HART to pay additional $7 million delay claim

HART to pay additional $7 million delay claim

KAPOLEI, OAHU (HawaiiNewsNow) - The HART board met today for the first time since the rail construction has been placed on hold.  The board plans to comply with the state Supreme Court ruling but is also looking at ways around the work stoppage.

The board is somewhat limited on what it can do.  The State Supreme Court said the city violated administrative rules.  One option could be to try to change the rules now after the fact.

The HART board heard an update on the ruling that prompted construction to stop when they broke up the search for ancestral bones on the rail route into four segments rather than studying the whole 20 miles first.  But the board went behind closed doors to keep strategies secret.  When it came out the board chair read a statement.

"The board is fully committed to moving the project forward as required by our charter in a manner that is responsible to taxpayers and respectful of our cultural resources," said Carrie Okinaga, HART Board Chair.

Delays were a common theme of the meeting before that point.  The board approved paying Kiewit Construction an additional $7.2 million, or 12 percent of the $60 million bid, for a delay from last year.  Taxpayers have now spent more than $22 million in delay claims to Kiewit.  That's not including the millions more from the current delay in construction.

"It was best to settle on what we could and that was the result on the $7.2 million. For those other items we still are at issue," said Lorenzo Garrido, HART Assistant Project Officer, to the board.

It begs the question, why the construction contract was awarded to Kiewit back in November 2009 knowing there was a possibility for delays because permits, access and approvals were still not in place.

"I'm not here to second guess what decisions were made in the past several years.  But those are the issues that are now confronting the staff currently," said Dan Grabauskas, HART CEO, to the board.

As of the latest progress report only 2 percent of construction is complete.  The city projected having 4.5 percent done at this point.  Also 32 percent of the design work is finished.  Each month delay is estimated to cost $10 million.  Still it's unknown if that money will go to pay construction workers or if they'll collect unemployment.

"When they give us some direction we'll have a better sense. Right now we don't have a sense," said Lance Wilhelm, Kiewit Building Group.

That direction clearly didn't come in the public portion of the HART meeting.

Board Chairwoman Carrie Okinaga issued the following statement following today's meeting of the Board of Directors of the Honolulu Authority for Rapid Transportation

(HART): The State and the City followed the State Historic Preservation Division's long]standing interpretation of its rules to allow the subsurface AIS work to proceed by sections. The lower court agreed with that interpretation. The Supreme Court disagreed with this interpretation and past practice. They ruled that we should complete the AIS work for all four sections of the project.

The HART Board is committed to fully comply with the Supreme Court ruling. The AIS work has already been completed in construction sections 1 and 2 and the AIS work in sections 3 and 4 will continue.

We were pleased to hear that the Supreme Court ruled that the City and State gave full consideration to cultural and historic values and that the court upheld the rail project's Environmental Impact Statement under State law.

We remain fully committed to moving the project forward as well as being in full compliance with all laws. The delay in construction will add costs, however we do have contingency funds to cover these costs.

The Board is fully committed to moving the project forward as required by our charter in a manner that is responsible to taxpayers and respectful of our cultural resources. The Board has directed the CEO to fully comply with the Supreme Court ruling and take the necessary steps to complete the AIS, including design and engineering.

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