USDOT, California High-Speed Rail Square Off Over $4 Billion in Grants
Proposed Cancellation Called ‘Unwarranted and Unjustified’
California High-Speed Rail is at a crossroads. It needs to develop reliable funding sources to complete the project, which has been plagued since its inception by delays and massive cost overruns.
Success or failure could shape the future for high-speed rail and other large infrastructure projects in the United States. Thanks to the Trump administration California’s path just became more difficult.
Two weeks ago, the Federal Railroad Administration released a 310-page report that the administration is using to justify cancelling $4 billion in grants for the high-speed rail line. “This report exposes a cold, hard truth: CHSRA has no viable path to complete this project on time or on budget.” said U.S. Transportation Secretary Sean P. Duffy in a statement.
The California High-Speed Rail Authority issued its formal response to the report Monday. It called the report “an inaccurate, often outright misleading, presentation of the evidence.”
In his letter to the FRA Choudri charged the effort to rescind the grants was politically motivated. He noted that the agency found “no significant compliance issues” in its October 2024 review.
“Termination of the agreements is unwarranted and unjustified,” said Ian Choudri, CHSRA chief executive officer. He contends the feds distorted data, used disingenuous methods, and cited reports that don’t support its conclusions.
A $929 million grant made in 2010 under the Obama administration and $3 billion award from the Biden administration in 2023 comprise the disputed funds. The money was earmarked for building a station in Fresno and extending the rail line from Shafter to Bakersfield and from Madera to Merced.
Federal aid accounts for only 18 percent of the project’s funding to date, but its participation could influence potential private sector investors.
The FRA report includes nine findings that, it says, justify the federal government rescinding the grants. It concludes CHSRA has “no viable path” to completing its initial operating segment between Bakerfield and Merced by 2033, as called for in its current business plan. Choudri said his agency will release a report this summer on its plans to reduce expenses and expedite construction.
In addition, the response contends the $1.6 billion in changes to the project since 2023 is “not a compliance issue” since they were not paid for with the federal grants. Further it counters charges of minimal progress by citing completion of 53 structures and 69 miles of guideway including viaducts, overpasses and underpasses.
In his letter to the FRA Choudri charged the effort to rescind the grants was politically motivated. He noted that the agency found “no significant compliance issues” in its October 2024 review.
“There have been no meaningful changes in the past eight months that justify FRA’s dramatic about-face,” he said. “Instead, the FRA has looked at essentially the same facts it considered in the fall of 2024 and simply reached a different conclusion.
“Hostility to public investments in high-speed rail, and to California’s leadership—hostility that dates back to FRA’s initial attempt to revoke federal funding to the Program in May 2019—appears to be the real basis for the proposed determination.”
Writing for the website tehelka.com, Gopal Misra suggested that Duffy’s move to cancel the grants could be aimed at stopping Chinese participation in the project. China Railway International has a proposal before CHSRA that covers design, construction, equipment procurement, and rolling stock. If the United States and China reach an agreement on trade and tariffs that opposition could end, he said.
The high-speed rail line was conceived to run between Los Angeles and San Francisco with branch lines to Sacramento and San Diego. It was supposed to be completed by 2020 and cost $33 billion. The Authority’s focus now is on completing the 172-mile Bakersfield – Merced trunk line by 2033, but the project has a shortfall of around $10 billion. Cost estimates for the entire line run as high as $128 billion.
California has provided 82 percent of the $14 billion already spent on the project. Approximately $1 billion annually comes from the state’s cap-and-trade program. That commitment runs out in 2030. Gov. Gavin Newsome wants to extend that to 2045, which would provide sufficient funds to complete the initial operating segment.
Despite the project’s problems, public support remains strong. A poll taken before the FRA report was released found 67 percent of California voters still support it. In an op-ed published in the Los Angeles Times, rail advocate Jeff Beeman said the high-speed line could relieve traffic congestion and turn Central Valley cities like Bakersfield, Fresno, and Merced into bedroom communities for Los Angeles, San Francisco, and San Jose.
