There was little aloha between the head of the city’s troubled rail project and Mayor Kirk Caldwell on Thursday, with Caldwell calling on the rail project’s governing board “to step it up and put the heat on the CEO” on Thursday.
Thursday’s special meeting of the Honolulu Authority for Rapid Transportation’s board of directors represented another extraordinary development for Hawaii’s largest public works project that just last month saw a failed attempt to oust HART’s CEO and executive director, Andrew Robbins.
The failed effort was followed a day later by Caldwell announcing on Sept. 25 that the city no longer would participate in the more than two-year-long effort to find a builder to finish the final 4.16-mile rail segment into Ala Moana using a so-called public, private partnership agreement that Caldwell says has been negotiated “in secret” with no noticeable results.
Caldwell said Thursday that the city’s action means any hopes of a so-called P3 agreement are dead, a formula that Caldwell calls “Triple P.”
Caldwell said, with Robbins at the head, the project “every step of the way has met with delay. Delay after delay after delay.”
The 20-mile, East Kapolei-to-Ala Moana line was originally projected to cost $5.3 billion and to be completed in 2019. The cost estimate now is between $9 billion and $10 billion and the target completion date is 2026. The rail is funded primarily through a general excise tax surcharge on Oahu and the statewide hotel room tax. Tax collections have dropped since the beginning of the pandemic.
The unpaid, volunteer board was clearly splintered following back-to-back presentations Thursday by Robbins and Caldwell on how to proceed.
Robbins wants to continue to pursue a P3 agreement and would like the city’s support in finalizing a plan. If not, Robbins told the HART board, he hopes to work with Honolulu’s next mayor. Caldwell’s term expires at the end of this year.
Robbins told the Honolulu Star-Advertiser after the meeting, “I would love to engage Mayor Caldwell. … But he’s shutting the door on that.”
HART faces a Dec. 31 deadline to present a plan to the Federal Transit Administration on how it expects to build the final segment of the rail project into Ala Moana.
Caldwell reiterated his position on Thursday that FTA officials are frustrated by the lack of a firm P3 plan, which could jeopardize millions of dollars in federal support if the Dec. 31 deadline is not met, FTA’s third extension on the issue.
“The FTA has made a hard stop of $250 million at end of year,” Caldwell told the HART board. “We will lose it.”
He repeatedly implored HART directors to pivot to a “Plan B” traditional design-build contract that’s been repeatedly used for prior rail phases — without the operating and maintenance agreements that would be included in a P3 contract for the the final segment.
“I think you need to step it up and put the heat on the CEO to address these concerns that remain unaddressed as we go through the remainder of this year,” Caldwell told the HART board.
Robbins told the Star- Advertiser that “P3 is just a term that’s thrown out as some exotic thing. It really is design build.”
Switching to a Plan B “automatically instills a delay in the process,” Robbins told the HART board.
He wants to “see if there’s a way to award this contract and, if not, we move on. I’m not saying P3 at any cost. I’m not saying that. I’m saying let the process play out.”
HART members expressed a range of positions and concerns in response.
Vice chairman Terrence Lee voiced confusion over two clearly different positions from Robbins and Caldwell on the board’s options — and hoped for more information on what has been a confidential P3 bid process unknown to even Caldwell, the City Council or HART board members.
“The challenge I have is: How do we make a decision when we’re faced to either believe what the city administration is saying or what Andy and his team are saying, which are obviously at odds with one another?” Lee said. “We’re effectively having to choose between one or the other and it’s not an informed decision per se, but rather who do you have more faith in in terms of your conclusion? I’m uncomfortable being in that position. … Before making that hard decision I want to exhaust every possibility to get information about this P3. … I believe there is a path forward.”
Caldwell was blunt in his reply to Lee.
“You don’t need to choose between HART and the city because the city isn’t there anymore,” Caldwell said. “The city has pulled out of this procurement. Simple as that. … The question you need to ask yourself as a board member, Terry, is: ‘Are you going to allow your CEO and executive director to control the Triple P procurement negotiation … and are you willing to bind HART?’ … Because we pulled out. This procurement is pau. There’s no choosing one side or the other. It’s done.”
Board member Glenn Nohara was clearly troubled that the board still has not received any written, legal advice on whether HART can legally continue to pursue a P3 agreement without the city.
“That’s kind of disturbing,” he said.
HART board chairman Tobias Martyn appeared clear in his direction. An original skeptic of the P3 concept more than two years ago, Martyn said, “It’s time to focus on Plan B, on the off-ramp, or whatever we want to call it.”
With the city withdrawing its support, HART board member Joe Uno declared, “As a practical matter, the P3 is dead.”
By continuing to negotiate a P3 agreement, without city support, Uno said, “we’re just inviting trouble. As a practical matter we really need to put it to bed.”
Board member Kathy Sokugawa suggested that the HART board needs to take an official stance — especially with Robbins’ future in doubt.
A day before Caldwell’s announcement that he had withdrawn the city’s support for a P3 plan, the HART board rejected the recommendation of its Human Resources Committee to tell Robbins that his contract would not be extended. His current, three-year contract expires Dec. 31 — the same day as the critical FTA deadline.
“It’s coming from the mayor, it’s coming from the City Council, it’s coming from Senate members,” Sokugawa said. “But most importantly, I think we owe it to Andy to know: Does his board back him or not? It’s important and we owe it to him to make a call on this. … We, as a board, need to weigh in and take a stand.”
Robbins told the Star- Advertiser that he hopes to continue to lead HART into 2021 and continue to shepherd the project.
“It’s been a great three years for me,” Robbins told the Star-Advertiser. “I have made it clear I would like to continue forward. … I have no other agenda than to do what its right for my project.”
Whatever happens, the actions of the past few weeks for the city’s rail project are likely to go down in history, said HART board member Michele Chun Brunngaber.
“I have no doubt that this specific PPP and this procurement will get written up by many program management analyst companies, like Gartner, as like almost a perfect example of how not to do a procurement right and especially how not to withdraw from a procurement,” she said. “HART’s now faced with this extraordinarily challenging and difficult problem.”