A Potential Thorn in the side for High-Speed Rail

Union Pacific Vows to Fight High-Speed Rail

Union Pacific Vows to Fight High-Speed Rail

Posted: May 12th, 2010 10:02 AM EDT

By Mike Rosenberg
San Jose Mercury News (California)

CALIFORNIA - Signaling its most forceful objection yet and perhaps protracted court battles Union Pacific has notified the California high-speed rail authority that it will fight the state's newest plans to run bullet trains from the South Bay to the Central Valley, including along Monterey Highway in San Jose.

The Delaware-based company, which runs late-night freight trains along the Caltrain corridor and south into the Central Valley, says the California High Speed Rail Authority's revised route plans released in March are "not acceptable."

The rail authority needs land owned by Union Pacific south of the San Jose Diridon Station including the property for the Gilroy high-speed rail station and in the Central Valley to build its railroad to Southern California.

But in a recent letter to the authority, Union Pacific rejected a plan to negotiate the sale of the land and vowed to join its freight-shipping customers in warding off the state's attempts to grab their land through eminent domain.

Critics question whether the company is holding out for more money for its tracks, while watchdogs say the charges set the stage for costly and lengthy legal battles.

Planners can't afford any cost increases or delays resulting from legal challenges the freight industry may bring. The $43 billion project needs to start construction by September 2012 or lose $2.25 billion in federal stimulus grants, which would be matched by state funds to total $4.5 billion.

Critics say the letter, dated April 23, is simply meant to bolster Union Pacific's negotiating stance. Assemblyman Jim Beall, D-San Jose, said he encountered similar tactics when he headed the Caltrain committee that led the agency's track purchase from Union Pacific in the early 1990s.

"Them saying they're not going to negotiate is simply posturing for their purposes of getting more money," Beall said. "If they want to do that kind of tactic, they're going to have to pay for it some way. What comes around goes around. If they want to do that kind of thing, watch out."

The rail authority and the Attorney General's Office are looking into the complaints, which have become a major priority for rail planners. They hope to arrange a meeting with Union Pacific leaders to improve what they called a "difficult relationship."

"That's an issue for us right now," rail authority Program Director Tony Daniels said at a meeting in Sacramento last week. "They don't want us, first of all, in their right of way or in any of their property. And, secondly, they have grave concern about us crossing their property with any overpasses."

Although Peninsula and South Bay residents and officials have been most visible in opposing and in some cases suing the rail authority, Union Pacific may present even greater challenges.

The company, with a $3.5 billion payroll, spends $2.5 billion on capital projects annually and intends to expand its local operations but said the high-speed rail project would severely hamper its shipping in the Bay Area and further south. Freight locomotives cannot operate when high-speed trains are running and the freight spurs off the main track could be jeopardized by the project.

Eminent domain appears to be the rail authority's only recourse to obtain the land on which it wants to build.

The state plans to run its trains alongside or on UP tracks from San Jose to Gilroy, the planned high-speed rail station in Gilroy, and in Manteca, Modesto, Salida, Turlock, Atwater and Merced.

"Locating the high-speed corridor immediately adjacent to UP's right of way raises serious safety issues and creates a barrier against any future rail-served development on that side," the four-page letter said.

The company said such an arrangement would increase the risk of a derailed freight train slamming into a passenger-filled bullet train, which "could result in one of the worst rail accidents in American history, with dozens or even hundreds of fatalities."

The rail authority tried to circumvent a stretch of UP-owned track by releasing plans to run bullet trains through an eight-mile stretch of Monterey Highway from Umbarger to Metcalf roads. However, citing safety concerns and expansion plans, UP demanded the tracks be 50 to 100 feet from its property.

"Either UP is serious, or UP wants some serious money," said Elizabeth Alexis, a co-founder of the Palo Alto-based watchdog group Californians Advocating Responsible Rail Design. "If it's posturing, then it's clear that there's going to be a really big cost to the state for their right of way."

UP officials did not return calls for comment.

Rail authority spokesman Jeff Barker released a statement saying officials will "thoroughly review" the letter and respond to it. He added that revised plans are still broad and that specific decisions will be made after the authority works closer with property owners in coming months and years.