California's high-speed rail programme could run out of money next year, the project's inspector general has warned, according to a KCRA report on the latest oversight findings.

The warning puts a fresh date on a funding gap that the California High-Speed Speed Rail Authority has acknowledged for years. The authority is building a 278 km initial operating segment in the Central Valley between Merced and Bakersfield, but its committed federal and state funding has long fallen short of the cost of completing even that truncated first phase.

The inspector general's office, which provides independent oversight of the programme, has repeatedly flagged cost growth and schedule slippage in quarterly and annual reports. The new caution that cash could be exhausted in 2026 indicates the authority's existing appropriations will not carry construction through the period needed to finish the Merced–Bakersfield segment.

The authority has projected service on the Central Valley segment in the early 2030s, subject to funding. Its most recent estimates put the cost of the initial segment well above earlier projections, driven by civil works contracts in the Fresno trench, the Hanford Viaduct and dozens of grade separations along the corridor.

Federal support for the project has been a contested variable since Washington's original allocations more than a decade ago. The state has relied on cap-and-trade auction proceeds to keep construction moving, but those revenues fluctuate with market conditions and cannot by themselves close the gap the inspector general now identifies.

The warning comes as the authority seeks additional federal grants and renewed state commitments to extend the programme beyond the Central Valley toward the Bay Area and Los Angeles, the endpoints specified in the 2008 ballot measure that voters approved with roughly $9 billion in bonds.

For now, the inspector general's assessment leaves the authority with a narrow path: secure new money before current funds run down next year, or slow the pace of construction in the Central Valley, further delaying a service start that has already slipped by several years from earlier plans.