Trump administration pulls $4B in federal funding for California's bullet train project
The U.S. Transportation Department announced it was pulling back $4 billion in funding for the project, weeks after signaling it would do so. Overall, a little less than a quarter of the project's funding has come from the federal government. The rest has come from the state, mainly through a voter-approved bond and money from its cap-and-trade program.
President Donald Trump and Transportation Secretary Sean Duffy both have slammed the project as a 'train to nowhere.'
'The Railroad we were promised still does not exist, and never will,' Trump wrote on Truth Social. 'This project was Severely Overpriced, Overregulated, and NEVER DELIVERED.'
The loss marks the latest blow to California by the Trump administration, which has blocked a first-in-the-nation rule to phase out the sale of new gas-powered cars, launched investigations into university admission policies and threatened to pull funding over transgender girls being allowed to compete in girls sports.
It also comes as rail project leaders are seeking private investment to help pay for its estimated price tag of more than $100 billion.
Voters first approved the project in 2008 and it was supposed to be operating this decade. But cost estimates have consistently grown and its timeline pushed back.
State officials are now focused on building a 119-mile (192-kilometer) stretch connecting the Central Valley cities of Bakersfield and Merced that is set to be operating by 2033. The California High Speed Rail Authority is slated to release a report this summer to state lawmakers with an updated funding plan and timeline for the project.
Authority officials wrote in a letter earlier this month that the Trump administration made up its mind about revoking funding before thoroughly reviewing the project. They noted that more than 50 structures have already been built, including underpasses, viaducts and bridges to separate the rail line from roadways for safety.
'Canceling these grants without cause isn't just wrong — it's illegal,' authority CEO Ian Choudri said in a statement Wednesday. 'These are legally binding agreements, and the Authority has met every obligation, as confirmed by repeated federal reviews, as recently as February 2025.'
The authority has asked potential private investors to express their interest by the end of the month.
Democratic Gov. Gavin Newsom said the state will keep 'all options on the table' to fight the revocation of federal funds.
'Trump wants to hand China the future and abandon the Central Valley. We won't let him,' he said in a statement.
The state has 'no viable plan' to complete even the Central Valley segment, said Drew Feeley, acting administrator of the transportation department's Federal Railroad Administration, in a report released last month. He called the project a 'story of broken promises' and a waste of taxpayer dollars.
California Democrats also have criticized project spending. Democratic Assemblymember Rebecca Bauer-Kahan said at a budget hearing earlier this year that her constituents 'overwhelmingly believe' high-speed rail spending 'has been irresponsible.'
Newsom plans to extend the state's cap-and-trade program, a key funding source for the project which is set to expire at the end of 2030, through 2045.
The program sets a declining limit on the total amount of greenhouse gas emissions large emitters can release. Those polluters can buy allowances from the state needed to pollute, and about 45% of that money goes into what's known as the Greenhouse Gas Reduction Fund, according to the Independent Emissions Market Advisory Committee, a group of experts that reviews the program.
The fund helps pay for climate and transportation projects, including high-speed rail.
The bullet train project receives 25% of the money from the fund, which ends up being a little less or a little more than $1 billion annually, depending on the year. Newsom in May proposed guaranteeing $1 billion a year for the project from the fund, but lawmakers have not agreed to that.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Daily Mail
13 minutes ago
- Daily Mail
MAGA strikes back after Trump ally Alina Habba ousted as top prosecutor job by 'rogue judges'
The MAGA movement erupted in fury on Tuesday after Alina Habba was abruptly ousted from her role as New Jersey 's top federal prosecutor by what Trump allies are calling a group of 'rogue judges.' Habba, the former personal attorney to President Trump, had been serving as acting U.S. Attorney for the District of New Jersey until her 120-day appointment expired this week without Senate confirmation. A panel of mostly Democrat-appointed judges bypassed Habba and installed her deputy, Desiree Leigh Grace, as the district's top prosecutor. Within hours, the Trump administration fired back, terminating Grace and sparking a dramatic power struggle between the executive branch and the federal judiciary. Attorney General Pam Bondi accused the court of overstepping its authority and threatening Trump's constitutional powers. 'This Department of Justice does not tolerate rogue judges - especially when they threaten the President's core Article II powers,' Bondi declared on X, launching what appears to be a full-scale legal and political offensive to reclaim the post for Habba. The sudden unraveling of Habba's tenure after a whirlwind rise from Trump's personal attorney to one of the most politically potent prosecutors in the country sent shockwaves through MAGA world. Only months earlier, Habba was sworn in by Trump himself in the Oval Office, taking over the New Jersey post in March. Attorney General Pam Bondi fired Grace, a nine-year veteran prosecutor, accusing the court of overstepping its authority and threatening Trump's constitutional powers Her appointment was always temporary and subject to Senate confirmation but she quickly made headlines by pursuing politically explosive cases, including charges against Newark Mayor Ras Baraka and U.S. Rep. LaMonica McIver, both Democrats. She also challenged New Jersey State Police over sanctuary city policies, generating praise from Trump and fierce criticism from Democrats who accused her of pursuing 'frivolous and politically motivated' prosecutions. Under federal law, if the Senate does not confirm a president's nominee within 120 days, the district court judges can install a replacement and this is exactly what happened - much to Trump's fury. The panel of judges, mostly appointed by Democrats, declined to extend Habba's tenure and instead chose Grace, her deputy, in what insiders describe as a calculated snub of the White House. 'Alina is President Trump's choice to lead,' said Deputy Attorney General Todd Blanche, another Trump loyalist and former defense attorney, in a fiery post on social media. 'No partisan bench can override that.' Behind the scenes, Habba is said to have seen the writing on the wall. Days before the decision, she gathered her staff for an emotional all-hands meeting, according to a source familiar with the conversation. 'Hopefully this isn't goodbye,' she told them, expressing gratitude and signaling that she was still banking on full Senate confirmation, although the odds were stacked against her. Her nomination, submitted formally on July 1, stalled in the Senate due to opposition from New Jersey Democrats Cory Booker and Andy Kim, who accused her of inexperience and partisanship. While Trump has pressed for the Senate to stay in session through August to fast-track his nominees, Habba's path remains uncertain. 'She would never back down from the job Trump chose for her', a person close to her told With Habba's nomination still pending and Grace ousted by DOJ leadership, the ball is now back in the Senate's court.
