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Extracted from Consolidated Report

This investigation was originally published as part of a larger consolidated report containing multiple investigations. View the consolidated PDF for the complete document.

Tulare County Grand Jury • 2010-2011

Tulare County Grand Jury Report 2010-2011

8 pages
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Findings 11 findings

F1 Page 19
Marijuana is the number one cash crop of Tulare County.
F2 Page 19
There is an urgent need to eradicate this illegal activity in Tulare County.
F3 Page 19
The illegal use of pesticides and fertilizers pollute the local water supplies.
F4 Page 19
Because some marijuana gardens are in close proximity to existing residential and school areas, the situation is even more dangerous to county residents.
F5 Page 19
The Tulare County Sheriff’s Department, along with other law enforcement agencies, provide excellent services and are diligently attempting to combat this growing problem with limited resources.
F6 Page 22
The estimated cost to upgrade the rail line south of Dinuba from 75 lb rail to at least 112 lb rail was $20 million. This is needed to transport freight at a speed exceeding 10 mph. In Tulare County, SJVR has plans to upgrade the portion of track between Exeter and Dinuba at a cost of $1.2 million keeping the 75 lb rail. TULARE COUNTY GRAND JURY REPORT 2010-2011
F7 Page 23
Measure “R” did not originally contain language regarding the preservation of rail lines when approved by the voters; however, TCAG indicated the rail lines will provide an alternative to trucking which will help preserve the road conditions and improve air quality.
F8 Page 23
Any voter approved initiative can be changed if a majority of the City Councils of the 8 incorporated cities and the Board of Supervisors approve an amendment. This took place with the short line rail amendment. Measure “R” now contains the following language pertaining to Rail Lines: “For Rail expenditures from the ‘Transit/Bike/Environmental Project Program’ funding may be used for Right of Way acquisition and/or preservation of rail corridors. Preservation of rail corridors by purchase of existing fixtures includes but is not limited to railroad ties, ballast, tracks, and signals are permitted when anticipated commercial operation will result in preservation of the ROW. The purpose of the requirement is to ensure that real-property interest (long term-lease/easement) is maintained for rail use. The expenditure of Measure “R” funds shall not result in a commitment of additional funds. Prior to an agency requesting rail funds from the ‘Transit/Bike/Environmental Projects Program’ a plan must be submitted that demonstrates the economic viability of the rail corridor for which the funding is proposed”.
F9 Page 23
SJVR is a subsidiary company of RailAmerica, which is a company owned by Fortress Investment Groups, LLC. Although the studies indicate that the parent company is a hedge fund wanting to salvage the rails for quick income, the Grand Jury was unable to support that conclusion. The County indicated that this company is responsible for increasing costs to users to a point that drove users from using the rail lines. The components for costs to the shipper are as follows: a. Shipping costs are negotiated between the major rail companies (Burlington Northern/Santa Fe and Union Pacific) and the shippers. SJVR does not govern these costs. Major rail company rate increases are passed to the shippers. The major rail companies pay SJVR to bring the rail cars from shippers to their lines. b. The shippers are charged by SJVR when extra services are provided. This includes extra time for loading, picking up cars that have not been loaded and other ancillary services. c. When a shipper’s volume is inadequate to cover the SJVR fixed cost of providing rail service to the shipper, SJVR adds a per rail car surcharge.
F10 Page 23
The County indicated that there is an advantage to having rail lines in the County for shipping purposes. In addition to keeping additional trucks off the County roads, the use of rails for freight also improves air quality, and provides an incentive for manufacturers to conduct business in Tulare County, thereby increasing employment opportunities for County residents. The County indicated that there may be additional funds from sources other than Measure “R” funds for the purchase and rehabilitation of the rail lines such as Air Quality funds. TULARE COUNTY GRAND JURY REPORT 2010-2011
F11 Page 24
The Grand Jury interviewed management representatives of the Economic Development Corporation (EDC), SJVR, and RailAmerica. These interviews revealed that while the EDC states that rail lines are important to the future economic growth of the county, the EDC is not making sufficient effort to bring SJVR and RailAmerica into the process of recruiting new businesses to the county. EDC would not provide the Grand Jury with requested information regarding potential new rail users. CONCLUSIONS According to the studies prepared for TCAG, it was economically infeasible to purchase and operate the short line rail system which included the portion of the system from Strathmore to Jovista. The voters of Tulare County did not approve expenditures for rail lines when considering their vote for Measure “R”. County organizations do not work effectively with potential shippers and the rail companies to increase the profitability of the rail lines. This would enable the rail companies to improve the lines without the use of government funds. EDC does not have an effective working partnership with SJVR and RailAmerica to attract businesses into Tulare County.

Recommendations 3