Editorial: Auditor will need more HART info

The relationship between state lawmakers and officials overseeing the construction of the city’s rail project has been anything but filled with warmth and trust. The general public also has vented its frustration about the fiscally troubled enterprise, now estimated to cost nearly $9 billion.

There are lots of reasons for that but, spinning this saga forward, Honolulu has now reached the point at which replenishing the coffers of goodwill is crucial, especially at this sensitive juncture.

The audit of the project, now underway, is a viable route for providing clarity about what problems have caused costs to escalate radically, and transparency about the way construction funding has been managed.

Both are necessary to rebuild public trust. That’s essentially why legislators mandated the inquiry from the Office of the Auditor as part of the financial rescue package approved in a special session last year.

State lawmakers drove a hard bargain over extending Oahu’s general excise tax (GET) surcharge and increasing the transient accommodations tax to generate more revenue to overcome a project shortfall. Ultimately it was the right decision given the importance of the project and the state’s own stake in its success.

However, it is a project authorized by Honolulu voters, so the Legislature rightly sought to draw a bright line limiting the burden on state tax sources. Ordering the audit was part of maintaining that due diligence.

In the interim there have been other problems. The Federal Transit Administration has withheld the balance of its $1.55 billion grant until it sees a revised financial plan accounting for all expenses.

Because lawmakers insisted that the city cover project administrative costs out of its own funds, the rescue plan had a $44 million hole in it that the City Council finally filled last week. It represents a reversal of policy barring the use of city general funds for the project, which was to have been financed through the dedicated GET surcharge.

Mayor Kirk Caldwell signed that bill Thursday, but not without more hand-wringing over precisely where to dig up $44 million. There was also more bickering between the mayor and his political foe, City Councilman Trevor Ozawa, over how the matter has been handled in Council chambers.

This political back-and-forth is tiresome. This is a critical issue, and the FTA seems unlikely to waver on its Nov. 20 deadline to get things signed and sealed. Time is of the essence to resolve this mess and move on.

The decision on how to close the gap is due Monday. The best option remains the one the Council proposed: diverting cash from the city’s rainy-day fund and other sources. This will avoid the extra expense of financing charges that bond financing, the option preferred by Caldwell, would incur. Council should move promptly to finalize the plan and get the federal funding secured at last.

The Honolulu Authority for Rapid Transportation (HART), meanwhile, should be more forthcoming with information sought by state Auditor Les Kondo.

Kondo has asserted that the authority took months to respond to some inquiries, which cut into the time the auditor has for analysis, citing two cases in which specific documents could not be found.

Bill Brennan, spokesman for HART, responded that the agency has done its best to locate and turn over what’s been sought. And, although he acknowledged a small percentage of documents remain outstanding, the aim has been to “cooperate fully.”

“We’ve provided thousands of pages of material, physical proximity to staff, access to all of HART’s systems,” he added. “To portray HART as denying information is off-base.”

However, there is a simmering dispute over access to the HART board’s unredacted minutes from its executive sessions. Chairman Damien Kim has said, on advice from corporation counsel, that the board decided to withhold these due to the confidential nature of some of the content.

Kondo has countered that this is unusual in the conduct of an audit, adding that private matters can be redacted from the final report at the request of the agency.

Further, he has complained that HART’s policy of having its own recordings of interviews conducted for the audit is intimidating staffers from making full disclosures. In fact, Brennan said, the only aim is for the agency to have a record of what was asked and answered.

At the end of the day, more disclosure — including the board’s executive session records — is needed. It would yield a more comprehensive audit report for lawmakers, which would go a long way toward smoothing a rocky relationship. And, most importantly, for providing some needed insights on the project’s escalating costs.

The audit was a legislative mandate, Kondo has a job to do — and taxpayers want him to do it, especially on something this consequential.