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date May 27, 2010.

Setting the record straight on rail's financial risk:

This past Monday, May 25, at a City Council Budget Committee hearing, we set the record straight by entering into the record of the meeting two documents.

The first was a two-page excerpt from the Federal Transit Administration's latest comparison of projected transit construction costs with actual cost outcomes. While Director Yoshioka had said at a previous Council meeting that the latest openings of transit systems showed they all came in on budget, the actual record shows that only one came in on budget and all rest were over when comparing the estimates at entry into Preliminary Engineering with the final costs. Note that the average cost overrun was 40.2 percent. That kind of a cost overrun on our $5.3 billion project would be over $2 billion.

Second, we introduced the San Francisco Bay Area Metropolitan Transportation Commission (MTC) Annual Report for 2009. (See below "MTC shocker")

We emphasized to the Council the $78 billion maintenance backlog for the nation's transit systems. It begs the question, if virtually all the nation's rail systems are having financial difficulties why should we be exempt?

 

date May 24, 2010.

MTC shocker — "Bay Area transit not sustainable":

The San Francisco Bay Area Metropolitan Transportation Commission (MTC) recently published their 2009 Annual Report. The Commission was created by the California State Legislature in 1970, and is the transportation planning, coordinating and financing agency for the entire nine-county San Francisco Bay Area.

Here are some excerpts from the 2009 Annual Report:

“Even before the worst shocks of the current crisis began to be felt the Commission reached a perhaps inevitable conclusion: “The current transit system is not sustainable ...

“For starters, we simply don’t have enough money to fund our Bay Area transit system — not just today, but in the future as well. The long-range regional transportation plan adopted by the Commission in April 2009, Transportation 2035: Change in Motion, forecasts a huge, $25 billion shortfall in transit funding between now and the year 2033 (see chart on page 8). On the operating side, our projections show a cumulative deficit of $8 billion, which is almost 10 percent of the overall operating costs of the system. The outlook is even worse on the capital side, where available revenues to replace worn-out vehicles and the like are expected to come in $17 billion shy of our projected needs, a deficit amounting to over 40 percent of the total needed. Looking at it another way, we will fall short of the resources our regional transit system needs by a cool $1 billion a year over the next quarter-century.”

They go on to say that the situation is not acceptable but their only concrete proposal to remedy it is to have a significant hike in taxes. They have already hiked fares, cut service levels and instituted user fees at many park and ride lots.

To put this in context with other transit lines, please remember that FTA Administrator Rogoff said Tuesday last (see May 22 below) that the nation's transit lines are, in total, $78 billion behind in bringing their systems up to a barely acceptable level of service.

 

date May 23, 2010.

Doubts about rail's future expressed in FTA internal memo:

In a January 23, 2010, posting we wrote a memo titled "What is a Letter of No Prejudice?" In it we quoted from an internal FTA Memorandum that preceded the permission they gave the City to enter Preliminary Engineering. However, we were remiss in not linking to the document itself and not quoting some of its more salient comments. Above we link to it and following is one passage that bridges the last two pages of this eight-page document. The full document is worth reading.

"... the City anticipates circulation of the FEIS shortly after PE approval and receipt of a Record of Decision (ROD) shortly after the FEIS circulation period concludes. With environmental clearance of the project, the City hopes to receive approval from FTA through a Letter of No Prejudice to break ground on the westernmost 6-miIe segment sometime in December. This schedule appears unlikely due to the delay of the FEIS for the reasons enumerated above in the NEPA section of this document.

"Finally, while the City already has in place a dedicated funding source, project costs have reached a point where they exceed the projected capacity of that source. Further, collections have under-run projections made before the current economic downturn. The financial plan calls for the use of FTA Section 5307 formula funds for nearly a decade to cover remaining capital costs. A look-ahead by FTA's financial contractor suggests that these difficulties may cause the financial plan to fail the financial stress tests that will be applied when the City requests entry into final design. Consequently, financial issues may pose difficulties sufficient to put at risk the City's anticipated initiation of final design in early 2010. An early warning of this risk has been included in the PE approval letter."

 

date May 22, 2010.

