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Point Of View

High-Speed Rail Free Money

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If you are one of the five construction contractors bidding on California's High-Speed Rail project, you won the lottery.

And you didn't even have to buy a ticket.

Two million dollars will be granted to each losing company, simply for bidding.

That's $8 million dollars from the taxpayers, on a project which is short billions.

I'd like to hear your Point of View. Send me an email at POV@fox11.com

The High-Speed Rail Authority says this type of payout, they call it a stipend, is not unusual for large-scale projects. And they say it encourages competitive bidding.

In reality, it's an uncommon practice and this is one of the highest loser payouts on record.

A new toll road for the 91 freeway in Southern California, also has a loser-stipend attached to it costs, but it's not even a third of what the rail authority is offering.

And in its own defense, the rail authority said California and several other states pay stipends too. But even the largest amount we could find other states paying out was half of what The Rail Authority is providing.

So why would the rail authority give $8 million dollars to the losing bidders?

Were they worried they wouldn't get anyone to bid? Are they that insecure about their plan?

The chance of winning hundreds of millions should be enough to encourage proper bidding.

This kind of reckless spending raises questions about the management of the entire project.

If they're subsidizing the losing bidders with millions then they may already be in violation of the spirit of the original law's intent, which clearly states the project must function without subsidies.

This bidding fiasco not only looks bad, but it raises a red flag that says: Stop!

Stop this project.

It's unpopular, it's underfunded and as this bidding process reveals, they're already wasting money before picking up the first shovel.

Thanks for listening.

I'd like to hear your Point of View.

What do you think? We want to hear from you on this P.O.V. segment. Share your thoughts in the comments section below or email me directly at POV@fox11.com.

Kevin Hale,

Vice President and General Manager
KTTV-TV, FOX 11 News

The views expressed are not necessarily those of the station or its employees.



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