From bullet trains to hyperloop, rail networks are picking up the pace globally. Australia has been talking about a need for speed in our rail networks from as early as the 1970s. In the last few years the need for a faster rail network that connects capital cities and growing regional economies has gained momentum.
In this episode, we chat to two experts who work as part of the California High Speed Rail Authority - WSP USA’s Daniel Horgan, who is the Deputy Chief Operating Officer and Frank Vacca, the Chief Program Manager. We also welcome Sam McWilliam WSP’s Project Director for Fast Rail, to talk about the ins and outs of these new rail programs.
From bullet trains to hyperloop, rail networks are picking up the pace globally. Australia has been talking about a need for speed in our rail networks from as early as the 1970s. In the last few years the need for a faster rail network that connects capital cities and growing regional economies has gained momentum.
In this episode, we chat to two experts who work as part of the California High Speed Rail Authority - WSP USA’s Daniel Horgan, who is the Deputy Chief Operating Officer and Frank Vacca, the Chief Program Manager. We also welcome Sam McWilliam WSP’s Project Director for Fast Rail, to talk about the ins and outs of these new rail programs.
On Season Two of the People and Place podcast, we will be taking a closer look at the future of innovative program delivery models. How can they be used to foster a culture of collaboration? Can they promote the integration of ideas from a variety of stakeholders and ultimately deliver better outcomes for our projects and the communities we serve? Here's your host, Kate Borg.
Kate:Thanks everybody. And welcome, we've got a very special podcast today. We've got representatives from the client and the delivery team in relation to California High Speed Rail. So welcome everybody to our discussion today. Frank, I'd like to start with you. Can you tell us about the strategy and objectives behind California High Speed Rail, particularly what does high speed mean to you?
Frank:I certainly would like to, it's a great project. One that's going to transform California and the lives of Californians. There's three primary objectives to our program. One is to get people out of their cars and out of the planes and on a high speed train. Today, the roads are congested. The short haul market between San Francisco and LA is the most congested air market in the country. Enormous delays because of the congestion. There's enormous air quality problems because of all the vehicles and the traffic and California is expected to grow 50% in terms of population over the next two decades. So it's only going to get worse. We need to entice these travelers out of their cars and out of the airplanes. To do that you need something that's competitive trip-time-wise competitive cost-wise to do that. And our program is designed to do just that. In addition, as I spoke about the air quality issues, we want to get out of those greenhouse gas vehicles and planes and use an electric high speed rail train. So that improves our air quality through all the regions. And the third major objective is to change the regional economies of California. There's three main regions in California. Most everyone's heard of Silicon Valley and San Francisco, the peninsula, the center of high tech. You also have the LA basin in Los Angeles. The booming economy is the second largest city in the country. But you also have the breadbasket, the Central Valley that most of the food in the country is grown in that agricultural region of California. It's the world producer of pistachios and almonds and all kinds of produce. But the economies of these three regions are very different because they're separated by mountain ranges. There's a mountain range between the peninsula and Central Valley. And there's two mountain ranges between the Central Valley and LA basin. So by car it's four or five hours to traverse between the Valley and peninsula and LA basin and by airline that is very expensive in the Central Valley because they don't have the kind of air service that you would need. This will transform the economies of these regions because with the high speed train, what now is a four hour car ride between Fresno and the Valley to the peninsula will turn into a one hour commute or a four or five hour ride between Fresno and the LA basins will turn into a one hour 15 or one and a half hour commute. So today where there's 3% unemployment in the peninsula and they're dying to find people, but you can't afford to live there. And in the Central Valley where there's double digit unemployment, but you can't get to where you need to get to, to have your job. So the train will, a high speed train will, transform how these economies mix something that has not been possible since California became a state in the 1850s. So, and then a fourth indirect benefit is jobs, not only construction jobs because the building of an enormous project like this, it's an$80 billion project, ultimately full build out it's construction jobs, but it's decades of construction jobs, but ultimately it's forever operating and maintenance jobs. So you're creating jobs. So there's four key benefits to the state. Now, high speed. Well, the reality is you need to determine what the trip time is that your passengers need to have in order to draw them out of their cars and out of the plane. This is not about a train. It's not about speed. It's about trip time. It's about, can you be as productive, as efficient as a car or much better or a plane. So by taking the trip time and the studies we've done, we've seen that you need to be under three hours between Los Angeles and San Francisco. If you're under three hours, you're competitive with the airlines. By the time you get to an airport, by the time you go through security, by the time you park your car and you take an Uber downtown to downtown. So if you take that, I have to be under three hour trip time, and you translate that into actual speed. For our train, we need to traverse that 500 miles because that's what the distance is between Los Angeles and San Francisco at about 220 miles an hour, or about 350 kilometers an hour. So that's what we call a fast train. Our train will be operating primarily, uh, 220 miles an hour, but that objective is to be able to do a nonstop trip between Los Angeles and San Francisco in about two hours and 40 minutes. By the time you add a stop or you add ahuman factors in there, you're guaranteed that you'll traverse that distance in under three hours. So that's the goal in this.
