Feds Cancel Nearly $1 Billion for California High-Speed Train

Construction continues on an elevated section of high-speed rail track near downtown Fresno, California. (Matthew Renda/CNS)

(CN) – The Trump administration said Thursday it would pull nearly a billion dollars in federal funding for California’s much-maligned high-speed rail project, terminating an agreement that previously awarded the Golden State another $2.5 billion for the plan.

The move is a major setback for proponents of the ambitious project, whose cost to taxpayers has swelled to over $77 billion as officials have stumbled to both lay out a comprehensive vision for the endeavor and produce results that inspire trust from taxpayers.

California Gov. Gavin Newsom did the project no favors during his State of the State speech in February when he said there was no viability in building a system capable of connecting Los Angeles and San Francisco in the near future.

Newsom, who has since walked back his comments, said at the time that the state would instead pursue a plan to build a 119-mile segment connecting cities in California’s Central Valley.

But President Donald Trump and Republican lawmakers seized on Newsom’s comments to further criticize a project they’ve long seen as a waste of tax dollars.

“They owe the Federal Government three and a half billion dollars,” Trump said in a tweet, adding that the project is a “green disaster.”

The decision Thursday by the Federal Railroad Administration to pull $928,620,000 in funding comes after the agency said in a March 4 notice that it would terminate its contract with the California High-Speed Rail Authority for failure to comply with underlying agreements on the project.

In a statement Thursday, the federal agency said the state body strayed from its original vision of speedy rail transportation between Los Angeles and San Francisco.

“FRA finds that [California High Speed Rail Authority] has repeatedly failed to comply with the terms of the FY10 agreement and has failed to make reasonable progress on the project” the federal agency said in the statement. “Additionally, California has abandoned its original vision of a high-speed passenger rail service connecting San Francisco and Los Angeles, which was essential to its applications for FRA grant funding.”

FRA Administrator Ronald Batory said in a letter accompanying the decision that California has consistently been “chronically behind” on its goals and has strayed too far from its original design.

“In FRA’s view, there is nothing in FRA’s long working relationship with CHSRA to suggest that CHSRA would likely be able to initiate and complete the necessary corrective actions, if given yet another opportunity,” Batory said in the letter.

The statement said the federal government “continues to consider all options” related to the return of $2.5 billion in American Recovery and Reinvestment Act funds awarded to California for the project.

It remains unclear what will become of the several large swaths of elevated high-speed railway track that have been constructed on the outskirts of Fresno and other Central Valley towns.

In statement, Newsom called the Trump administration’s move “illegal and a direct assault” on workers building the railway tracks and on the state’s plans to expand transit infrastructure.

“Just as we have seen from the Trump Administration’s attacks on our clean air standards, our immigrant communities and in countless other areas, the Trump Administration is trying to exact political retribution on our state,” Newsom said in the statement. “This is California’s money, appropriated by Congress, and we will vigorously defend it in court.”

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