Newsom drops lawsuit against Trump that sought to restore $4B high-speed rail funding

SACRAMENTO, CALIFORNIA: California Governor Gavin Newsom this week dropped his lawsuit against the Trump administration that sought to reinstate $4 billion in federal funding for the state’s long-delayed high-speed rail project. 

The lawsuit had been filed after federal officials withdrew the funding, prompting criticism from state leaders. With the dismissal, the state now plans to pursue alternative funding sources to try to complete the ambitious rail endeavor.

Newsom's lawsuit and Trump's funding termination

In July, the Transportation Department slashed $4 billion in federal funds that had been committed to California’s bullet train project, which aims to link San Francisco and Los Angeles with high-speed rail service.

The Trump administration had said the California High-Speed Rail Authority had “no viable plan” to complete a significant stretch of the project in the Central Valley, a region rich in agricultural production.

Trump announced the termination on Truth Social, writing, "To the Law abiding, Tax paying, Hardworking Citizens of the United States of America, I am thrilled to announce that I have officially freed you from funding California’s disastrously overpriced, ‘HIGH SPEED TRAIN TO NOWHERE.'"

In response, the Rail Authority quickly filed a lawsuit against the Transportation Department and the Trump administration to challenge the withdrawal of the funds.

Newsom denounced the funding cut, accusing the federal government, “Trump’s termination of federal grants for California high-speed rail reeks of politics. It’s yet another political stunt to punish California."

The Democrat further said, "We will be exploring all options to fight this illegal action."

Newsom's future plans for high-speed rail project

Announcing the decision to drop the lawsuit, officials said the move reflects a reassessment of the state’s relationship with the federal government, which they described as “not a reliable, constructive, or trustworthy partner” in advancing high-speed rail in California.

The Rail Authority said it would now shift its focus to other funding sources in an effort to continue the multi-billion-dollar transportation project. The total cost of the rail effort is estimated at over $100 billion. 

One key alternative source of funding is California’s cap-and-trade program, which places a declining cap on greenhouse gas emissions and requires polluters to reduce emissions or buy pollution allowances.

The state recently secured $1 billion in annual cap-and-trade funding through 2045 for the high-speed rail project.

The Rail Authority noted that moving forward without federal involvement “offers a new opportunity” to build the project and adopt global best practices from successful high-speed rail systems around the world. 

Republican Congressman Kevin Kiley said, responding to the lawsuit withdrawal, "Newsom just conceded defeat over High-Speed Rail. He's withdrawn the lawsuit he filed after we cut off federal funding earlier this year."

"Now the $4 billion can go to our roads rather the train. The cost of HSR has grown to $128 billion as no track has been laid in 17 years," he added.