There’s another audit out on rail. It’s just as bad as the other ones

(Hawaii News Now)
Updated: Jan. 18, 2019 at 1:03 PM HST
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HONOLULU (HawaiiNewsNow) - If you’re keeping count, three audits on Honolulu’s $9 billion rail project have been released this month.

Two came from the state auditor — and there are two more to come — and the city released its own.

The one thing they share: All of them fault rail officials for missteps that led to project costs ballooning 80 percent from the original estimate of $5.1 billion.

The latest audit, the city auditor’s look at the project from its inception to June 2016, blames “inexperienced” managers and contractors for approving a “plethora” of change orders that increased costs and led to delays.

The scope of those change orders and contract amendments is tough to wrap your head around: Some 648 were approved from fiscal years 2008 to 2016.

And they resulted in $488 million in additional costs.

[Read more: Blistering audit blames political rush to construction for ballooning rail costs]

[Read more: Audit: 18 rail consultants paid average of $500,000 a year in salaries, overhead]

“According to experienced project managers and consultants, the number of contracts, change orders, and amendments were excessive, particularly since contract amendments and change orders represent one of the highest risks,” the city audit concluded.

Auditors even sampled change orders to get a feel for whether they were properly reviewed. Spoiler: They weren’t.

An analysis of 271 change orders and contract amendments found that more than half weren’t substantiated or lacked supporting documentation. Many were deemed “questionable.”

Auditors also calculated that change orders in three construction contracts added 2,246 days to the project schedule.

And they found that HART violated state procurement laws 18 times, making after-the-fact payments to contractors totaling $4.5 million.

The city does acknowledge that the Honolulu Authority for Rapid Transportation has made key improvements, many of which were based on previous audits.

But the city auditor says those improvements aren’t enough to avoid more significant problems.

The most glaring problem, according to the audit, HART is still relying too much on costly outside consultants and not doing enough to develop its own staff.

And despite HART’s efforts to address shortfalls, the city audit ends on this ominous note: “Unfortunately, current HART staffing and other policies and practices are inadequate to prevent cost overruns and schedule delays from recurring.”

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