California Forever had promised to turn 60,000 acres of wheat fields in Solano County, 60 miles northwest of San Francisco, into a European-style city housing 400,000 people.

The company’s chief executive, Jan Sramek, 37, a former Goldman Sachs trader, and Reid Hoffman, 56, a LinkedIn co-founder, were among the venture capitalists behind the futuristic city which was billed as having the potential to create a $54m (c. £42m) tax surplus by 2040.

But on Monday, California Forever and a Solano County supervisor released a joint statement announcing that the proposal would no longer be put before voters on a ballot in November.

The decision to suspend the project followed a report by the Solano County board of supervisors which estimated that the plan could cost taxpayers $50 billion (c. £39bn) for infrastructure. California Forever’s outline was so vague, the board said, that it was difficult to assess how the company would get the project off the ground, let alone make it “financially feasible”.

The company did not disclose how it would get water to the city, and the county stood to lose millions of dollars every year due to cuts in agricultural and farm production, according to the report.

The proposal has faced opposition from residents, ranchers, and farmers who were dubious about the mysterious entity buying up land in east Solano County. Before a New York Times report last year revealed the technology tycoons behind the plan, California Forever’s real estate arm, Flannery Associates, alienated locals by suing them for $510m (c. £395m) for allegedly colluding to inflate prices.

“Faced with the anticipation of overwhelming rejection by Solano County voters on the ballot, California Forever has pulled the plug on the East Solano Plan Initiative,” Solano Together, a coalition that opposed California Forever’s project, said in a statement. “The people have spoken and California Forever has been forced to withdraw their hastily drawn, poorly designed initiative, given a surefire loss in November.”

California Forever had tried to cut through red tape by gathering enough signatures to put the plan before voters on a ballot in autumn. It has now agreed to follow the traditional route and file an application to rezone the land, which was bought for more than $800m.

The company and the county are expected to work together on a joint environmental impact report and development agreement, which will then be presented to county supervisors for approval in 2026.

“While the need for more affordable housing and good paying jobs has merit, the timing has been unrealistic,” Mitch Mashburn, chairman of the board of supervisors, said in a statement. “[Sramek] is also right that we cannot solve our jobs, housing, and energy challenges if every project takes a decade or more to break ground.”