"The current project, as planned, would cost too much and, respectfully, take too long", Newsom said in his speech.
Newsom criticized Republican President Donald Trump for promoting a "manufactured" crisis on the U.S. -Mexico border and for vandalizing pieces of former President Barack Obama's health care overhaul law.
A state audit issued in November said California's High-Speed Rail Authority's "flawed decision making and poor contract management have contributed to billions in cost overruns and delays". The main reason: if the project was canceled the state would have to return $3.5 billion from the federal government.
However long it takes for San Francisco and Los Angeles to be a priority once again, it's sure to throw off several transportation projects centered around the high-speed rail.
Newsom says he wants to continue construction of the high-speed link from Merced to Bakersfield in California's Central Valley. Jerry Brown, the state's HSR program has ballooned in cost from $64 billion to $77.3 billion and wouldn't be completed until 2033, according to the California High-Speed Rail Authority's (CHRSA) 2018 business plan.
That caveat led to outrage from some critics who said Newsom should pull the plug on the entire project, which has skyrocketed in cost to more than $70 billion.
California voters approved a $10 billion bond in 2008 largely for the construction of bullet train between San Francisco and Los Angeles.
Newsom said contractors and consultants would be held more accountable in the future, with details of expenditure to go online. He's proposed a new tax to raise money for water infrastructure projects.
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Newsom called for rail planners to instead focus on connecting the Central Valley, the only section is he sure can be achieved in a timely manner and in a region that is "more dynamic than people realize".
"Let's get something done once and for all", he said, arguing the Central Valley should not be left out of the project's "economic transformation".
"Merced, Fresno, Bakersfield, and communities in between are more dynamic than many realize. It will just put more billions into [high speed rail]" said Nielsen.
"Last week, we heard (Trump) stand up at the State of the Union and offer a vision of an America fundamentally at odds with California values", he said. "He described a country where inequality doesn't seem to be a problem, where climate change doesn't exist, and where the greatest threat we face comes from families seeking asylum".
California Gov. Gavin Newsom is preparing to deliver his first State of the State address a day after declaring he wouldn't participate in the Trump administration's "political theater" over border security.
During his speech, Newsom praised state lawmakers for passing a bill past year that aims to improve privacy protections for consumers.
He said he has convened a team of the nation's best bankruptcy lawyers and financial experts from the energy sector to work with his administration to develop a strategy to protect the state's power grid, wildfire victims, company employees and ratepayers.
The Internet Association, which worked to water down the language of the consumer privacy law, said it looks forward to reviewing Newsom's plan.