BUDGET ONHONOLULU RAIL TRANSITPROJECT

RAIL CONSTRUCTION GOT A GO SIGN

The federal government has granted approval on Monday that will allow the city to begin up to

$184.7 million in construction and other activities on the city’s rail project, including erecting the first sections of raised guideway from East Kapolei to Pearl Highlands

Approval announced by Sen. Daniel Inouyeallows the city to move forward with construction before the federal government has actuallycommitted to contributing its proposed

$1.55 billion share of funding for the 20-mile rail project.

The city hopes to obtain a final commitment for federal assistance by October.

RAIL CONSTRUCTION GOT A GO SIGNWHO GAVE THE APPROVAL?

RAIL CONSTRUCTION GOT A GO SIGNWHO GAVE THE APPROVAL?

THE FEDERAL TRANSIT ADMINISTRATION

RAIL CONSTRUCTION GOT A GO SIGNWHO GAVE THE APPROVAL?

THE FEDERAL TRANSIT ADMINISTRATION-An agency within the United States Department of Transportation (DOT) that provides financial and technical assistance to local public transit systems

-Public transportation includes buses, subways, light rail, commuter rail, monorail, passenger ferry boats, trolleys, inclined railways, and people movers.

-The federal government, through the FTA, provides financial assistance to develop new transit systems and improve, maintain, and operate existing systems.

-The FTA oversees grants to state and local transit providers, primarily through its ten regional offices.

-These grantees are responsible for managing their programs in accordance with federal requirements, and the FTA is responsible for ensuring that grantees follow federal mandates along with statutory and administrative requirements.

RAIL CONSTRUCTION GOT A GO SIGNREQUIREMENTS BYTHE FEDERAL TRANSIT ADMINISTRATION

RAIL CONSTRUCTION GOT A GO SIGNREQUIREMENTS BYTHE FEDERAL TRANSIT ADMINISTRATION

RECORD OF DECISION-issued Jan 18, 2011-City and County of Honolulu met all of the laws and regulations of the environmental review

RAIL CONSTRUCTION GOT A GO SIGNREQUIREMENTS BYTHE FEDERAL TRANSIT ADMINISTRATION

RECORD OF DECISION-issued Jan 18, 2011-City and County of Honolulu met all of the laws and regulations of the environmental review

PRE-AWARD AUTHORITY -issued Dec 29, 2011-phase where Honolulu can relocate utilities, procure vehicles and acquire real estate-move into final design phase-project sponsors and the public that the project are eligibleFor reimbursement

RAIL CONSTRUCTION GOT A GO SIGNREQUIREMENTS BYTHE FEDERAL TRANSIT ADMINISTRATION

RECORD OF DECISION-issued Jan 18, 2011-City and County of Honolulu met all of the laws and regulations of the environmental review

PRE-AWARD AUTHORITY -issued Dec 29, 2011-phase where Honolulu can relocate utilities, procure vehicles and acquire real estate-move into final design phase-project sponsors and the public that the project are eligibleFor reimbursement

LETTER OF NO PREJUDICE-the City has to explain the requirements of the project to the public-City and County of Honolulu can start building pillars

RAIL CONSTRUCTION GOT A GO SIGNHowever there are some limitations.

The city is only allowed to spend

$184.7 million on this phase of the project.

RAIL CONSTRUCTION GOT A GO SIGN

Concrete pillars can only begin in the following areas:• the West Oahu/Farrington Highway guideway, • the Kamehameha Highway guideway, • the maintenance & storage facility • near Leeward Community College• all Farrington Highway stations

However there are some limitations.

The city is only allowed to spend

$184.7 million on this phase of the project.

SO HOW MUCH DOES IT COST?

The entire rail project:-20 miles rail line-21 stations (high-level platforms)-From East Kapolei to Ala Moana Center-uses 720 concrete columns -80 vehicles

SO HOW MUCH DOES IT COST?

