California’s “Bullet” Train Needs More Money

California’s bullet train needs $7 billion in additional funding by June 2026, or else the project may face further delays. The project was initially touted as a $40 billion “bullet train” system connecting Los Angeles and San Francisco that would be completed sometime around 2020. The price tag has reached above $100 billion, and the train is currently planned to cover a much shorter route than initially intended. In 2019, Gov. Gavin Newsom declared that the train would span 171 miles from Merced (a 130-mile drive from San Francisco) to Bakersfield (110 miles from Los Angeles). The completion of the Bakersfield-Merced line of the system is not expected until 2030 at the earliest.

The project started during the Obama administration, which provided $3.5 billion in grants, and more recently, President Biden gifted California’s high-speed rail project $3.1 billion in taxpayer money from his Infrastructure bill in December 2023 on top of $1 billion he provided earlier. The Trump administration is investigating how the $4 billion in federal funds were to be spent on the project, and is looking at possibly canceling them. According to Transportation Secretary Sean Duffy, his department will continue investigating the project to determine how federal dollars have been used and whether federal support should continue.

So far, California has spent about $14 billion on the project, but is expected to need at least an additional $28 billion to finish the Bakersfield-Merced line. The state has no specific plan to raise the $7 billion needed by June of next year, and that amount could end up being even higher. The California High-Speed Rail Authority submitted an incomplete updated funding report that they now expect to update and produce by sometime this summer.

The Los Angeles-San Francisco line cleared all necessary environmental review hurdles in 2024, and “pre-construction planning” for Bay Area segments is ongoing. As of September 2023, the state had spent more than $600 million on environmental reviews for the project despite making little progress toward completing the system and beginning operations. California voters approved funding for the Los Angeles to San Francisco high-speed rail line in 2008. Still, the project has encountered delays and budget overruns since California voters initially approved issuing bonds to finance the project.

Voters were told that more than 20 percent of the project would be privately funded, but, in reality, taxpayers are single-handedly funding the project. The only partially completed segment so far connects a field and an orchard and has cost $1.4 billion for 22 miles of raised dirt, with 11 overpass structures. Zero feet of track have been laid to date, but Newsome says it is coming.

Further, labor unions have been one of the largest beneficiaries of the project. The California High-Speed Rail Authority, in its community benefits agreement regarding the rail construction, indicates that union members will be the primary source of labor and that the local unions will be allowed to refer employees for the job. The High-Speed Rail Authority will exclusively bargain with union representatives for craft labor. While no employee will be required to join a union, workers at the site for more than eight days will be required to pay union dues.

Florida’s Rail Project

The Obama administration also wanted to provide federal grants for a rail project in Florida, but then-Governor Rick Scott nixed the project. Since then, Florida opened a new rail system between Orlando and Miami (a $6 billion project) with all private financing, and an extension to Tampa is in the works. Brightline, the only provider of higher-speed rail service in America, runs 32 trains daily with 16 daily departures from Miami and Orlando. The service can reach maximum speeds of 125 miles per hour and covers the 235-mile distance between the two cities in 3 hours and 25 minutes.

Florida’s lawmakers refuse to fund the extension to Tampa. In April, the state Legislature declined to allocate $50 million toward the project. Florida Governor Ron DeSantis made it clear that state taxpayers will not be responsible for funding the rail’s construction, although he indicated that space has been reserved for the project. “If they proceed with [the expansion to Tampa], there is a corridor to be able to do that,” DeSantis said. “But it’s not going to be Florida taxpayers constructing a train—I can be clear on that.”

Conclusion

Despite receiving federal funds and grants, California is having a tough time constructing a 171-mile rail line from Merced to Bakersfield that was intended to be a high-speed rail line from Los Angeles to San Francisco. The latest estimate is that it will need another $7 billion by June of 2026. That estimate could be higher since an updated funding report will not be completed until this summer. The Bakersfield-Merced line will cost at least $44 billion and may be completed by 2030. The entire project from Los Angeles to San Francisco is now slated to cost well over $100 billion and not be completed until 2050. President Biden provided $4 billion to the project during his term, and President Trump is trying to obtain any unspent portions of that funding. In contrast, Florida has a working rail system from Miami to Orlando, which is privately funded. California chose to build an enormous government project, which has turned into a money pit and boondoggle. In contrast, Florida decided to ignore federal money and work with the private sector to build a system that works and fills a need for Floridians.