California Gov. Gavin Newsom. Photo: Scott Varley/MediaNews Group/Daily Breeze via Getty Images

The Transportation Department said Tuesday it intends to cancel $929 million in federal grant funds for California's scaled-back high-speed rail network, and that it is "actively exploring every legal option" to take back $2.5 billion in funds already given to the state for the project.

The big picture: Last week, California's newly elected Gov. Gavin Newsom disputed Trump's claim that California owes the federal government $3.5 billion for scaling back its plans to build an estimated $77 billion high-speed train from San Francisco to Los Angeles, saying the money was allocated by Congress. In a new statement, Newsom said: "This is clear political retribution by President Trump, and we won’t sit idly by. This is California’s money, and we are going to fight for it.”

  • Newsom also noted: "It’s no coincidence that the Administration’s threat comes 24 hours after California led 16 states in challenging the President’s farcical ‘national emergency.’"

Go deeper: California's $77 billion derailment

Go deeper

Updated 1 hour ago - Politics & Policy

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Politics: McConnell urges White House not to strike stimulus deal before election — Republican senators defend Fauci as Trump escalates attacks.
  2. Health: The next wave is gaining steam.
  3. Education: Schools haven't become hotspots — University of Michigan students ordered to shelter-in-place.
Updated 2 hours ago - Politics & Policy

Biden has huge cash advantage over Trump as Election Day nears

Democratic presidential nominee Joe Biden in Wilmington, Delaware, on Monday. Photo: Drew Angerer/Getty Images

Democratic presidential nominee Joe Biden had $177.3 million in the bank at the end of September, per the latest Federal Election Commission filings.

Why it matters: President Trump's re-election campaign reported having $63.1 million in the bank at the end of last month, as campaigning enters the final stretch ahead of Election Day on Nov. 3.

Court allows North Carolina mail-in ballots deadline extension

An absentee ballot election worker stuffs ballot applications at the Mecklenburg County Board of Elections office in Charlotte, North Carolina, in September. Photo: Logan Cyrus/AFP via Getty Images

North Carolina can accept absentee ballots that are postmarked Nov. 3, Election Day, until Nov. 12, a federal appeals court decided Tuesday in a 12-3 majority ruling.

Why it matters: The 4th Circuit Court of Appeals' ruling against state and national Republican leaders settles a lawsuit brought by a group representing retirees, and it could see scores of additional votes counted in the key battleground state.