A California high-speed rail transparency law has introduced both mandatory publication of watchdog reports and new powers to temporarily withhold sensitive information, following an investigation into hundreds of thousands of dollars in allegedly wasteful travel expenses.
The report found spending on late-night luxury rides to nightclubs, gyms, a tiki bar and an escape room, with some expenses allegedly approved by the rail authority’s chief executive, Ian Choudri.
It also said a Legal Services contract manager told investigators that the acting chief counsel had instructed her to approve travel that did not meet the rules because Mr Choudri had requested it.
Mr Choudri has not publicly responded to the findings and did not respond to a request for comment.
What California’s high-speed rail transparency law changes
The 29-page investigation was published under legislation that requires California’s high-speed rail inspector general to release completed audits, reviews and investigations in full.
Before the law was passed, the inspector general’s office was required to publish an annual summary of its findings and recommendations, but not every completed report. Ben Belnap, the state’s first inspector general dedicated solely to high-speed rail, had chosen to publish full reports despite the absence of a specific legal requirement to do so.
“I’m not really authorised by anything in state law to produce the reports I have been publishing,” Mr Belnap said.
The new requirements mean future inspectors general will not be able to rely solely on an annual summary. The travel investigation instead sets out the destinations, expenses, approval concerns and internal decision-making behind its findings.
However, the law also gives the inspector general discretion to delay publication of material that would expose a substantial and identifiable risk to information security, physical security, fraud-detection controls or pending litigation.
Republican lawmakers criticised that provision during the legislation’s passage. Assemblymember David Tangipa described it as an “anti-transparency bill, painted as a transparency bill”, while Assemblymember Carl DeMaio argued it could allow the majority party “to keep secrets on high speed rail”.
Assemblymember Diane Dixon said it could protect “a failing project from public and legislative scrutiny”.
Confidentiality powers come with conditions
The First Amendment Coalition, which campaigns for government transparency and public access to records, initially opposed the proposal. Ginny Lareau of the organisation said: “I’ll be honest. We had some concerns.”
Mr Belnap said those concerns led him to invite Ms Lareau to help shape the safeguards. He also credited an unnamed Republican lawmaker with helping to develop some of the limits, although she ultimately opposed the bill.
Ms Lareau now says the legislation “more properly balances the people’s right to know with legitimate confidentiality needs”.
Under the law, the inspector general cannot simply remove material without explanation. If information is withheld, the public must be told that something has been omitted and why.
Any sections that can reasonably be separated from the sensitive material must still be released. The decision must also be reviewed at least every 120 days, and the information must be published once the underlying risk has been resolved.
The provisions could apply if an investigation uncovered a weakness in the rail authority’s ability to detect fraudulent travel charges. Details of the weakness could be held back temporarily to prevent others exploiting it, but the public would still have to be notified and the decision revisited.
In the travel case, however, the report indicates that managers were able to identify many of the non-compliant expenses. It therefore documented decisions surrounding spending the authority could already detect, rather than revealing a hidden flaw in its systems.
Criticism over access to withheld information
One concern remains over which elected officials may receive information withheld by the inspector general. The law allows confidential material to be shared with the governor and the chairs of the Assembly and Senate transportation committees.
It does not require the committee vice-chairs, who are generally Republicans, to receive the same information. Senator Tony Strickland, the Republican vice-chair of the Senate Transportation Committee, questioned that arrangement during a legislative hearing.
“If it was truly transparent, wouldn’t you want the vice chairs of these committees… to be notified on all this information?” he said.
Lori Wilson, the Assembly Transportation Committee chair who authored the legislation, said the named officials “may” receive confidential material and would not automatically be sent every withheld report.
“The vice chairs do not have that responsibility,” she said. “They’re not in charge of negotiating bills.”
Mr Belnap said he had not written that part of the legislation and that the decision had been made by the bill’s author after weighing various factors.
The law also protects certain investigative files and work product from automatic release. But it permits the inspector general to publish findings and supporting evidence where appropriate, while requiring the release of all material that does not reveal a protected weakness.
The first major investigation issued under the new framework has therefore provided more detail than the previous law required. Without a full report, the public might have received only a summary of the findings and recommendations at a later date.
The case does not establish how every future inspector general will use the confidentiality powers. It does show, however, that the first major report published under the new system disclosed travel expenses, internal approval problems and allegations involving senior management that previously could have remained outside the public report.
