California High-Speed Rail Authority v. U.S. Department of Transportation

On December 23, 2025, the California High-Speed Rail Authority voluntarily dismissed its action challenging the Federal Railroad Administration’s decision to terminate federal grant funding for the California high-speed rail program. In a <a href="https://hsr.ca.gov/2025/12/23/news-release-california-high-speed-rail-launches-process-to-draw-in-private-investors/">press release</a> issued the same day, the Authority announced that it had “initiated a process to bring private investors and developers to the Authority by summer 2026.” Two weeks earlier the federal district court for the Eastern District of California denied federal defendants’ motion to dismiss the action. The Authority’s complaint described the high-speed rail program as “a crucial part of California’s long-term strategic planning, not only to address critical transportation needs, but also greenhouse gas emissions and climate change, as well as to spur economic growth in California’s Central Valley and across the State.”

The parties filed a stipulation in which the federal defendants agreed that the de-obligated funding would not be re-obligated, transferred, or awarded to any other program or recipient except through a new notice of funding opportunity pursuant to applicable requirements and for “purposes authorized by the applicable appropriation that funded the Cooperative Agreements.”

The California High-Speed Rail Authority brought a lawsuit against the U.S. Department of Transportation and Federal Railroad Administration and the heads of those agencies in the federal district court for the Eastern District of California challenging the termination of more than $4 billion in federal grant funding for the California high-speed rail program, which the complaint described as “a crucial part of California’s long-term strategic planning, not only to address critical transportation needs, but also greenhouse gas emissions and climate change, as well as to spur economic growth in California’s Central Valley and across the State.” The complaint asserted that termination of the Cooperative Agreements pursuant to which funding was awarded and de-obligation of funds awarded under them was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law in violation of the Administrative Procedure Act.