Stay on track with rail but ‘build better’

People winced last week at hearing the new projections for cost overruns on the elevated rail construction.

That’s not a new experience for critics of the controversial transit line, but a lot of those now shaking their heads are taxpayers who have favored the state’s largest public works project in history.

At the head of the pack stood Honolulu Mayor Kirk Caldwell, someone who staked a lot of political capital on lobbying for an extension of the rail tax that is helping to finance the 20-mile system, which was authorized by state lawmakers but still awaits approval by the City Council.

That approval should come in due course, but the mayor sounded the right note of alarm. Perhaps that reaction to distressing news was a predictable response from a mayor who will be up for re-election in a year.

Regardless, the reality is that the city can’t just sit back and accept that dismal forecast uncritically. Instead, taxpayers will demand, as they should, that the Honolulu Authority for Rapid Transportation account even more scrupulously for its expenditures going forward.

With a $910 million budget shortfall already penciled in, the latest update added another $200 million in red ink on top, pushing the shortfall over the $1 billion mark and the total pricetag above $6 billion.

The news came in a Sept. 14 letter, signed by HART Chairman Don Horner and Executive Director Daniel Grabauskas, sent to Caldwell and City Council Chairman Ernie Martin. Also, they wrote, the full opening of the rail system with its 21 stations could be pushed back from 2020 to 2021.

The reason for the revised projection, according to their letter, is that Honolulu’s construction market ranks among the nation’s most expensive, making a 40 percent cost escalation estimate more realistic than the 30 percent HART had previously set.

Additionally, HART now has switched to a "design-build" contracting approach, which is seen as a more efficient and collaborative means of delivering the guideway and stations.

Although that seems to be a right decision, it’s unsettling that it follows the completion of $100 million in design for the next phase of the project, money that, at least in part, will be wasted.

In an interview Friday with the Honolulu Star-Advertiser, Grabauskas said much of that work can be salvaged, and in ways that should reduce the risk inherent in the next phase of rail bids — for the stations at the airport and in the city center.

The foundational part of the design encompasses details on utility locations and land ownership, making the planning for the pillar placements and station construction less complicated for the risk-averse contractors, he said.

And less risk should mean lower bid costs, he said, which will help compensate for the lost design funds.

That would ease the pain, of course, but only as long as HART ensures that its request for proposals is framed carefully, constraining the bidders to that less-risky construction environment.

And while cost-cutting is a high priority, HART should consider carefully before paring too close to the bone. Some of the amenities — escalators, for example — are, in most cases, "need to haves" for busy commuters rather than mere niceties.

Grabauskas said construction has proceeded at a slower pace than initially anticipated, in part because HART’s contractors have worked to reduce the impact on Leeward Oahu communities and businesses.

What makes many in the public uneasy is that these pressure points were not anticipated better, and that the pressure will only intensify as the work proceeds toward the urban core.

Although HART’s assurances are that costs will become much more predicta- ble when contracts are open next year, it’s reasonable to fret that another budgetary shoe could drop.

HART also is contemplating postponing the project’s interim opening to go beyond the first 10 miles to Aloha Stadium. Instead, it would open the first 15 miles so that it includes stations at the airport and Middle Street bus complex.

This seems a rational choice, because it would make the line more usable, bringing commuters to a reasonable transfer point, which likely would drive up ridership — and revenues.

To some extent, the rail authority is managing public perceptions, currently tarnished with disappointment.

"We need to be in a new position where we’re underpromising and overdelivering," Grabauskas said.

Overdelivering would be nice, indeed.

When the city embarked on the project, cost overruns were hazy, theoretical eventualities that now have come into focus.

The messy complexities and costs are now impossible for even the most avid supporters to ignore.

And of course, ignoring them is the last thing HART or elected city officials should do.

This is where the rubber meets the road on Honolulu’s rapid transit — before the steel wheels can meet the steel rails.