Kate:That sounds amazing. That's such a good project. I can imagine how excited you must be to be involved in something that's contributing so much to society, but also how amazing to do 350 kilometers an hour in a high speed train to get you from Los Angeles to San Francisco. That's truly amazing. So if we turn to the procurement model, WSP of course is involved as the project manager or the rail delivery partner. Why did you choose that model for delivering this project?
Frank:Well, the state of California recognized very quickly that they're not an expert in high speed trains. They're not an expert in rail. And the business model was that state people will make state decisions and the state expertise, but we need to bring in real experts and construction experts and people have an expertise in this area. The state does not want to grow a large government bureaucracy around high speed trains or around this performance. So we have a cadre of state employees to do oversight and coordination to make state decisions, but we want the private sector to be involved. We want a rail delivery partner. Who's got the expertise to be the frontline person, making decision group, making decisions on construction and rail and other technical decisions that the state does not have the expertise in. And that's the model, not only for the construction phase, but also for the operations and maintenance phase. The state will not be doing the operations. We will be hiring experts for the infrastructure maintenance and for the rolling stock maintenance and for the operations. Ultimately we'd love once the system is up and proved itself and ridership has leveled out, we would love to have a longterm concessionaire operate and maintain the system. And that's the business model that we are progressing on from planning all the way through operations.
Kate:That sounds very sensible to me. Is this a normal model that the US use or is it quite new?
Frank:No, I think it's quite new. I, as I said, I've been in the real industry for almost 45 years. I've worked for freight railroads and commuters and high-speed operators like Amtrak. And in all those cases, the organization operates, maintains and is fully responsible for all of these items, including planning and construction. So this is a different model it's unique. And it's a great deal of insight for the state of California to recognize the shortcomings and the longterm benefits of having the experts do their job.
Kate:Yeah, no, that sounds, that sounds amazing. If we travel to the Southern hemisphere now and start to look at Australia, welcome Sam. Sam, as the project director for Australia's fast rail or fast rail in New South Wales rather, can you tell us a little bit about the Australian project? Did Frank's answers, resonate with you? What are we trying to do here?
:Thanks Kate. So most definitely. Our fast rail program in New South Wales is very much focused on that trip time. And how do we improve communicability into the city. So, in New South Wales at the moment, we're looking at the hub and spoke model, which essentially improves the connectivity of regional centers to Sydney and vice versa. So there are a number of corridors underway at the moment and WSP's the technical advisor on those corridors. Again, helping the client get to a point where we can start that planning process around some of those corridors. So Sydney-Newcastle, Sydney-Central West, Sydney-Canberra, and Sydney-South Coast, again, looking at getting people out of their cars, working out that people don't necessarily want to live in our CBDs. They may want to leave in our regional centers. And how do we improve both the trip time and that commuter experience I suppose, into the CBD.
Kate:That sounds very familiar when you think about California High Speed Rail. Do we also want to look at what the opportunities that the cities along those alignments might have access to as well? So growing hubs, rather than just relying on our city centers all the time.
