Between 2007 and 2020, the new rail lines, busways, trolleys and other public transit systems that opened across the U.S. cost on average slightly less to build than predicted, according to the most recent Federal Transit Administration data available.
That’s in sharp contrast to Honolulu’s fledgling rail line, a system whose construction began around the same time as some of those finished transit projects and whose price tag has more than doubled since 2012.
One former, longtime FTA official who helped launch Honolulu rail more than a decade ago said the dramatic cost overruns that have plagued the project ever since construction started are worse than anything he’s seen.
“I’ve never seen anything close,” Ron Fisher, former director of the FTA Office of Project Planning, said of rail’s persistent and growing budget woes.
When City and County of Honolulu leaders signed a funding agreement for the project in 2009, rail was slated to cost some $5.12 billion. Currently, it’s expected to cost as much as $12.4 billion and faces an approximately $3.6 billion shortfall, according to recent Honolulu Authority for Rapid Transportation estimates.
Fisher spent 30 years at the FTA, including 12 years as its OPP director, before retiring in 2009. To support his take that Honolulu has the worst overruns by far, he cited his former agency’s own occasional evaluations of how well it forecasts the costs and ridership for new transit systems that it helps build.
Join Civil Beat reporters Marcel Honore and Nick Grube for a virtual discussion where they’ll share updates on the progress of the Honolulu rail project. Tuesday, August 10, 2021 from 2-3 p.m. Register to attend or receive the recording here.
Join Civil Beat reporters Marcel Honore and Nick Grube for a virtual discussion where they’ll share updates on the progress of the Honolulu rail project.
Tuesday, August 10, 2021 from 2-3 p.m.
Register to attend or receive the recording here.
Those reports, which include so-called “predicted versus actual” cost studies, date back to 1990 and they show that the FTA’s forecasts have generally improved over time.
The most recent report was released in 2007. Last year, however, an FTA staffer presented the agency’s updated data during an annual transportation research conference.
It was delivered by Jim Ryan, who was then a community planning official within the agency. The data showed that 29 new transit systems completed in the past 14 years had, on average, cost 98% of their initial budget.
In other words, those combined projects slightly beat their predicted costs.
“It was a good news story. Estimates have gotten better,” Fisher said, because “projects always get criticized for going over budget.” For the FTA planners who recommend which transit projects Congress should fund, it’s important to be accurate and maintain credibility, he added.
Honolulu’s cash-strapped rail project wasn’t among those 29 projects. Its final price tag still isn’t known because completion has been delayed over a decade. The full 20-mile, 21-station line that’s planned to end at Ala Moana might not be completed until March 2031, according to HART.
Fisher said its failure to stay even remotely close to its original, $5.12 billion estimate is a stark outlier among recent U.S. transit projects.
The most expensive project on Ryan’s updated 2020 list was the first phase of Washington Metro’s Silver Line, which eventually aims to provide service to Dulles International Airport outside of Washington, D.C. That effort cost just over $3 billion and it came in slightly under budget, according to Ryan’s presentation.
The FTA, meanwhile, has not yet released an updated report based on Ryan’s 2020 data. In an email Friday the agency said to expect it “in the near future” but didn’t specify further.
Specific to Honolulu, Ryan previously scorned some of the city’s planning and analysis for rail as it sought approvals for the project.
In a 2006 email, Ryan told his FTA colleagues that “we seem to be proceeding in the hallowed tradition of Honolulu rapid transit studies: never enough time to do it right, but lots of time to do it over.” That email was released as part of a 2012 federal lawsuit that tried unsuccessfully to stop the rail project.
Ryan could not be reached for comment for this story — Fisher said that he recently retired.
When asked to discuss why Honolulu has had such severe budget struggles compared to other transit projects, HART spokesman Joey Manahan said via email that the agency “appreciates the opportunity to respond but respectfully refrains from commenting at this time.”
Honolulu rail didn’t break ground until 2012, so Fisher said he couldn’t offer insight as to why its costs have grown so dramatically.
However, he said that during the project’s earlier planning phases, officials identified two main challenges to rail: the cost to send materials to Oahu and the difficulty in getting the consultants and experts needed to oversee its completion to relocate there.
In his 2020 slide presentation, Ryan included “better adherence to management plans” as a main reason why other recent transit projects were coming in at or even below their original budget estimates.
HART, however, went years without making the proper updates to its so-called “project management plan.” The federally mandated blueprint was considered critical if rail was to succeed. At least two different outside audits flagged HART for the lapse.
Ryan also cited the favorable construction bid environment following the Great Recession as a reason for widespread success, and Honolulu rail did initially benefit from that factor. The initial contracts were awarded under budget.
However, work on those contracts stalled because the city lacked the proper approvals to proceed, swiftly driving up costs. State and federal lawsuits also stalled work for about a year, and the subsequent construction contracts went out to bid in a much hotter and more expensive market.
Last year, Terrence Lee, then a HART board member, said that officials in Washington D.C. told him that the FTA now considers Honolulu rail to be the most “challenged and troubled project they’re dealing with.”
Fisher, meanwhile, said that rail is in an unusual situation among the nation’s transit projects because it’s woefully short on cash and essentially has been pushed back into a planning phase.
Local transportation officials should pause the project, he said, in order to study different endpoints to the line as well as their impacts to ridership, rail operations and the surrounding environment.
That study of the various costs and benefits of stopping at different places should involve credible experts, and it should include legitimate public input and participation, Fisher added.
“This is no longer in a construction phase. A pause and a reasonable decision on where to end the project need to be made, and that shouldn’t be done casually,” he said.
Honolulu should seek out transit-industry experts to help lead the effort, Fisher said, adding, “It can be done.”
Honolulu Mayor Rick Blangiardi and other city leaders are expected to meet with FTA officials to discuss rail’s future sometime later this year.
Read Jim Ryan’s 2020 presentation on transit costs here. Slide 22 shows the recently completed transit projects coming in slightly under budget:
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