Aaron Hunt in Sacramento said his company understands the state’s dire budget
predicament, and has no plans to pull out of the sales agreement should money
not come through immediately.

"I don’t think we’re
going to move away from where we are," Hunt said. "We’ve had a good
relationship with the county transportation commission and we plan to continue
that.

Mendez said he hopes that
if the state commission does not award the money, state officials will commit
to funding the purchase once California’s economy perks up. That would likely mean
extending the life of the Prop. 116 funds, which are due to expire in July.

Meanwhile, a previously
explored loan from the Coastal Conservancy for roughly $3.8 million plus $5
million for repairs until state money comes through might still be in the cards,
Mendez said. The conservancy, however, also has been hit hard by the recession
and might not be able to loan that much money. The issue will be addressed
further following the state transportation commission’s funding decision, which
is expected at the end of June.