The city and the Honolulu Authority for Rapid Transportation have again delayed awarding an all-important contract for a multi-billion-dollar segment of the 20-mile rail line from East Kapolei to Ala Moana Center.
The HART board of directors also announced Thursday that the completion date for the full rail line has been pushed back slightly.
If it is ever finally awarded — this is the sixth delay — the public-private partnership or P3 agreement will be the largest contract in city history. But the complex procurement process requires the chief procurement officers for the city and the rail authority to agree on the outcome, including who will get the contract.
Details of the procurement process have been a closely guarded secret, with the rail authority even refusing to make public the exact specifications that the bidders must meet.
In general, the contract would involve an estimated $1.4 billion in construction work including 4.1 miles of elevated rail line and eight train stations in the urban core between Middle Street and Ala Moana. The construction piece of the contract is also supposed to include a Pearl Highlands transit center and a 1,600-stall parking garage.
The winning P3 bidder would also get the job of maintaining and operating the entire 20-mile rail line for 30 years. That is expected to cost the city on the order of $140 million a year from the time the entire rail line is scheduled to open in 2026, and the cost will increase in increments from there. That portion of the contract is expected to cost the city at least $4 billion.
The city originally planned to award the P3 contract last September, but repeatedly had to move that award date back. Most recently, the companies competing for the contract told the city they needed more time because the pandemic interfered with their ability to get cost information from suppliers and subcontractors that was needed to prepare their proposals.
Thursday was the most recent award date announced by HART that has come and gone.
At least two companies or conglomerates submitted bids on July 23 to compete for the contract, but they have not been identified publicly. HART reported Thursday that the panel tasked with evaluating the proposals from those entities has produced a report on its findings.
Andrew Robbins, who is executive director and chief procurement officer for HART, said it now falls to him and his counterpart with the city to decide “what the next steps are from that point.” Robbins said he is working with the acting city director of the Department of Budget and Fiscal Services on the selection, Manuel Valbuena.
“The process sucks.” — Honolulu City Council Chair Ikaika Anderson
But having the chief procurement officers for HART and the city exclusively control the award of such a huge contract does not sit well with some. The procurement process does not give the HART board of directors or the Honolulu City Council veto power over the contract, which has drawn criticism from some observers.
HART Vice Chairman Terrence Lee noted there have been press reports that have been demanding that the board have oversight over the P3 award. He said it appears that is not possible given how the procurement code has been interpreted by the relevant agencies and the legal counsel to the board, putting the directors “in a tough spot because the public expects us to have this oversight” but the agency doesn’t.
“As a matter of law, we cannot have that oversight,” Lee said. “We, like the rest of the public, are in the dark as to what considerations, what’s being proposed, the amounts, all that stuff until after the contract is awarded.”
The board went into a lengthy closed-door executive session to discuss the procurement process shortly after Lee made those remarks.
One of the critics of the process is outgoing City Council Chairman Ikaika Anderson, who said in an interview that the council has asked for details about the solicitation for the P3 contract, and been provided with only limited information.
“The process sucks,” Anderson said. “It’s not so much leaving the council out, it leaves the public out.
“I don’t really look at this as an insult to the council at all, but it’s not fair to the taxpayer who’s paying for the project. That’s really why I say the process sucks,” he said.
Robbins also announced Thursday that HART is now forecasting the full rail line will be completed April 17, 2026, which is about a month later than the most recent public estimate. The latest delay was caused by difficulties with a project to relocate utilities such as electrical and water lines out of the way of rail line construction, he said.
The actual, final construction schedule will be set once the new P3 partner is selected and the city has input from the new contractor, Robbins said.
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