Reuters
13 minutes ago
- Reuters
Japan vows more US rice imports within tariff-free quota
TOKYO, July 23 (Reuters) - Japan will import more rice from the United States but within the existing tariff-free quota, Prime Minister Shigeru Ishiba said on Wednesday, stressing Tokyo's success in protecting the agricultural sector in agreeing a bilateral trade deal. After months of negotiations, the two countries struck a deal to lower the so-called "reciprocal tariffs" to 15% from a proposed 25%, and said increased rice shipments from the U.S. to Japan was part of that deal. Under a World Trade Organization (WTO) "minimum access" framework introduced in 1995, Japan imports about 770,000 metric tons of rice tariff-free every year. Last fiscal year, the U.S. accounted for 45% of the total. "We made absolutely no sacrifice in the agricultural sector," Ishiba told reporters. "Import volumes will remain within the minimum access framework and we retain the discretion over how much and what type (of rice) to import from each country," he said. Announcing the trade deal on Tuesday in Washington, President Donald Trump said Japan would increase market access to American producers of cars, trucks, rice and certain agricultural products, among other items. Neither country disclosed what other farm products were included, but Ishiba said the deal did not include a lowering of tariffs. Beyond the minimum access framework, Japan imposes a levy of 341 yen ($2.36) per kg of rice, which has, for the most part, effectively priced imports out of the market. While these imports have typically been negligible due to Japan's self-sufficiency for its staple grain, the country has imported historically high amounts over the past year due to a shortage and ensuing spike in the price of home-grown rice.
Reuters
13 minutes ago
- Reuters
FACTBOX Key facts on the US-Japan tariff deal
TOKYO, July 23 (Reuters) - U.S. President Donald Trump and Japanese Prime Minister Shigeru Ishiba on Wednesday said they had struck a trade deal that will include a 15% tariff on imports from Japan. Here's what we know so far. In a post on Truth Social, Trump said the deal would include $550 billion of Japanese investments in the United States, improved market access into Japan for American goods including automobiles, rice and other agricultural products. Japanese autos, which account for more than a quarter of all the country's exports to the U.S., will also be subject to a 15% tariff, down from a punishing 25%, Prime Minister Shigeru Ishiba said. The U.S. has also agreed to not impose any caps on auto imports, he added. Japan will keep its existing tariffs on imports of U.S. agricultural products and maintain a minimum market access system that limits the amount of rice that it buys from overseas including the U.S., he said. A Trump administration official said Japan would increase its purchases of U.S. agricultural products such as rice. The $550 billion of investment was the upper limit of loan investments and guarantees that Japanese government state banks and agencies would make available to companies to help companies build resilient supply chains. Japan's top trade negotiator Ryosei Akazawa said steel and aluminium, subject to a separate 50% tariff, were not included in the deal. Akazawa has traveled to the U.S. eight times since April for trade talks with U.S. officials including Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick. The latest visit came days before an August 1 deadline when the Trump Administration said it would impose a 25% tariff on all Japanese imports. The U.S. is Japan's biggest export market. Economists had estimated that Trump's tariffs could lower Japan's GDP by as much as a percentage point. The tariff agreement comes three days after Ishiba's administration lost its upper house majority in an election, triggering calls for his resignation including from within his own ruling Liberal Democratic Party, according to local media reports. In the wake of that election defeat, Ishiba said he would stay in place to push for a trade agreement with the U.S. and to tackle Japan's looming economic problems. Ishiba will announce his intention to step down by the end of August, the Mainichi newspaper reported on Wednesday. Japanese automaker shares led the Nikkei share average higher, which rose by 2% in early trading following the announcement. Toyota Motor Corp's (7203.T), opens new tab shares jumped by 10% with Honda Motor Co (7267.T), opens new tab up by 9%. The benchmark 10-year Japanese bond futures tumbled as much as 0.92 yen to 137.68 yen, the lowest since March 28.
