California’s top officials spear-headed a lawsuit to end the implementation of President Donald Trump’s national emergency declaration.

Now, the US Department of Transportation (DOT) has cancelled millions in grants for the high speed rail project that has been substantially scaled back by California Governor Gavin Newsom.

The fate of California’s troubled high speed rail project was cast into further doubt Tuesday when the U.S. Department of Transportation said it will cancel $929 million in grant funds, a move that some viewed as political payback.

The action marks an escalation in the battle between President Trump and the state of California since Gov. Gavin Newsom announced last week that the project lacked a path to complete a statewide system and vowed to scale back the $77 billion mega project.

The transportation department also said it was “actively exploring every legal option” to get back another $2.5 billion grant that is being used to finance the construction of 119 miles of rail line in the Central Valley.

The two federal grants represent about one-fourth of all the funding for the project — money critical to completing even a partial 119-mile segment in the Central Valley and finishing environmental reviews for other segments from San Francisco to the Los Angeles. If the funds are lost or tied up in a long legal battle, the state would have to either make up the money or further curtail the project.

In the announcement, the DOT’s Federal Railroad Administration said that the California High Speed Rail Authority project has missed “timely and satisfactory financial reports,” as well as several important deadlines tied to the $928 million appropriation.

The letter addressed that CHSRA has no chance of finishing the first phase of the project by the 2022 deadline.

The Federal Railroad Administration said it “has regularly communicated its concerns on the above issues to CHSRA,” and noted that “California Governor Newsom presented a new proposal that represents a significant retreat from the state’s initial vision and commitment.”

The FRA said because the CHSRA “failed to take appropriate corrective actions,” the FRA plans to “de-obligate the full $928,620,000 obligated under the agreement.”

California’s politicos are angered by the move.

“This is clear political retribution by President Trump, and we won’t sit idly by,” Newsom said in a statement. “This is California’s money, and we are going to fight for it.”

However, Sacramento’s plans for the money may just have been derailed by the Trump Train.


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