California High-Speed Rail Cash Crisis Threatens New Cutbacks

California's high-speed rail project may run out of funds by December 2027, potentially forcing officials to scale back the planned Central Valley route, according to state Inspector General Benjamin Belnap. The project, aimed at connecting Los Angeles to San Francisco, has faced delays, rising costs, and funding challenges. Now, the watchdog warns that the project's financial cliff could disrupt construction plans unless lawmakers secure new funding or a loan next year.

The initial operating segment from Bakersfield to Merced could be shortened if additional money is not found. While Belnap warned about the funding gap earlier in the summer, lawmakers did not act before the legislative session ended in September. State officials must move quickly in 2024 to secure funds or identify budget cuts.

The Central Valley segment, expected to cost $36 billion, may need to be reduced to a shorter stretch between Madera and Poplar Avenue in rural Kern County. A recent investigation found that the California High-Speed Rail Authority had allowed consultants to charge for unnecessary travel, highlighting oversight and accountability issues.

Belnap urges Governor Gavin Newsom to sign legislation that would allow his office to access higher-level job classifications and expanded purchasing authority.