We now have the Draft Final EIS for the rail project:

This latest Draft Final Environmental Impact Statement is the one revised through October 12, 2009. We are starting to work our way through it and would appreciate any comments you have about any major changes since the Draft EIS. Please send your comments to info@honolulutraffic.com.  We have also linked to the Draft Final EIS on our NEPA process docs tab

 

FTA warns about the expense of rail transit:

In a speech made at the Federal Reserve Bank of Boston last Tuesday, Peter Rogoff, the head of the Federal Transit Administration made some surprising remarks. Here is an excerpt together with a video of him making the speech:

"Supporters of public transit must be willing to share some simple truths that folks don't want to hear. One is this -- Paint is cheap, rails systems are extremely expensive.

"Yes, transit riders often want to go by rail. But it turns out you can entice even diehard rail riders onto a bus, if you call it a "special" bus and just paint it a different color than the rest of the fleet.

Once you've got special buses, it turns out that busways are cheap. Take that paint can and paint a designated bus lane on the street system. Throw in signal preemption, and you can move a lot of people at very little cost compared to rail.

"A little honesty about the differences between bus and rail can have some profound effects.

"Earlier I pointed out that our new estimate for the deferred maintenance backlog for the entire transit universe is roughly $78 billion. But you should know that fully 75 percent of that figure is to replace rail assets.

"Now let's remember that the majority of transit trips in this country are still done by bus. When it comes to delivering actual transit service, Americans take 21 percent more transit trips every year than rail trips. That said, fully three quarters of the funding backlog we face in achieving a state of good repair is associated with underfunded rail assets.

"Communities deciding between bus and rail investments need to stare those numbers in the face. Some communities might be tempted to pay the extra cost for shiny new rails now. But they need to be mindful of the costs they are teeing up for future generations."

The full speech, which is available online on the FTA website, is worth reading if only to learn that while the busiest seven rail transit systems have a maintenance backlog of $50 billion, the others add another $28 billion for a $78 billion backlog total. And that total only brings these systems into an marginally acceptable condition, what is called "a state of good repair," a condition with half the score of an "excellent" condition.

[Our thanks to Randal O'Toole and Dale Evans for bringing this speech to our attention.]

 

date May 14, 2010.

Excellent transportation presentation on the 19th from NDTA

Those with a serious interest in Oahu's transportation problems should consider this event sponsored by the NATIONAL DEFENSE TRANSPORTATION ASSOCIATION next week Wednesday, May 19, 8:30 AM at the Pearl Country Club. Lunch is at noon and adjourn at 1:30 PM. It is all part of the NATIONAL TRANSPORTATION WEEK Forum.

Morning Panel: KAPOLEI – SECOND CITY OR SECOND BEDROOM?

Keynote Address: MOBILITY FIRST! DR. DAVID CALLIES is Hawaii’s preeminent expert on Land Use & Development laws. This is a rare opportunity to find out his take on the forum’s morning panel topic.

Dr. Callies has a fascinating background in legal practice, teaching and writing. He has authored seventeen books including Bargaining for Development: A Handbook on Development Agreements, Annexation Agreements, Land Development Conditions and Vested Rights, 2003, Preserving Paradise: Why Regulation Won’t Work, 1994, Regulating Paradise: Land Use Controls in Hawaii, 1984. Callies is updating his book on Hawaii land use law. http://www.law.hawaii.edu/personnel/callies/david

DR. SAMUEL STALEY brings an international perspective on land use, urban growth and transportation policy. He is the author of Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century (2009) and has spent the past three years on transportation policy projects in China. http://reason.org/staff/show/706.html

The other two distinguished morning panelists are: KIONI DUDLEY, Ph.D. who will discuss the Ho’opili situation and Professor PANOS D. PREVEDOUROS, PhD., to discuss transportation & disaster resilience for Oahu. http://www.cee.hawaii.edu/persons/prevedouros/prevedouros.htm

DR. STALEY will be the luncheon keynote speaker on MOBILITY.

$30 FEE if you register before 5 PM Monday 5/17 Send reservation to: Yvonne Frazier <yvonne.frazier@hickam.af.mil>

Please disseminate this invitation to your colleagues and other organizations.

Please RSVP now so that we can provide a count for lunch.

