The price tag for Honolulu’s rail project has jumped nearly $1 billion to $9.5 billion including financing, according to an updated financial plan given to the Federal Transit Administration (FTA).
The increase comes from another $1 billion in financing costs not previously disclosed. The plan was turned into the FTA still labeled a draft, and is the first update to the financial plan since 2012.
The actual construction costs remain unchanged from this summer’s estimate of nearly $8.2 billion. The Honolulu Authority for Rapid Transportation (HART) had been saying it would hit $8.6 billion including interest payments on things like bond and other debt financing. But now they have told the FTA it could be closer to $9.5 billion —$1 billion more in interest.
HART has about $6.8 billion it can count on, but needs $8.2 billion—plus any debt financing to cover cash flow—to get to Ala Moana. HART’s new vice chairman, Terrence Lee, learned of a now $2.8 billion funding gap, including financing, about a week ago and says he demanded an explanation of how the financing-inclusive price got to $9.5 billion instead of the $8.6 billion HART stood behind this summer and fall.
According to executive director Brennon Morioka, HART is running 20 to 25 different scenarios, all assuming extension of a 0.5% excise tax surcharge, but with varying state versus city portions, and varying durations. The $9.5 billion cost including financing is just one of the outcomes assuming the city keeps getting a 90% cut of the G.E. tax surcharge for an extra 10 years past 2027.
The Honolulu Rail Transit Project was ranked #4 in Roads & Bridges Top 10 Bridge projects for 2016.