Officials torn on how to get rail money

Key city officials Monday assured top brass at the Federal Transit Administration that they are committed to providing the city’s share of funding for the financially strapped rail project.

Mayor Kirk Caldwell, Hono­lulu City Council Chairman Ernie Martin, City Council Budget Chairman Trevor Ozawa, Honolulu Authority for Rapid Transportation CEO Andrew Robbins and Honolulu Authority for Rapid Transportation Chief Financial Officer Robert Yu made the trip to Washington, D.C., for the meeting.

Martin and Ozawa, whose leadership team only recently regained control of the Council, have been at odds with Caldwell over his proposal to include $44 million in the city’s fiscal year 2019 capital improvements program budget to help fill a projected rail funding gap. They object because the proposal calls for bond money — borrowed money that eventually will need to be paid with interest by city taxpayers — to balance rail’s $9 billion construction and financing costs.

Instead, Martin and Ozawa want cuts to the city’s $2.61 billion operating budget to make up the $44 million.

Administration officials insist budgeting a bond amount makes more sense than cutting the operating budget because more recent general excise tax surcharge projections show no need for the $44 million next year to begin with.

Caldwell warned that uncertainty about how the $44 million was to be paid could jeopardize the federal funding.

There was no mention of the dispute in the joint release.

“During the meeting there was agreement by all that significant progress has been made in addressing project cost issues over the last 24 months and that the FTA continues to review elements of the Recovery Plan, including its analysis of project construction and financial risks as a part of its larger review of the project Recovery Plan,” the statement said.

“The Council leaders and the Mayor reaffirmed their commitment to fulfill the City funding obligations outlined in the Recovery Plan, including a commitment to providing the City’s share of funding $44 million for FY 2019.”