Honolulu Rail Transit – Fix It Recommendations

Picture of the Honolulu Rail Project

By: T. Jeffersonian

The Problem

The state of Hawaii’s largest-ever public works project, the Honolulu Rail Transit (HRT), has again fallen into financial crisis and slipped years off its schedule. Originally in 2006, the full 20-mile, 21-station, system running from Kapolei to Ala Moana was estimated to cost $4 billion. Recently, the estimates have fallen somewhere between $10 billion and $11 billion. The original $4 billion cost estimate was to be a shared burden between state and federal government. The state raised General Excise Taxes (GET) by .5 percent from 2007-2022 and the Federal Transit Administration (FTA) granted $1.55 billion to the HRT. Due to major cost overruns, the GET .5percent increase has been extended an additional eight years to 2030 and an additional thirteen-year 1.0 percent surcharge on the existing 9.25 percent statewide Transient Accommodation Tax (TAT) has been added. The federal government previously stated that it will no longer be providing further funding because its original grant was contingent on the HRT being completed at Ala Moana.

This could change, given that the FTA accepted the state’s Rail Recovery Plan in 2019. Due to the Biden Administration’s new commitment to providing infrastructure improvement grants to states as a part of its Coronavirus Rescue Plan. There still is cause for concern that the $11 billion estimate might not be enough to see the project to completion. Due to budget shortfalls, the state has periodically re-appropriated extra HRT tax revenues to cover the unforeseen expenses . The state is currently $1.4 billion short in revenue and that deficiency is expected to grow by another $1 billion in 2021. The other cause for concern that $11 billion might not be enough to cover all costs is because the final, most difficult building stage, has yet to begin. The construction of the 4.3-mile section through downtown Honolulu final stage currently involves removing utilities along Dillingham Avenue and dealing with historic Hawaiian burial sites.

The Honolulu Authority for Rapid Transportation (HART) officials say they believe they can deliver the full 20-mile, 21-station system in either late 2027 or 2028. The agency has consistently missed its projected targets. Honolulu city leaders, perhaps in a bid to better manage public expectations, have said construction might continue through 2033. If 2033 is the real deadline, the GET and TAT increases will need to be extended another three years as well. HART Interim Executive Director, Lori Kahikina, is soliciting new ideas to get the rail line past Dillingham. Her predecessors at the agency considered several alternative routes before concluding the line should run along that crowded corridor.

That includes Department of Environmental Services clearances, which Kahikina managed under former Mayor Kirk Caldwell before moving to HART in January 2021. Kahikina reported that HART would not get the clearances and must pursue an alternative route in order to avoid shoving utility relocation cost down the city of Honolulu’s throat. HART is considering a route shift toward the mountains along Nimitz Highway or even building part of the HRT underground. The worry is that any drastic changes in the HRT’s route will likely trigger new environmental impact reviews that will add even more delays and costs to the project. Director Kahikina believes that because the rail’s current environmental approvals encompass an area that is one to two blocks from the newly proposed Dillingham route, environmental impact studies may not be required.

Recommendations

From the very beginning, legal and environmental challenges have delayed the project. Every new lawsuit and additional environmental impact study further increase the project costs and delays the project’s completion. The state should establish a special court and three task force groups to fast track the HRT’s completion. The bureaucracy of the existing state court is too slow to address HRT delays with the urgency required to avoid further increased cost.

The state should establish a special court consisting of three judges. This special court’s sole purpose would be to quickly adjudicate all HRT related litigation. This judicial body would not be a mediation or arbitration mechanism, and the special court’s rulings would be binding. Appeals would go immediately before the Hawaii Supreme Court and beyond to the U.S. Supreme Court if required. If the special court becomes overwhelmed with the amount of incoming litigation, then the Governor must have the ability to install additional special courts..

The state must stand up an HRT Environmental Impact Task Force answering directly to the Governor. This Task Force’s sole purpose would be to ensure that the HRT remains compliant with all environmental restrictions . Should new environmental studies need to be completed, then this Task Force would complete them quickly.

