California has withdrawn its lawsuit against the Trump administration that sought to restore $4 billion in federal funding for the state’s high-speed rail project.
Driving the news: The U.S. Transportation Department had cut the funds in July, claiming the California High-Speed Rail Authority lacked “a viable plan” to complete a critical segment of the project in the Central Valley.
- Governor Gavin Newsom and other officials previously criticized the federal government’s decision as politically motivated.
What we’re watching: The state now plans to focus on alternative funding, including seeking private investment and leveraging $1 billion annually from California’s cap-and-trade program through 2045.
What they’re saying: The high-speed rail authority stated that ending the lawsuit reflects their view that the federal government is “not a reliable, constructive, or trustworthy partner” for high-speed rail in California.
- President Trump and Transportation Secretary Sean Duffy have publicly criticized the rail project, referring to it as a “train to nowhere” that is “severely overpriced, overregulated, and never delivered.”
Go deeper: Shifting the funding strategy is seen as a “new opportunity” for the rail authority to pursue international best practices for high-speed rail development.
- The cap-and-trade program provides ongoing funding for climate-change mitigation, transportation projects, and other state initiatives.
