U.S. Transportation Secretary Sean P. Duffy announced an investigation into how California is spending a $3.1 billion federal grant for a high-speed rail, citing “mismanagement” of a project that he said was “severely — no pun intended — off track.”
“The project is not going to happen,” Duffy said at a news conference at Los Angeles Union Station. “There is no timeline in which you are going to have a high-speed rail that is going to go from Los Angeles to San Francisco.”
In a letter to the state High Speed Rail Authority last week, the Federal Railroad Administration said it would conduct inspections, review activities and examine financial records of the authority. The letter warned that the state could be liable for any further expenditures of federal money under the grant authorized by the Biden administration if they are not determined to be in compliance with the grant’s requirements.
The loss of so much federal money, if it were eventually held back, could fundamentally threaten a project that is already struggling with inadequate funding, potentially delaying the installation of electrical systems and the purchasing of trains — both essential big-ticket items.
The project, as it was originally envisioned, would connect Los Angeles and San Francisco in two hours and 40 minutes with 220-miles-per-hour trains, among the fastest in the world, at a cost of $33 billion. But Duffy noted that the costs of the project have tripled since then and that it was failing to achieve the goal.
That original ambition had already been scaled back by Gov. Gavin Newsom, who committed in 2019 to building a starter line within the Central Valley, from Merced to Bakersfield. But the estimated $22.9 billion cost of even that minisystem has escalated to over $30 billion, leaving a $6.5 billion shortfall in the available funding — even with the $3.1 billion federal grant expected to be received.
A decision by the Trump administration to cancel the grant could strike a crippling blow. It would leave the project to proceed through construction with a roughly $1-billion-per-year revenue stream from the state’s greenhouse gas auction program, barely enough to maintain the historical spending pace of $3 million per day.
Ian Choudri, chief executive of the rail authority, said the project had already been an important source of economic activity and job creation for California, even before the first train runs.
“We welcome this investigation and the opportunity to work with our federal partners,” he said in a statement. “With multiple independent federal and state audits completed, every dollar is accounted for, and we stand by the progress and impact of this project.”
The project continues to have a core of supporters in California, some of whom turned out Thursday at a noisy demonstration that interrupted Duffy’s news conference.
Rail projects in Europe historically have had much broader popular support, said C. William Ibbs, professor emeritus of civil engineering at the University of California, Berkeley, who consulted on bullet train projects around the world and who chairs the state-appointed peer review panel for the project.
“We are not sold on rail systems,” he added. “We are sold on cars.”
The lack of broad political support has taken a toll. Newsom declined to support additional major state funding, even when the state was flush with tens of billions of dollars in surplus revenue. When voters approved a $9 billion bond issue in 2008, it was supposed to provide a third of the project’s funding, while private investors and the federal government were expected to chip in the rest. Since then, however, private investors have shown no interest, either.
And through the years, the project has consistently grown in cost — a result of inflation, changes in plans, higher land acquisition costs, the Covid pandemic and inaccurate cost estimates, all of which happened at a faster pace than new sources of money could be found. As a result, the funding gap has grown, not narrowed.
“This just emphasizes the underlying problem that it is unmanageable without adequate funding,” said Louis S. Thompson, a veteran railroad expert who chaired the state-appointed peer review group until last year. “If federal funding is withdrawn, it will make management of the project all the more difficult.”
A full loss of federal funding, some analysts said, could mean that the project might have to run lower-speed diesel trains on the new tracks. Such a fallback plan was originally proposed as part of grants, issued under the Obama administration, that called for any construction to have “independent utility” if a bullet train system were not realized.
Duffy’s announcement is not the first warning about problems with the project. Earlier this month, the inspector general for the project, Benjamin Belnap, warned that completion of the Bakersfield-to-Merced line by 2030 or even by 2033 was “unlikely,” and he cautioned that there were other “ongoing risks of delay.”
The harshly worded report by Belnap renewed longstanding concerns that the optimistic projections by the rail authority were unrealistic, and also added fuel to President Trump’s efforts to further scrutinize the project. Trump targeted the project in his first term, as well. The Federal Railroad Administration rescinded a $1 billion grant that the Transportation Department under the Obama administration had allocated to the project. California sued to get the money back, and former President Joseph R. Biden Jr. restored the money when he entered office.
The California rail authority applied for an additional $8 billion infusion under Biden’s ambitious national infrastructure program. That money failed to materialize, but the $3.1 billion grant was approved.
Trump signaled earlier this month that he wanted an investigation of the rail project. Several Republican state lawmakers, who have generally opposed the large funding allocations to high-speed rail, sent him a letter applauding the idea of such an investigation and saying they “stand with you.”
“By all metrics, the High-Speed Rail is a colossal failure,” they wrote. “The $1 billion the state spends on the High-Speed Rail each year would be better spent on protecting lives, homes, and jobs against wildfire and other natural disasters as well as securing water infrastructure for our economy to grow.”
Ralph Vartabedian is a reporter for The New York Times. Copyright 2025, The New York Times
I spoke vehemently against the “Rail to No-where” many years ago during a city council meeting.
