Honolulu rail board approves ‘public-private partnership’ plan for project’s last segment

The Honolulu rail authority today officially approved plans to use a “public-private partnership” approach to develop the last segment of the 20-mile Honolulu rail line and the planned Pearl Highlands Transit Center, which together are expected to cost about $1.4 billion to build.

The so-called “P3” plan calls for the Honolulu Authority for Rapid Transportation to solicit proposals from developers who will finance, design and build the new facilities as well as operate and maintain the entire rail system from Kapolei to Ala Moana for 30 years. In all, that work is expected to cost the city many billions of dollars over the life of the contract.

Mayor Kirk Caldwell, who supports the P3 plan, has said the hope is that developers will offer to build the last four miles of the rail line at a bargain price with an aim to secure the contract to operate the rail line for decades to come.

The rail project has incurred huge cost overruns in recent years.

The city signed an agreement with the Federal Transit Administration in 2012 that called for rail’s elevated guideway and 21 stations to be built for $5.26 billion, and to be completed in 2020. However, construction and financing of the project is now expected to total about $9 billion, and HART says the project won’t be finished until late 2025.

The FTA committed $1.55 billion in federal funding to help Honolulu build the rail line, but has withheld $744 million of that money while HART has struggled to manage rail cost overruns and schedule delays.

The FTA is demanding that HART submit a revised “recovery plan” by Nov. 20 that spells out how it will complete the rail line from Kapolei to Ala Moana, which is the largest public works project in state history.

The P3 plan is a key piece of that recovery plan, according to HART Executive Director Andy Robbins.