:Most definitely that New South Wales program is very much focused on regional uplift and what are the benefits to those regional centers? And I think even more so after the current pandemic situation, people are choosing not necessarily to live in the CBD and not necessarily live in the city. They can live and work where they choose. And part of the program that we're looking at at the moment of what are some of those benefits that the regional areas get out of improved connectivity, to jobs, to healthcare, to education, and giving people really the freedom of choice as to where they want to leave them, bring up their family.
Kate:Thanks, Sam. And somebody that's worked in both Australia and the US and knows a lot about rail projects, Daniel Horgan. Welcome. How do you think the two projects compare what Australia is trying to do and what the US is trying to do? Do they both sound like they could roll out in a very similar way?
Daniel:Yes, it's the same logic that Sam and Frank said earlier. It is about connecting people and empowering people in smaller communities and making them more mobile and basically providing connectivity and obviously building sustainable railways as well. That is obviously a big part of our future for all of us being more sustainable and being better connected.
:Yeah. We've struggled for a little while in terms of the population density in our major cities and how far apart they are. I think this focus on regional connectivity to start with as that precursor to a potentially a high speed rail connection between our major cities. I think that that's sort of the stepping stone, isn't it looking at those high speed corridors into the future.
Kate:Yeah, Sam, I noticed you were feeling quite connected with that question. Do you think Australia is ready for a high speed rail? And do you think Australia understands what high speed rail means?
:I think we're probably a little way off that true connected to Sydney and Melbourne model. But as I said, I think the regional connectivity is very important. I think the connectivity to centers like Canberra will be very important moving forward. So I think if we can get that up and running and improve the access between those regional centers, I think the long term and future proofed version of connectivity between the major cities is what's next.
Kate:Daniel, getting back to you. Just a bit more of a comment around the delivery partner or the program partnering that we're doing in California High Speed Rail. Is this the first time you've worked in that kind of delivery environment and what does that mean to you? Do you see some benefits in how it's working?
Daniel:Um, I spent most of my career working in integrated teams, so I'm fully familiar with it. Integrated teams are a wonderful concept, but the skill is getting everybody to work as integrated partners and on the California High Speed Rail WSB has a wonderful partner in the authority and we've collaborated and work exceptionally well together. So that's the most important thing integration, thrust, and knowing where the responsibilities for decisions lie and where the expertise is.
Kate:Fantastic. Thanks Daniel and Frank if I can go back to you just starting to look at the project in its infancy. How did the funding work for California High Speed Rail? Where does it come from? And do you think that there's some lessons that we can learn from a global scale?
Frank:Well, California looked at and planned for this project for many years prior to it's actually taking off the ground, but in 2008, the voters of California approved moving forward with this project, the high speed rail program. And with that, they approved$9 billion funding through a general bond sale. So the state took on the first traunch of money by providing 9 billion of bond money. Then the federal government had a high speed rail grant program through their stimulus act. And California was awarded almost 3.5 billion between two different fiscal years. So we got off the ground with about$12.5 billion to start between 2008 and 2010. Then the state of California initiated a greenhouse gas program called cap and trade where businesses can buy credits to offset their greenhouse gas emissions. And the authority was granted 25% of the annual revenue from those greenhouse gases. So that developed a longterm funding stream for the authority. That program is right now set through 2030, and we get 25% of the annual proceeds, which is estimated between 500 million and 700 million a year. It's been actually until COVID hit. We were averaging above 700 million a year. Those total funds through 2030 amounts to about 25% of our total program, our program, which is not only Los Angeles to San Francisco, but extends to Sacramento, the capital of California and down to San Diego, which is really 800 miles. So the full program is about$80 billion. And right now we have about 25% of those funds in hand committed through 2030.
Kate:$ 80 billion. That to me is inconceivable that figure. I have no idea on what the scale of that project must look like.
