Newsom quietly enacts controversial part of high-speed rail oversight bill, may veto part watchdog calls essential
California is attempting to build the nation's first bullet train, a project that's ballooned in cost and has blown through deadline after deadline for more than a decade.
Now Gov. Gavin Newsom is threatening to veto a bill containing what the project's independent watchdog calls "absolutely essential" tools for holding the High-Speed Rail Authority accountable, according to multiple sources familiar with the discussions between the administration and the Legislature.
CBS California Investigates recently exposed costly missed train-procurement deadlines and reported that the project could run out of money as soon as 2027 without new financing. To provide oversight, the state created an independent watchdog in 2023: an inspector general with the power to audit contracts, investigate fraud and flag problems before they turn into bigger, more expensive ones.
That watchdog is Ben Belnap. He was appointed by Newsom. He says the state has never actually given him the tools he needs to fully do the job.
A bill meant to empower the office, Assembly Bill 1608, authored by Assemblymember Lori Wilson, has been moving through the Legislature all year. It cleared the Senate Appropriations Committee last week and is two floor votes away from passing as written. Now, the governor's office is threatening to veto it, according to multiple sources with direct knowledge of the discussions, who spoke on condition of anonymity because they were not authorized to discuss the negotiations
Here's the twist: Gov. Newsom already enacted the most controversial part of the bill. Those provisions give the inspector general new authority to temporarily withhold portions of his reports that reveal security risks, fraud-detection gaps or pending litigation. Critics called them "anti-transparency."
Newsom enacted them quietly by folding them into a state budget trailer bill. Trailer bills are companion measures that ride along with the state budget on a fast track, with less public vetting than standalone legislation.
The governor is now planning to veto the remaining provisions in the bill, according to sources familiar with the discussions. That's the part that would give the inspector general the purchase authority and job classifications he says he needs to hold the High-Speed Rail Authority accountable.
To be clear, this isn't a story about whether the controversial part of AB 1608 is good policy. It's already law.
This investigation focuses on a threat made outside public view. It targets the one part of the bill with bipartisan support from lawmakers and independent watchdogs alike.
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Newsom appointed the Inspector General himself. It is not clear why the administration would oppose the tools its own appointed watchdog says he needs to oversee the governor's signature project and hold High-Speed Rail accountable.
The governor's office declined to answer specific questions from CBS California Investigates, saying only, "We don't typically comment on pending legislation."
If this bill is amended in these final two weeks of session, the amendments will be public — but the reason for them won't be. The amendments will not go through the standard committee review and there will be no public record of who demanded the changes, or why.
Wilson's office says that it is in discussions with the governor's office, adding, "there has been no direct language about amendments nor a possible veto."
Notably, the statement confirms that negotiations with the governor's office are underway — and indicates that the administration does not support the provisions as written, which cleared five legislative committees and passed on the Assembly floor.
CBS California Key findings
- The inspector general has spent two years and $1.15 million trying to buy $300,000 in standard software — and still doesn't have it. Records show the state's approval process is projected to add roughly $2 million to the cost. The bill would let the IG buy it directly, following the same state purchasing rules without the added cost.
- According to the IG, the watchdog's office is half-staffed because experienced auditors don't qualify under the current low-level job classifications — a problem the Legislature's own analyst predicted two years ago. Belnap says he's had to turn away "fabulous" candidates. The bill would allow him to immediately hire qualified staff under classifications other state watchdogs already have instead of waiting years for the state's reclassification process.
- The inspector general says, as a result of the staffing shortage, they have not yet been able to audit the rail authority's change order process, which records indicate, is costing California taxpayers hundreds of millions of dollars.
- The initial version of the trailer bill that the governor later used to pass the controversial provisions also included the purchase authority and job classification changes. Newsom's office has not explained why they were stripped.
- Those provisions have drawn wide, bipartisan support in the Legislature and from the Association of Inspectors General, which calls them consistent with national standards for OIG independence.
- The bill is two floor votes away from passing as written. The veto threat, according to multiple sources, surfaced after it cleared its final committee. Wilson's office says there has been "no direct language" about amendments or a veto in its discussions with the governor's office.
- Newsom appointed this inspector general himself. The tools he's threatening to veto are the ones his own appointee says he needs most.
What AB 1608 actually does
As originally written, AB 1608 had four primary provisions that impacted the inspector general's office: the reporting rules, the confidentiality framework, the purchase authority and the job classifications.
Two of those provisions recently became law as part of the state budget trailer bill. The inspector general now has to publish every completed report into High-Speed Rail. Previously he only had to publish one annual summary.
