After waiting months, just less than two weeks before the release of yet another revised business plan, the peer review group (PRG), published their report on March 21, 2012 reviewing the November 2011 draft business plan. It is required by law to give its opinion within 60 days of publication. But why was the report delayed almost to the point of “why bother” since a new one is due out so soon?
It was the opinion back in January of then Board Chairman Tom Umberg and present Authority Board Chairman Dan Richard that “a more productive procedure would be to meet and consult prior to the Group issuing their report to reduce possible misunderstandings and to provide an opportunity for dialogue, of answering questions from your members and interaction on different ideas.” The Authority reps said let’s meet and “avoid a repetition of the recent events where our positions were played out in a hyper-intensive media environment.”
Perhaps another reason for the delay was the timing wasn’t right for a January release of the Peer Report. Remember back in early January a scathing review was released from the State Auditor. Executive Summary: http://www.bsa.ca.gov/reports/summary/2011-504
In the March 13, 2012 Mountain View High-Speed Rail Meeting we found out a bit more about the missing review of the draft business plan. Will Kempton, PRG Chairman said, “We delayed submittal of comments on the draft business plan [when] the original comment period was extended from Dec 31st to January 16th so we could sit down [with] them, at the Authority’s invitation, and talk with them about some of the issues we have had and maybe have the opportunity to settle those issues and perhaps make our comments more concise.”
The question is what happened between January 16th and March 21st? Another question is what does “make our comments more concise mean?” Does that mean they changed their original comments after the Authority and the PRG reached an agreement? And is that appropriate? If they are working on the plan together, who’s looking at their work?
How Independent Is The Peer Review Group?
To state it as the Legislative Counsel’s Digest of AB3034 says, the authority is to: establish an independent peer review group for the purpose of reviewing the planning, engineering, financing, and other elements of the authority’s plans and issuing an analysis of appropriateness and accuracy of the authority’s assumptions and an analysis of the viability of the authority’s funding plan for each corridor.”
That doesn’t sound like the PRG is supposed to act as a consulting arm to the Authority; it’s supposed to be “independent.” They were obviously selected because they shared the vision of high-speed rail but they shouldn’t apologize for criticizing the Authority’s plans, it’s their job.
William Grindley, co-author of many financial analyses of the high-speed rail project found at http://www.cc-hsr.org/index.shtml#finreport does not feel the PRG is independent at all and stated, “The Peers became advocates for the Authority in mid-2011 when they tried to shift the measure of the project’s success from those dictated in AB3034 to “not require an operating subsidy” to measuring success by the ‘social benefits’ of the train. Specifically their July 2011 report recognized the project could never meet the promise to voters that “users of the system pay for the system” when they said: “More critically, the approach implies, but does not state explicitly, that a significant part, perhaps all, of the Authority’s infrastructure investment will not be recovered from the operator(s). If this is correct, then the Authority’s measurement of public benefits should be fully developed and carefully reviewed in order to justify the net public outlay.”
Grindley concludes, “One is forced to conclude the Peers have either been co-opted by the Authority or have chosen to violate their legally-defined role to issue an analysis of appropriateness and accuracy of the authority’s assumptions and an analysis of the viability of the authority’s funding plan. Either way, the public no longer has an independent voice of experts protecting its investment in the project.”
Why might that be and who are these people in the Peer Review Group? http://www.cahsrprg.com/biographies.html Most have worked on facets of transportation and transit work and each have a different expertise; actually they all have far better backgrounds than the current high-speed rail authority board. One member, Freider Seible who currently sits on the PRG was recently in the news which highlighted his part of an expert panel for the Bay Bridge. http://enr.construction.com/yb/enr/article.aspx?story_id=170695676
Chairman Will Kempton is a skilled career transportation expert, well-respected in his field however he is the CEO of the Orange County Transportation Authority (OCTA) and his organization could well benefit from funds that are diverted to the bookends by the Authority. This appears to be a conflict of interest at least in spirit. The law specifically asks for two experts from agencies providing intercity or commuter passenger train services in California. The question is, is it appropriate to be a memberof the PRG when one is employed by an agency that would benefit from HSR funds. Perhaps at a minimum there should be a re-think on who the chairman is. It seems Kempton has been at every official legislative hearing, giving his person opinion as well as representing the peer review group.
Now, there is a new appointee to the Peer Review group, the sixth of seven spots on the committee. Stacey Mortensen, who is the Executive Director of the Altamont Commuter Express (ACE) and again, her agency, could be the beneficiary of high-speed rail funds. Stacey Mortensen is very articulate and intelligent but this isn’t about any individual. It’s about the appearance of impropriety since there could be a perceived advantage for the agencies they represent if the project moves forward. Somehow this seems wrong and gives the appearance of stacking the decks in favor of the Authority. They are immune from the state conflict of interest laws because they are in an advisory role. At the very least AB3034 should be clarified to allow former representatives, not active representatives of transit agencies to participate in the peer review group… It only makes sense.
Next: The content of the Peer Review Group’s most recent report