The City Council achieved two results by authorizing bonds for rail construction this week: The most compelling was to keep the work on track beyond January.
But the other was to turn up the pressure several notches on the Legislature, which up to this point has seemed unfazed by any countdown clock. Now it’s the state lawmakers’ turn to make a critical decision on the project’s longer-term future, and there isn’t much time left.
The bottom line is that continued inaction on this issue at the state Capitol could have unintended consequences for rail’s federal funding.
There’s no official deadline set by the Federal Transit Administration for the balance of the $1.55 billion subsidy for Honolulu’s 20-mile raised guideway system.
But there are at least some indications that the FTA may not wait beyond summer for the city and the Honolulu Authority for Rapid Transportation to correct the project’s deep funding shortfall. It’s too much money to be risked, even if it’s a relatively small part of the anticipated final cost, now estimated to reach around $10 billion.
Meanwhile, legislators demonstrate little sense of urgency about scheduling a special session, sooner rather than later, to resolve the problem.
Council members this week finally moved to lift the cloud of uncertainty at least for the near term. On Wednesday, the required six votes came through to authorize up to $350 million in city general obligation bonds. That loan will be on hand to cover contracts for building the system as far as Middle Street.
The 6-3 vote is a squeaker, and it came only after a session of the kind of frustrated hand-wringing taxpayers have come to expect from any discussion about this financially troubled project.
But a win is still a win, and this one was critical. The authorization sends the FTA a message of continued municipal support for finishing the project. And that’s a message that federal authorities need to hear, given the roller-coaster ride state lawmakers have given them over the past few months.
The public has to hope that legislators are having back-channel discussions now, and that an accord is near on how to settle the bitter dispute over authorizing additional financing for the rail.
These talks broke down last month in a spectacular failure of leadership. Competing ideas that were floated included raising the transient accommodations tax and giving the city the 10 percent “skim” the state had collected from the primary funding source, a half-percentage point surcharge on the general excise tax (GET).
The skim funding is simply insufficient, while a TAT increase for rail may siphon away too much from the tourism sector, with visitors already absorbing high costs.
The least problematic solution remains the same: The state should extend the authorization of the GET surcharge. The best proposal left on the table would have extended it for 10 years; something at least approaching that level of funding likely will be needed.
Lawmakers might have to contemplate coming back into session on or around July 11, which is when Gov. David Ige has to make final decisions on vetoes. If the Legislature hopes to combine a vote for rail funding with other business — such as overriding any vetoes — there’s only a fleeting few weeks left to hammer out some agreement.
Further, the governor doesn’t get to sit passively on the sidelines any more. Ige just signed a bill endorsing the Paris climate-change accord. Rail is projected to decrease the state’s carbon footprint by taking cars off the road, so if Ige wants to wave the environmental banner, he’s got to own this part of the mission, too.
The taxpayer can’t be left wondering what’s happening with the state’s largest-ever public works project. It’s time to commit — or explain why they won’t.
