POSTED: 03:32 p.m. HST, Jun 06, 2012
LAST UPDATED: 05:07 p.m. HST, Jun 06, 2012
The Honolulu Authority for Rapid Transit will have the ability to tap up to $450 million via low-interest city loans under a bill passed by the City Council today.
The Council voted 7-2 to approve Bill 37 after more than three hours of testimony and debate.
Members Tom Berg and Ann Kobayashi voted against the bill. Members Romy Cachola and Tulsi Gabbard voted yes with reservations.
The bill allows the city to borrow up to $450 million for the $5.27 billion rail project using commercial paper, or short-term debt sold on financial markets.
Kobayashi and Berg led the charge in grilling HART and city officials about the need for the bill. Kobayashi questioned how the city could give HART the ability to tap the money when it has no plan on how it would pay it back.
HART chief executive Dan Grabauskas said the agency is being asked to provide the OK by the Federal Transit Administration before it will commit $1.55 billion for the project.
Grabauskas said HART does not intend to use commercial paper bonds, and stressed that the agency would need to get a two-third approval from the Council before being able to use such funding.
Grabauskas also said the Council would be involved in planning how the city would be reimbursed by HART should it need to tap the money.