The main problem for this type of project is getting environmental and safety clearance and land rights. A particular problem with building in California is that the government there has pushed hard on their questionable HSR project and they might not want competition. There is also now a set of people who have a vested interest in keeping HSR going and won't like the idea of scrapping HSR for hyperloop.
On the other hand, Musk seems to have a lot of clout in California, so maybe it makes more sense to make his push there. If it doesn't work out for California, I hope he or someone else gets the project rolling somewhere. Texas might be a good candidate, since it has a fast-increasing population and is generally more pro-development than California.
I was studying in the LW Study Hall, and during our break someone posted this link to the official hyperloop announcement:
http://www.spacex.com/sites/spacex/files/hyperloop_alpha-20130812.pdf
One member was doubtful it would get past regulations, and another said "tentative p>0.05 that a hyperloop gets made by 2100", which was met with "p>0.05 that uploading people and moving them between bodies will be available by 2100".
It struck me that people might be interested in betting on things like this, or at least having a conversation about it.
A few predictions to start: