Honolulu Mayor Kirk Caldwell reiterated his support Monday to build a 20-mile, 21-station commuter rail line from East Kapolei to Ala Moana Center, and said that a five-year extension of a half percent general excise tax surcharge from 2022 to 2027 should provide enough money to do so.
Caldwell made those remarks while being questioned by Honolulu City Council Chairman Ernie Martin during a special meeting of the council’s Budget Committee at Washington Middle School.
The committee is considering passing the five-year tax extension as well as another proposal from Martin that would place a $910 million cap on additional spending from the extension while increasing accountability measures for the Honolulu Authority for Rapid Transportation, which is overseeing construction of the project.
With rail’s growing deficit of more than $1 billion dollars, Martin and others have wondered at what point the city might want to consider cutting its losses.
The Honolulu City Council Budget Committee has gone on a listening tour to find out what the public thinks about extending a rail tax surcharge for another five years. The committee is expected to make a decision later this month.
Cory Lum/Civil Beat
Their concern is that the GET extension — which was already approved by the Legislature and signed into law by Hawaii Gov. David Ige — might not be enough to cover costs should construction prices continue to soar. Some have broached the idea of shortening the route or eliminating stations.
“The essential question is: Is there a tipping point?” Martin asked Caldwell.
The mayor was careful in his response, at first saying he didn’t want to speculate about what would happen if rail costs exceeded the current total budget estimate of $6.6 billion.
“You have every reason to ask these tough questions and I support you in doing that. But I think the five-year cap is the way we should go.” — Kirk Caldwell
He said the five-year GET extension should be enough to cover that amount, but it’s clear there’s not much cushion should there be major cost overruns in the future.
Caldwell said that if costs do increase beyond what the GET surcharge extension can pay for then it will be up to HART and the city to find cost-cutting measures. But he said it’s still important to build the full system.
The city has signed a $1.5 billion grant agreement with the Federal Transit Administration to build a 20-mile, 21 station rail line. Anything less, and officials fear they would have to pay some or all of the money back.
Caldwell also said he supports Martin’s proposal to bring more accountability to the rail project by forcing HART to provide more detailed financial reports to the council, which would also include specifics about how much money subcontractors are earning on the project.
But Caldwell doesn’t want Martin’s proposed cap on surcharge funds because it would not be enough to cover current estimated costs. Caldwell added that the Legislature and governor already effectively placed a cap on spending by limiting the surcharge extension to five years.
Mayor Kirk Caldwell says it will be important to provide strict oversight of HART if the council grants a tax extension to pay for cost overruns.
Cory Lum/Civil Beat
“You have a lot of control over the budget and rightly so,” Caldwell told the council members. “You have every reason to ask these tough questions and I support you in doing that. But I think the five-year cap is the way we should go.”
The Budget Committee did not vote on the rail tax extension Monday. It was the second of two special meetings to allow for public comment. The first was held last week in Kapolei, where Martin questioned if HART Executive Director and CEO Dan Grabauskas needed to be fired.
Budget Committee Chairwoman Ann Kobayashi has said she does not expect to vote on the rail tax extension until Nov. 18. The proposal will then head to the full council for a second reading before going back to committee. The council would then have to vote on the measure a third time before it heads to Caldwell for his signature.
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