House Republicans launch probe into California bullet train

Valerie Plesch/Bloomberg

Rep. James Comer, R-Ky., chair of the House Oversight and Government Reform Committee, said Tuesday he had launched an investigation into whether the authority overseeing California's long-stalled high-speed rail line has misrepresented ridership projections to obtain federal funding.

Comer Tuesday sent a letter to Transportation Secretary Sean Duffy that asks for a briefing from DOT staff and all documents and communications related to the state's high-speed rail network no later than Sept. 2. The committee will look into whether the California High Speed Rail Authority "knowingly misrepresented the ridership projections and the associated financial viability" of the train to secure federal and state funds, according to the letter.

"In 2008, Californians approved $9.95 billion dollars of state bond funding to build an 800-mile high-speed rail network connecting Los Angeles, San Francisco, and the Central Valley to coastal cities with a completion date of 2020 and a cost of $33 billion," Comer said in the letter. "To date, not one route is complete and the CHSRA Project is facing financial collapse, but now CHSRA is claiming they will begin service in Central Valley in 2032," he said adding that current cost estimates range from $89 billion to $128 billion.

"The [California High Speed Rail] Authority's apparent repeated use of misleading ridership
projections, despite longstanding warnings from experts, raises serious questions about whether funds were allocated under false pretenses," Comer said.

It's the latest attack on one of the nation's largest infrastructure projects — and the only publicly-funded high-speed rail — that has long been the focus of Republican ire. In July, the Federal Railroad Administration terminated $4 billion of federal grants after a compliance review in which it found that the CHSRA could not meet binding obligations it made to receive the funds.

The rescinded grants include $929 million promised in 2010 and $3 billion promised in 2023. The Department of Transportation said it may claw back other funds and was "consulting" with the Department of Justice on the compliance review findings.

The CHSRA has since reached an agreement with the FRA to put the $4 billion into a legal trust while a lawsuit filed by the authority moves through court.

A CHSRA spokesperson said Comer's questions about ridership projections have already been addressed.

"This is yet another baseless attempt to manufacture controversy around America's largest and most complex infrastructure project," a spokesperson said. "The authority has already addressed these recycled criticisms in its response to the FRA's compliance review supported by facts, noting the ridership critiques are 'nonsensical,' 'cherrypicked and out-of-date, and therefore misleading.'"

The authority's 2024 ridership projections estimate the "valley to valley" route will attract 12.22 million riders by 2040. That's 34% lower than the 2020 forecast. "The difference in socioeconomic growth assumptions accounts for a portion of this reduction," as well as "more refined modeling assumptions, network configurations, and updated service patterns for connecting rail and bus services," the authority said in the report.

The move comes as the CHSRA is seeking private investment to help complete the bullet train's initial operating segment. Gov. Gavin Newsom's latest budget proposes extending the state's cap-and-trade program through 2045 and carving out 25% for the HSRA. With the fresh cap-and-trade funding, the authority won't need federal funds, the authority's CEO Ian Choudri has said.