Frank:It's one of the largest rail transportation projects in US history. So it's an enormous undertaking, but we have 25% and we're going to, we have a building block approach. And I think that's the key here is that when you're talking about a mega project, or when you're talking about the scale of these kind of rail projects, you need to address it. In a building block approach, so that funding can come on a regular basis, a longterm stream of funding and try to build and design the system on a building block approach that also allows you to get that shovel in the ground sooner and get some operation sooner, which excites everyone to see a train traveling at 200 plus miles an hour. And that's what we're trying to do. Our first segment, which will be 171 miles between our Central Valley is fully funded through these funds. And as soon as you can get that train operating, believe me, the rest of the people will be clamoring to expand that and ride that train. And that's key, I think.
Kate:I think it is the key. Definitely people like to see, I imagine that's why you're doing it in this staged approach, is people like to see rubber on the road or track on the rail, if you like. Daniel, if I could turn to you, how much did WSP get involved with the staging approach and were we instrumental in that, or had the client already come to us with preconceived ideas of how they wanted it to roll out.
Frank:WSP has been involved in every significant decision on the program. And the program has had to adapt to the sort of the political climate as well and the funding. So one of the objectives of the California High Speed Rail authority is to be ready if we get additional federal funding or we get additional state funding or maybe additional private funding. So the staged approach is to be ready. So we're rolling out construction in the Central Valley. We're also planning for future segments. We have cleared already 171 miles for environmental clearance. By the end of December 22, we will have cleared 500 miles in terms of environmental parents. So that means we're ready to roll out probably another seven or eight contracts. So we are well ahead of the curve.
Kate:Fantastic. And getting back to that funding model, and I know Frank you talked about sustainability and paying for projects that didn't actually rely on the population necessarily. How much did patronage come into play with getting access to funding?
Frank:We had a great deal of support politically, and from the constituents in California, and when you're working with a mega project and large projects you need an enormous amount of support, both groundswell, and you need political support because these projects do take a long time and they go way beyond the immediate horizon of a political election or something else. You need a great deal of, of endurance to see these projects through and California has been able to do that. They've been able to put their support behind this for the longterm and not for the short term site. So it's key. Any major projects needs a champion, and they need to continue to champion that cause, and we're fortunate in California to have those champions, the previous Governor Brown and the existing Governor Newsome are champions for this project. And that's why we can continue to seek more funding and continue to build. But every mega project needs a champion.
Kate:I agree. I think that's very important. I mean, how long are we talking about here? Are we talking about a 10 year program or a two year program?
Frank:This is a long program. The California studied it for almost 10 years before we went out to the voters in 2008. So we started for the authority and the rail delivery partner started around 2008, 2009. And we hope to have the first operating segment before 2030. So that's, that's almost 15 years, but that's only, that's only 170 miles of 500 so it's decades, but you need to continue to make progress and show that you're making progress.
Kate:Absolutely completely agree. Sam, if I can turn to you, just bring it back into that Australian experience. I know you must struggle with this. I know I struggled with it myself about how this, this expectation that public infrastructure always has to meet a particular benefit cost ratio to really be providing that benefit back to society. And as we've heard from Frank and Daniel, that it's not necessarily always about patronage. There are other angles that come into play. Are we seeing that shift here in Australia as well? Or do you think we're still got a bit of a way to go?
:I think we are Kate and I think there's lessons to be learnt definitely from the likes of California High Speed in that this is a long term prospect. It's not something that gets done in one election term. It is something that needs a bit of focus beyond those four year election cycles that we have. I think some of the alternate funding models and the alternate funding sources that Frank has mentioned are very relevant here and will become more relevant as we get further down the planning of fast rail particularly New South Wales, but some of the other States as well. The benefit cost ratio is one aspect that we look at and more and more I see in our government decisions that the timing of those benefit cost ratios are more important. So how do we bank benefits that will happen in the long term versus the spend that may happen in the short term, but definitely some lessons to be learned around some of those funding models, particularly that the greenhouse gas funding is a particularly interesting one, which we're not quite there yet, but that is definitely something that would be worth considering.
Kate:I picked that up too. I thought that was something that we could really tap into and take some learnings from that. Looking forward and it is a long program and I'm really interested to understand maybe from you Daniel, what is the California High Speed Rail doing to make sure that it's current during that long program. So to make sure we're still building for the future, even though we're doing it over a long period of time.
