The Honolulu agency overseeing rail construction has determined that its prior history of shoddy relocation payments ultimately short-changed 24 businesses and tenants displaced by the future rail line to the tune of $883,000.

Those underpaid parties were later compensated as part of a lengthy effort that wrapped earlier this month. It aimed to fix as best it could the widespread problems that occurred with the Honolulu Authority for Rapid Transportation’s relocation payments through 2016.

HART submitted its final report on the so-called “corrective action plan,” which the Federal Transit Administration had required it to do, on May 2, according to Krista Lunzer, the rail agency’s latest director of property acquisition and relocation. She briefed the HART board on the matter Thursday.

HART rail guideway construction along Kamehameha Highway near the Oahu Community Correctional Center.
Rail guideway construction has reached Kamehameha Highway near the Oahu Community Correctional Center, just past Middle Street. HART, meanwhile, has grappled with widespread problems in its relocation payments to those displaced by the future transit line. Cory Lum/Civil Beat/2022

What Lunzer didn’t address in that briefing, however, were the numerous overpayments for relocation that HART and the city were also found to have made, in addition to the underpayments.

Such overpayments on relocation costs were the focus of a grand jury subpoena delivered to HART in early 2019, as part of a federal criminal investigation into rail that’s believed to be ongoing.

Board members did not ask Lunzer on Thursday about the status of the overpayments, although the group’s chairwoman, Colleen Hanabusa, said after the meeting that she might place it on a future meeting agenda to discuss in closed session.

Neither Lunzer nor HART Executive Director Lori Kahikina responded to a request for comment Thursday.

A Host Of Problems With The Files

Since rail construction started, HART has relocated more than 100 property owners, businesses and residents along the transit route from east Kapolei to Ala Moana Center. The agency has reported issuing more than $13.2 million in relocation costs.

Numerous problems including missing documents, math errors and “payments without justification” in HART’s relocation files were first discovered by the agency’s real estate consultants in 2017.

The rail agency made the problem public in 2018 and agreed to forgo $3.8 million in future FTA payments. That move essentially gave back what the federal agency had already paid out to cover its share of relocation costs.

HART Board nominee Colleen Hanabusa answers media questions.
HART Board chair Colleen Hanabusa said she might put the overpayments issue on a future meeting agenda, to discuss in closed session. Cory Lum/Civil Beat/2021

A team of investigators with Hill International subsequently took a detailed look at most of HART’s relocation files for the FTA in 2019. They found that 22% of the individuals in those files were actually overpaid, and an additional 6% were paid even though they were ineligible.

In its damning assessment that year, Hill stated that HART’s relocation files were so incomplete based on what’s required under federal standards that nearly half of those displaced “were likely harmed” as a result.

Hill further determined that widespread inexperience and a lack of understanding about the process among HART’s staff and its consultants was a big cause of the problem.

Its report did not name those responsible, however — and officials with the project have never specified them either. Neither Hill nor HART have said how much money the rail agency is believed to have overpaid or to whom.

It its efforts to correct the problems, HART reviewed 109 of its files and managed to survey 69 people who were displaced by rail and were part of the agency’s relocation program, according to Lunzer.

HART did not provide a copy of the final report that it provided to the FTA on its corrective action program by the end of day Thursday.

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