CEO of California high-speed rail project loses contracting power in key vote as spending scandal grows

The CEO of California’s beleaguered high-speed rail project is facing the fallout of a spending scandal after the board voted to strip him of his contracting powers — as he refused to answer reporters’ questions in person.

The board voted 7-2 Friday to revoke Chief Executive Ian Choudri’s sole authority to sign and manage contracts worth less than $25 million, requiring the agency’s in-house attorneys to review new and existing agreements.

The move came after a state watchdog found nearly $593,000 in unallowable consultant travel expenses — including first-class flight upgrades, rides to bars and restaurants, and mysterious late-night trips to and from Choudri’s Folsom home.

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The rail authority paid roughly $2 million in travel expenses to four major consulting firms, with auditors flagging a slew of questionable reimbursements.

Among the eyebrow-raising expenses were a dozen Lyft trips involving two highly paid consultants — Denver-based Nossaman LLP attorney Brent Butzin and KPMG director Thierry Prate — linked to a quiet residential road where Choudri owns a home. Some rides occurred after 1 a.m., according to receipts obtained by CBS Sacramento.

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The trips were vaguely described as “related to work with Ian,” according to an email from KPMG.

Another dozen rides were tied to bars and restaurants near a pricey surf-and-turf spot, Land Ocean Steak House, that Choudri is known to frequent, CBS reported.

The agency even rejected a $94.39 pizza delivery order submitted for reimbursement — but other expenses made it through the system, including premium airfare, rides to a cigar lounge and an “escape room,” according to the audit and officials at Friday’s meeting.

Choudri, who earns $638,943 annually to run the troubled bullet train project, has said the agency is taking steps to fix its reimbursement problems.

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“I wanted to call this special meeting to demonstrate just that we are not going to ignore, and we’re not going to sweep under the rug issues that are affecting this organization and impacting the people of California,” Board Chair Steve Kawa said at the meeting.

Board member Lynn Schenk was less diplomatic.

“I am outraged that we would be treated like a piggy bank for these kinds of expenditures,” she said.

Jason Elliott, a former deputy chief of staff to Gov. Gavin Newsom, also blasted the spending.

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“You can’t fly first class when you’re on state travel, you don’t take an Uber black SUV,” Elliott said.

Choudri reportedly told board members that “we remain committed” and that he would “take full responsibility and accountability to fix if there was something broken in the system.” He also mentioned “displicinary actions” but did not elaborate.

After the meeting, reporters followed Choudri as he walked away without answering questions about the expenses or calls for his resignation. Video captured by CBS showed him entering a separate room, while the authority’s acting head of external affairs, Matt Rocco, fielded questions on his behalf.

In an emailed statement to The California Post, Choudri said the authority was strengthening internal oversight and requiring updated training for managers and consultants. He also claimed the agency had saved more than $68 million on consultant contracts over the past two years.

Rail authority spokesperson Daniela Contreras said the agency was tightening its reimbursement rules.

“Only travel that is pre‑approved, within contract scope and consistent with state regulations will be eligible for reimbursement,” Contreras said.

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The scandal comes as the project faces a critical funding crunch, with the inspector general warning it could run out of money by the end of 2027 without additional financing.

One estimate puts the project’s total cost at a staggering $231 billion, while the authority’s latest business plan pegs it at $126.3 billion. Construction began in 2015, but only about 119 miles are under active construction, with completion of that segment targeted for 2032.

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