The Trump administration cited missed deadlines, budget shortfalls, and overrepresentation of projected ridership as primary reasons for revoking federal funding. They also highlighted concerns over the project’s ballooning costs and alleged failure to follow agreements for receiving grant funding, with current estimates showing the project could cost up to $128 billion, nearly four times its original budget[2].

The loss of federal funding—which previously accounted for about 25% of the project’s total funding—is a significant setback, likely causing delays and jeopardizing plans to complete even the initial segment by the original 2033 target. The project is now struggling to secure alternative funding sources and may need to scale back its ambitions, focusing on a shorter 119-mile Central Valley segment[2].

California is actively seeking private investors to fill the funding gap left by the federal withdrawal. Governor Gavin Newsom has stated the state will explore all legal and financial options to counter the funding loss and will present an updated funding plan later in the summer[2].

Construction on the 119-mile Central Valley segment is ongoing, with significant progress reported in 2025, including the start of track-laying, completion of major structures like the Hanford Viaduct, and the development of a railhead facility in Kern County for materials and equipment[1][3]. As of March 2025, more than 15,000 jobs have been created, and 84 structures are complete or underway.

California High-Speed Rail Authority

Governor Newsom has vowed to fight the federal decision, calling it politically motivated and a “gift to China.” He has pledged to keep building California’s high-speed rail and accused the Trump administration of abandoning the Central Valley. The move is expected to trigger a legal battle and further escalate tensions between the Trump administration and California’s Democratic leadership[2].