California commits $1B a year to high-speed rail through 2045

Sacramento, California – California’s high-speed rail project, often derided as a boondoggle and hailed as a vision of the future in the same breath, has secured something it has rarely enjoyed in its turbulent history: financial certainty.

This week, Governor Gavin Newsom signed legislation guaranteeing the California High-Speed Rail Authority $1 billion annually from the state’s cap-and-trade revenues through 2045. The move extends the state’s cap-and-invest program by 15 years and ensures a steady stream of money for a project that has been plagued by budget overruns, shifting timelines, and persistent political opposition.

The commitment represents a lifeline. For years, the rail authority has been forced to cobble together grants and one-time appropriations, always operating with the specter of cancellation hovering above. While federal funding has been instrumental—until the Trump administration revoked a key tranche earlier this summer—the state’s new pledge means construction will continue regardless of Washington’s mood swings.

At the center of the project’s near-term ambitions is the 170-mile Central Valley segment, stretching from Merced to Bakersfield. Construction is well underway there: 70 miles of track bed are finished, more than 50 bridges have been erected, and crews are preparing to begin laying track later this year. Still, without the infusion of predictable funding, even that scaled-down vision had appeared tenuous. The authority now says it has the resources to complete the line by 2033.

“This agreement makes a bold statement about California’s future,” CEO Ian Choudri said in a statement. “It will create jobs, cut pollution, and connect and transform communities across the state.”

The political context is as important as the dollars. High-speed rail has always been ambitious—originally priced at $33 billion, now projected at more than $135 billion for a statewide system—but its opponents have consistently cast it as a cautionary tale of government overreach. Former President Donald Trump, in particular, relished mocking the project and made good on his threats to withdraw federal support in July. By stepping in with its own guaranteed funds, California is sending a clear signal: the project will not live or die based on partisan winds in Washington.

The $1 billion appropriation also opens the door for new partnerships. The authority sees the funding as a way to attract private-sector investment and to strengthen its case for future federal grants. It can now move forward with planning for train procurement and early operations, no longer caught in the cycle of uncertainty that has stalled progress in the past.

Of course, the skeptics remain. To them, a decade until the first passengers board in the Central Valley is still too long, and a price tag north of $135 billion is untenable. To pull the plug now, however, would mean abandoning a decade of work, billions already spent, and the symbolic promise of a more climate-friendly California.

For supporters, the vision is bigger than any one budget line. They see a chance to connect Northern and Southern California with sustainable, high-speed travel, to ease congestion on highways and airports, and to anchor the state’s climate policy in infrastructure that changes how people move.

For now, with construction cranes dotting the Central Valley skyline and a billion dollars a year locked in through mid-century, the project has something it has never truly had before: time and money on its side.