Trump Vows to Reclaim California Rail Money, Newsom Threatens 'Fight'
White House takes back $1 billion, says 'exploring every legal option' to get the rest
President Donald Trump's administration has announced that is "exploring every legal option" to reclaim $2.5 billion in taxpayer money from California for a canceled rail project that the state is refusing to return.
The White House revealed that it has already managed to cancel an almost $1 billion federal grant that has yet to be paid, with California Governor Gavin Newsom saying he will "fight" the president on the remaining $2,500,000,000 of American citizens' money.
In his “State of the State” address on Feb. 12, Newsom announced the cancelation of the San Francisco-to-Los Angeles high-speed rail project, saying it “would cost too much and, respectfully, would take too long” to complete.
Newsom, however, told legislators he still wants to complete the portion of the bullet train under construction in the rural Central Valley, in a bid to hold on to the federal dollars granted to California by President Barack Obama as part of the 2009 stimulus.
The Democrat governor claimed the returning the money would be, somehow, giving it to President Trump, rather than to the taxpayer.
“I am not interested in sending $3.5 billion in federal funding that was allocated to this project back to Donald Trump,” Newsom said.
According to Fox News, in response to the Trump administration's legal threat Tuesday, Newsom vowed that he would not sit "idly by" as the White House engaged in what he called "political retribution" against California.
In a letter, the U.S. Department of Transportation and Federal Railroad Administration (FRA) Administrator Ronald Batory said Newsom's State of the State address constituted a "significant retreat from the State's initial vision and commitment and frustrates the purpose for which federal funding was awarded (i.e., an initial investment in the larger high-speed rail system.)"
Batory, writing to the California HSR Authority (CHSRA), also charged that the state had "materially failed to comply" with its agreement to contribute substantial matching funding to the project in recent months.
For example, Batory noted, California pledged to spend $141.8 million to "advance final design and construction activities" on the high-speed rail network in December 2018 but ended up recording only $47.9 million in expenditures.
Additionally, the letter pointed out that the project would not have been completed by 2022 when the state agreed to complete the work.
The agreement's termination is set to take effect March 5, although Batory offered California officials an opportunity to dispute the government's findings.
The high-speed rail has been seen as a beleaguered and problematic project for years.
According to a timeline created by Citizens Against Government Waste (CAGW), California voters in 2008 "first approved $9.95 billion in bonds for a first in the nation, 800-mile high-speed rail project with an initial cost estimate of $35 billion, to be completed by 2020."
By 2014, no construction had started, but in his State of the State address, then-Gov. Jerry Brown, a Democrat, “ad-libbed [a] summary of the Little Engine That Could, rhythmically chanting its signature line, ‘I think I can,’ four times.”
In 2017, the Orange County Register wrote that the project was "more time-consuming and tens of billions of dollars more expensive than estimated when California voters approved the funding measure in 2008.”
Finally, Newsom announced this month, “Let's be real. The current project, as planned, would cost too much and respectfully take too long. There's been too little oversight and not enough transparency.”
Republican lawmakers in the Golden State responded to Newsom's pullout from the project last week by calling for a referendum vote on Newsom’s plan to build a much shorter, 171-mile railway through the state’s Central Valley.
The constant delays and overspending have made California Democrats a prime target for the White House.
On Tuesday, Trump mocked California for joining 15 other states in suing the administration over its recent emergency declaration -- and added a jab about the rail project. (The $77 billion project would dwarf the cost of a wall at the border -- estimated to be $20-25 billion.)
"As I predicted, 16 states, led mostly by Open Border Democrats and the Radical Left, have filed a lawsuit in, of course, the 9th Circuit! California, the state that has wasted billions of dollars on their out of control Fast Train, with no hope of completion, seems in charge!" he tweeted.
The president added: "The failed Fast Train project in California, where the cost overruns are becoming world record setting, is hundreds of times more expensive than the desperately needed Wall!"
Last week, Trump and Newsom publicly sparred over the governor's sudden withdrawal from the pact to build the rail network.
In a tweet, Trump wrote: “California has been forced to cancel the massive bullet train project after having spent and wasted many billions of dollars. They owe the Federal Government three and a half billion dollars. We want that money back now. Whole project is a ‘green’ disaster!”
California has been forced to cancel the massive bullet train project after having spent and wasted many billions of dollars. They owe the Federal Government three and a half billion dollars. We want that money back now. Whole project is a “green” disaster!— Donald J. Trump (@realDonaldTrump) February 14, 2019
Newsom shot back 40 minutes later.
“Fake news," Newsom wrote.
"We’re building high-speed rail, connecting the Central Valley and beyond. This is CA’s money, allocated by Congress for this project. We’re not giving it back. The train is leaving the station — better get on board! (Also, desperately searching for some wall $$??)”
In a statement, CAGW President Tom Schatz said there were larger lessons to be learned from the debacle.
“California’s high-speed rail fantasy quickly became a train to nowhere at taxpayer expense," Schatz said.
"This failed boondoggle should be taken as a giant red stop sign for any politician who supports the ‘Green New Deal’ and its equally farcical promise of ending air travel by forcing taxpayers to pay for a California-style rail system across the entire nation.”
The Los Angeles Times reported additionally that the Department of Transportation said it was “actively exploring every legal option” to recover the other $2.5 billion granted by the federal government to California for the project.
Newsom complained angrily that Trump was carrying out “political retribution” for California’s legal challenge Monday to his emergency declaration to build a barrier on the U.S.-Mexico border.
He reiterated: “This is California’s money, and we are going to fight for it,” according to a statement quoted by the Times.