November 22, 2024

Rise To Thrive

Investing guide, latest news & videos!

Congressional Republicans launch probe into California high-speed rail

3 min read
Congressional Republicans launch probe into California high-speed rail

A pair of top Congressional Republicans Wednesday opened an investigation into the Biden administration’s allocation of billions of federal dollars to California’s ambitious and pricey high-speed train project.

Rep. Sam Graves, R-Mo., chair of the the House Transportation and Infrastructure Committee, and Sen. Ted Cruz, R-Texas, top Republican on the Senate Commerce Committee, sent Transportation Secretary Pete Buttigieg a letter Wednesday asking for the DOT to produce documents and provide staff briefings related to the project by June 12.

They called the rail line, which has been beset by delays and cost overruns, “one of the most troubled ‘megaprojects’ in the nation.”

The California High Speed Rail Authority, or CHSRA, “still has not completed a single segment of the system, the total estimated cost has ballooned to $128 billion and counting, and there is no expected completion date,” the pair said.

Rendering of a planned high-speed rail station in Bakersfield, part of the Central Valley segment.

California High Speed Rail Authority

It’s the latest salvo from Republicans who remain opposed to the train project, which was initially funded in 2008 with Proposition 1A, a $9.9 billion bond issue to help fund what was then envisioned as a $33 billion, 800-mile high-speed rail system between San Francisco and San Diego.

It’s had a bumpy ride since the bond issue. The Trump administration rescinded federal funds for the project, but support started to flow again under President Joe Biden, a known train aficionado. In December, the administration awarded the authority a $3.1 billion federal grant, part of the Infrastructure Investment and Jobs Act, which provides around $70 billion for high-speed rail projects around the country. The project also won money from the Federal Railroad Administration.

In their letter, Cruz and Graves cited a 2023 CHSRA Peer Review Group study that “reported an astounding ‘unfunded gap of $92.6 billion to $103.1 billion between estimated costs and known state and federal funding’ for the full line. They also cited a March 2024 update from the same group that noted the $3.3 billion in DOT awards over the last year “have not closed even half of the unfunded gap for the isolated” Merced-to-Bakersfield segment.

“Despite evidence that continues to show that the California High-Speed Rail project has critical issues indicating there is no reasonable path forward for successful completion of the project … the Biden administration continues to allocate substantial federal taxpayer dollars on this highly questionable endeavor,” the pair wrote.

The letter asked the DOT to be ready to answer a series of queries, including about the funding gaps, low ridership projections for the initial segment, and any plans to withhold further funds until the issues raised by the Peer Group studies are resolved.

The CHSRA is “reviewing the letter and take this seriously,” said a spokesperson. “We stand ready to respond to the [Federal Railroad Administration] and U.S. DOT at their request.”

In a May press release, the authority said it is working to extend the 119 miles currently under construction to 171 miles of future electrified high-speed rail from Merced to Bakersfield, and has created more than 13,000 construction jobs.