Lawmaker wants audit of airport hangar project

Senate Transportation Chairwoman Lorraine Ino­uye wants lawmakers to order an audit of the over- budget, long-delayed construction of a new maintenance and cargo hangar for Hawaiian Airlines at Daniel K. Ino­uye International Airport.

Earlier this month Hawaiian CEO Mark Dunkerley called for a state investigation to determine how the badly needed hangar project was so badly botched, and Inouye said last week she wants the state auditor to scrutinize the job.

Inouye said she plans to draft legislation ordering up the audit and possibly providing extra funding to finance the review. However, Inouye said the scope of the audit might be limited because contractor DCK Pacific Construction LLC and the state are suing each other in connection with the project.

Lawyers for the state generally refuse to publicly release information that could affect the outcome of any ongoing court case, and that restriction likely would limit the ability of any auditor to gather information about the project.

The state signed a contract with DCK Pacific in 2010 for $73.43 million to build the 280,000-square-foot hangar for Hawaiian, but work stalled on the project in 2015 after subcontractors abandoned the project.

The state Department of Transportation alleged it was paying general contractor DCK, but DCK was not paying the subcontractors. Transportation officials discovered 30 subcontractors were owed a total of $4.2 million, and the department finally stepped in to stop all work and lock down the job site at the end of 2015.

A year of delays followed as the state and Hawaiian Air worked out an agreement to complete the structure. The airline finally took control of the project last year, and Dunkerley said fixing problems with the structure and completing the facility cost Hawaiian $34 million. That brought the total project cost to about $120 million, Dunkerley said.

Hawaiian identified 3,688 “issues” on the hangar project after the airline took control of the unfinished facility in November, including incomplete work that the contractor had marked as finished and the state had already paid for.

Other components of the project involved work that was done so poorly that Hawaiian’s contractors had to do the work over, Dunkerley said.

That included site preparation that was so poorly done that concrete was cracking in a parking area before any traffic had passed over it, and a vehicle ramp that was so steep that a heavily loaded truck would not be able to negotiate it, he said.

Other examples involved a 12-foot door with an obstruction built in that blocked it at the 9-foot level, lighting that was completely blocked by ducts, and walls that had to be ripped out because they were completed without the necessary electrical wiring inside, Dunkerley said.

“We certainly want to have the state investigate what went wrong, and people appropriately held to account,” Dunkerley said earlier this month.

DCK said last spring that it was wrongfully terminated from the job by the Department of Transportation, and alleged it has not been paid for some of the work it did on the project in 2015.

The company questioned whether it is being used as a “scapegoat” for delays in various airport projects. Several components of the airport modernization have been on hold pending completion of the maintenance and cargo hangar.

Senate Government Operations Committee Chairwoman Donna Mercado Kim has also questioned the role of consultant Wesley R. Segawa &Associates Inc., which was awarded a $4 million contract in 2009 to oversee construction on the hangar and cargo facility.

Kim (D, Kalihi Valley- Moanalua-Halawa) has suggested Segawa may be partly to blame for problems with the project, but the state later extended Segawa’s contract. Lawyers from the state Attorney General’s Office have said Segawa, which was the project manager, is assisting the state with the ongoing lawsuits in connection with the hangar.

Inouye (D, Kaupulehu- Waimea-North Hilo) said Hawaiian essentially rescued the project, and said the problems with the hangar underscore the need for the state to establish an “airport authority” to operate and manage the 15 state airports.

Ford Fuchigami, director of the Department of Transportation, has proposed that the state create a new airport authority or “airport corporation” within his department to upgrade and better manage state airports.

He cites the “progressive deterioration” of terminal facilities, which he says are increasingly well below the standard of other airports serving leading global destinations.

The system will function better if the state centralizes decision making for the airports system under an authority or airport corporation and frees the system from complex requirements imposed by the state, including the state procurement code, Fuchigami said.

The Hawaii Government Employees Association, the state’s largest public-worker union, opposes that plan. The union says the state tried a similar approach when it created a corporation to run the state’s network of public hospitals, and lawmakers were frustrated with the result.

Lawmakers have complained regularly about inefficiencies in the public hospital system and the ongoing need for tens of millions of dollars in state subsidies to support the hospital corporation each year.

A Honolulu Star-Advertiser poll in April found 55 percent of Oahu voters oppose the airport authority plan, while only about a third support it.