There wre several “High-speed Rail” Authorities in attendance, in city council chamber, sitting behind tables located on the floor before the dais.
These ‘Authorities’ were visually unhappy with my speech.
Governor Newsome is an adminstrative mistake of life.
All of those “Right-aways’ purchased for the “Rail to No-where.” And…the sheer incompetance to route the Rail to San Jose. Dumb.
I hope President Trump will cut-off all Federal funding.
Let the “”Rail to No-where” rot where it stands and return the “right-awys.”
David S. Wall
Not only should they cut off funding they should also investigate where the billions spent so far have gone. People ripped off the public and there is zero effort into why. Its time for an audit. DOGE the California Government!!!!!
What more can be said about this boondoggle.
There are only two things left to do on this project.
1) Cancel it
2) Investigate every parcel purchase and contract, and prosecute to the fullest extent of the law.
Why are you people always so wrong?
This is yet another reminder despite what anyone thinks of Trump people that the project has been fundamentally defective from the start due to politics, in particular, and it has largely been a disaster in the making as well as pillage of the taxpayers, as one insider has called it.
This is yet another lesson, as with e.g., education, including higher education, that state and local governments should be paying fully for such things and controlling them fully as well. Part of the silliness was expecting private investors to contribute a lot as well as the federal government, and let there not be an attitude of entitlement about federal money, with or without unwanted dependence.
Even more challenging, especially to typical fans today, is the need to be realistic about where high-speed and other improved passenger rail service could succeed, and where it could fail. Despite the view of many fans, new trains aren’t shiny toys that perform socio-economic re-engineering magic.
This still viable?
Yeah, this project is a stinker. Defund it.
ARCH STANTON: Something like it is viable, but is better done as part of a larger system connecting the Bay Area and Sacramento using Altamont Pass, and it would involve regional trains at each end as well as north-south trains.
Your choice of which to be done first, #1 or #2 or #3, with limited funds:
1. A new Altamont Pass route for trains of various speeds and doesn’t need high speed trains at first makes more sense to haul those commuters. Do the same with improvements between Palmdale and Union Station (in Los Angeles).
2. Connect Palmdale and Bakersfield since the real thing to boost rail use as well as performance in the state is connecting Nor-Cal and So-Cal across the mountains.
3. If Merced-Bakersfield is built, then build Sacramento-Merced to complete the Central Valley portion plus make it better to improve Altamont Pass for regional as well as inter-city trains.
S. J. KULAK and others, a real solution here is another ballot measure even though there actually are many in the state that view the project in a positive light.
The ballot measure can either terminate the project outright or strictly reduce and limit its scope.
Proponents can do the math (arithmetic) once federal funds join private investor funds in not being present, and use the results when making the case of ending or reducing this project with the ballot measure.
Mr. Suckered,
I love HSR, Shinkansen, TGV – Tokyo to Osaka by way of MT Fuji. Tokyo to Nagano. Paris to Lyon and onto Val-d’Isère. Paris to Bordeaux on route to Arachon, maybe more packed than Paris-Lyon. Taipei to Kaohsiung and the mountains in between. All fantastic, all worth the investment, all packed, all cash flowing. And the stations these days, Mon Dieu! Laduree, Ekiben, Paul Boulangerie, so good!
California HSR ain’t it.
DC to NYC – enough traffic – right of way – maybe. Some constellation within the Texas triangle, probably. Detroit to Chicago may even have the numbers. LA to Vegas could probably be privately funded.
Bakersfield to Modesto, uhh uh. This is a boondoggle, but there are too many small special interests with their thumb on the scale to change course. That and the progressives in the state will never capitulate to Trump.
S. J. KULAK: Yes, it’s nice, though we’re not Europe. The NEC’s problem is the old right-of-way that has too much curvature, and superelevation (banking) to the level of an amusement park ride is not the solution, not to mention illegal. (Yes, someone has proposed that and surprisingly, Musk hasn’t recycled this idea, too, as he has others.) Don’t forget Boston-New York, too.
One problem is that in the USA, with New York and Washington, DC being notable still-living exceptions, we’re a suburban nation, don’t care about going or being downtown, left it after World War II. One or two suburban stops in the Bay Area and in LA besides Union Station (which remains a good nerve center for rail) helps boost ridership notably. The problem is that it’s a California project ruined early from the state’s politics. The route is wrong and it has too many stops in too-small cities. Then there are those with a foot, not merely a thumb, on the scale, including those big contractors. They’re not above reproach, not about the obvious and historical, not about anything: Was the defective bridge work that had to be redone truly mistaken?
And current problems with construction are with the easiest, cheapest part of the project.
Overlooked is improvement of conventional rail to where it approaches slower new HSR at 155 mph. See Railjet, which you may also know about — interestingly, same family of Siemens cars as used on both Brightline and as newer conventional cars being put to use now in California and elsewhere, just differing on some details or features. That’s what ought to serve those many smaller cities on the HSR project route, and So-Cal runs someday, with other faster trains doing the long runs between the Bay Area or Sacramento and L.A. Union Station.