Voters passed Proposition 1A (Phase I, $9.5B min. GO capital requirement to bond the project) by a slim margin. MSM estimates the CA current state budget deficit ranges $17B-$21B. Nearly simultaneously, Schwartzeneger announces that the state requires a 1.5% increase to the sales tax rate to raise approximately $10.8B over the next fiscal year. (Let's assume the executive office revenue model accurately forecasts consumption trends over the next 12 to 18 months.) "Phase I" financing is roughly equivalent to projected revenue from Ahnie's sales tax increase.

What is so tragic about this inevitable state action is that current market conditions pit voters for Prop 1A against legislators seeking capital primarily to fund legacy obligations such as public services, pensions, and Medicaid/Medicare dollars. In a decent world, they would be working together to discount debt service. A sales tax increase would be justifiable investment capital, regardless of class-politicking, simply because anyone could visualize how project completion serves the broadest number of beneficiaries. Sales tax is one reasonable and reliable source of revenue to service HSR financing.

Another would be millage. And another would be state marginal income tax rates. Taken together these measures would absolutely mitigate (reduce) federal grant dependencies and investors' (abnormal) expected rates of return.

Cue "progressive" economists who warn, "This proposal is regressive, unfair to millions of working- ...uh, middle-class families. Sales taxes require them to bear a disproportionate shares of the tax burden funding state welfare ...uh, programs." That is true but does not address coherently the fact that "working poor" disproportiately utilize mass transit, so equally" subsidize" POS fares  through sales levies.

Cue "free market" economists who warn, "high-income households may decide to utilize mass transit, if sales tax (and millage and higher marginal income tax rates) 'subsidy' low-income household transportation. Everyone knows there is no profit opportunity, if fares do not capture the cost of capital (trade in the secondary bond market)."

Proposition 1A financing, in part:
http://www.cahighspeedrail.ca.gov/faqs/financing.htm
The other part is a pdf also available at the official site.

Diversity is the key to economic and political evolution.