HART board weighs 6 options to deal with rail’s cost overruns

Local rail leaders will have until Aug. 7 to tell federal transit officials what they plan to do about Oahu’s massively over-budget transit project — even though they don’t like any of the options presented to them and say they don’t yet have the details or faith in the numbers needed to make an informed choice.

The Honolulu Authority for Rapid Transportation board weighed six options Wednesday for how the city might reduce the size and scope of a rail line that’s now estimated by local and federal officials alike to cost about $8 billion.

None of the scenarios offered by HART staff has rail’s elevated line making it to Ala Moana Center with the estimated $6.8 billion the project is slated to receive.

The farthest the line might extend under that budget is Kalihi, according to figures quickly prepared for the HART board’s special meeting Wednesday. Other options discussed included ending the line at Middle Street, building the line at ground level east of Middle Street, rerouting it from Dillingham Boulevard to Nimitz Highway — or a more flexible “a la carte” approach that would have crews eliminate stations in order to build the elevated line as far into town as possible.

None of the choices sat well with HART board members. The Nimitz idea could delay the project another 10 years, said Brennon Morioka, HART’s deputy executive director. Shortening the line at Middle Street might significantly reduce ridership and put an added strain on the city’s public bus service, board members worried.

“I’m not optimistic that any of them are going to pan out or make sense,” board member Terrence Lee fretted, adding that the city might instead consider abandoning the project or finding another way to cover the cost overruns. “Do we have the ability to do a (public) poll? Because I think we should start preparing for that.”

Added board member Ivan Lui-Kwan, who recently opted not to seek reappointment at the end of this month: “Realistically speaking, most of these options aren’t available to us. I don’t know what the answer is.”

The HART board doesn’t know exactly who makes the final choice, either. The rail agency intends to present project options to Honolulu’s mayor and City Council, then form a “working group” to decide the best way to make the Federal Transit Administration’s Aug. 7 deadline.

Honolulu resident Barbra Armentrout told the board Wednesday that local residents should have a say in the choice.

When board Chairwoman Colleen Hanabusa asked Morioka what he would do, Morioka suggested building the elevated rail line to the downtown station, near Aloha Tower and three stops shy of Ala Moana Center, and then cutting as many stations as needed to afford the move.

All of the uncertainty and on-the-fly decision-making over rail’s future occurs as the elevated guideway’s construction continues through Pearl City along Kamehameha Highway toward town. Rail officials estimated Wednesday they’ve already spent about $100 million in planning, design and property acquisition in town for the final 5-mile stretch that potentially could now be scrapped based on what’s decided.

“I think it’s a mess, is what it is,” Armentrout said at Wednesday’s meeting.

HART hasn’t yet issued the two big contracts to complete rail’s final 10 miles into town. Dan Grabauskas, the agency’s executive director, said Wednesday that HART is in a “best-and-final-offer” process with candidates to build the next 5 miles around the airport. That indicates that the prices from the firms looking to build came in higher than expected, based on previous comments by rail officials.

Board members further pressed Morioka and Grabauskas for answers Wednesday on how the agency in the past two years has repeatedly underestimated how much more the project would cost — and how their estimates missed by such a wide margin.

HART budget figures provided by Hanabusa in May showed that the agency estimated rail would cost $6.9 billion. At Wednesday’s meeting, less than a month later, HART increased that estimate to more than $8 billion. A separate FTA estimate also put the cost at more than $8 billion.

“We’re going to have to explain why our figures are so far off. We were just using these numbers June 1, and we didn’t make that disclosure to Council,” Hanabusa said Wednesday, referring to HART’s earlier estimate provided in May. “What could’ve possibly happened in that time?”

Morioka and Grabauskas both said they’ve never seen the double-digit percentage construction cost escalation affecting Honolulu and plaguing the island’s transit project. Morioka said HART factored future escalation into its budgets. Still, it remains unclear how the agency “missed the numbers,” as city Transportation Services Department Director Mike Formby put it, by more than $1 billion in such a short amount of time.

Grabauskas said projects across the island are similarly dealing with escalating prices in the island’s red-hot construction market. “It’s bad luck,” he said.

In 2012, HART estimated it would cost about $528 million to build rail’s final 5 miles or so to Ala Moana Center. In October, it estimated it would cost $702 million. In March, it estimated $866 million.

Now, Morioka said Wednesday, HART estimates it could cost as much as $1.5 billion to complete that same stretch.

“Every step along the way, we’ve missed the numbers,” Formby said Wednesday. “People ask us all the time — how does that happen?”

Rail’s final 5 miles represents the biggest “driver” pushing up project costs, Morioka said. Much of those added costs deal with utility-line clearance issues along Dillingham Boulevard. Additionally, the guideway’s foundations in that same area have to be drilled deeper, Morioka said Wednesday.

In West Oahu, the foundations had to be drilled only about 40 feet in the ground, but around Dillingham some of the foundations will have to be drilled more than 280 feet, Morioka told the board Wednesday. Several in the audience gasped. Morioka said he didn’t know exactly how the deeper shafts are affecting rail’s price — but it is a big reason why the project isn’t expected to finish until 2024, he said.

Options to reduce cost of rail project

FTA letter June 6 by Honolulu Star-Advertiser