Federal officials likely won't budge from using stimulus funds to begin building California's high-speed rail system in the central San Joaquin Valley, despite a stinging condemnation issued two weeks ago by state analysts over the route choice.

In a letter Wednesday to the California High-Speed Rail Authority, federal Transportation Department Undersecretary Roy Kienitz restated his agency's commitment to start construction of the proposed 800-mile system with a 130-mile stretch from near Chowchilla to just north of Bakersfield.

The Kienitz letter also draws a line in the Valley's sandy soil between the federal government and the state Legislative Analyst's Office over the initial construction section and the money needed to build it.

One point of contention is the billions of dollars in matching funds that the federal government is counting on from California. California voters approved Proposition 1A, a $9 billion bond measure, in 2008 to help finance construction of the system.

In a May 10 report, the LAO suggested withholding that money – unless the Obama administration considers changing the route or easing spending requirements.

On Wednesday, Kienitz said that could kill the whole project. In his letter, he wrote that the route and deadlines are not up for debate, and California will only get about $3.5 billion in grants from the Federal Railroad Administration if it makes good on its pledge of about $2.75 billion more from the state bond measure.

"Withholding these matching funds would put California's high-speed rail project in serious jeopardy," Kienitz wrote.

Eric Thronson, the policy analyst who wrote the LAO report, said Wednesday he is not so sure that is true.

"If we require the authority to renegotiate with the Federal Railroad Administration or else they won't get their [state bond] funds, maybe the High-Speed Rail Authority and the Federal Railroad Administration might have a different perspective on where to start," Thronson said. "There's no law that says we can't start somewhere else."

The LAO report urged that construction begin not in the Valley, but in Los Angeles or the San Francisco Bay Area.

It's not clear how much traction the LAO report has among lawmakers in Sacramento. The office is an independent, nonpartisan agency that typically examines state budgets, legislation and ballot measures to evaluate their effects. Its role is advisory.

Even supporters of high-speed rail say the report raised valid issues concerning the authority's management, lack of a firm financial plan and reliance on consultants.

But Assembly Member Cathleen Galgiani, the Livingston Democrat who wrote Prop. 1A, said the recommendations to change the route or push deadlines back would kill the project if they are adopted.

The federal government "has made it perfectly clear that we will be building in the Central Valley or they will take their dollars back," Galgiani said.

Galgiani said the authority worked closely for more than two years with federal officials, engineers and other rail experts to determine where to start building the system.

"The LAO wants the Legislature to set criteria for choosing where to start building, but legislators already did that when they put Prop. 1A on the ballot," Galgiani said. "What this looks like is that perhaps the LAO doesn't like the outcome, so they want another legislature to change the rules to affect a different outcome."

The state's rail authority, meanwhile, is in the middle. It must satisfy not only the legislators who ultimately will have to sign off on budgets, business plans and bonds, but also the federal agencies that are putting up the bulk of the money available so far.