SACRAMENTO (CBS13) — The U.S. Department of Transportation announced Tuesday that the Federal Railroad Administration (FRA) intends to cancel millions of dollars in federal grant funds designated for the California High-Speed Rail project.

The FRA intends to cancel $929 million in grant funds that have yet to be paid to the project which was meant to connect between Los Angeles and San Francisco.

The Department also said they are “actively exploring every legal option” to seek the return of $2.5 billion in federal funds previously given to California for the project.

In a letter to the California High-Speed Rail Authority (CHSRA), the DOT said the CHSRA has “materially failed to comply with the terms of the Agreement and has failed to make reasonable progress on the project.”

READ ALSOGovernor’s Office Changes Tune On High-Speed Train Hours After State Of The State Address

Last week, Governor Gavin Newsom suggested pulling the plug on the line between San Francisco and Los Angeles and focusing on one between Merced and Bakersfield instead during his State of the State address.

Newsom said the project had been botched and cost too much, but within the last several hours, a spokesperson massaged his remarks, saying the governor is not walking away from the project altogether, even if there is not a full path for it right now.

ALSOTrump Takes Shot At California ‘Fast Train’ After 16 States File Lawsuit Over Emergency Declaration

“Let’s be real. The project, as currently planned, would cost too much and respectfully take too long,” Newsom said during the State of the State address last Tuesday morning.  “Right now, there simply isn’t a path to get from Sacramento to San Diego, let alone from San Francisco to L.A. I wish there were. However, we do have the capacity to complete a high-speed rail link between Merced and Bakersfield.”

The Governor’s office released a comment Tuesday.

“It’s no coincidence that the Administration’s threat comes 24 hours after California led 16 states in challenging the President’s farcical “national emergency.” The President even tied the two issues together in a tweet this morning. This is clear political retribution by President Trump, and we won’t sit idly by.  This is California’s money, and we are going to fight for it,” Newsom said. 

Newsom is referring to this tweet:

https://twitter.com/realDonaldTrump/status/1097856404629700609

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