By: T. Jeffersonian
On Thursday, March 18, 2021, the Honolulu Authority for Rapid Transit (HART) announced that the Honolulu Rail Transit (HRT) costs haven risen to $12.4 billion and will take another 10 years to complete. This cost is $3 billion more than the amount of revenue HART expects to collect from excise and hotel taxes, some borrowing, and the federal government. Earlier this week, there was more unfortunate bad news. During a recent inspection, rail officials discovered cracks in several crossover tracks along the line that could cause further delays. These cracks most certainly impose up to a one-year delay in any interim opening of the system’s first half – from Kapolei to Aloha Stadium. It is uncertain who will end up responsible for the cost of fixing these flaws because HART and the operations contractor, Hitachi Rail, are in a dispute over who is to blame.
The troubled Dillingham Boulevard segment remains a delay as well. Dillingham has a rat’s nest worth of utilities underground. There’s no available space in which to relocate them. Earlier this month, interim HART CEO Lori Kahikina, stopped the Dillingham construction because HART did not have 100 percent of the design drawings complete which are required before being actually being permitted to work. Kahikina said the guideway might be moved to the mountain side of Dillingham Boulevard instead of right down the middle due to high voltage lines and other utilities that have to be moved out of the way.
The moving the route effort hinges on approval from landowners like Kamehameha Schools and the University of Hawaii. A construction expert, suggested that having contractors start building backward from the Ala Moana end of the route towards the troubled Dillingham segment would shave both time and money from the project. Kahikina said they were seriously considering that approach, but said that the lack of a guaranteed way to cover the financing shortfall remains a problem. As it stands, HART costs $12 million per month regardless any construction progress.
Let’s connect a few dots, shall we? One of the HART board members questioned whether Kahikina was being intentionally pessimistic with all this bad news so as to avoid letting down the public again. We are already let down. Don’t worry any more about something that has already happened. What we are worried about now, is having to pay for 3-5 more years of higher General Excise Taxes (GET) and Hotel Taxes. Last week, the State Senate passed a bill raising Hawaii’s taxes to the highest level in the United States. The public are fish in a Hawaii tax barrel and our tenured, wealthy political are shooting their poorest constituents. Okay, enough of that. That does not solve the problem we are having with our HART.
Our politicians do have a problem. We are getting $6.1 billion in American Rescue Act funding and our politicians need plausible justification to re-appropriate some of it. This bad news makes it more explainable to justify spending more of the $6.1 billion on infrastructure projects which actually means more money going to political financiers who can make political donations that keep tenured politicians in power. Wait, there is more unfortunately. The Biden Administration is now talking about a massive infrastructure plan. The package’s cost is expected to be in the trillions of dollars, according to previous Biden proposals. It will come on the heels of the $1.9 trillion coronavirus relief and stimulus package, which has triggered concerns in Washington, D.C. over how the government might pay for a massive infrastructure initiative. The $1.9 trillion stimulus package alone will raise our debt to $32 trillion dollars in
2021. Executives from Wall Street, major corporations and private equity firms are engaging with the White House and officials in the Transportation Department about how to pay for the eventual infrastructure bill. Tax hikes, private-public partnerships and fee increases for bridge and highway tolls are among the ideas being proposed by business leaders to the Biden administration. The tax hikes that Biden is considering, will be the biggest tax hike in America since 1993. Americans are paying higher taxes after enduring coronavirus.
The HART bad news is deliberately timely because it provides public justification to pump more federal money into Hawaii, all-the-while our state government continues to increase taxes and costs for constituents. Even if the businesses are taxed, businesses are forced to raise the prices of their goods and services to account for the higher taxes. The customer feels the burden in their pockets, not the businesses.
Hitachi Rail should be made to pay for the cross-rail repairs. Get the completed portion of the rail operational so that it is making revenue. If it is not already leased or sold, do this so the whole enterprise can be privatized just like in Japan and Singapore. If we can realistically start on the Ala Moana portion while the Dillingham section is being sorted out, then begin operating it so that we are not paying $12 million monthly for employees just sitting around. Move the Dillingham section to the mountainside.
The state certainly has the financial and legal leverage with which to successfully negotiate the move with both Kamehameha Schools and the University of Hawaii. A team of lawyers, surveyors, court, architects, etc. must be set aside to work exclusively on fast tracking the HRT’s completion. Procedural bureaucracy must be replaced with rapid processing and decision making to get HART moving forward to final completion well under the $12.4 billion price tag that was displayed this week.