City Council approves tax surcharge extension for Honolulu rail project

Published: Jan. 28, 2016 at 2:55 AM HST|Updated: Jan. 28, 2016 at 10:49 AM HST
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Dan Grabauskas
Dan Grabauskas
Council Chair Ernie Martin
Council Chair Ernie Martin

HONOLULU (HawaiiNewsNow) - The Honolulu City Council Wednesday voted to extend the rail tax surcharge another five years but not before placing some conditions on the project.

The measure, which was approved by a 7-to-2 vote, caps the Honolulu Authority for Rapid Transportation's take from the 0.5 percent general excise tax surcharge extension at $1.1 billion. It also requires the remaining money generated by the tax extension to go into the project's contingency and reserve funds and to pay for disability access improvements. HART also must provide quarterly financial reports to the council.

"What I think ultimately came out of this was a bill that gives us restrictions, requires a lot of reporting by Hart but gives us the money to put the financial plan together," said Hart CEO Dan Grabauskas.  "We're very thankful that we can move the process forward with the funding in place."

Council members said a cap was needed to help reign in escalating costs.

"The concern is that will there be further shortfalls that are going to be so significant that it just makes it so unbearable with respect to continuing to finance the cost," said Council Chair Ernie Martin.

Councilmember Ikaika Anderson voted against the bill because he doesn't like the idea of a cap.

"We have already heard from Hart that we are short on funding.  I don't see why we should cap the money that is being generate by the GET surcharge extension knowing full well that we may have to reach the taxpayer for additional monies," said Anderson.

To curb those costs, Anderson says he wants even more council oversight.  He plans propose a bill requiring City Council approval on all construction contract amendments, or change orders of anywhere from $500,000 to $1 million or more.

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