The half-percent excise tax surcharge levied on Oahu residents and visitors has brought in more than $810 million so far to fund the Honolulu rail project, with collections continuing to run ahead of projections, the Honolulu Authority for Rapid Transportation said Monday.
HART received $49.02 million in general excise tax revenue for the three months ending on Dec. 31, which was $12.08 million more than projected in the financial plan for the rail project.
The half-percent excise surcharge took effect in January 2007, and is set to expire at the end of 2022. In all, the tax surcharge is expected to provide more than $3.15 billion for the 20-mile rail project, which is projected to cost $5.27 billion.
The rest of the funding for rail is supposed to come from the federal government. The city is seeking up to $1.55 billion in New Starts construction funding from the Federal Transit Administration and hopes to secure a final commitment for that funding this fall.
Another $244 million for the rail project is being sought through federal Urbanized Area Formula Funding grants.
HART officials said it was the third consecutive quarter that excise tax collections have topped the city’s current projections.
"The additional surcharge revenue is good news for the rail project," said Toru Hamayasu, HART interim executive director and chief executive officer. "This strong revenue pattern positions us well to bring the project in on time and on budget, and shows we will be able to pay for the project with the GET surcharge and federal funds."
HART Finance Committee Chairman Don Horner said the city has collected about one-fourth of the total excise tax revenue it needs for the rail project.
"WE remain ahead of projected revenues. And, to date, HART has contracted 50 percent of our total construction costs and is $300 million below our planned expenses," Horner said in a written statement released by HART. "HART remains on track in terms of both revenues and costs."
In 2009 the city had hoped to collect more than $3.5 billion in excise tax surcharge revenues for the rail project, but projections had to be revised downward in recent years as the economy weakened.
The excise tax is generally seen as a good indicator of overall business activity, and increasing collections for the past three quarters suggest a general strengthening of the Hawaii economy.
