In stern letter, federal agency sets deadline for suitable financial plan for rail project

In stern letter, federal agency sets deadline for suitable financial plan for rail project
Published: Sep. 25, 2018 at 10:26 AM HST
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HONOLULU (HawaiiNewsNow) - The federal government is warning rail authorities that the agency is running out of patience with delays in the new financial plan for the rail system.

Mayor Kirk Caldwell plans to hold a news conference on Tuesday morning to discuss the demands.

In a letter Friday, Federal Transit Administration Acting Administrator K. Jane Williams set a 30-day deadline for sending a suitable financial plan for review.

"The FTA has exercised considerable patience since requesting in August 2015 that HART provide addition information about the project budget and schedule in light of then-apparent problems," Williams wrote. "However, HART's repeated difficulties with identifying cost savings or sufficient funding have led to significant, recurring project schedule delays and cost increases."

At stake is $750 million that the FTA has been withholding while the Honolulu Authority for Rapid Transportation and the city work out an acceptable budget for the remainder of the beleaguered $8.2 billion project.

The letter says FTA is still waiting for a recovery and financial plan and warns, "Decisive and expeditious action is needed to prevent future cost escalation."

In addition, the agency set a 30-day deadline for HART to decide what type of contract will be sought for the final segment of the project and a 60-day deadline for the recovery and financial plan and a plan to fully commit $44 million in city funds.

"Absent of a suitable and timely response, FTA may proceed with the remedies set forth in the Full Funding Grant Agreement for this project," the letter concludes.

A spokesman for Mayor Kirk Caldwell said the letter is proof that the council should have included the $44 million in the city construction budget as the mayor requested, and that HART needs to quickly decide whether it will seek a public-private partnership or traditional bid system for the next rail contracts.

This story will be updated.

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