Key airport projects delayed, costing more than expected

Key airport projects delayed, costing more than expected

HONOLULU (HawaiiNewsNow) - Some of the largest projects in an $800 million effort to upgrade Honolulu International Airport are already running a year or two behind schedule and are costing more than expected, a Hawaii News Now investigation has discovered.

When state airport officials originally announced the Honolulu airport projects in 2012, they said the work would be completed in 2017. Now it's not scheduled to be finished until the end of 2019, two years after the original completion estimate.

Jeff Chang, the state airports engineering manager said, "There are a lot of issues with the current airport. It's an old facility. So what we're trying to do in modernizing is make it more convenient for the public."

One of the big projects is already having a big effect on people who use HNL.

The Diamond Head side of the overseas parking structure, without about 1,000 parking stalls, is now cut off to the public, because that's where an interim car rental facility is being built.

Tierra Fethal, who had just parked in the overseas parking structure said, "There was no parking. I had to go all the way to the top. It was kind of confusing with all the construction and everything going on."

Temporary car rental offices are being constructed in the first floor of the Diamond Head side of the overseas parking garage. When the state went out to bid for the job it found the overall price went up by 11 percent from original estimates to about $31 million, because busy contractors are charging more.

"We're hitting the construction market that's saturated with projects," said Chang, the airports official. "So there are a lot of other projects going on in Kakaako, the rail and there's a finite amount of resources for construction locally so we're seeing a little higher prices."

Laura Ebesugawa, a Hawaiian Airlines passenger at HNL traveling home to Hilo said, "That's a lot of money they're going to be spending."

But no tax revenues are being used in the rental car project because it is being funded entirely by fees paid by rental car customers in Hawaii. Rent-a-car customers pay a $4.50-a-day facilities fee that is funding the construction.

The state plans to move rent-a-car companies from their existing site right next door to the interim facility so it can build a new five-story rental car facility where the rental operations are now.

Construction of the new centralized rental car building has been delayed by about two years. Now it isn't estimated to be completed until 2019 instead of 2017 and is expected to cost about $300 million.

Construction is scheduled finish in May for temporary facilities where rent-a-cars will be gassed up and vacuumed while the permanent building is being built. And a temporary car wash area is still being finished.

The gas and car wash buildings are costing about $7 million. The state plans to demolish them in just four years, once the rental car operations move next door to their new permanent digs.

Car rental customers aren't sure what to think about that.

Lee Hoomana, who travels to Oahu from Maui occasionally to visit friends and for medical appointments said, "That seems like double work. I'm glad I'm not on that planning committee to get this thing organized."

Chang, the airports engineer said, "There's really no way around this because it's a constrained site and we need a temporary facility to use when we're building the new facility. So we tried to put the minimum amount in that we could for the temporary facility and the users were OK with the amount of money we're spending on it and the fact that we have to tear it down in a couple years."

Chang said the interim car rental facility was delayed about one year because of a bid protest and difficulty in borrowing money for construction based on unpredictable rental car fees.

In a second major project, the state plans to build a new commuter terminal for Island Air and Mokulele Airlines, on the Diamond Head side of the overseas terminal.

The state said when it put the commuter terminal out to bid, the lowest bid came back at $41 million, about 14 percent above the initial cost estimate of $36 million.

So the state is cutting out parts of the project, in a process called "value engineering," and will put it out to bid a second time.

Chang said, "We were able to reduce the size of some of the terminal, the hold room, and the baggage claim area. Also the main ticket lobby area we were able to reconfigure to a different shape which will save money."

The new commuter terminal project has already been delayed a year before construction even begins, because of factors beyond the state's control. Airport officials said airlines kept changing what they wanted in the design and when billionaire Larry Ellison bought Island Air, the terminal had to be redesigned to accommodate his changes.

Delays in building the new commuter terminal have pushed back the start of construction on a new mauka concourse planned to replace the commuter terminal on the mountain side of the inter island terminal by about one year.

It's part of the snowball effect of one delay creating another in major new projects at an airport with limited space.

"It's an operating airport. We can't stop any of the traffic or the planes. We have to keep operating while all this construction is going on. So it is a real challenge, but we're trying to do the best we can," Chang said, "In the short term there is a lot of construction. There may be some inconvenience. But in the long term, they will end up with a nicer facility, more modern, more services and also a better look."

The money to fund the new terminals does not come from tax dollars but from airport user fees, paid for by airlines in landing fees and facility rentals, as well as parking, food and retail concession revenues.

The state has 159 projects at airports statewide costing $2.7 billion over a nine-year period from 2010 to 2019.

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