US will not pay for California high-speed rail, Trump says

By David Shepardson and Steve Holland

WASHINGTON (Reuters) - The U.S. government will not pay for a high-speed rail line planned between Los Angeles and San Francisco, President Donald Trump told reporters at the White House on Tuesday, citing cost overruns.

The Republican president's administration in February began probing whether to rescind about $4 billion in federal funds awarded to California's High-Speed Rail project.

"This government is not going to pay," Trump told reporters during a meeting with Canadian Prime Minister Mark Carney.

Voters approved $10 billion for the project in 2008 but the costs have risen sharply and Trump has sharply criticized the effort. The Transportation Department under former President Joe Biden awarded the project about $4 billion.

The full project was initially estimated to cost around $40 billion but has now jumped from $89 billion to $128 billion.

A spokesman for California Governor Gavin Newsom, a Democrat, said on Tuesday: "With 50 major structures built, walking away now as we enter the track-laying phase would be reckless — wasting billions already invested and letting job-killers cede a generational infrastructure advantage to China."

The California High-Speed Rail Authority said on Tuesday the rail project "is delivering real results. There is active civil construction along 119 miles in the Central Valley, resulting in over 15,000 construction jobs, and design and pre-construction activities are underway on the extensions to Merced and Bakersfield totaling 171 miles."

In 2021, Biden restored a $929 million grant for California's high-speed rail Trump had revoked in 2019 after the Republican president called the project a "disaster."

The Federal Railroad Administration said in February it had initiated a review of the California project at the direction of Transportation Secretary Sean Duffy over the funds to build the segment in the California Central Valley between Merced and Bakersfield.

The entire San Francisco-to-Los Angeles project was initially supposed to be completed by 2020 for $33 billion, USDOT said, but the Merced-to-Bakersfield segment alone will cost more than the original total, USDOT said.

USDOT cited a report that the Merced-to-Bakersfield segment alone has a funding gap of at least $6.5 billion.

(Reporting by Steve Holland and David Shepardson in Washington; Writing by Susan Heavey; Editing by Matthew Lewis)

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