Audit Flags $680,500 in Rail Travel Costs
Audit Flags $680,500 in Rail Travel Costs
Anonymous
Key Points
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The watchdog’s $592,900 estimate consisted of $81,000 that appeared unallowable under state travel regulations and $543,400 that violated the consultants’ contracts; some expenses fell into both categories.
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Specific examples included a nearly $40 luxury Uber ride in downtown Sacramento and upgraded Uber trips from a consultant’s home to the airport, the rail authority’s office and a steakhouse in Folsom more than 25 miles away.
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Travel requests frequently used vague explanations such as “project management,” “typical trip” and “attend HSR Board meeting,” while consultants did not explain why meetings with authority executives could not be conducted remotely.
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Since October 2024, state agencies have been required to consider whether work could be performed remotely before approving travel, and the contracts examined by the watchdog required consultants to obtain written approval in advance.
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One consultant defended an in-person trip by saying the authority’s CEO had requested his presence and that questioning the instruction was inappropriate, adding that “other consultants in other Authority offices are learning the hard way.”
California's High-Speed Rail Authority spent more than $2 million on consultant travel in fiscal years 2024-25 and 2025-26, but an audit found roughly $680,500 in costs lacked documented approval before the trips happened CalMatters. Investigators also identified about $592,900 in expenses that violated state rules or contract terms, including first-class flights, private planes, luxury car rides, and trips to nightclubs, escape rooms, and a cigar lounge California High-Speed Rail Office of the Inspector General.
The scandal adds fuel to criticism of a rail project that promised service by 2020 at a $33 billion cost but now faces a $88-128 billion price tag with zero passengers served CalMatters. The authority says it will tighten approval controls and recover improper costs, but lawmakers from both parties are demanding accountability ABC10.
Luxury Rides and Unapproved Trips Paint a Pattern
The inspector general reviewed about $1.15 million in travel claims across more than 200 trips. Auditors found a nearly $40 luxury Uber ride that covered less than one mile in Sacramento California High-Speed Rail Office of the Inspector General. Consultants also charged upgraded rideshares to a Folsom steakhouse 25 miles away and to a gym, nightclubs, and other venues SF Gate.
Travel requests used vague reasons like "project management" or "attend HSR Board meeting" without explaining why meetings could not happen remotely California High-Speed Rail Office of the Inspector General. One consultant defended an unapproved trip by saying the CEO ordered him to attend, suggesting it was wrong to question executive instructions California High-Speed Rail Office of the Inspector General.
Authority Failed to Enforce Basic Approval Rules
Of the $1.15 million in expenses reviewed, about 60 percent — roughly $680,500 — lacked advance written approval as contracts required California High-Speed Rail Office of the Inspector General. The auditors broke down the $592,900 in unallowable spending into two categories: $81,000 violated state travel regulations, and $543,400 breached contract terms SF Gate. Some expenses fell into both groups.
Premium and first-class airfare, private planes, and international travel added up to over $118,000 SF Gate. The authority sometimes approved reimbursements without even checking if trips were necessary, cost-effective, or something a consultant could do from a computer California High-Speed Rail Office of the Inspector General.
Bipartisan Anger Over Wasted Millions on a Troubled Project
State Sen. Dave Cortese, a Democrat and head of the transportation committee, said "I will not tolerate unauthorized travel expenses by professional consultants" ABC10. Republicans were harsher. Assembly Minority Leader Alexandra Macedo said "Only in California could a project that is years late and billions over budget somehow find money for consultant rides to a cigar lounge" CBS News.
The rail authority promised voters a $33 billion system from Los Angeles to San Francisco by 2020 CalMatters. Now the estimated cost ranges from $88 billion to $128 billion, no passengers have ridden it, and the state is building just a smaller 171-mile Central Valley segment expected to open between 2030 and 2033 CBS News.
Authority Promises Recovery and Stricter Controls
The High-Speed Rail Authority spokesperson Matt Rocco said the agency "takes these findings seriously" and will "strengthen internal controls around consultant travel, implement more rigorous documentation and approval requirements, and recover any improper costs identified" CalMatters. Since October 2024, state agencies must evaluate whether work can be done remotely before approving travel CalMatters.
The office of the inspector general plans a formal follow-up review to verify the authority enforced the new controls and clawed back the improper spending KFI AM 640. The scandal threatens annual funding streams, including $1 billion from California's Greenhouse Gas Reduction Fund ABC10.
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