Daniel:That's a very good question, Kate. So basically we are trying to make the railway as sustainable as possible. We're also looking at providing the energy for the railway by using solar farms. So we have lots of ideas. We're also making sure that it's future-proofed. So we're designing the stations for ultimate capacity. We're designing the railway signaling system for ultimate capacity, even though we won't need that initially. So it is to be a future forward looking railroad. And we have a whole team of people which are focused on sustainability and station area planning. And that is making sure we fully integrate the stations with the local communities. So they're integrated with the bus services, local bus services, park and ride, and the local community. So we'll be building out from the station areas and that is a longterm strategy.
Kate:And Frank, if I could turn to you. Do you feel like as the government agency or the client, you have support from your political parties, that sustainability is very key contributor to the unfolding of the project?
Frank:Oh, absolutely. Especially in California, the environmental process, sustainability, it is just absolutely key as part of the outcomes in this project. As I said earlier, taking people out of greenhouse gas, emitting vehicles and airplanes, we are very confident we can have solar powers, our initial power for our power substations and our catenary. All of our buildings and facilities will be platinum. We are planting 5,000 trees to offset any construction mitigation. We require all of the construction debris, the concrete, the steel to be recycled. So we are quite focused. We are protecting a lot of the habitat and making sure we have crossings for our protected animals and the like. This project is focused on sustainability on the environment and improving the conditions that are out there longterm for everyone.
Kate:Wow. That's very aspirational for us to hear that, Sam, do you think that's something Australia needs to aspire to? Are we there yet? How are we comparing when you hear Frank talk about that?
:I think the focus is definitely changing to the more sustainable railroad, isn't it? And I think if you look at why a lot of us work in railways rather than road or a number of other areas, it's because of that sustainability aspect and the ability to change people's lives, but, but also contribute from an environmental point of view. I think in Australia, we are seeing that shift. So we're seeing the likes of Metro being solar power and seeing new operators and new infrastructure being built with the idea of being solar powered and that being sort of a baseline for new infrastructure. So I think we are definitely following down that route.
Kate:Yeah, I agree. This is the first time I've ever been on a project where not only was it about how we're getting our power sourced, but also how we're renewing things. So for Melbourne Metro, we did a lot of water recycling and yeah, we know we've done water recycling before, but this was much more into station operations. It wasn't just about storm water harvesting. It was actually using that regeneration of water. So I was really impressed that we're actually doing it now, even we're not just talking anymore, getting back to our benefit cost ratio discussion earlier, do you think by having a sustainable project, that's a good sales pitch to society?
:Most definitely. I think they're selling projects both here and in California to get people out of their car. So I think the more you can tip them on that environmental scale, the better off we'll be and the better off the outcome will be.
Kate:How do you think getting back to our old lives pre-COVID? How is that going to change? Do you think we're going to see any shifts there for how these projects get off the ground? Or do you think we're going to go back to the way it was? I think in Australia, we're seeing people shift out of the cities. I think we're seeing people realize that they don't need to be necessarily located in the CBD all the time to be able to work. If anything that drives the need for that connectivity to our regional centers and to some of our neighboring cities faster than it probably was before. I think we'll also see a shift in how cities and offices are put together. So not necessarily having everyone in the office all the time, I think we'll change those patterns in terms of connection and commutability, but I think if anything, people have sort of woken up to the fact that you don't need to be within close distances to your office and the lifestyle of living on the coast or living inland on the farm, it's probably become more attractive rather than less attractive. Yeah, I agree. I must admit I was one of those people that had a team and if someone wanted to work from home, I always thought, oh gosh, we're not gonna be able to do it. They're not going to be as efficient. And I've really changed my tune now because I've had to adapt. And so I think we're going to say a shift as well, of people working from home and having that better work life balance. Frank and Daniel, I'd like to ask both of you for a comment around that as well, particularly from the US experience. So Frank, if I can ask you first, how you think COVID life is going to change the delivery of public infrastructure.
