High Speed Rail: Brown Asks the California Supreme Court for Help
On March 18, 2013, the High Speed Rail Authority (“Authority”) asked its Finance Committee to authorize the issuance of more than $8 billion in bonds – in part to take private property for the project. The Finance Committee obliged stating it was “necessary and desirable” to do so.
The Authority then filed an action in Sacramento Superior Court asking the court rule that the March 18, 2013 actions were valid, binding, and in conformance with the applicable legal requirements. Opponents of the High Speed Rail asked the court to rescind the Authority’s funding plan. In short, Judge Michael Kenny refused to validate the bond authorization, because there was no evidence that supports the Authority’s “necessary and desirable” finding. The Judge also required the Authority to rescind its funding plan, for failure to comply with the laws enacted by Brown and the legislature. (Read the Article Here)
At the time, the spin from Governor Brown and the Authority Chairman was essentially, ho-hum no big deal. When asked what effect rescinding the funding plan would have, a Deputy AG said it would have “no effect”.
Oh, how times have changed. On January 24, 2014, the AG’s office filed a 61 page brief directly with the California Supreme Court (bypassing the Court of Appeals). (Read the Brief Here). The reason- Judge Kenny’s rulings “imperil” the project and force the Authority to either (1) comply with the requirement to rescind the funding plan or (2) ignore the ruling and risk being in contempt of court. The AG’s office has sure changed its tune from no effect to:
“Since the project’s inception, opponents of high-speed rail have tried to block its construction. Now, two rulings of the Sacramento Superior Court-which are otherwise unreviewable as a practical matter-imperil the project by erecting obstacles found nowhere in the voter-approved bond act. These erroneous rulings tum the requirements of the high-speed rail bond act on their head, threaten state and federal funding for the project, and urgently warrant review by this Court in an exercise of its original writ jurisdiction. (Cal. Rules of Court, rule 8.486(a)(l).)”
Some commentators have likened the appeal to the Supreme Court as a Hail Mary Pass. It appears Brown is losing grip of his dream. He has gone so far as to ask for $250 million in cap-and-trade revenue to help fund the state’s share of the project costs- a move met with a chilly reception by the legislature and called potentially illegal by his budget analyst.
Does the California Supreme Court hold the future of the High Speed Rail, and thus the future of thousands of hard working homeowners, residents, farmers, ranchers, and other business owners in its hands? Has the High Speed Rail hit an insurmountable roadblock? Has the political tide shifted? We shall see. We will continue to follow the developments to ensure our clients who are being affected by the High Speed Rail receive the best representation possible.