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The Trump administration officially cancelled the previously awarded $929 million in funding for California’s bullet train project.

The Federal Railroad Administration (FRA) announced the decision on Thursday. Its announcement comes almost three months after warning the California High-Speed Rail Authority (CHSRA) regarding its incompliance with terms of their 2010 cooperative agreement.

In February, the FRA informed the CHSRA about its intention to cancel their cooperative agreement, which included the $929 funding for the bullet train project.

California failed to comply with the terms of its agreement with FRA

On Thursday, the FRA “terminated the cooperative agreement” and “will deobligate” the funding for the California high-speed rail project after careful consideration.

The federal agency explained that the California rail authority “repeatedly failed to comply with the terms of the FY10 agreement and has failed to make reasonable progress on the project.”

“Additionally, California has abandoned its original vision of a high-speed passenger rail service connecting San Francisco and Los Angeles, which was essential to its applications for FRA grant funding.”

Furthermore, the FRA said it “continues to consider all options regarding the return of $2.5 billion in American Recovery and Reinvestment Act (ARRA) funds awarded to CHSRA.”

President Donald Trump previously demanded that California must return the $3.5 billion in federal funds for the bullet train project. He made the demand after California Gov. Gavin Newsom said in his first state of the state address that the current plan for bullet train project “would cost too much and take too long.”

Newsom also said he doesn’t see a path towards the completion of the Sacramento to San Diego and San Francisco to Los Angeles lines.

Newsom vows to challenge the FRA’s decision in court

In response, Newsom said FRA’s decision is a direct attack on California. His administration will challenge it court.

“The Trump administration’s action is illegal and a direct assault on California, our green infrastructure, and the thousands of Central Valley workers who are building this project,” said Newsom in a statement.

In addition, the governor said, “Just as we have seen from the Trump administration’s attacks on our clean air standards, our immigrant communities and in countless other areas, the Trump administration is trying to exact political retribution on our state. This is California’s money, appropriated by Congress and we will vigorously defend it in court.”