New $6.5B price tag for rail said to be more 'realistic'

New $6.5B price tag for rail said to be more ‘realistic’

HONOLULU (HawaiiNewsNow) - Honolulu rail officials are projecting more cost overruns and a nearly two-year delay of the 20-mile driver-less rail system that would operate from Kapolei to Ala Moana Shopping Center.

The data, revealed in an outline of a new financial plan at Thursday's Honolulu Authority for Rapid Transportation board of directors meeting, now brings the total cost projections for rail to roughly $6.5 billion.

In December 2014, the estimate was $5.8 billion.

Meanwhile, the project is now expected to be completed in the fourth quarter of 2021; officials originally thought the project would wrap up in the first quarter of 2020.

HART officials told the board they are running the numbers with the most accurate and "realistic" data they can in order to account for the recent rising construction costs and fewer GET revenues.

The new data included higher estimates to account for rising construction costs and financial charges, as well as for additional utility relocation, traffic signal improvements and rail station escalators.

It also includes $299 million in "unallocated contingency" costs to be figured in, on top of the project's current "allocated contingency" costs.

The unallocated contingency funds are required by the FTA to account for a sort of "cushion" of contingency costs that could arise. The FTA wants to see a clear plan in place to address unforeseen costs and revenue shortfalls as it doles out most of the funds to support Oahu's largest infrastructure project to date.

Mike Formby, director of the city's Department of Transportation Services and a HART Board member, said the board will seek more details and ask for more clarity regarding the numbers over the next month.

"As the DTS Director sitting on the Board, I am extremely concerned yet encouraged," said Formby. "Concerned because the numbers have increased twice since the legislative session, yet encouraged that HART, in response to demands from the mayor, board and FTA [Federal Transit Administration], is finally presenting realistic numbers and dates and as a board member, I intend to hold their feet to the fire."

Formby continued, "The mayor and DTS will insist that HART continue to answer questions and manage down and backwards from the numbers and dates presented yesterday."

The new projections come as rail officials prepare to convince lawmakers and the governor to approve a five-year extension of the general excise tax surcharge for rail of .5 percent thru 2027.

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