SACRAMENTO, Calif. — Update: 5:47 p.m.
The Trump administration said Tuesday that it plans to cancel $929 million awarded to California's high-speed rail project and wants the state to return an additional $2.5 billion that it has already spent.
The U.S. Department of Transportation announcement follows through on President Donald Trump's threats to claw back $3.5 billion that the federal government gave to California to build a bullet train between Los Angeles and San Francisco.
Gov. Gavin Newsom vowed a fight to keep the money and said the move was in response to California again suing the administration, this time over Trump's emergency declaration to pay for a wall along the U.S.-Mexico border.
"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."
It's the latest spat between the White House and California. Trump earlier in the day linked the emergency declaration lawsuit to the train, noting that California filed the challenge on behalf of 16 states.
"California, the state that has wasted billions of dollars on their out of control Fast Train, with no hope of completion, seems in charge!" the president tweeted.
The train project has faced repeated cost overruns and delays since California voters approved it in 2008. The Trump administration argued Tuesday that the state hasn't provided required matching dollars and can't complete certain construction work by a 2022 deadline.
Newsom declared in his first State of the State address last week that he planned to scale back the project and focus immediately on building 171 miles (275 kilometers) of track in central California. His office said he still plans to complete the full line, although he said the current plan would cost too much and take too long.
He's pledged to continue environmental work on the full line, which is required to keep the federal money.
Congress nearly a decade ago approved the $929 million that Trump wants to cancel. The state has not started spending that money. But it has already spent the extra $2.5 billion that Trump now wants back. It's unclear if the federal government can demand that money back before the 2022 deadline.
The U.S. Department of Transportation said it is "actively exploring every legal option" to get back the money.
The U.S. Department of Transportation announced that the Federal Railroad Administration’s (FRA) will cancel nearly a billion dollars in funds that had yet to be paid for California’s high-speed rail project.
In a press release issued Tuesday afternoon, the transportation department also said they are “actively exploring every legal option” to recoup the $2.5 billion already given to California for the project.
According to the press release, FRA Administrator Ronald Batory told the California High-Speed Rail Authority of the department’s plan in a letter on Tuesday.
In his state of the state address, Gov. Gavin Newsom all but pulled the plug on the full project, that was envisioned to connect Los Angeles to San Francisco, after costs soared to $77 billion. Newsom later clarified that he wanted to focus on finishing the work that was started linking Merced to Bakersfield.
This is a developing story.
California's newly sworn-in governor Gavin Newsom is delivering his first State of the State Address. Newsom will cover, among other things, the state's economy, PG&E's bankruptcy, education and his response to President Trump's continued efforts at building a border wall.