The state alleges $4 billion in federal grants were cut for political reasons as the project enters the track-laying phase.
California sued the Trump administration on July 17 over its decision to revoke $4 billion in federal grants for the state’s high-speed rail project, calling the move politically motivated and illegal.
Gov. Gavin Newsom announced the lawsuit in a press release, accusing the administration of using the federal grant termination as retribution against California. The state claims the Federal Railroad Administration (FRA) ended two grant agreements without cause, despite the project meeting its obligations under federal oversight.
“In reality, this is just a heartless attack on the Central Valley that will put real jobs and livelihoods on the line,” Newsom said in the release. “We’re suing to stop Trump from derailing America’s only high-speed rail actively under construction.”
The California High-Speed Rail Authority (CHSRA), which filed the suit, said in a post on X that “canceling these grants without cause isn’t just wrong, it’s illegal.”
CHSRA said it has met every requirement under its agreements, pointing to multiple federal reviews—including one as recent as February—that found the project to be in compliance.
The lawsuit argues that President Donald Trump’s actions are part of a long-running pattern of political retaliation, pointing to his first administration’s attempt to revoke high-speed rail funding the day after California sued to block his emergency declaration for a border wall.
In both instances, California claims, the timing and public remarks show the decisions were driven by personal animus, not project performance.
The state also claims that the FRA ignored its own oversight record. As recently as October 2024, the agency completed an annual monitoring review and “made no findings for which corrective measures were needed,” according to the suit.
The lawsuit says the abrupt reversal in Trump’s second term was unjustified and that CHSRA was given inadequate time to respond.
Transportation Secretary Sean Duffy announced the termination on July 16, following what the FRA described as an exhaustive compliance review. He said CHSRA failed to meet critical benchmarks, citing a $7 billion funding gap, missed procurement deadlines, and a lack of capacity to deliver the project’s first operating segment by 2033.
“This is California’s fault,” Duffy said in a statement. “Governor Newsom and the complicit Democrats have enabled this waste for years. Federal dollars are not a blank check–they come with a promise to deliver results. After over a decade of failures, CHSRA’s mismanagement and incompetence have proven it cannot build its train to nowhere on time or on budget. It’s time for this boondoggle to die.”
By Chase Smith
