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In February, the Secretary of Transportation of the United States, Sean Duffy, launched a review of the California High Speed Rail Authority, which is building part of the Los Angeles-to-San Francisco project in the central valley of the State. The review will determine if the authority can hold $ 4 billion in previously required federal aid.
The project has been critical for many years due to increasing delays and costs. In 2008, when California voters approved a $ 9.95 billion bond measure to start the project, the authority estimated the total cost of the L-Bay area line at $ 33 million, and promised that the trains would run in 2030. Last year, the authority business plan estimated that a section of 171 miles between Merced and Bakersfield could take place between Merced and Bakersfield, 2030 and 2033, dear of the section of Merced and Bakersfield, California. $ 28.5 billion to $ 35.3 billion only for this section.
The public dowry statement of February 20 on the review was referred to by a report by the California Inspector General, who said that the authority faces a financing gap of $ 6.5 billion to complete the initial segment and that it is “increasingly likely” the authority will be able to finish this part until the target date of 2033.
Transportation Secretary Sean Duffy
Kevin Dietsch through Getty Images
“That is why I run my staff to review and determine if the Chsra has followed the commitments he made to receive billions of dollars in federal funding,” Duffy said in a statement. “If not, I will have to consider -if this money could be delivered to the infrastructure projects they deserve anywhere else in the United States.”
For the authority, this is Deja vu. During Trump’s first term, the Federal Rail Administration canceled a $ 928.6 million agreement with him, saying that the authority “could not repeatedly fulfill the terms of the FY10 Agreement and failed to make reasonable progress in the project.” The Biden administration restored this funding by 2021. FRA in 2019 also requested $ 2.5 billion to North -American Recovery and Reinvestment Funds, which was not achieved.
A dowry spokesman told Smart Cities Dive that the current review includes the same $ 928.6 million grant from FY10 and a $ 3.1 billion grant granted in December 2023 under the Federal-State Partners for Interity Passenger Program.
In a statement of February 21, the authority said that it welcomes the investigation and the opportunity to work with its federal partners. “With multiple independent federal and state audits completed, we have each dollar and we maintain ourselves according to the progress and impact of this project,” said CEO Ian Chudri.
The reaction to dowry’s investigation came rapidly. “The California High Speed Railway project (CAHSR) is the most ambitious and innovative transport project in the whole country,” said Greg Regan and Shari Semelsberger, president and secretary-treasurer of the Department of Transportation Commerce, ESC-CIO, in a statement on February 20. “He has created thousands of middle-class jobs, putting more than 14,600 Americans to work already and has been an economic advantage to more than 800 small companies involved in the project.”
Can the point back back these already awarded funds? The terms of the subsidy agreement and the fulfillment of the authority of these terms will greatly determine that Joshua Schnell, a member of the Cordatis law firm, who represents the recipients and federal contractors as head of the firm’s litigation practice. If the investigation finds a violation of the subsidy agreement or the regulations of the subsidy or the indications of fraud or abuse, this could be the cause of recovering these funds.
The authority does not fully depend on the federal subsidies. In reference to the State -General Inspector’s report, a spokesman said that of about $ 13 billion spent on the project, $ 10.5 billion came from the state.
These funds mainly come from the California emission and emission trade program. The program establishes the limits of emissions and issues a small number of bonuses each year by virtue of this lid. Issuators The program covers must have compensation for each ton of their carbon dioxide emissions; They can buy and sell bonuses at an auction depending on their needs, with some of the revenue that will be used for the state greenhouse gas reduction fund.
The fund dedicates 25% of its annual revenue to high -speed railway. The authority projects income of $ 26.7 billion to $ 29.7 billion from $ 750 million GGRF income to $ 1.25 billion a year up to 2030, according to their 2025 project update.
