Trump administration cancels $929 million contract for California bullet train

In a dramatic move, the Trump administration announced Thursday it has canceled a nearly billion-dollar funding contract with the California bullet train, throwing the state’s troubled high-speed rail project further in doubt.

California Gov. Gavin Newsom immediately fired back, calling the move illegal and vowing to fight it in court.

The Federal Railroad Administration said it terminated a longstanding contract to pay the California High Speed Rail Authority $928,620,000 because California “has repeatedly failed to comply with the terms of the (2010) agreement and has failed to make reasonable progress on the project.

“Additionally, California has abandoned its original vision of a high-speed passenger rail service connecting San Francisco and Los Angeles, which was essential to its applications for FRA grant funding.”

Trump previously tweeted that California “has wasted billions of dollars on their out of control Fast Train, with no hope of completion.”

Gov. Newsom responded defiantly Thursday afternoon.

“The Trump Administration’s action is illegal and a direct assault on California, our green infrastructure, and the thousands of Central Valley workers who are building this project,” he said. “Just as we have seen from the Trump Administration’s attacks on our clean air standards, our immigrant communities and in countless other areas, the Trump Administration is trying to exact political retribution on our state. “

“This is California’s money, appropriated by Congress, and we will vigorously defend it in court.”

FRA officials say they also are continuing to look at options for requiring the state to return a past $2.5 billion that California had received for the train project under the American Recovery and Reinvestment Act.

The FRA foreshadowed today’s announced decision three months ago when it sent letters to state authorities laying out a case that state officials were failing to meet federal requirements for the money. The federal agency reiterated those concerns Thursday in a 25-page letter to Brian Kelly, head of the state high-speed rail authority.

The rail project recently underwent overhauls under new Gov. Gavin Newsom, who called the original plan bloated. Under Newsom, the state has scaled back its near-term aspirations and is focusing instead on building an initial line between Bakersfield and Merced.

State high speed rail officials argue that they have met federal requirements for the project, which is under construction, and that they plan to continue forward even if the feds refuse the funding.

California rail officials said they have planned to use the $929 million federal grant in the fiscal year 2021-22. That money is expected to be part of a basket of funds, including state Prop. 1A funds and annual state cap and trade funds, to be used to complete the initial bullet train line from Bakersfield to Merced.

That line is planned to be up and running around 2028.

High speed rail officials currently budget that line at $20.4 billion. That includes purchase of train sets, as well electrification of the Caltrain system between San Jose and San Francisco. It also includes funds to do environmental studies for future project expansion from Merced to San Jose on the north end and from Bakersfield to Los Angeles in the south.

State officials have said they will have to find more future funding to build those coastal extensions, which are expected together to cost far more than the starter line.

Assemblyman Jim Patterson, R-Fresno, a bullet train critic, said the federal funding withdrawal is the beginning of the end for the project.

“They have torn up central California, destroyed thousands of acres of prime farm land and taken homes and businesses,” he said. “The question now is, how are they going to put it all back together before they spend all the money they have left and leave town. We are witnessing the beginning of the end.”

Patterson dismissed California’s complaint that the federal decision is political, noting that the state’s own auditor warned last year that this could happen unless the state improves its performance.

House Minority Leader Kevin McCarthy, R-California, said the Trump announcement “ensures that we move on from the failed boondoggle.” He called for focus instead on water storage.

State Sen. Jim Beall, D-San Jose, however, derided the Trump move, calling it “irrational” and “clearly politically motivated.”

“To cancel funding for the nation’s largest infrastructure project during national Infrastructure Week shows the Administration’s priorities are not aligned with what is best for California workers and families.”

U.S. Sen. Dianne Feinstein, D-California, issued a press statement backing Newsom. “I agree with Governor Newsom that California should take this decision to court and I thank him for responding so quickly. These are funds that Congress appropriated and the president obligated. They cannot legally be withdrawn without good cause.”

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