It’s been nearly a year since the Hawaii Supreme Court stopped construction on Honolulu’s $5.26 billion rail project because of the city’s failure to follow established law when seeking out Hawaiian burial sites along the proposed 20-mile route.

While the work stoppage is estimated to cost the city tens of millions of dollars to pay idling construction contractors, it’s not the only snafu rail has experienced since first breaking ground in April 2012.

Overspending on public relations, an embarrassing first audit and the revelation that the rail system lacked back-up power have all smudged the celebrated start to building the largest public works project in Hawaii’s history.

Some of these oversights will cut into the project’s $644 million contingency that was set aside for unexpected costs, while others will simply bolster the arguments of rail opponents who believe the project is a misguided solution to traffic congestion on Oahu.

But more surprises are on the way. Unexpected costs are a part of the landscape of large infrastructure undertakings.

For example, the Honolulu Authority for Rapid Transportation is on the cusp of paying another $20 million to $30 million to build platform screen gates at all 21 rail stations. These gates are meant to stop people from falling or jumping onto the guideway when waiting for a train.

Although this safety feature was included in previous schematics, designs and project presentations, someone forgot to put a line item in the budget. As a result the gates will now be considered an add-on expense.

HART Executive Director and CEO Dan Grabauskas admits this was a “terrible oversight,” but he also said that’s the reason the rail project has money set aside for these sorts of costs.

“The contingency is expected to be spent and it’s expected to be spent on unknown or unforeseen circumstances,” Grabauskas said. “The thing I tell people is that as long as we’re not burning the contingency faster than the drawdown chart expects we’re OK. So right now we’re in a really good place.”

Seeking Out Savings

Grabauskas is charged with making sure the 20-mile stretch from East Kapolei to Ala Moana Center will be built on time and on budget. That means getting the project up and running by 2019 without having to ask for more money.

So far, HART has only spent $3.2 million of the contingency. Delay claims from contractors will add to that figure.

Another big expense on the way is for back-up electricity for the driverless rail system. With the current designs, if the power goes out passengers would be forced to walk the elevated guideway to get to a rail station staircase.

Grabauskas said he didn’t know why officials didn’t include back-up power in the initial project plans, although it was discussed. He calls this component a necessity, but didn’t have a “meaningful” cost estimate because he’s not sure what sort of system he’ll pursue. It could be anything from low-tech diesel generators to an advanced regenerative braking system that stores energy similar to that found in some hybrid automobiles.

“People deserve to be able to have the safety of having the train get back into the station in the event of an emergency,” Grabauskas said. “We’re not on the mainland. We are an island. There have been power outages and you have to build a system for the place in which you live. And if one of the concerns here is power outages then we need to build back-up generation.”

Now Grabauskas is keeping his eyes on the driverless train cars, which he says are the most complex component of the project and are being built under part of a $1.4 billion contract with Ansaldo Honolulu Joint Venture.

The company is a partnership of AnsaldoBreda and Ansaldo STS, both of which are owned either in part or completely by the Italian company Finmeccanica. While the companies have come under scrutiny for everything from cancelled rail contracts and major financial losses to the arrest of Finmeccanica’s CEO Giuseppe Orsi in a corruption probe, Grabauskas is confident Ansaldo JV is solvent and will deliver on its contract with HART.

The HART chief is also looking for other ways to save the project money. In July 2012, Grabauskas axed $3 million in PR contracts, calling the expenses “excessive” and “unnecessary.” He’s also repackaging many of the contracts to eliminate middle managers. By doing this he expects to save up to $25 million dollars.

Grabauskas has also said that scaling down the size of train stations has trimmed about $100 million off the project.

Scoring Major Victories

Rail has received its share of good news over the past year. When Grabauskas was hired in April 2012 the existence of the project was in question. There were three pending lawsuits, uncertainty about whether Honolulu would get $1.55 billion in federal grant money and a mayoral election that saw former Hawaii Gov. Ben Cayetano thrust himself back into the political spotlight in an attempt to dismantle the project.

Many of these issues have been resolved. Kirk Caldwell, a staunch defender of rail, defeated Cayetano in a November runoff and the following month the federal government approved the $1.55 billion full funding grant agreement for the project.

Officials have also received favorable rulings in many of the lawsuits, and — with the exception of the stop order on construction and a pending federal appeal — government attorneys have successfully kept the project alive.

