HART committee tentatively settles $7.5M delay claim

A Honolulu Authority for Rapid Transportation board committee Thursday recommended approval of a $7.5 million change order to settle a delay claim made by the company hired to build the rail project’s three Waipahu stations.

The recommendation, made by HART’s newly formed Executive Matters Committee, will get a final vote before the full board Jan. 17.

The committee met behind closed doors for nearly two hours discussing the issue. Committee Chairman Damien Kim, who also chairs the full HART board, said the panel spent much of the time discussing its authority and duties because it was meeting for the first time. The committee was set up to deal with urgent issues in a “fast response” manner, but in this case, attorneys decided the full board should have the final say, Kim said.

Details of the settlement won’t be disclosed until the Jan. 17 meeting. But Kim said $7.5 million is the amount agreed to between attorneys for HART and contractor Hawaiian Dredging Construction Co.

The project is three months behind, according to HART’s November progress report. “Substantial completion” of the contract was originally slated to be reached this month, but rail officials now project that will occur in April, HART documents said.

Hawaiian Dredging was first given a $78.9 million contract in May 2015, but the project’s price tag rose to $82.3 million due to change orders, HART documents said.

While the $7.5 million will be tacked onto the $78.9 million amount to be paid to Hawaiian Dredging, the additional money for the change order is being covered by an allocated contingency account and will not add to HART’s $8.2 billion price tag, rail officials said.

The contract involves construction of the rail stations at West Loch, Waipahu Transit Center and Leeward Community College, HART documents said. Also included are ancillary operational buildings as well a traction power substation and kiss-and-ride parking lot at the West Loch station near Leoku Street and the Waipahu Don Quijote store.

Nan Inc., second-lowest bidder for the contract, unsuccessfully challenged the award with the state Department of Commerce and Consumer Affairs.

Further delay also may have been the result of HART’s decision to break up the contract for nine West Oahu stations into three separate contracts, Kim said.

The delay claim is one of several that have come before the HART board in recent months.