The inspector general can temporarily withhold sensitive material — security risks, fraud-detection gaps, pending litigation — as long as he publicly reveals that he's withholding something, and explains why.
Republicans in the Legislature called these "anti-transparency" provisions – focusing on the fact that the IG can withhold some information.
The Newsom administration folded these two provisions into this year's budget trailer bill, Senate Bill 169, which passed with the budget and required no separate floor vote on AB 1608 itself.
CBS California Investigates examined criticisms of the provisions in a separate fact-check and found the confidentiality rules come paired with disclosure requirements stronger than any that exist under current law.
The inspector general and the bill's author say they worked closely with the First Amendment Coalition (FAC), a nonpartisan government transparency organization, to amend the bill.
The FAC — an early opponent — flipped to support, calling the amended framework "a model" for how inspectors general can balance confidentiality with the public's right to know.
The Assembly budget subcommittee chair went further at a May hearing, calling it "beyond the gold standard" for inspector general transparency.
The part that isn't law
After the administration enacted the controversial provisions through the trailer bill, AB 1608 was amended down to the two things the governor's office left out — the provisions the watchdog calls "absolutely essential": access to job classifications so he can hire qualified auditors, and purchase authority up to $1 million so the office can buy goods and services without waiting in the state's centralized line.
The provisions have support from the Association of Inspectors General, a nonpartisan group representing thousands of inspector general staff across nearly all 50 states, which called them standard for OIG independence and adequate resources. The group says it takes no position on the broader rail project; its support is limited to whether the bill strengthens the inspector general's own structure and authority.
Belnap says administration officials have told him they want strong oversight and asked how they can help. His answer never changes: purchase authority and higher-level job classifications, which AB 1608 would grant immediately. Without them, the delays "directly impact our ability to complete timely, robust reviews."
The stakes go beyond standard purchase authority. Investigating technical allegations about the rail project requires hiring outside experts — and without AB 1608, Belnap says his office can't do that on its own. The bill "would allow my office to efficiently — and independently — hire needed expertise," he wrote; without it, procuring experts "will be lengthy and subject to the review and approval of other entities."
In other words: Belnap says the watchdog's investigations of the state currently depend, in part, on the state's permission to staff them.
The threat
AB 1608 cleared the Senate Appropriations Committee and is awaiting a full Senate floor vote, its last stop before heading back to the Assembly for concurrence and then to the governor's desk.
Now, multiple sources told CBS California Investigates that the governor's office plans to veto AB 1608.
Asked directly whether that's true, Wilson's office said the assemblymember "stands by AB 1608 in its current form" and confirmed it is "discussing the bill with the Governor's Office and considering all feedback, which is normal at this point in the legislative process."
In those discussions, her office said, "there has been no direct language about amendments nor a possible veto." Once the discussions conclude, the office said, it "will have a better sense of the bill's future."
CBS California Investigates asked the governor's office directly: Is a veto on the table, and why? We also asked why the purchasing and hiring provisions were left out of its trailer bill, and whether the governor would sign AB 1608 as written.
The governor's office did not respond.
Why this matters
The bill is two floor votes away from passing exactly as written. If it gets amended in these final days instead, the amendments will be public — but the reason for them won't be. There will be no public record of who demanded the changes, or why.
The public fight over the confidentiality provisions is effectively over — those are already law.
According to multiple sources, the new fight is private: whether the administration will allow the purchasing and staffing provisions the watchdog says are needed to survive.
As the bill was heading to appropriations in early August, Sen. Dave Cortese, who chairs the Senate Transportation Committee, stressed: "Everyone should be held accountable if the inspector general doesn't have the resources he needs. We're all accountable for that."
Wilson, the Assembly transportation chair and the bill's author, called it "unacceptable" for the Legislature or the administration to hamper the inspector general.
Wilson added, "But guess what? If it dies, guess what I'll be doing in January. I'll be introducing this again."
On the record, Wilson's office says she "stands by AB 1608 in its current form."
The warning signs were on the record in May
At a May budget hearing, Assemblymember Steve Bennett, who chairs the subcommittee overseeing High-Speed Rail's budget, asked the inspector general whether the administration's trailer bill gave him what he needed. Belnap told the subcommittee it didn't go far enough — two provisions were "absolutely essential," and they were removed from the governor's budget trailer bill.
Asked whether the administration would adopt those provisions, the Department of Finance's representative would say only that it was "taking into consideration the feedback."
A month later, the administration's trailer bill became law, without them.