Rail has also received heavy support from the business community and other influential leaders. Late U.S. Sen. Daniel K. Inouye’s former chief of staff, Jennifer Sabas, has taken over the helm of the pro-rail nonprofit Move Oahu Forward, lending her significant political weight to the project, and ensuring that rail officials have a direct line to both business leaders and federal officials.

The Honolulu City Council is also decidedly pro-rail, whereas just a year ago there were a number of council members who were grumbling about the project.

“We’re moving ahead other than on actual physical construction,” Grabauskas said. “My steel-toed boots are dusty and it’s because they’ve been sitting in my closet, not because they’ve been walking on work sites. And that’s a travesty.”

One Last Hurdle

Construction is set to pick up again in the fall. But before that happens Honolulu’s railway must pass one last test — the 9th U.S. Circuit Court of Appeals.

On Nov. 1, U.S. District Court Judge A. Wallace Tashima issued a split decision in a lawsuit that argued the city did not follow certain federal transportation and environmental rules when determining the elevated rail system was feasible.

Tashima ruled that the city would need to redo some of its environmental assessments as well as identify cultural properties, such as Native Hawaiian burials, that were along the 20-mile route. He did not say the project would have to be scrapped. Those surveys have now been completed.

But now the plaintiffs in the case, which include Cayetano, HonoluluTraffic.com founder Cliff Slater, University of Hawaii law professor Randall Roth and retired judge Walter Heen, are appealing that ruling, saying Tashima did not go far enough and that the city must completely reevaluate the project, including studying whether bus rapid transit, managed lanes and light rail, are better options. They’re convinced that if that happens, the elevated guideway will be seen as a boondoggle.

Cayetano, Slater and Roth say their case was recently bolstered by a July 8 letter from U.S. District Court Judge Susan Oki Mollway to Grabauskas and Ted Matley, of the FTA. Mollway, wrote the letter on behalf of Hawaii’s federal judges, and ripped the rail project because it doesn’t go to UH as originally planned.

“We think it speaks volumes about just how badly this rail effort has been run,” Roth said during a press conference to address Mollway’s letter. “We think this has had to do with big landowners and developers. This has had nothing to do with traffic congestion and it never did.”

Mollway submitted the letter as part of testimony on a supplemental environmental impact statement for a Beretania Street tunnel option that officials have said is too expensive. The new study was required as a part of Tashima’s ruling.

In an interview with Civil Beat, Cayetano expressed hope that his appeal will be successful in deterring the project. He said the plaintiffs had raised around $280,000, getting much of the money from donations ranging from $25 to five figures. Cayetano himself has added $5,000 to the kitty, he said.

If the 9th Circuit rules in favor of the plaintiffs and the city is faced with redoing its environmental assessment, he believes citizens will find the extra time and cost unsupportable.

Should the appeal fail, however, Cayetano says he’s done. He wouldn’t support a challenge to the U.S. Supreme Court.

“I’m kind of weary,” the former two-term governor said. “It’s been a long road for me. I came out of retirement to run for mayor and I lost. After awhile you have to accept finality.”

Paying for the Future

The 9th Circuit has slated a hearing for Aug. 15 in San Francisco, something the defendants asked the court to schedule before construction resumes.

Aside from this appeal, the only foreseeable hurdles that seem to stand in the way are escalating costs.

Mayor Kirk Caldwell has a plan to lessen the aesthetic impacts of rail in the downtown corridor, something he hopes will save money but could also add some extra expense. A major component of Caldwell’s “build rail better” proposal is also to keep the project within budget.

Grabauskas acknowledges that occasionally things will go wrong once construction resumes. His only hope is that he can mitigate whatever might occur, and keep them from ballooning the project’s budget.

He said that if costs do start to increase beyond what’s manageable, HART will have to consider tweaking various components of the project although the agency won’t be able to change the number of miles or stations.

But he also said that if costs truly do get out of hand lawmakers can consider extending the general excise tax surcharge that is being used to pay for much of the project. The surcharge is half a percent and collects roughly $300 million a year for rail. If the project is in a bind for money there’s always the option of extending the tax another year rather than looking for other sources.

“The GET is a pretty powerful mechanism,” Grabauskas said. “I keep telling people, the fact that this project is paid off within a couple of years of having construction done is almost unheard of. It’s like building a house and having a two year mortgage.”