Californians for Electric Rail Lauds Governor’s Proposed $1B Minimum Annual HSR Cap And Trade Contribution
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Californians for Electric Rail applauds Governor Newsom’s proposal to commit at least $1B/year of Cap and Trade revenues to California High Speed Rail. Providing a consistent minimum amount of funding will lead to better construction schedules and unlock private financing that will allow the Authority to access more money sooner, cut costs, and get to LA and SF faster.
However, in his May Budget, the Governor also proposes large cuts to the Transit and Intercity Rail Capital Program (TIRCP), a major source of funding for regional rail capital investments. The 2024 State Rail Plan is a transformative vision of an integrated statewide rail network with 1500 miles of electrification, 15 minute regional rail service in most major cities, and new rail lines to growing cities, but both the governor’s budget and the structure of current funding threaten to leave it gathering dust on the shelf. To make this dream a reality, we need more, not less funding for transit. To fully build out the State Rail Plan, we need regular, consistent investments of at least $2B/year today and ramping up over time.
Cap and Trade Reauthorization provides an opportunity to reform the TIRCP to encourage more cost-effective project delivery. Currently, regional projects must compete against local projects, with no priority given to projects in the State Rail Plan, threatening to leave CA’s ambitious plan as little more than just a plan. Additionally, projects are awarded construction funding as partial awards at 0% design, encouraging budget overruns and ensuring delays as agencies struggle to patch together their budget from multiple programs with different requirements. By contrast, in European countries that have lower per mile transit costs, projects in regional plans are guaranteed funding, design and construction are funded separately, and projects are given full awards. California should follow their lead and reform the TIRCP to use a similar process.
Building out the State Rail Plan is critical for California to meet its climate goals, improve job access in disadvantaged communities, and ensure the success of California High Speed Rail. It’s time for California to provide rail with not just more, but smarter funding by renewing and reforming the TIRCP program.
Recommendations:
Guarantee $2B/year for TIRCP through a combination of Greenhouse Gas Reduction Fund and the general fund to ensure State Rail Plan implementation.
Prioritize funding for projects included in the State Rail Plan, projects that increase transit service, and projects in advanced design.
Establish a new fund to support design work for rail and transit projects
Support Gov. Newsom’s ‘Cap and Invest’ proposal to provide California High Speed Rail a minimum of $1B/year
For more, see: “Californians for Electric Rail Responds to the Governor’s May Budget Revise and Cap and Trade Proposal” Californians for Electric Rail’s May 20, 2025 press release at: https://calelectricrail.org/californians-for-electric-rail-responds-to-the-governors-may-budget-revise-and-cap-and-trade-proposal/
In an earlier version, the indicated date of the press release in question was written as: May 20, 2015. Text has since been revised and is now correct.
Updated: Jun. 21, 2025 at 8:18 a.m. PDT.