Frank:Well, and Daniel will talk to this because actual construction we've been very fortunate during the actual COVID experience right now this year. So far, our construction has gone full bore. In fact, we've increased our workers through this program. So we've been very fortunate there and I'll let Daniel speak to the details, but there's no doubt that people are now realizing that you can successfully work remotely. And as you've indicated and I agree it's a first for me, and it's done much better than I expected. So on the local commuting area, there'll be some impact longterm cause we will transition away from that daily situation. On the high speed rail and the longer distances we're talking about, I don't see a huge shift in that we're talking about long distance, what were not commuting distances before. So our projections should be on target for what we had in the past. So I don't, I don't see it impacting the longterm travel market in terms of whether it's for pleasure or for meeting business or starting business long term. But I do see the shorter community market impacted by it.
Kate:Daniel?
Daniel:Just to pick up on Frank's point, just to give you some perspective on our program, approximately 90% of all management staff are working remotely, but frontline staff, all our construction markers are on site frontline staff, including me we're on site all the time. And as Frank said, we've managed to drive production consistently upward on a month by month basis through COVID. However, it has obviously required a lot of extra effort. All the contractors have put in place, you know, temperature checks on a daily basis. Everybody has to wear a mask on site, you know, in the offices, they're social distancing, but we have managed to keep the job going as regards to the longterm. I agree with what Sam said. I think more people will work from home. More people will live outside the major cities. They'll live by sea or on their farm or in a small town. And they'll work from home maybe three or four days a week and come to the office maybe one day for meetings. So I can definitely see a trend. And it's, it's amazing to see what we've all been able to achieve, you know, by using Microsoft Teams, Zoom or Skype, it's absolutely fantastic. And we all dreaded that production would fall off and it hasn't in fact production has gone up in some cases. So it's amazing.
Kate:I agree. I mean, this podcast is all about the power of the program and procurement, and I think we can really see how programs can adapt and be flexible depending on the environment and it really comes back to what the people want to achieve, doesn't it? Have you sort of seen that your program has adapted and been flexible or can you make some comments around that?
Daniel:Yeah, I think the has been phenomenally adaptive and flexible and for WSP, a lot of our staff are used to working from home. They're used to taking their laptops with them, occasionally working late. For some of the state staff, it was a transformation because in the old system working from home wasn't really encouraged. But I think going forward, Frank, and you can talk to this more, the authority is planning to allow more people to work from home.
Frank:Absolutely. All of us have seen how successful it can be. And you're right. We've seen it a lot more productivity that we expect that in fact, better than we are maybe being in the office, less chit chat and more work getting done.
Kate:Sam, I'd really like to hear your perspective because I think you were a work from home advocate before COVID. Did you always know that this was the case and you've been keeping this as a secret.
Sam:We've always had teams spread out across a number of offices and a bit like Daniel's team we do a lot of government work and a lot of that involves being embedded in integrated teams with clients or in different locations. We've always had that ability to sort of work as a team, across many locations. Some of those being at home, some of those being in client offices. I take Frank's point that government agencies did take a little bit longer to transition to working from home. And in our experience being that technical advisor, we've been able to help a couple of our government clients be able to do that. I think it's allowed us to use some of our technology a bit better than it probably was used previously. So some of the tools and that sort of bits and pieces that have been developed on projects have definitely come in handy in terms of that sharing of information, because really it's all about getting people on the same page. So things like WSP create and some of those other visual tools that we use to provide information have been much more important and much more relied upon in terms of doing virtual workshops and that sort of thing around similar information. So I think it's been quite good to get people's head around using that technology. And I think that we'll embed it more in the projects going forward.
Kate:I'd just like to thank everybody for joining us today, particularly our guests from the US, you've given us some time on your weekend to be with us today. So I really appreciate that. Thank you to Frank. Thank you to Daniel. And of course, thanks to our Australian representative, Sam.
Daniel:Thank you, Kate.
Frank:Thank you for having me. It was a enjoyable time talking about high speed rail, always fun.
Sam:Thanks, Kate.
Kate:We hope you enjoyed this episode of people in place to him or find us on Spotify, Apple podcasts, and Google podcasts. You can also find us on LinkedIn and Facebook at WSP in Australia and on Instagram and Twitter at WSP_Australia.