California Drops Lawsuit After Trump Admin Pulls Billions From High Speed Rail Project

California this week pulled a lawsuit filed against the Trump administration after the federal government withdrew $4 billion in funding for the state’s long-delayed high-speed rail project. In July, the U.S. Department of Transportation canceled federal grants for the bullet train project intended to connect San Francisco and Los Angeles.

Trump administration officials said the California High Speed Rail Authority had “no viable plan” to complete a major segment of the project running through the state’s Central Valley, ABC News reported. The rail authority quickly filed suit challenging the decision, and at the time, Democratic Gov. Gavin Newsom called the funding withdrawal “a political stunt to punish California.”

The authority said this week it would instead focus on alternative funding sources to advance the project, which is now estimated to cost more than $100 billion.

“This action reflects the State’s assessment that the federal government is not a reliable, constructive, or trustworthy partner in advancing high speed rail in California,” an authority spokesperson said in a statement.

President Donald Trump and Transportation Secretary Sean Duffy have repeatedly criticized the project. Trump in July called the plan a “train to nowhere” and questioned whether it would ever be completed.

“The Railroad we were promised still does not exist, and never will,” Trump wrote on Truth Social. “This project was Severely Overpriced, Overregulated, and NEVER DELIVERED.”

The rail authority’s decision to drop the lawsuit comes as it seeks private investment to help finance the project.

The authority recently secured $1 billion in annual funding through 2045 from California’s cap and trade program.

The cap and trade system sets a declining limit on greenhouse gas emissions from major polluters in the state.

Companies must reduce emissions, purchase allowances from the state or other businesses, or invest in projects designed to offset pollution.

Revenue generated from allowance sales is used to fund climate change mitigation efforts, affordable housing initiatives, transportation projects, and utility bill credits for Californians.

Rail officials said shifting away from federal involvement creates new opportunities for the project.

“Moving forward without the Trump administration’s involvement allows the Authority to pursue proven global best practices used successfully by modern high speed rail systems around the world,” the spokesperson said.

The project, first approved by voters in 2008, has faced repeated delays, cost overruns, and scaling back of its original scope.

Construction is currently focused on segments in the Central Valley, far from the major population centers the system was originally designed to serve. Federal officials have cited those issues as justification for withdrawing funding.

California officials maintain the project remains viable and say they are committed to completing it despite the loss of federal support.

As speculation grows over whether Newsom might pursue a presidential run in 2028, one of his most controversial past scandals is resurfacing on social media this holiday season.

In 2007, while serving as mayor of San Francisco, Newsom acknowledged an affair with Ruby Rippey Gibney, the wife of his close friend and campaign manager, Alex Tourk. The disclosure shocked the Bay Area political establishment, strained personal and professional relationships, and threatened to derail his career at the time.

At the time, Newsom made a televised admission and apology.

“I want to make it clear that everything you’ve heard and read is true,” he said. “I am deeply sorry about that. I’ve hurt someone I care deeply about, Alex Tourk, and his friends and family. That is something I have to live with.”