$9B Honolulu Light Rail: Poor Management behind Price Spike, 6-year Delay-Audit

-After an evaluation of the Honolulu Authority for Rapid Transportation (HART), the Hawaii state auditor’s office issued a scathing report that describes the authority’s performance on the $9.2 billion Honolulu Rail Transit Project as “over promising, under delivering.” This is the first of four reports that the auditor plans to issue.

  -The price tag for the 20-mile commuter light rail has increased from $5.1 billion in 2012 and is six years behind schedule.

 -In the report, state auditor Leslie Kondo pointed out what he found to be HART’s management shortcomings, including jumping the gun on a $483 million contract award to Kiewit Pacific Co. for the first section amid fear of rising costs and the potential loss of tax revenue. The report also critiqued the authority for awarding almost $2 billion more without achieving the necessary construction milestones first.

The audit also determined that HART neglected to inform its board of directors or state lawmakers of cost overruns and schedule changes in a timely manner and gave different information to the Board and Federal Transit Administration when costs were escalating — decisions that reportedly “undermined board oversight and eroded public confidence.”

HART, according to its response to the audit findings, outlined measures it has taken since the audit period to refine its practices, The Maui News reported. What the authority took the greatest issue with is Kondo’s negative view of HART’s willingness to participate in the audit. “Simply put,” Kondo wrote, “we requested and were promised the full cooperation by and complete access to HART. We expected HART to be good to its word. It was not.”

Honolulu Mayor Kirk Caldwell in November signed legislation that will provide up to $214 million in funding for the rail, reversing a 2006 city promise not to put any money toward the project. Honolulu committed $20 million in funding for the project for HART’s fiscal year 2018 budget and an extra $24 million for fiscal year 2019 as part of HART’s official September 2017 Recovery Plan, which the FTA required the authority to formulate and submit in order to maintain their Full Funding Grant Agreement.

A rail project on a large scale requires years of planning and even the best intentions can go sideways. The California High-Speed Rail Authority has found itself the subject of even greater criticism for cost overruns and schedule delays on the $77 billion Northern California-to-Southern California bullet train.

That project has also been subject to an official review, and the auditor, in that case, found that one of the California authority’s problems was that it issued contracts too soon in the process, just as Honolulu officials did, leading to cost overruns and delays.

*This report was first published by www.constructiondive.com

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