The entire rail project:-20 miles rail line-21 stations (high-level platforms)-From East Kapolei to Ala Moana Center-uses 720 concrete columns -80 vehicles

The estimated total cost is

$5.27 billion($865 million or 20% is set aside as contingency)

HOW ARE WE GOING TO GET THAT $

There is no assurance yet:A full funding grant agreement

$1.55 billion for the city to receive(expected from federal funding)

HOW ARE WE GOING TO GET THAT $

There is no assurance yet:A full funding grant agreement

$1.55 billion for the city to receive(expected from federal funding)

For planning and design, Congress appropriated

$65 billion Obama Administration awarded another

$55 million

HOW ARE WE GOING TO GET THAT $

There is no assurance yet:A full funding grant agreement

$1.55 billion for the city to receive(expected from federal funding)

For planning and design, Congress appropriated

$65 billion Obama Administration awarded another

$55 million

That’s

not

enough!

HOW ARE WE GOING TO GET THAT $

Local Funding:The ½ percent surcharge on theGeneral Excise and Use Tax (GET)Paid by residents, business and tourists

$810.4 million Total surcharge revenue collected to date,25 percent of GET estimated revenue(as of January 23, 2012, according to Honolulu.gov )

HOW ARE WE GOING TO GET THAT $

Local Funding:The ½ percent surcharge on theGeneral Excise and Use Tax (GET)Paid by residents, business and tourists

$810.4 million Total surcharge revenue collected to date,25 percent of GET estimated revenue(as of January 23, 2012, according to Honolulu.gov )

The GET surcharge dedicated for the HonoluluRail system began in January 2007 and set to expire on Dec. 31, 2022

ADDITIONAL COST FACTORS

The state financial study, publicly released on December 2, 2010, indicated that the project would likely experience a $1.7 billion overrun above the $5.3 billion projected cost, and that collections from the General Excise Tax would be 30% below forecasts

ADDITIONAL COST FACTORS

Project delay cost at least $15 million (West Oahu/Farrington Highway Guideway)

A federal lawsuit including former Gov. Ben Cayetano totaled more than$1.87 million with seven law firms hired for legal bills (as of Jan 26, 2012, according to Star-Advertiser)

State Supreme Court lawsuit to stop work untilarchaeological survey along the entire road iscompleted

ADDITIONAL COST FACTORS

City Council approved $400,000 for anticipated new legal cost on Jan. 27, 2012

BUT…… HART says…..Construction contracts come in about $300 million under budget, as companies compete for jobsin the tight economy.

DO WE REALLY NEED THIS?

DO WE REALLY NEED THIS?

Honolulu City Council Budget ChairAnn Kobayashi (District 5)

Prior to the 2008 Honolulu general elections,

the City spent over $5 million on lobbying and a public information campaign for the project. From June 30, 2008, to July 31, 2009,

the city spent nearly $1.97 million on community outreach efforts, which included speaker’s bureaus, workshops, a public television

show, and community events. Over $700,000 was also spent on printed material related to the project. The campaign successfully advocated the proposed rail system to the general public and elected officials, as 53% of voters voted in favor of the charter amendment establishing a steel wheel on steel rail transit system. Nevertheless, at the time of the vote, voters were under the impression that the rail project was to cost only $3 billion. Nearly four years later, the project is now estimated to cost $5.3 billion.(according to Feb 8, 2012 Hawaii Reporter )

DO WE REALLY NEED THIS?

CouncilmanTom Berg (District 1)

Berg voted against the additional funding, saying he would rather the city revisit the environmental Impact statement and adopt a different rail technology such asmagnetic levitation.

Government’s role is to make something a success, and if this rail’s going be a success, we can’t bump along and ignore basically half of the island population that begs to differ about the idea of Investing $5 to $10 billion on a Problematic train that relies on old and expensive technology.

DO WE REALLY NEED THIS?

CONTRIBUTORS FOR 2010 HAWAIITOP 10 INDUSTRIES1. Lawyers and Lobbyists2. Real Estate3. Construction Services4. Retired…………8. General Contractors9. Lodging &Tourism

TOP 10 INDIVIDUAL CONT.1. Hawaii Association of Realtors2. HI State Teachers Ass.3. Alexander & Baldwin…………6. A1A Lectrician