Trump Administration Seeks to Defund California High-Speed Rail

Elon Musk, Viviek Ramaswamy Cite it as Example of ‘Wasteful Spending”

California High-Speed Rail bridge. Currently the project has construction underway on 112 miles of its 494-mile route but it may be challenged to get additional funding from the new administration.

In the cult classic film “Office Space” two clueless consultants are working on the premises to downside the company where Peter Gibbons, the story’s protagonist, is employed. Since both are named Bob, everyone calls them “The Bobs.”

The new Trump administration will have its own pair of “Bobs.” Billionaires Elon Musk and Vivek Ramaswamy, co-heads of an entity called the Department of Government Efficiency (DOGE), have taken on a mission to downsize the federal government by eliminating “wasteful spending.”

One of their first targets is the San Francisco – Los Angeles high-speed rail line being built by the California High-Speed Rail Authority (CAHSR). Ramaswamy has called the rail line “a wasteful vanity project” that has wasted “billions in taxpayer cash, with little prospect for completion in the next decade.”

In addition, Rep. Kevin Kiley, R-Rocklin, plans to introduce legislation to bar further federal funds for the project. He contends the money would be better used to fix roads.

CAHSR represents low-hanging fruit to Trump’s Bobs. It is a highly visible mega project that has been plagued by delays and cost overruns from Day One. Initially, Phase One of the project, the San Francisco – Los Angeles main line, was expected to cost around $45 billion and be completed by 2020. Current estimates run as high as $127.8 billion, and there is no timeline for completion.

The Authority to date has received $6.8 billion in federal grants for the project but has only used around $2.6 billion of that amount. Combined, the federal monies represent one quarter of the $29 billion raised so far to build the 171-mile initial operating segment (IOS) between Merced and Bakersfield.

However, CASHR needs $7 billion more to complete this section and has asked for an additional $4.7 billion from the U.S. Department of Transportation. The Biden administration previously provided $200 million of that amount but the next President will decide whether they get the rest.

Based on comments by people like Ramaswamy and Musk the new Administration will probably reject the $4.7 billion new grant. The previous Trump Administration clawed back a $929 million grant for the California project. If the grant is rejected or the administration attempts to recover unspent funds the program could be set back. Meanwhile the project’s cost will continue to rise.

Clawing back an existing grant would be more difficult than rejecting a new one. Martin Lockman a climate law fellow at Columbia Law School, told the San Francisco Chronicle the ability to terminate a grant depends upon the terms of the funding agreement. Generally, agencies can terminate an agreement for breach of contract or if the government decides the grant “no longer effectuates the program goals or agency priorities,” he added.

When a new administration tries to terminate an agreement the courts usually defer to the language of the statute used to authorize a program, Lockman continued. To recover a grant an agency would require a stronger argument than a change in political interests and political will.

Rep. Kiley’s bill will probably pass in the House of Representatives. However, it is unlikely to be voted on in the Senate because 60 votes are required to end debate on a bill.

Back home a majority of Californians still support the project. Sen. Alex Padilla, D-CA, said in a statement he is working with the Biden-Harris to prevent claw backs of funding for high-speed rail. “I’ll use every available avenue to protect this funding as California builds the nation’s first true high-speed rail network.”

Another project supporter, state Sen. Scott Wiener, D-San Francisco, contends Elon Musk has been sabotaging CAHSR for years by promoting the Hyperloop. His intent was to convince the public and legislators that investing in high-speed rail made no sense because his new technology would make HSR obsolete.

“Now he has government power and is trying to kill off California’s high-speed rail project,” Weiner said in a post on X. “That’s why he pushed the scam hyperloop for so long and fed into the bogus claim that transit isn’t necessary because the magical hyperloop will solve everything.”

The best thing CASHR can do to thwart claw backs is to keep making measurable progress, contends its former CEO, Brian Kelly. “As long as we are putting the federal dollars we get to good use, expanding economic opportunity and job growth, I think it gets harder and harder to take those dollars away,” he advised state legislators.

Right now, CAHSR has 112 miles of rail line under construction in the Central Valley. It also has environmental clearance for construction on 422 miles of its 494-mile route. Recently it announced an RFP to build high-speed trainsets; Siemens Mobility and Alstom Transportation have already submitted proposals. The Authority’s goal is to begin operations on the IOS by the early 2030s.

If the Trump Administration and Republican-controlled Congress defund California high-speed rail they will be emboldened to halt funding for other rail systems. Therefore, passenger rail users and advocates throughout the country have a huge stake in the outcome of this battle.

First would likely be Amtrak, which has been a target of conservatives since it started up in 1971 and has several multi-billion dollar capital projects under way. Commuter lines and intracity public transit (heavy rail rapid transit, light rail, and streetcars) would follow. The impacts would be massive: increased traffic congestion, more greenhouse gases and other pollutants released into the atmosphere, and more land taken for highway construction.

Supporters of the high-speed rail project like Senator Wiener say the challenges faced in California illustrate the need to change “how we design, approve, and deliver transit projects,” he points out. “It needs to happen more quickly and effectively.”

Even President-elect Trump, who clawed back high-speed rail funding in his first term, said he doesn’t understand why other nations around the world have “unbelievably fast” bullet trains. We don’t have anything like that. Not even close, and it doesn’t make sense that we don’t,” he said in an online conversation with Musk last August.

The reason we do not have high-speed rail lines comes down to too much opposition from: airlines; auto manufacturers; Big Oil; environmentalists; freight railroads; the highway lobby; politicians; NIMBYs; and landholders who refuse to grant rights of way. In addition, the complex and lengthy permitting and funding processes, coupled with litigation brought by project opponents, can stretch out for decade.

I would not be surprised if Trump and the Republican-controlled Congress enact measures to simplify and accelerate the approval processes, i.e. cut red tape. However, I doubt they would back that up with adequate levels of funding to advance HSR development. In all likelihood they would point to Brightline’s accomplishments and call for privatization of high-speed rail.

So here’s a suggestion: give the California HSR project over to Musk, who is the richest person on Earth with estimated wealth greater than $450 billion! Since he has already been successful in two distinct transportation fields – motor vehicle manufacturing and space travel – he should be up to the challenge.

Perhaps with his technical and financial acumen he could complete the project quicker and for less money without sacrificing safety, reliability, and comfort. In addition, since he has more than enough money to fund building the railroad he won’t have to spend years begging for grants from the government.

Seriously, though, the California High-Speed Rail project is too important to fail. Successful adoption of HSR technology there can build support for building high-speed lines in other corridor such as Dallas – Houston, Atlanta – Charlotte, and Seattle – Portland. Also, it will serve as a testing bed for concepts that can be adapted in the future to drive down costs and speed implementation.

If you are a high-speed rail supporter let your representatives in Washington know and consider making a donation to or joining the High-Speed Rail Alliance.