The question of halting the city’s troubled rail project at Middle Street — rather than pushing forward to Ala Moana Center — was advocated before the rail board’s directors Friday after members were told that cost-cutting efforts still will leave rail 80% short of plugging its $3.5 billion deficit.

Board member Joe Uno quoted the Honolulu Authority for Rapid Transportation’s own plans calling its Lagoon Drive station “the most practical location to transfer to and efficiently route connecting rail access services.”

“Let’s consider this carefully, because we already have a plan to provide a multimodal mass transit system embedded in our current operating plan,” Uno said. “Stopping at Middle Street does not necessarily render the investment we’ve already made useless. It actually enhances the dividends from the money.

“Searching for another $3.6 billion and a decade of time, what could the city use that money for otherwise?” Uno asked. “Fixing roads and bridges and addressing homelessness and bringing broad band access to the city? Paying our city employees better? We might be able to pay down some of our unfunded liabilities that threaten to bankrupt us, and we can pay our fire and police and EMTs adequately so that they don’t leave us.”

Uno first called for an unspecified “Plan C” for rail in the Honolulu Star-Advertiser; has since challenged the idea that the city will have to repay the Federal Transit Administration as much as $800 million if it does not build to Ala Moana Center, the state’s largest transit hub; and more recently has said that even paying back the federal government makes more sense than struggling to come up with more than $3 billion that HART has no easy way to find.

Fellow board member Natalie Iwasa, a certified public accountant and certified fraud examiner, restated rail’s original promise to take riders from East Kapolei to the University of Hawaii.

“When we were told about rail back in 2006, it was projected to cost $2.6 billion to go all the way to UH,” Iwasa said. “And now we’re looking at a current shortfall, which is in excess of that original cost, of $3.5 or $3.6 billion.”

Current plans to build the 20-mile, 21-station project have now ballooned to $12.499 billion; it is scheduled for completion in March 2031.

“I just want to express my concern that building rail all the way to Ala Moana at any and all cost is just simply not reasonable, nor is it fiscally responsible,” Iwasa said. “Somewhere along the line, other alternatives should be reviewed and discussed publicly so that we make the best multimodal transportation project that we can within the resources that we have. … Somewhere along the line, somebody needs to really evaluate where we’re at and where we’re going.”

Acting board Chairman Hoyt Zia ended the more than five-hour meeting by saying that board members’ views do not represent the entire board and that quoting from “long documents can be misconstrued.”

No proposal resulted from the discussion, and Uno told the Star-Advertiser that whether to stop the project at Middle Street is up to the City Council.

“I hope they do take it up after they understand that this bogeyman of an FFGA (Full Funding Grant Agreement with the FTA) refund is just that,” Uno told the Star-Advertiser. “I think it’s false, and it’s unfortunate that board members continue to trot this out.”

The HART board received even more bad news Friday: The contractor connecting prefabricated overhead train guideways for the West Oahu portion let “tensioning wires” rust and corrode by failing to grout them in in an unspecified “timely manner,” according to Steve Cayetano, HART’s construction director. The new policy for eastbound construction is to grout tensioning wires within two weeks, Cayetano said.

The so-called tendons run horizontally through each prefabricated segment to connect them and help shoulder the load of the guideway, trains and passengers.

The information about the rust and corrosion was included in a board presentation Friday titled “Lessons Learned” from the West Oahu construction. Uno — who runs an engineering firm bearing his name — was visibly concerned.

“That post-tensioning grouting — that sounds like that could be a real issue if the tendons were allowed to develop any rusting before they were grouted,” Uno told Cayetano. “That’s significant, not just a lesson learned for design and construction going eastward.”

He called rust and corrosion on tensioning wires “a very scary thing. … Replacing a cable in this particular structure, I think, is near impossible.”

Cayetano said the contractor will use acoustic monitoring technology used “throughout the world” to search for damage.

Jade Butay appeared irritated at the brevity of the “Lessons Learned” presentation overall.

“Slides are presented here as the lessons that have been learned on a $12 billion project,” Butay told Cayetano. “The last I checked, the project is grossly over budget and behind schedule. So I find the list woefully inadequate and, frankly, unacceptable. I mean, the people of the city and county, if not the state, deserve to not repeat the mistakes made on this project. I think the lessons learned should be captured in a more formal and much more robust documents to ensure that the message of these lessons is conveyed to both the airport guideway contractor and the City Center guideway contractor, whenever that part of the project is continued. … This ‘Lessons Learned’ seems very light.”

Lori Kahikina, HART’s new interim CEO and executive director, earlier told the board that she had dismissed 48 of HART’s 112 employees, with the caveat that some may have to be rehired “as work dictates.”

She also “drastically” reduced an unspecified number of HART contractors who were “part of some of the inefficiences and redundancies that we found.”

The cost savings are still being calculated, but Kahi­kina said reducing payroll and contractors should result in annual savings of anywhere from $10 million to $38 million.

Plans to avoid putting some underground utility lines along crowded Dillingham Boulevard by moving the guideway farther makai also will result in savings, Kahikina said.

But none of the plans, including long-shot hopes of getting more financial support, will not come close to making up the $3.5 billion shortfall, Kahikina said.

Rick Keene, HART’s deputy executive director and chief operating officer, said personnel savings and moving the guideway makai down Dillingham Boulevard could possibly come up with 20% of the $3.5 billion shortfall, while still leaving a whopping 80% of the way to go.

“It’s going to be hard to close the whole thing,” he said. “We’ve got our work cut out for us.”

During Friday’s hearing, Lynn McCrory, the board’s Human Resources Committee chairwoman, reported that Kahikina met or exceeded expectations during her first quarterly review of four issues, but offered no details of the evaluation.

Kahikina was evaluated on her interaction with the board, external relationships, internal relationships and general management and will be evaluated again for her performance in the current quarter.

Kahikina has said she wants the permanent job. Her predecessor, Andrew Robbins, did not have his three-year contract renewed at the end of the year after serving as the city’s highest-paid employee.

McCrory said of Kahikina:

“HART is undergoing a cultural change which readily identifies problems and then works on solutions, and Lori is an open, strong and focused leader. And, as we all know, there is always room for improvement as she goes forward in her second quarter as the interim executive director/CEO of HART.”