The Honolulu City Council today gave final approval to a bill to extend the 0.5 percent surcharge on Oahu for the state general excise tax to pay for the bulk of the contentious rail project.
Council members voted 7-2 to pass Bill 23 (2015), which extends the surcharge on Oahu for the excise tax on goods and services for five additional years through 2027. Council members Ann Kobayashi and Ikaika Anderson cast the “no” votes.
The bill allows the Honolulu Authority for Rapid Transportation to use up to $1.1 billion from the extended period to pay for the 20-mile, 21-stop line from East Kapolei to Ala Moana Center. The overall cost of the project is now estimated by HART to cost $6.57 billion, thus necessitating the extension of the surcharge. Critics say they expect costs for what is the largest public works project in Hawaii’s history to continue to climb.
HART and Mayor Kirk Caldwell initially sought an unlimited extension but the 2015 state Legislature, after much deliberation, chose to extend the surcharge only through 2027.
Council members have been discussing a cap of its own and passed one, of sorts. The bill’s language calls for $1.1 billion to be expended for the 20-mile segment. It then says any remaining revenues “may be expended … in the following order of priority:” contingency and other reserves required by the Federal Transit Administration as conditions of a $1.55 billion grant; disability accessibility improvements; planning and design costs for the rail line’s future segments; and “infrastructure improvements to rail station areas to support affordable housing, as permitted by state and federal law.”
The bill also requires additional reports by HART be given to the Council, including quarterly cash counts.
HART Chief Executive Officer Dan Grabauskas told Council members, during questioning, that both FTA officials and HART staff are OK with the final language of the bill.