California's High-Speed Rail Project Faces a New Watchdog Finding
California has been promising a high-speed rail line since 2008, when voters were told the system would be running by 2020. Years past that deadline, the project remains a byword for cost overruns and delays — no track has been laid. This week brought another unwelcome development: a state investigation into how the agency running the project handles its consultants' expenses.
The Office of the Inspector General for California's High-Speed Rail released findings on Tuesday concluding that the California High-Speed Rail Authority (HSRA) used nearly $600,000 in taxpayer money to reimburse consultants for "travel expenses" over a two-year span. The reimbursements covered far more than airfare and hotel rooms. According to reporting by CalMatters, they included ride-share trips to gyms, a nightclub, a tiki bar, a cigar lounge and an escape room.
As the outlet put it bluntly, no tracks have been laid for the high-speed rail yet.
A Breakdown of the Flagged Expenses
The investigation paints a picture of expense reporting that drifted well beyond the business of building a railroad. Among the reimbursements identified by the inspector general's office:
- International travel that the consulting contracts explicitly prohibited — a category that nonetheless accounted for $118,000 in state reimbursements.
- Premium ride-share trips to and from a restaurant, a bar and a nightclub, logged between 9:40 p.m. and 2:30 a.m.
- Repeated trips to Planet Fitness gyms, even after a supervisor had written that "the state does not cover ride share to gyms."
- Rides to leisure destinations including a tiki bar, a cigar lounge and an escape room.
Each of those line items is small on its own. Taken together over two years, they add up to the kind of spending that erodes public confidence in a project already struggling to justify its price tag.
Approvals That Came After the Spending
Compounding the expense questions is a procedural one. The HSRA approved at least $685,500 in payments to four consulting firms without first signing off on travel and expense policies, according to the investigation. In other words, the money went out the door before the rules governing how it could be spent were formally in place. That sequencing matters for oversight: without pre-approved travel terms, reviewers have little basis to reject an invoice when it arrives.
Contracts Barred the Travel That Was Reimbursed
The $118,000 in international travel is especially difficult to square with the paperwork. The contracts signed by the consulting firms barred international travel outright, yet the authority reimbursed those costs anyway. The inspector general's office has since issued a set of recommendations aimed at helping the HSRA actually enforce its own travel and expense policies.
The Firms Involved
CalMatters reached out to the four consulting firms that received the reimbursements in question, among them KPMG LLP, the AECOM-Fluor Joint Venture, and the SYSTRA/TYPSA Joint Venture. None of them responded to requests for comment. The authority, for its part, insisted that it did not need to justify each consultant's expenses, according to the outlet's account.
A Project Measured in Billions, Not Millions
The roughly $600,000 in flagged reimbursements is a rounding error against the project's overall finances — which is precisely why it lands as a symbol rather than a sum. When California voters first backed the rail plan, the budget stood at $33 billion. It has since climbed to $126 billion, while the timeline has slid from a 2020 completion date into an indefinite future. Consultants and joint ventures have collected large contracts along the way, and the inspector general's findings suggest that at least some of the ancillary spending received less scrutiny than the dollar figures would warrant.
That combination — no track laid, costs ballooning, and reimbursements for late-night ride shares — is a difficult narrative for any agency to shake.
What Happens Next
A bill that would strengthen the inspector general's oversight of the HSRA is headed to Governor Gavin Newsom, who must either sign or veto it by September 30. The measure would give the watchdog more leverage over how the authority manages contracts and expenses — leverage the current arrangement appears to lack. Alongside the legislation, the inspector general's recommendations offer the HSRA a roadmap for tightening enforcement of travel and expense rules, provided the agency adopts them.
Whether the bill becomes law or not, the audit puts a spotlight on a structural question: how much latitude consultants should have when billing the public for the cost of doing business. For a project whose supporters have spent years asking Californians to keep the faith, the answer may matter more than the dollar amount involved.
The Broader Backdrop
It is worth remembering why rail spending is politically fragile in the United States. The country has long celebrated individual mobility — the lone cowboy of the early 20th century, the self-made trillionaire of today — while investing comparatively little in shared infrastructure. Public transit and high-speed rail offer broad benefits but limited individual profit, and that mismatch has made sprawling rail proposals easy targets for critics.
California's project has survived court fights, funding shifts and repeated redesigns across nearly two decades. An audit about ride shares to a tiki bar is, in the end, about whether the public can trust that money appropriated for trains actually goes to trains. For now, the answer from the inspector general's office is that at least part of it did not.
This article is based on reporting by Jalopnik. Read the original article.
Originally published on jalopnik.com
