James Andrew, Assistant Chief Counsel for the California High-Speed Rail Authority (“CHSRA”), spoke Tuesday, October 14, at the Sacramento County Bar Association, Environmental Law Section Luncheon.  He stated that High-Speed Rail (“HSR”) is a “transformative project” in that it will be the largest infrastructure project ever built as one single project.  However, the “regulatory scheme has not caught up with the project.”  Andrew compares HSR to the federal highway system construction in the 1950s, with countless opponents and regulatory hurdles.  Similarly, HSR is being constructed in California in the same manner as the federal highway system:  in the center and branching outward.

To show that HSR can be a success, Andrew explained that HSR is comparable to the Northeast Corridor, a high speed rail system that runs from Washington, D.C. to Boston.  The two regions are similar in terms of distance of rail, population, and complexity of issues.  According to reports, over 11 million people rode the Northeast Corridor during 2012.

Andrew also emphasized the environmental benefits of the HSR, specifically land preservation and air quality control.  The CHSRA is in the process of buying 5,000 acres of permanent agricultural easements for HSR construction.  This land will be preserved and, according to Andrew, will prevent sprawl in the Central Valley, reducing car travel.  In regards to air, the Air Resources Board specifically named HSR as an instrument to reduce carbon emissions in its Scoping Plan under Assembly Bill 32.  The CHSRA has pledged to be carbon-neutral in construction by taking cars off the road, thus reducing emissions, and planting “lots and lots of trees.”  Additionally, Andrew predicts that CHSRA will be a big player in the energy market, which will increase and promote the use of renewable energy.

Although Andrew was appointed only months ago, in March 2014, he has significant experience defending California Environmental Quality Act (“CEQA”) suits against HSR.  He stated that this year “has been a good year” for HSR with fewer lawsuits and more legal wins.  A recent example is this week’s victory.  On Wednesday, October 15, the California Supreme Court declined to grant review to an appeal challenging the issuance of bonds for construction of the project.  The California Court of Appeal had ruled in the favor of the CHSRA in July 2014, and the Supreme Court’s decision to decline review means that the Court of Appeal’s decision will stand.

The other current legal issue facing the HSR is federal preemption.  The federal Surface Transportation Board was created by the Interstate Commerce Commission Termination Act (“ICCTA”) and regulates all railroads.  According to opponents, the Surface Transportation Board’s regulations preempt CEQA regulations with respect to the HSR.  At least one court has found state law not preempted by federal law with regard to CEQA’s applicability to the HSR.  The Third Appellate District held that federal law did not preempt state law due to the market participation doctrine.  (See Town of Atherton v. Cal. High Speed Rail Authority (July 24, 2014, Case No. C070877).)  In contrast, the First Appellate District has held that the ICCTA grants the Surface Transportation Board exclusive jurisdiction over rail operations and preempts local laws that attempt to regulate this field.  (See Friends of the Eel River v. North Coast Railroad Authority (1st Dist., Div. 5, 2014) ___Cal.App.4th ___, 2014 WL 4809456.)  We’ll examine this issue of preemption further in an upcoming blog post.

By Mike Mills (mnmills@stoel.com) and Shannon Morrissey.  Ms. Morrissey is a Law Clerk with Stoel Rives LLP and is not currently licensed to practice law in California.