Construction of California's controversial high-speed rail project will likely begin in the Central Valley thanks to a $902 million federal grant the Federal Railroad Administration announced Monday.

The Los Angeles Times reported today that the grant also includes $16 million for the rail corridor between San Francisco to San Jose. It did not specify how these funds would be used.

The grant specifies that $715 million would be used to build the Central Valley segment of the line -- the first phase of the 800-mile project. Rep. Jim Costa, D-Fresno, held a press conference Monday to celebrate the fact that his segment would get priority over other parts of the San Francisco-to-Los Angeles line.

"This will begin the first phase of the construction of state-of-the art, high-speed rail in our nation," Costa said in a news release. "This is the largest sum allocated in the U.S. for the first phase of any high-speed rail corridor."

The grant is a "tremendous vote of confidence" for the project," Gov Arnold Schwarzenegger, a fervent supporter of the rail project, said in the release.

State officials estimate the initial phase of the project linking San Francisco and Los Angeles will cost $43 billion. California voters approved a $9.95 billion bond for the project in November 2008, when they passed Proposition 1A.

"As the nation's largest infrastructure project, California's high-speed rail system will create hundreds of thousands of new jobs, reduce pollution, boost economic growth and link Californians from one end of this great state to the other," Schwarzenegger said.

"I thank the federal government for recognizing the value of accelerating the pace of our project and (I) look forward to the many groundbreakings sure to follow."

The rail project has drawn intense opposition in the Peninsula, where several cities have called for the FRA and the state officials to cut off funding for the proposal in light of a series critical audits.

The Palo Alto City Council recently adopted a stance of "no confidence" in the California High-Speed Rail Authority. On Monday night, the council unanimously voted to oppose a possible high-speed rail station in Palo Alto.

The new grant announcement suggests that it could be more than a decade before high-speed rail comes to the Peninsula. Nevertheless, the rail authority plans to complete its analysis of Peninsula design options by the end of this year and to release an environmental impact report for the San Francisco-to-San Jose segment in December.

Palo Alto Mayor Pat Burt said Monday that the authority's announcement is consistent with previous statements by authority CEO Roelof van Ark.

The grant announcement didn't specify which of the two Central Valley segments would get built first.

Burt said van Ark indicated that if the first segment is Fresno to Bakersfield, the second would likely stretch from Bakersfield to Los Angeles. If the first Central Valley segment will be Fresno to Merced, the Peninsula segment would likely follow.

The goal is to stretch the rail line between two metropolitan areas within the next 10 or 20 years, Burt said van Ark indicated.

Burt, who sits on the council's High-Speed Rail Committee, said Monday that the delay in bringing high-speed rail to the Peninsula makes the authority's decision to release an EIR for the Peninsula segment in December hasty and unnecessary.

"It would serve no legal purpose -- it would be a stale EIR," Burt said. "It would do detriment without any benefit."