California high-speed rail CEO is out after report flags consultant costs

A shake-up at the California High-Speed Rail Authority brought the departure of its chief executive officer, Ian Choudri.

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Choudri, who had been lauded in some transportation circles for setting the troubled authority back on solid ground, had come under fire after the authority’s inspector general issued a report in September finding the authority had allowed its consultants to bill it for travel expenses.

It’s another setback for a project authorized by a state bond measure in 2008 that has been characterized by ballooning cost estimates and delays.

Joe Stephenshaw, director of the California Department of Finance, will step in as interim CEO. He will begin his new role at CHSRA on Tuesday.

“The board received Ian Choudri’s resignation as CEO of the High-Speed Rail Authority, effective immediately,” authority board chair Steve Kawa said in a statement Thursday. “Mr. Choudri was a board appointee. We thank him for his service and contributions to the high-speed rail program, and we wish him and his family well.”

Of Stephenshaw, Kawa said: “his experience as the Director of the Department of Finance, combined with his commitment to transparency and accountability, make him the perfect person to carry us forward into the next exciting chapters of building this project.”

In his resignation letter, Choudri said he made the difficult decision to step down as CEO to focus on family matters and his health.

“This has not been an easy decision as leading the Authority has been one of the most meaningful and rewarding chapters of my life,” Choudri said.

The authority paid more than $2 million in travel-related expenses across four primary consulting firms, KPMG, Nossaman LLP, AECOM-Fluor, and SYSTRA/TYPSA, during fiscal years 2024–25 and 2025–26, according to the inspector general’s report.

The authority was billed for luxury rideshares, private plane travel and international flights, all of which were prohibited by contracts. Specific examples cited include a legal consultant making 30 trips between Denver and Sacramento, in which they charged $86,500 in travel time plus $40,800 in reimbursements, and late-night Uber and Lyft “Black” rides that use luxury cars.

On Oct. 9, following the inspector general’s report, the CHSRA Board took away Choudri’s sole authority to sign and manage contracts under $25 million. The board also ordered the authority’s in-house attorneys to sign off on any new or amended contract. The board already votes on contracts above that amount.

“The governor is committed to delivering the nation’s first high-speed rail system and to protecting California taxpayers every single step of the way,” said Anthony Martinez, a spokesman for Gov. Gavin Newsom.

“That’s why he brought fresh leadership onto the High-Speed Rail Authority Board this year, with a clear charge to demand accountability for every dollar and transparency the public can count on,” Martinez said. “The governor welcomes today’s announcements as an important step in that direction.”

The CHSRA board is responsible for appointing the CEO. The governor appoints board members. Newsom added Kawa and Jason Elliot in May to replace the outgoing chair and vice chair, with Newsom saying at the time he had done so to “bring stronger accountability and transparency to the project.”

The board selected Kawa to chair the board in June.

Choudri’s abrupt departure took the shine off milestones the authority : a contract to design and build the system’s first high-speed trainsets and approval of the final environmental document marking completion of environmental clearance for the full system between San Francisco and Los Angeles/Anaheim.

Stephenshaw’s departure comes with the DOF in the midst of preparing the governor’s budget proposal that is unveiled in January.

But a new governor — one who will appoint his own finance director — takes office Jan. 4, after Tuesday’s election pitting Democrat Xavier Becerra and Republican Steve Hilton against each other.

“As for the preparation of next year’s budget: that’s been well underway — which is the case in every transition year — with some important modifications as there will be a new governor next year,” said H.D. Palmer, a spokesman for the Department of Finance.

Each July, DOF sends out a “budget letter to state departments and agencies with general guidance for them as they prepare their proposed budgets in the summer and fall for the upcoming fiscal year,” Palmer said.

In the letter, Palmer said, DOF makes “it clear that since this is a transition year, the only proposals we would consider during the fall are for “maintain[ing] current service levels for existing authorized services.”

Stephenshaw has been DOF director for four years and has two decades of experience in California finance and budgeting.

“Joe Stephenshaw has spent the last four years guarding the state’s budget as Director of Finance,” Martinez said. “The governor is grateful for that service and confident Joe is the right person to oversee the Authority in the interim. With thousands of workers on the job across the Central Valley every day and major milestones ahead, this project keeps moving forward.”