Firm appeals rejection of its protest over bid

Dennis Oda / doda@staradvertiser.com
The elevated guideway for Oahu’s rail line arches across east Kapolei. Principals and employees for 145 known subcontractors for the rail system have made nearly a quarter-million dollars in political donations to Mayor Kirk Caldwell over the past five years

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Honolulu’s rail project faces a new challenge against its construction bid process, and the officials overseeing the project say this latest bid protest could create a ripple effect that might delay the project’s completion and opening.

The latest protest comes from Nan Inc., which in March had submitted the second-lowest bid to build three West Oahu stations, at Leeward Community College, Waipahu and West Loch, for $85.1 million.

The lowest bid, from Hawaiian Dredging Construction Co., was $78.9 million. Nan is arguing that Hawaiian Dredging’s bid should be ineligible.

In a March 9 letter to rail officials, Nan asserts that Hawaiian Dredging, in crafting its low bid, did not list properly licensed subcontractors, and that its estimated costs for compensation in the event of a delay were "unreasonable, unrealistic and false."

Earlier this month Honolulu Authority for Rapid Transportation Executive Dan Grabauskas rejected Nan’s protest. On April 20, Nan appealed to the state’s Department of Commerce and Consumer Affairs.

The DCCA has 45 days from that filing to respond, and that means HART will have to wait at least 2 1⁄2 months longer than expected to issue the award for those stations, Grabauskas said. Officials will have to hope that whoever ultimately gets the work contract will be able to make up that lost time, or the overall schedule could get pushed back and the transit system could face delays in opening, he added.

"The big fear, you know, in this process is that every one of these contracts that we’ll be putting out, we have a very tight schedule to meet the schedule that we’ve got, and every time there are protests, that makes impacts on the schedule," Grabauskas said Thursday.

Nan filed a protest last year when HART canceled its previous bid to build nine West Oahu stations, which included the three in the bid now at issue, when all of the bids came in significantly over budget. Nan eventually opted to cancel that protest.

Rail officials have said that they learned in talks with construction firms after last year’s bids came in too low that "time compression" helped drive up the bids. In other words, giving the firms more time to build the stations would help to drive down the bid costs.