Details of Honolulu’s rail P3 plan remain concealed

Details of negotiations between city officials and potential third-party entities that would help construct and operate the struggling $9.2 billion rail project remain shrouded in mystery, even to members of the Honolulu Authority for Rapid Transportation, who sought to get some answers Thursday.

“I don’t know if I can give you a definitive estimate,” HART Chief Executive Officer Andrew Robbins told the board at a meeting Thursday when asked by one board member if the panel could get at least a ballpark estimate on when a decision would be made whether to select a partner or revert back to a model that would have the city finish construction and maintain operations on its own.

“My sincere hope is to get an award as soon as possible,” Robbins said.

As he’s done with news media queries, Robbins cited procurement laws that require secrecy during the process in order to ensure a fair selection.

Even a discussion on that process was held by Robbins and the board in executive session outside public view and scrutiny.

The public-private partnership is supposed to help ensure the financial burden shouldered by the city and its taxpayers is minimized to no more than about $1.4 billion. Last month, HART announced that two or three proposals were received by a July 23 deadline and deemed acceptable and under consideration.

Robbins also noted that the procurement decision is to be made jointly by HART, the semi-independent agency tasked with building the rail project, and the city’s chief procurement officer. The Department of Transportation Services, headed by a director appointed by the mayor, is tasked with operating and maintaining the rail line when it begins operations.

While Robbins declined to tell the board when to expect a decision on the contract, a letter recently sent by Federal Transit Administration Regional Administrator Raymond Tellis suggests that HART expects it to happen by the end of the month.

“During our virtual meeting on June 18th, you indicated that HART intends to complete the contract award by the end of August 2020,” Tellis wrote.

Tellis’ letter to Robbins last week said that the FTA is now giving HART four additional months, until Dec. 31, to determine how it will fund the final construction phase. The letter said HART has to show “satisfactory project progress” on an approved recovery plan that’s supposed to address how the city is to meet the project’s escalating price tag.

HART was supposed to have that done by Sept. 30 or risk having $250 million in federal funding lapse. The money is part of a $744 million tranche of the FTA’s $1.55 billion share of the project that’s been withheld by federal officials until they are satisfied with the city’s plan to move forward.

The extension “will provide sufficient time to complete the grant award if HART completes the city center contract award by its target date,” Tellis said.

The allowable time for the city to obtain the money was already extended once, for a year dating back to September 2019.

It’s possible that public-private partnership proposals will be rejected by the city. If that’s the case, “at the end of the day, there is the opportunity to cancel, perhaps re-procure, what we have called the Plan B,” Robbins said. “There are … contingency plans in the event we have to look at the worst case as well … and we’re prepared for that.”

Also on Thursday, the board voted to create permitted interaction groups, or subcommittees, to investigate HART’s organizational structure and the board’s rules and policies.