Newsom said while he doesn't currently see a path forward to complete the entire project, he wants to finish ongoing construction in the Central Valley.

The project was long championed by Newsom's predecessor Gov. Jerry Brown, but had lost support among voters, who approved $9.95 billion in bonds for the train in 2008, as the cost of the project skyrocketed.

"The current project, as planned, would cost too much and respectfully take too long," Newsom said during his first State of the State address. "There’s been too little oversight and not enough transparency."

LOS ANGELES — California Gov. Gavin Newsom announced Tuesday that he is abandoning a plan to build a high-speed rail from San Francisco to Los Angeles, a project with an estimated cost that has ballooned to more than $77 billion and is years behind schedule.

"Right now, there simply isn’t a path to get from Sacramento to San Diego, let alone from San Francisco to LA. I wish there were," he said. "However, we do have the capacity to complete a high-speed rail link between Merced and Bakersfield."

He added that completing the rail in the Central Valley would help revitalize the economy in that part of the state.

"The Valley may be known around the world for agriculture, but there’s another story ready to be told," he said. "A story of a region hungry for investment, a workforce eager for more training and good jobs, Californians that deserve a fair share of our state’s prosperity."

Still, Newsom said the state will complete an environmental review for the rail line connecting San Francisco and Los Angeles and continue to push for more federal and private dollars to complete the project.

"Look, we'll continue to support our regional projects north and south," he said. "But let’s get something done once and for all."



Roger Dickinson, executive director of Transportation California, a transit advocacy group, told BuzzFeed News getting the Central Valley portion into operation "would be a significant first step."

"That will demonstrate to people the fundamental value and viability I think of high-speed rail," Dickinson said, adding that he thinks the whole system will ultimately be built. "I think the governor's direction here makes sense. Let's get something up and going and then we can build on that for the future."

Newsom also announced plans to increase transparency about how money is being spent for the rail project and pledged to make that information available online.



"We’re going to hold contractors, we’re going to hold consultants accountable to explain how taxpayer dollars are spent — including change orders, cost overruns, and even travel expenses," he said.

A November audit report of the state's High-Speed Rail Authority, the agency tasked with planning, constructing, and eventually operating the rail line, said that "flawed decision-making" and "poor contract management" have contributed to billions of dollars in cost overruns.

While the authority has secured and identified more than $28 billion in funding, including $3.5 billion in federal grants, those funds won't cover the costs of connecting segments in the Central Valley and the Bay Area or completing the rest of the rail between San Francisco and Los Angeles, according to the audit.

The state also risks having to pay back the $3.5 billion to the federal government if it doesn't complete construction of the Central Valley portion by a December 2022 deadline, according to the audit.

Newsom said he has no interest in sending the money back and that abandoning the project altogether would be a waste of billions of dollars.

"That fundamentally would have to happen if we just walked away, but also I’m not interested in making the same old mistakes," he said.