The fallout continues from Gov. Gavin Newsom’s State of the State address last week, with the federal government now threatening to cancel hundreds of millions or even billions in grant money intended for California’s high-speed rail project connecting San Francisco to Los Angeles.
On Tuesday, Federal Railroad Administration administrator Ronald Batory sent a letter to Brian Kelly, CEO of the state’s bullet train project, accusing California of missing key deadlines for $929 million of federal funds.
“FRA has determined that CHSRA [California High Speed Rail Authority] has materially failed to comply with the terms of the agreement and has failed to make reasonable progress on the project, significantly endangering substantial performance,” writes Batory.
“Considering this determination, FRA intends to exercise its right to terminate the agreement,” the administrator added.
Batory accuses the state of neglecting timely reports on the project, not raising enough state money for the rail project, missing agreed-upon deadlines for completion, and failing “to take appropriate corrective actions to ensure delivery.”
He specifically cites the governor’s recent speech, accusing Newsom of “a significant retreat from the state’s initial vision and commitment,” saying that the Department of Transportation agreed to help build a train connection extending to San Francisco and that a shorter route violates the deal.
In his State of the State address on February 12, Newsom appeared to have canceled the SF to LA bullet train. “The project, as currently planned would cost too much and take too long,” he said. Newsom emphasized the under-construction Central Valley portion of the train route instead.
Hours after his speech, the governor’s spokespersons walked back his declaration, telling Curbed SF that Newsom’s comments were misunderstood and that the SF connection would go on.
The Department of Transportation released a statement Tuesday saying that it is “actively exploring every legal option to seek the return from California of $2.5 billion in Federal funds FRA previously granted for this now-defunct project.”
In an emailed response to the federal declarations, Kelly said:
The FRA communicated that it has determined that the Authority has failed to comply with the terms of the grant agreements. This determination is both ill-advised and misguided. We are preparing a formal response. Our commitment to delivering the requirements of the grant agreements remains.
We intend to deliver the California high-speed rail program including all Phase 1 environmental documents for the San Francisco to LA/Anaheim system. And we are focusing on advancing the Merced to Bakersfield line as outlined by Governor Newsom in his State of the State address. We are continuing our efforts to deliver this transformational program and to expand the economic and environmental benefits to the thousands of hard-working families in the Central Valley.
Newsom accused the White House of singling out California for political reprisal, saying via a statement Tuesday, “It’s no coincidence that the administration’s threat comes 24 hours after California led 16 states in challenging the president’s farcical ‘national emergency.’”
Approved by voters in 2008, the now-$77 billion bullet train is key to San Francisco’s planned transit infrastructure.
Having an appropriate destination terminal was an important selling point in building the Transbay Transit Center, and hundreds of millions of dollars of future funds for projects like the downtown Caltrain extension are predicated on high-speed rail plans as well.