California High-Speed Rail Cost Hits $126 Billion After Chief Resigns

California taxpayers face a rail system that costs more than three times what voters originally approved. The state's high-speed rail authority now estimates the first phase at $126 billion. This figure far exceeds the $45 billion cost estimate provided in 2008. The change in leadership will not lower this price tag.

Ian Choudri recently resigned as the chief executive of the California High-Speed Rail Authority. His departure followed an investigation by the Office of the Inspector General. The probe examined roughly $600,000 in travel expenses billed by consultants. The review found that these bills did not correspond to actual train trips. Choudri's exit is the latest shift in a project that has struggled with spending controls.

The project began in 2008 when voters passed Proposition 1A. That measure authorized $9.95 billion in bonds to build a fast rail line. The original plan promised a trip between San Francisco and Los Angeles in under three hours. Construction has focused on a 119-mile stretch in the Central Valley. The current plan targets passenger service between Merced and Bakersfield in 2033.

The Merced-to-Bakersfield segment is expected to cost nearly $35 billion. The California Legislative Analyst's Office warned this year that available funding may not cover even that limited section. Extensions beyond the Central Valley face a funding gap in the tens of billions of dollars. No clear plan exists to close that gap.

Federal officials have also scrutinized the project's performance. In 2025, the Federal Railroad Administration reviewed compliance with two grants. Those grants totaled more than $4 billion. The agency moved to terminate the funding. California disputed the findings and filed a lawsuit. The state later dropped the suit. Officials cited a decision that the federal administration was not a reliable partner.

Riders traveling between major cities like Los Angeles and San Francisco will still require other transportation. The current plan does not connect those two hubs directly. The state has scaled back the initial build to reduce costs. However, the authority has not fully explained why the total cost rose from $45 billion to $126 billion. The state currently reports a true deficit of $20 billion.

Lawmakers must now decide how to proceed with the remaining funds. The project has spent years missing its original targets. A new executive will manage the remaining budget. The cost of the first phase stands at $126 billion, while the central segment faces a $35 billion price tag. The first scheduled service date remains 2033.