A planned public school envisioned to be a “vertical” prototype for urban Honolulu areas near transit stations is on track to be built sooner rather than later as part of a Kakaako project with two residential apartment towers.

The Hawaii Housing Finance and Development Corp., a state agency facilitating affordable-housing development, was given the green light on May 11 by its board to negotiate an agreement with the state Department of Education for including a four-story elementary school as part of the first of two apartment towers to be built by a private developer on state land next to Mother Waldron Park.

Previously, it had not been determined whether the school would be part of the first tower or second tower in the long-delayed project known as 690 Pohukaina.

“It’s on track to move forward,” said Lindsay Chambers, a DOE spokeswoman.

DOE has been working on adding an elementary school in Kakaako for several years to avoid overtaxing existing schools in the area as more people move into the urban neighborhood that has been undergoing a condominium tower development boom over the last few years.

One of the keys to moving ahead with a school at 690 Pohukaina, a site that was home to a public school decades ago, was funding obtained by DOE.

State lawmakers this year approved $16 million that can be used for planning and design work, producing an environmental assessment and some construction that could include infrastructure development for the school, which is expected to be in a four-story building next to the initial 690 Pohukaina tower.

The total cost of the school, which would serve 750 students, has been estimated at $40 million. DOE would have until the end of next year’s Legislative session to secure the balance, and if that isn’t accomplished then an agreement to build the school in the first tower could be terminated.

Of the $16 million, $6 million for design work lapses at the end of next year, so there is some urgency to move forward.

HHFDC anticipates being able to execute a development agreement with Alaka‘i Development LLC for the initial tower by October, followed by pre-development and permitting work. Construction is projected to begin in late 2019 and finish in late 2021.

Alaka‘i was selected by HHFDC last year to develop the first tower, and the company will build the school for DOE. Alaka‘i will lease the land for 75 years at $1 a year but will pay a premium upfront for the appraised market value of such a lease on the land, which is owned by the state Department of Land and Natural Resources but is being set aside for HHFDC.

The 400-foot tower is estimated to cost $300 million and is slated to have 390 apartments, of which 60 percent, or 234 units, will be reserved for households earning up to 140 percent of Honolulu’s median income at monthly rents ranging from $2,257 for a studio to $3,343 for a three-bedroom unit. This income limit translates to $98,560 for a single person, $112,560 for a couple or $140,700 for a family of four.

A second tower with 200 apartments will serve low-income residents who make no more than 60 percent of the median income. This translates to $42,240 for a single person, $48,240 for a couple or $60,300 for a family of four. Monthly rents in the second tower would range from $1,056 for a studio to $1,568 for a three-bedroom unit.

A development timetable for the second tower has not been determined. HHFDC plans to issue a request for proposals to build the second tower, which is expected to be financed largely through a combination of public money that could include loans, bonds and tax credits issued by the agency.

The 690 Pohukaina project under HHFDC is a rebirth of a previously stalled initiative announced in 2011 by then-Gov. Neil Abercrombie to produce affordable housing. Another state agency, the Hawaii Community Development Authority, had issued a request for proposals to develop the same site and in 2013 selected a plan for 804 rental apartments by Ohio-based Forest City Realty Trust.

Forest City’s plan was bogged down by lease negotiations and the effort by DOE to include a school. Forest City was agreeable to the addition but HCDA said such a change would violate competitive bidding procurement rules. HHFDC took control last year, and Hawaii executives of Forest City formed Alaka‘i to continue working on the project.

“It’s a really terrific project,” said Jon Wallenstrom, a principal with Alaka‘i Development. “We are excited to be providing a school in a new format to the people of Hawaii.”