Court clears way for California to sell
$8 billion of bullet-train bonds
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[August 01, 2014]
(Reuters) - A California appeals
court has ruled a state authority may issue $8 billion in bonds to help
finance a high-speed rail system in the most populous U.S. state,
removing a substantial obstacle to the proposed $68 billion plan.
In overturning on Thursday a state court's 2013 ruling, the
three-judge panel in Sacramento said the California High-Speed Rail
Authority, which is overseeing the high-speed rail project,
"properly found that issuance of bonds for the project necessary or
desirable," court documents show.
The panel also vacated a lower court order that the state re-do its
financial plan for the project.
The rail project has been dogged by questions over its planned
routes, ridership estimates and projected costs.
The plan to build an 800-mile high-speed rail system between San
Francisco and Los Angeles is a priority for California Governor
Last year, Sacramento County Superior Court judge Michael Kenney
ruled there was too little information to support a decision by the
authority overseeing the project to move forward with the sale of
the bonds. He also ordered the state to re-do its financial plan for
The appeals court in February agreed to a request by the state to
expedite its review of the lower court ruling.
Thursday's ruling does not remove all obstacles to the rail project.
The authority still needs to answer "substantial financial and
environmental questions ..." the court said. "But those questions
are not before us."
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The court also said, "Substantial legal questions loom in the trial
court as to whether the high-speed rail project the California
High-Speed Rail Authority seeks to build is the project approved by
the voters in 2008."
(Reporting by Eric M. Johnson; Editing by Larry King)
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