The move comes after the governor of California, Mr Gavin Newsom, announced on February 12 that California’s high-speed rail project will be scaled back due to spiralling costs and poor oversight.

Newsom confirmed that the 191km Merced - Bakersfield Central Valley section will be completed, even though in January, the California High Speed Rail Authority (CHSRA) announced that the cost of this section had increased from $US 7.88bn to $US 10.6bn and completion had been pushed back from 2025 to 2029.

At the time, Newsom stated that California would not be paying back the federal funding allocated for the project.

“For those who want to walk away: abandoning high-speed rail means we will have wasted billions of dollars with nothing but broken promises and lawsuits to show for it,” Newsom said. “I’m not interested in sending $US 3.5bn in federal funding - exclusively allocated for HSR - back to the White House.”

Following the announcement, President Donald Trump tweeted that he would be asking for the money to be repaid and on February 19 FRA administrator, Mr Ronald Batory, notified the California High Speed Rail Authority (CHSRA) through a letter that it intends to withdraw the funding on March 5.

“FRA has determined that CHSRA has materially failed to comply with the terms of the (funding) agreement and has failed to make reasonable progress on the project, significantly endangering substantial performance,” Batory said in the letter.

FRA listed a number of factors that it says contributed to its decision to cancel the funding, including CHSRA’s failure to achieve the state contribution rates, that the project would not be completed by 2022, and Newsom’s decision to scale back the project.

Batory has given CHSRA until March 5 to provide information showing that it has satisfied its obligations under the agreement, was making reasonable progress to deliver the project and that Newsom’s announcement does not constitute a fundamental change in the purpose of the overall project.