U.S. DOT Scraps Funding for California High Speed Rail Project
Written by David C. Lester, Editor-in-Chief
Chairman of the California High-Speed Rail Authority Board Tom Richards speaks at a ceremony celebrating CHSRA’s creation of 10,00 jobs in 2023. In 2025, the number of jobs created has risen to approximately 15,000. (Photo courtesy of CHSRA.)
WASHINGTON, D.C. – The U.S. Department of Transportation announced this week that the Federal Railroad Administration has terminated about $4 billion in funding for the California High Speed Rail project.
The announcement was made by Transportation Secretary Sean Duffy, and the $4 billion had been allocated to the project but was not yet spent. Referring to the project as a “boondoggle,” Duffy said “After 16 years and roughly $15 billion spent, not one high speed track has been laid by the California High Speed Rail Authority (CHSRA). The $135 billion total cost of the project could buy every San Francisco and LA resident nearly 200 round trip flights between the cities.”
Duffy added the following: “This is California’s fault. Governor Newsom and the complicit Democrats have enabled this waste for years. Federal dollars are not a blank check – they come with a promise to deliver results. After over a decade of failures, CHSRA’s mismanagement and incompetence has proven it cannot build its train to nowhere on time or on budget,” said U.S. Transportation Secretary Sean P. Duffy. “It’s time for this boondoggle to die. President Trump and I will always fight to ensure your tax dollars only go to projects that accomplish great, big, beautiful things.”
The press release also said “The decision follows FRA’s exhaustive compliance review, after which the California High-Speed Rail Authority (CHSRA) was given two opportunities to respond consistent with the grant agreements. Neither response addressed FRA’s significant concerns. CHSRA simply cannot meet its obligations under the grant agreement.”
Below is the letter (which you may read and download) from FRA Active Administrator Drew Feeley to Ian Choudri, CEO of the CHSRA, informing him of the funding cut:
The release goes on to say that “In addition to canceling $4 billion in unspent federal funds to CHSRA, Secretary Duffy has directed FRA to review other obligated and unobligated grants related to the CHSRA project. The Department of Transportation will also consult with the Department of Justice on the finding of FRA’s Compliance Review, including potentially clawing back funding related to California’s train to nowhere and other potential issues under Federal law.”
The U.S. DOT carries the discussion further by noting that earlier this year, the Inspector General of the CHSRA issued a report that identified serious issues with the project. One revelation from the CHSRA IG report was that the Bakersfield to Merced line would not be completed by 2033. (Ed. Note: the CHSRA IG report was released prior to the “FRA’s exhaustive compliance review” mentioned in the fourth paragraph above, and the funding termination letter available above. In other words, the sequence of events was CHSRA IG Report > FRA “exhaustive” review > Letter from FRA to CHSRA about funding cut.)
You can download and read that report here:
After the CHSRA IG report was released, the FRA decided to conduct its own review (referenced above) which, essentially, confirmed and added to the CHSRA IG report. According to the DOT press release, the FRA review revealed nine key issues with the project:
- “CHSRA has executed numerous change orders and will likely have many more change orders in the near future to account for contractor expenses as a result of project delays.
- CHSRA has already missed its deadline for finalizing its rolling stock procurement.
- CHSRA has at least a $7 billion funding gap to complete the EOS, with no credible plan to secure additional funds.
- CHSRA does not have a viable path to complete the EOS by 2033 per its commitment in the FY10 Agreement and the FSP Agreement.
- CHSRA relies on volatile non-federal funding sources, which present significant project risk.
- CHSRA lacks time and money to electrify the EOS by 2033.
- CHSRA’s budget contingency is inadequate to cover anticipated contractor delay claims.
- CHSRA has overrepresented its ridership projections for the EOS substantially.
- CHSRA lacks the capacity to deliver the EOS by 2033.”
The press release ends with the following statement: “By terminating these grant agreements, FRA is saving taxpayers nearly $4 billion dollars. FRA will start exploring how these funds can be made available to viable and meritorious passenger rail projects.”
California Reacts
For it’s part, California and CHSRA leadership reacted strongly to this decision. Governor Gavin Newsom said “Trump wants to hand China the future and abandon the Central Valley. We won’t let him. With projects like the Texas high-speed rail failing to take off, we are miles ahead of others. We’re now in the track-laying phase and building America’s only high-speed rail. California is putting all options on the table to fight this illegal action.”
CHSRA CEO Choudri said “Canceling these grants without cause isn’t just wrong — it’s illegal. These are legally binding agreements, and the Authority has met every obligation, as confirmed by repeated federal reviews, as recently as February 2025. America’s only high-speed rail project underway is fast approaching the track-laying phase, with 171 miles under active construction and design, 15,500 jobs created, and more than 50 major structures completed. This is no time for Washington to walk away on America’s transportation future.”