The state must stand up a special Department of Permitting and Planning Task Force answering directly to the Governor. This Task Force’s sole purpose is to quickly review and approve all permits allowing the HRT work to continue.

The State’s Attorney General must stand up an HRT Graft and Corruption Task Force designed to suppress under-the-table dealings that further drive up the HRT’s costs. Those arrested and charged, will be tried through the state’s traditional court networks and not through the special HRT court so as not to take any valuable time from the courts main purpose.

None of the members on the special courts or three task force groups should be political appointments. Each member should undergo an extensive voir dire processe to include background checks with polygraphs. This is intended to ensure that all members operate beyond personal politics and are nonsusceptible to corruption.. These members should be chosen purely based on their merits, their personal stamina, and their commitment to complete the HRT legally and quickly so as not to impose one singular additional cent in cost to the state’s citizens. These members cannot operate on “Island Time.”

HART must immediately decide to move the Dillingham route. This re-route should be done in a matter that does not require additional environmental studies nor require the relocation of existing utilities. HART also should re-route the HRT away from known ancient Hawaiian burial sites. We already know that Dillingham and the burial sites will cause delays and raise costs. We must make decisions now, in order to reduce costs and remain on schedule.

The portion of the HRT from Kapolei to the Aloha Stadium that is ready to begin operating soon should immediately be sold to a privately owned transportation company. Japan, Singapore, and the Washington DC METRO systems are either privately owned and operated or are a private-public partnership (P3). These three examples should serve as models for our HRT. These three examples safely move millions of travelers daily without incident. They provide billions of dollars in revenue to the countries and states in which they operate. Selling the HRT from Kapolei to the Aloha Stadium allows us to recoup HRT’s already ballooned cost and will begin bringing in additional tax revenue from the HRT buying company’s annual earnings. Any profits that the state makes from selling the completed portion of the HRT should immediately be put into paying for the last and most difficult phase of the HRT. The special HRT court would hear and rule on any litigation filed to prevent a private HRT sale.

In the event that none of the recommendations listed above are implemented or delayed, the legislature should extend the current GET and TAT increases from 2030 to 2033. Furthermore, the Legislature should lock in GET and TAT specifically collected for HRT completion. The Legislature should debate and pre-approve the privatization of the existing HRT section that is soon to begin operations from Kapolei to the Aloha Stadium. The Legislature must pre-approve the privatization of the final HRT phase that is currently getting ready to commence construction through downtown Honolulu. It is possible that the sale of the final stage can be completed during construction, allowing the buyer to take on the remaining construction costs. If the Legislature approves HRT privatization, the state special HRT court and task force groups must remain in place to enable the HRT’s completion without further delays and cost increases.

There are other ideas for expanding HRT along the leeward side, through Mililani, parallel to the H3/Pali/Likelike, and the Windward side. If any of these are viable prospects, the Legislature can pre-approve the permits and licenses for those HRT route purchases and allow them to be bought by private companies.

Additional Sources of Income

The state must approve additional sources of residual operating revenue. This approval begins with safely and quickly reopening the state’s tourism industry after the COVID-19 pandemic. Beyond reopening for tourists, the state should also approve a lottery, Hawaiian Homeland casinos, and recreational marijuana. Each of these approvals will bring in billions of dollars in annual operating revenue for the state. This additional revenue will enable the state to pay for affordable housing construction, education, renewable energy programs, health care, and resilient diversification of the state’s economy to prevent future over-reliance on tourism and federal government funding. Hawaii should vigorously pursue the Biden Administration for our fair share of the announced infrastructure grants. When obtained, a portion of the grants should be allocated to completing the HRT.

Conclusion

Oahu (597 square miles) is twice the size of Singapore (281 square miles). Singapore has six times the population of the entire state of Hawaii. It also has 126 miles of METRO track, nine lines, 187 stations, and a daily rider count of 3.4 million passengers. Singapore began construction on its Metro in 1983 and opened its first line in 1987. The island of Singapore is one of the most densely populated areas on Earth. HRT is 20 miles long with 21 stations and has a projected daily rider count of 100,000. If Singapore c