He noted that high-speed rail lines in Japan and Europe also went over budget and were delayed. However, after they entered service they proved to be popular with travelers. A high-speed line that enables people to travel between Los Angeles and San Francisco in three hours or less would be a game changer for California. It would get people out of their cars and away from the airport. It could stimulate demand for HSR throughout the country.
But we need visionary leaders to get to that place. President Trump and Secretary Duffy should look to the future instead of the past. Rather than beating up on California because they feel threatened politically by its governor and its 54 electoral votes, they should be working collaboratively to identify opportunities to cut through red tape, accelerate the approval processes, and build a stable financing environment to attract investment.
Amtrak Moving Forward on Extension to Long Island
At its May 22 board meeting Amtrak officials laid out plans to extend three New York – Washington round trips to Ronkonkoma, Long Island, roughly 50 miles east of Penn Station. The move would create the first one-seat rail line between Long Island and the U.S. mainland.
The three trains would head east during off-peak hours and return the same day. The 277-mile run between Washington and Ronkonkoma would take roughly five hours and include additional stops in Jamaica and Hicksville. Amtrak officials say the extension would meet demand for one-seat travel between Long Island and New Jersey and Philadelphia in addition to the nation’s capital.
Nicole Bucich, Amtrak vice president for network development, told Newsday the railroad is “committed” to coming to Long Island and sees the run to Ronkonkoma as a “natural extension of its existing network.” The route would serve a population of more than three million, and a one-seat ride should increase demand, according to Bucich,
The Ronkonkoma extension was one of 69 expansion projects included in Amtrak’s Connect Us strategic vision statement, released in 2021. Since the service would operate over existing infrastructure with an 80 mph speed limit in most locations its capital requirements would be minimal.
Service would begin after 2030. By then rehabilitation of Amtrak’s East River tunnels should be complete and a sufficient number of Airo trainsets should be one the property.
The next step is obtaining a grant from the Federal Railroad Administration to study cost, feasibility, and funding options and produce a service development plan. This would follow on a $500,000 preliminary study funded by FRA in 2024.
Amtrak is also working with New York’s Metropolitan Transportation Authority, which owns the Long Island Rail Road, on details for the service, including finding slots to run over the busy LIRR mainline.
While LIRR customers can readily connect with Amtrak trains at the Moynihan Train Hall at Penn Station, through service would several advantages beside the one-seat ride:
Greater convenience since passengers would not need to walk the length of platforms and/or corridors to make connections. This would be especially beneficial for families, seniors, and persons with disabilities and/or lots of luggage.
No missed connections.
Better seat selection since travelers coming from Long Island would board ahead of those getting on in New York.
CAHSR is a boondoggle and a textbook case of California government failure. What was promised —
$33B for 113M riders/year and LA–SF by 2020
has become —
$128B for 24–50M riders/year, only Bakersfield to Merced by 2035, with LA–SF TBD.
What most Californians don’t realize:
- The ridership estimates are wildly inflated. Amtrak’s busiest line (NEC) gets ~12M riders/year in an area with twice the population density. California rail totals under 3M today.
- The cost estimates have exploded. Even the $128B figure is optimistic—CAHSR uses tunneling costs half those of Japan or Norway to mask true expenses.
The only reason it has 67% support is because people don't understand how much waste, fraud and abuse exists in the project.
My suspicion is local and state support will keep on building. When California Proposition 1A (the Safe, Reliable High-Speed Rail Bond Act for the 21st Century) passed in November 2008, it had garnered roughly 52 percent of the state-electorate vote then. Frankly, I’m somewhat taken aback by the fact that support of the project to date, is 67 percent in the state. I didn’t think it was that high, and speaking candidly, I’m glad it is! That’s encouraging!
One point I keep emphasizing is the need to focus on finishing Madera to Shafter — the distance covered here is 119 miles, the section being known as the Initial Operating Segment or IOS, for short. Once track on the IOS is laid, then testing of the high-speed trainsets can commence. Talk about about a game changer! Not only would this be a game changer, but a milestone moment in the U.S. at the same time in that the fast, fast-train-transportation threshold here domestically will have, at long last, been reached. The faster that we can get to this point, the better.