When the California High-Speed Rail Authority awarded a $24 million contract to KPMG, newly obtained records indicate it knew the consulting giant intended to charge more than its unusually low bid for high-level positions.
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giant → award → positions
KPMG's winning bid proposed an average hourly rate of roughly $200, but records reviewed by CBS California show its billed average rate was more than double that.
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rate → win → California
KPMG did not deny the findings; instead, a spokesperson stressed that California High-Speed Rail had been aware of its plan:
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Rail → deny → plan
"KPMG's bid in December 2024 detailed the people who would work on the engagement, their job classifications aligned to the state's definitions, and the associated billing rate for each person.
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who → detail → person
KPMG billed taxpayers roughly $2 million more in just four months than its winning cost proposal indicated.
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proposal → bill → months
In its first year, KPMG has already spent nearly half of its four-year, $24 million contract.
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KPMG → spend → contract
No Comment
CEO Ian Choudri and KPMG Managing Director Thierry Prate, who signed the contract, did not respond to emails.
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who → sign → emails
Choudri also refused to answer questions in person after a recent board meeting.
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Choudri → refuse → meeting
A public affairs representative asked that we direct questions to his office, but California High-Speed Rail has since failed to respond to our multiple requests for comment.
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Rail → ask → comment
CBS California is also still waiting on public records we requested more than a month ago.
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we → wait → records
Instead of providing the records, last week, the authority's public relations team demanded a correction to our last story.
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team → provide → story
They did not dispute the findings; rather, they took issue with "the characterization that the California High-Speed Rail project has fallen further behind since CEO Ian Choudri's appointment.
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project → dispute → appointment
They called it "inaccurate," adding that, "since his appointment, the program has advanced significantly, turning the corner from planning to implementation, consistent with global best practices."
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program → call → practices
We declined to add a correction, noting that Choudri's own 2026 Business Plan states the High-Speed Railhttps://www.cbsnews.com/news/california-high-speed-rail-consultants-sacramento-travel/#:~:text=Since Ian Choudri became CEO, California's high-speed rail project has fallen further behind,project timeline has been extended by at least nine months since he became CEO.
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he → decline → months
The Inspector General also acknowledged the delay.
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General → acknowledge → delay
As
, the authority lost $4 billion in federal funding under Choudri because it repeatedly missed deadlines to purchase the trains.
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it → lose → trains
Meanwhile, the project is currently projected to four consultant contracts totaling a quarter of a billion dollars over two years.
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project → project → years
, and Choudri has awardedTaxpayers continue paying hundreds of millions for consultants who aren't laying track or building trains, but who are at the center of an Inspector General investigation into wasteful and unallowable travel spending.
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who → pay → spending
New records obtained by CBS California indicate that was just the beginning.
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that → obtain → California
- KPMG's winning bid cut hourly rates for its "Managing Directors," "Managers," and "Senior Associates" from hundreds of dollars per hour under its previous contract to just $35 per hour in its winning bid.
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bid → win → bid
- Then KPMG raised the pay for people in its lowest-experience "Associate" position from $45 to $425 per hour.
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KPMG → raise → hour
- When high-speed rail assigned work to now $35-per-hour "Managers" and "Senior Associates," KPMG billed them as low-level "Associates" at the new rate of $425 instead.
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KPMG → assign → 425
Allegations of bid manipulation:
- A competing bidder filed a protest with the state, accusing High-Speed Rail of allowing KPMG to manipulate its bid to win the contract.
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KPMG → compete → contract
The protest argued KPMG never intended to charge $35 an hour.
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KPMG → argue → 35
- The runner-up had a higher technical score than KPMG and lost by just two points based on price.
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up → have → price
- A year later, CBS California could not find a single KPMG staff hour billed at $35 on the invoices reviewed.
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California → find → invoices
The bid vs. the contract:
- KPMG bid one price for managers in the winning proposal, but the signed contract lists another price, more than ten times higher.
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contract → bid → price
- Under the legally mandated scoring parameters, the runner-up would have won if KPMG had bid the higher contract rate.
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KPMG → mandate → rate
Warnings ignored:
- State officials dismissed the runner-up's protest as "mere speculation," but explicitly warned the authority not to pay higher rates for work assigned to the $35 positions.
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officials → ignore → positions
- Records show High-Speed Rail did just that.
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Rail → show → that
California High-Speed Rail knew:
- KPMG says the authority knew it didn't plan to staff the $35 positions when it awarded the contract.
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it → know → contract
- Records show evaluators flagged budget concerns when scoring the winning bid, noting KPMG's proposal didn't assign any staff to the $35 positions.
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proposal → show → positions
High-Speed Rail awarded KPMG the contract anyway.
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Rail → award → contract
- Once the contract was in place, High-Speed Rail assigned work to the $35 "Managers" and "Senior Associates" but allowed KPMG to bill them as less-experienced "Associates" at the $425 rate.
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KPMG → assign → rate
Familiar names:
- KPMG also billed hundreds of dollars an hour for highly paid subcontractors, including a former High Speed Rail CEO, a former board chair, a former principal removed from another firm and the KPMG managing director's former employer.
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KPMG → bill → firm
- After legal consultant Brent Butzin spent through most of his initial consulting contract, he began billing under the KPMG contract at $589 per hour.
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he → spend → hour
That is well above the highest rate allowed under the KPMG contract.
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That → allow → contract
Denver consultants and the CEO
A recent
revealed that highly paid consultants repeatedly charged taxpayers for late-night rides home from Choudri's house and nearby restaurants, 30 minutes east of their Sacramento hotels.
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consultants → reveal → hotels
Those were just a few of the questionable consultant expenses linked to Choudri.
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Those → link → Choudri
The consultants are KPMG Managing Director Thierry Prate and High-Speed Rail legal-services contractor Brent Butzin, who is also paid through the KPMG contract that Prate administers.
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Prate → pay → that
…and 117 more, not listed.
The Aporia
