City fails to pay for land it took for rail

A month after local business Honolulu Hardwoods became the first official casualty of rail eminent domain, the city has missed the deadline to pay its owner the balance he’s owed.

That final $450,000 installment, part of a $3.15 million court settlement reached last month, was due Aug. 29 to Honolulu Hardwoods owner Bryan Hoernig. But Hoernig hasn’t been paid because the Federal Transit Administration, the city’s partner on rail, has not yet approved the deal, according to the parties in the recent condemnation trial.

Instead of a check, the Honolulu Authority for Rapid Transportation sent Hoernig a letter Aug. 29 saying it may be 30 days late because the agency needs the federal approvals — even though that step was not mentioned at the time of the settlement, according to Hoernig’s lawyer, Dennis King.

HART, meanwhile, says it “was not made aware that FTA concurrence was required on this particular settlement until after the agreement was made” in court.

Hoernig said that the agency, which oversees the city’s financially challenged rail project, has not been forthright on its due payment.

“I’m trying to find a property that I’m going to move to permanently … and I’ll need that money. And they’ll get around to it when they want,” Hoernig said via phone Monday.

“It is what it is,” he added, resigned. Despite the delay, he’s making ends meet, but “not very easily.”

Hoernig further contends that he hasn’t been paid some $240,000 for moving expenses, but there appears to be some confusion. HART says it made its initial payment of more than $117,000 Aug. 24 and that “vendors received it.”

Nonetheless, the agency is aware of Hoernig’s claims, and it says he’ll have to sign an affidavit at the city’s Treasury Department to stop the city’s moving payments and then reissue the first one.

Hoernig — similar to other owners whose land lies in the path of Honolulu’s planned elevated transit line — has spent much of the past three years jostling with the city over the fair price to take his property, which is needed for rail. Earlier this month he became the first such owner to take that fight all the way to a jury trial in state civil court.

At considerable expense, he challenged the city’s efforts to condemn his 10,000-square-foot property for $2.7 million. Based on his attempts to find a new warehouse, he said he believes the land and building where he runs Honolulu Hardwoods is worth $2 million more than what the city offered.

For nearly a week a jury heard testimony from the two dueling appraisers hired by the city and Honolulu Hardwoods. They also heard briefly from Hoernig himself.

After they were dismissed, at least three jurors expressed strong doubts about the approach used by the city’s appraiser.

Hoernig said after the deal was reached that he doesn’t know whether it will be enough for Honolulu Hardwoods to survive. He’s now leasing a space about half the size in Kalihi near Sand Island but says he’ll need to find a better location closer to his clientele.

“They’re boxing me into a corner, still, to this day,” he said Monday.