City pulls out of bidding process to finish, operate rail system

City pulls out of procurement for public-private partnership to build rail’s final leg

HONOLULU, Hawaii (HawaiiNewsNow) - In what could prove another major blow to Honolulu’s troubled rail project, the city has abandoned its participation in the procurement of a public-private partnership for the rail line’s final leg — leaving it up to the rail authority whether to proceed with the contract.

Honolulu Mayor Kirk Caldwell announced Friday afternoon that he’d notified the Federal Transit Administration of the city’s decision to “conclude its participation” in procurement for the contract.

It is up to the Honolulu Authority for Rapid Transportation to cancel the procurement for a public-private partnership — something HART CEO Andrew Robbins said Friday he was not doing.

The Honolulu rail authority has warned that canceling plans to pursue a public-private partnership to complete the project to Ala Moana would trigger delays of up to 18 months as other options are pursued.

Following the city’s withdrawal, Robbins said HART is weighing how to move forward.

Robbins added, “HART is very disappointed in the city’s decision to withdraw. World-class teams of developers and contractors stand ready to complete the project for the people of Honolulu. After nearly two years of detailed work ... HART does not consider it in the public interest to walk away at this point.”

The city and HART were partners in negotiating the public-private partnership because the winning developer would take over rail operations from the city for 30 years.

“I remain committed to the rail project and encourage HART to explore a more open and effective approach of continuing the construction to Ala Moana,” Caldwell said, in a statement.

“I hope to see the timely development of an alternative bid strategy, such as a more traditional design-build approach, so this important transportation infrastructure project can continue to move forward.”

The four-mile segment between Middle Street and Ala Moana Center is the most expensive and most complicated part of the rail project. That’s why the rail authority sought bids from private developers to build the rest of the guideway and stations and to operate the system for 30 years.

A contract for a private-public partnership — or P3 — was supposed to be awarded last year but it’s been pushed back several times. It’s budgeted at $1.4 billion, but builders have said the real cost is likely higher.

The city said that because the procurement hasn’t been canceled, bids are still confidential.

This story will be updated.

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