Lawmakers had, in fact, already drafted and posted a version of the trailer bill that included those two provisions — hoping the administration would take it up. It didn't.
What passed kept only the controversial reporting and confidentiality language.
Neither the governor's office nor Wilson's office has explained why those two sections were left out between the May draft and the final trailer bill.
What it's costing taxpayers to wait
Two pieces of off-the-shelf software, standard across the industry, were supposed to cost about $300,000. Instead, the state approved a combined project budget of more than $2.5 million — and Belnap says about $2 million of that total is driven by the state's own oversight requirements, required consultants and redirected staff time.
The office needs the two systems — one to safely take whistleblower complaints, one to manage audit files. Two years in, Belnap says neither is fully in place.
By June 2026, the office had already spent roughly $1.15 million — about $945,000 of it tied to the state's oversight requirements, consultants and redirected staff time. Not the software itself.
"We've spent millions," Belnap said — just to get authorization to buy $300,000 worth of software he still doesn't have.
In a written response Monday, he put the toll in hours as well as dollars: for his small staff, time spent on the state's approval process "delayed, on a 1 hour-to-1 hour basis, my office's ability to complete timely investigations."
Meanwhile, a whistleblower inside High-Speed Rail can only report a problem through a server the rail authority itself can access. "We have complained about this for two years," Belnap added.
Then there's staffing. "Currently my office is half-staffed because of classifications," Belnap said.
The state's own analysts said the watchdog's staffing request was "well justified" two years ago. Today, despite year-round recruiting, Belnap says only half his budgeted staff-level positions are filled because the state's job classifications don't pay enough to compete for qualified auditors.
The Legislative Analyst's Office reviewed his request in February 2024 — 15 positions, eight staff-level — and found the staffing would support six major reviews a year, plus roughly 900 hours responding to whistleblower complaints and 2,000 hours answering the Legislature, the governor and the rail authority itself. The LAO even warned that without a higher-level job classification, the office could struggle to attract and retain staff.
That's apparently what happened.
The cost is a half-billion-dollar blind spot. The office's own work plan called for reviewing the rail authority's change-order process by July 2026 — including a $500 million-plus construction change order settlement.
Belnap confirmed in a written response to CBS California Investigates that the review hasn't even begun due to the staffing shortage. It's now pushed into next fiscal year.
Creating a new job classification series through CalHR and the State Personnel Board is an option, but it takes years and significant administrative resources Belnap says the office doesn't have, with no guarantee the classification gets approved at the end of it.
Correcting the record on the $1 million
At a June 23 Senate Transportation Committee hearing, Sen. Dave Cortese, the committee's chair, raised a concern about the bill's price tag. "I don't know if a million on the appropriation piece of it is the right amount or not," Cortese said. "I think we've received some inquiries about that."
However, AB 1608 doesn't appropriate $1 million to the inspector general's office.
It gives the office authority to enter qualifying contracts worth up to $1 million without first obtaining another state agency's approval. The office would still need money in its budget to pay for those contracts and would still have to follow state purchasing rules.
In other words: $1 million is the contracting threshold, not a $1 million check.
That distinction matters if the governor's office cites cost as a reason.
It's worth noting the office is already paying more to wait: roughly $1.15 million so far — on software the state budgeted at more than $2.5 million, driven largely by its own approval requirements.
Two months ago, no talk of veto
When CBS California Investigates first interviewed the inspector general in June, before the trailer bill had passed, he said there had been no talk of a veto.
"I don't want to paint this picture that those provisions will never get passed, (there is) no talk of veto or anything like that," Belnap said then. "I still hope and believe we'll get support for AB 1608 if it passes the Senate and gets to the governor's office desk."
That was in June. The veto threat described by multiple sources surfaced later — after the trailer bill became law and AB 1608 advanced through the Senate.
In response to updated questions Monday about a possible veto, Belnap said, "without getting into deliberative specifics," that his office has been "in regular communication with the Governor's office" about enhancing oversight.
He credited the administration for the trailer bill's provisions and said it "has signaled that it wants effective oversight of the High-Speed Rail project."
Now, the Legislature and administration, he wrote, "have this unique opportunity" to "clear the path of administrative barriers" so his office can deliver "timely insights into how to keep this project on track."
The unanswered question is why the administration would oppose the tools its own appointed watchdog says he needs to oversee the governor's signature project.
The governor's office — which appointed the watchdog, enacted the half of his bill that it wanted and now, sources say, is threatening to veto the rest — declined to answer a list of specific questions from CBS California.
