LOS ANGELES — Honolulu Mayor Kirk Caldwell sent a letter to rail officials demanding answers about $1.1 billion in cost overruns on Oahu's 20-mile elevated rail project.
In his letter, sent Thursday, Caldwell asked why costs are an additional $200 million over projections given to state legislators in May when they approved a five-year rail tax extension at the end of session.
The letter, addressed to Honolulu Authority for Rapid Transportation Board Chairman Don Horner and Executive Director Dan Grabauskas, asks what has changed in four months that has caused the budget shortfall to soar to $1.1 billion on the now $6.2 billion project.
During the legislative session, in which Caldwell helped lobby state lawmakers for the tax extension, rail officials provided lawmakers with detailed construction budget, schedule and procurement estimates several times, the mayor said.
Caldwell's letter came in response to a quarterly report from HART officials released Sept. 14 that also stated the project could take a year longer than anticipated, pushing completion out to 2021. Hawaii Gov. David Ige requested that HART provide detailed quarterly reports to state lawmakers when he approved extension of the general excise tax.
The mayor asked rail officials to provide more detail about what changed in the baseline assumptions to cause overruns projected at $594 million in fourth quarter 2014 to soar to $1.1 billion by September.
During the rail board's meeting Thursday afternoon, Grabauskas explained that increased cost estimates are a result of having higher bids come in on the project than anticipated and also interest costs on financing if the project takes longer.
"They are estimates in a changing market, which is very volatile," Grabuaskas said.
The Rider Levett Bucknall construction cost index now says that Honolulu has surpassed New York City as the most expensive place to do construction, Grabauskas said.
"I continue to strongly encourage HART board and staff to explore all alternatives and do everything within their power to control project costs and maintain the project schedule," Caldwell said.
He also asked that HART hold a public meeting Oct. 15 to discuss planned revisions to the project, phasing and the budget.