The two-year quest to land a private partner who could finish Honolulu’s beleaguered rail transit system and operate it in the coming decades may still be on life-support, but it’s not quite dead.
On Tuesday, the Honolulu Authority for Rapid Transportation board failed to pass Resolution 2020-5, which called for the agency’s executive director, Andrew Robbins, to finally abandon his long-touted effort to secure a public-private partnership.
The so-called P3 deal, which was supposed to be a collaboration between HART, the city and a private partner, has already been delayed more than a year. The contract was most recently supposed to be awarded on Aug. 27, but the date passed without an award. One of the bidding teams disclosed its bid was well above HART’s budget, and the city pulled out of the procurement Sept 25.
The HART board on Tuesday actually voted by a 7-2 majority to pass the resolution canceling P3. However, the two dissenting votes from board Vice Chair Terrence Lee and the board’s newest member, Kika Bukoski, were enough to stymie the measure under obscure rules that govern public-agency boards in the state.
The measure also failed despite several weeks of relentless lobbying by Honolulu Mayor Kirk Caldwell and members of the City Council to cancel the procurement.
Still, there’s nothing that precludes Robbins from following the wishes of the board’s majority on P3. Board member Hoyt Zia pressed Robbins on whether their vote count mattered to him, regardless of the resolution’s failure.
“If seven out of nine said for you to cancel it, what are you going to do? What do you take from that?” Zia asked during the board’s virtual meeting.
“I don’t know if I have an answer for you today, I need to think about it,” Robbins responded.
Robbins has previously said he would stop the P3 process if the board instructed him to. He didn’t specify, however, whether that required the board’s formal resolution or just a simple vote.
“I hear all of you, but I have a staff that I owe to listen to them as well,” Robbins told Zia and the other board members. The HART board hasn’t directly participated in the P3 process and it isn’t privy to the discussions taking place behind closed doors with bidders.
If board members looking to cancel P3 were part of the process they would likely change their minds, he said.
Even if Robbins doesn’t halt it immediately, he said that he now expects to have a recommendation on the P3 procurement before the board on Nov. 13, which is in two weeks.
He’s said that there’s still valuable information for HART staff to extract from the bidders in a series of so-called “post proposal meetings.” Those details could help any subsequent procurements succeed, he’s argued.
Robbins hasn’t provided specifics on those details, however. HART board member Joe Uno wondered Tuesday what information is left to be gathered. And it’s not clear how far along Robbins and HART have gotten in their meetings with bidders.
Agency spokesmen Bill Brennan said Monday that they couldn’t disclose their progress under state procurement rules.
One of the companies vying to finish the project, Tutor Perini Corp., disclosed to investors during an earnings call this past summer that it had bid more than $2 billion to finish the remaining major construction, an amount that vastly exceeds HART’s budget.
The project in recent weeks has also seen its efforts to relocate utilities along Dillingham Boulevard completely stall, as well as a new budget hole of more than $1 billion dollars. Those issues are connected with the difficulties in awarding the P3 contract, officials say.
Looming in the background is the Federal Transit Administration and how the rail project’s federal partners will react to its latest dysfunction and cost overruns.
City leaders have expressed deep concern that the FTA will pull some or all of the $1.55 billion it’s committed to Oahu’s 20-mile, 21-station elevated transit project. They’re especially worried the agency will let some $250 million lapse on Dec. 31.
The city needs to present the FTA with a preliminary plan to deal with rail as soon as possible. The federal dollars are in serious jeopardy. “I was told that twice” in phone conversations with FTA officials on the mainland, Caldwell said.
The P3 process has already seen numerous delays, and pushing critical decisions on what to do about the cash-strapped project into the holiday season might throw it into further disarray, Caldwell has argued.
He’s expressed concerns that HART is negotiating with bidders behind closed doors on a massive deal for a project that has plunged once more into a huge budget hole.
“What two more weeks will do, I don’t know,” Caldwell said in his latest round of testimony Tuesday before the HART board. “A plan has to be submitted to the FTA shortly.”
Meanwhile, two state senators, including the chamber’s transportation chairwoman, Lorraine Inouye, testified Tuesday in favor of keeping the P3 process alive.
“We do not believe that the FTA’s intent of the Dec. 31 date is to force HART and the city to cancel the P3 and incur further delays and cost increases,” Inouye told HART board members.
What’s lacking, however, is any public input from the FTA on the matter.
The agency recently declined a request to discuss rail with Ray Tellis, the FTA’s administrator for Region 9, which includes Hawaii.
The agency declined Tuesday to specify whether it had set any deadlines to receive a plan for rail, or whether it could afford to wait at least another two weeks. The FTA also declined to say whether it would release rail’s remaining federal dollars under a “phased” approach to finishing the project to Ala Moana, as both Caldwell and Robbins have proposed.
Instead, the agency on Tuesday pointed to a statement it had previously released, saying the “FTA will not begin to release any of the $744 million that has been withheld for the project until the cost of the City Center procurement is identified and shown to be within HART’s ability to finance it.”
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