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The U.S. Department of Transportation wrote they are "actively exploring every legal option" to get back the $2.5 billion in federal grant funds already given to the state.
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The notice comes a week after Governor Gavin Newsom's State of the State address where he announced future construction would only focus on the section between Merced and Bakersfield.
President Trump tweeted following the Governor's address that the American people "wanted their money back."
READ: Full letter from Department of Transportation