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Budget committee votes to extend rail tax surcharge by 5 years

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A view of the progress of the construction of the rail transit project on Oct. 16 along Kualakai Parkway in Kapolei.

The Honolulu City Council Budget Committee gave preliminary approval to a bill that would extend Oahu’s 0.5 percent surcharge on the general excise tax through 2027 to help pay for the $6.57 billion rail project. 

The vote was 4-1 with Budget Chairwoman Ann Kobayashi casting lone vote opposing the bill. Councilwoman Carol Fukunaga voted yes “with reservations.” 

The measure is now slated to be taken up at the Council’s Dec. 9 meeting, where all nine Council members will consider giving it the second of three needed approvals. If approved there, it would return to the Budget Committee for another go-around before returning to the Council again for a final vote. 

Honolulu Authority for Rail Transportation officials say without the extension, the 20-mile, 21-station line from East Kapolei to Ala Moana Center cannot be completed. 

Federal Transportation Administration chief Therese McMillan last week told Mayor Kirk Caldwell that her agency is withholding $250 million in federal funds for the project until assurances can be obtained that there will be money available to finish the project. 

The $250 million is part of $1.55 billion that the FTA promised to the city under a federal Full Funding Grant Agreement. 

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