 

date May 13, 2010.

Honolulu should have traffic lights like Quincy, Mass.:

An article this week in the Boston Globe describes how traffic lights operate in Quincy, Massachusetts and how they could operate here. Dr. Prevedouros calculates that if we had such computerized traffic lights we would save seven million gallons of gas annually and it would result in the equivalent of removing 14,000 cars from our roads.

Read the Boston Globe article linked above and the follow that with Dr. Prevedouros' comments:

"About three million trips are made on a typical day on Oahu and we can extrapolate that there should be at least 60 million stoppages of vehicles in a day. Optimized traffic lights can reduce at least five (5) seconds for each stoppage, on the average.

"These five seconds accumulate to 83,000 of vehicle hours of idling engines per day. This is like having 8,300 vehicles idle for 10 hours every day. So?

"An average vehicle will consume about one third of a gallon per hour of idling, or one (1) gallon if it's a truck or bus. Let's stick to 0.33 gallons per hour of idle and 250 typical days a year. The rest of the year we assume no savings.

"This comes out to nearly seven million gallons of saved fuel per year!

"Further if you assume that the typical Oahu car is driven for 10,000 miles and has an average fuel consumption of 20 mpg, then it needs 500 gallons of fuel per year. Divide the 7,000,000 gallons of fuel saved by 500 and this 5 seconds of savings from traffic lights becomes equal to the permanent removal of 14,000 cars for one year.

"That's more that any rail on Oahu will ever do. And you just thought that traffic lights were just three boring colors.

"(A side point: On your regular commute you know the "long lights." You will save fuel and engine wear if you turn your engine off at those lights when you are caught at the beginning of a red signal. Hybrids do this regularly and get a big jump in their city MPG rating.)"

Read more of Dr. Prevedouros' thoughts on fixing Oahu's infrastructure at http://fixoahu.blogspot.com/

 

date May 12, 2010.

Federal EISs are statutorily required to be scientific and accurate:

Our readers who are professionally involved in the technical aspects of the NEPA process might want to pay attention to the two documents we link to below. The first is titled THE NEPA TASK FORCE REPORT TO THE COUNCIL ON ENVIRONMENTAL QUALITY and is where the excerpts below are from. This one implements the requirements of the Office of Management and Budget's guidelines referred to below for NEPA documents.

"1.5. NEPA and Information Quality The [Council On Environmental Quality] (CEQ) regulations implementing [the National Environmental Policy Act] (NEPA) state that environmental information must be available to public officials and citizens before decisions are made and actions are taken. Additionally, the information must be of high quality because accuracy is essential to implementing NEPA."

"Additionally, the CEQ regulations state:

"Agencies are to ensure the professional integrity, including scientific integrity, of the discussions and analyses in environmental impact statements. They shall identify any methodologies used and shall make explicit reference by footnote to the scientific and other sources relied upon for conclusions in the statement. An agency may place discussion of methodology in an appendix. OMB’s “Guidelines for Ensuring and Maximizing the Quality, Objectivity, Utility, and Integrity of Information Disseminated by Federal Agencies” implementing the Information Quality Act further emphasize the need for high quality information in NEPA analyses and documents."

"3.3. Content of Programmatic Documents Agencies and the public believe that programmatic NEPA documents should be concise and clear and provide vision and goals for the next level of decisionmaking. At a minimum, agencies should state the significant issues and clarify what the purpose of the first tier document is in relationship to subsequent levels of analyses and documentation. Many respondents expressed frustration that the contents of programmatic documents do not fulfill expectations for scope of alternatives and scope and specificity of effects analysis.

 

date May 10, 2010.

City Council requests documents from Honolulutraffic.com:

During the Council Transportation Committee hearing on Thursday it became quite contentious with Councilmembers Cachola and Kobayashi trying hard to get straight answers from DTS Direction Wayne Yoshioka. The video may be seen by clicking here and is worth seeing if only to learn how adept the DTS Director is at avoiding answering direct questions through the use of the Yoshioka two-step; it is dancing at its finest.

Cliff Slater testified (1 hour 18 minutes into the video) that Director Yoshioka was painting far too glossy a picture of the rail project's financial plan and quoted from several federal documents in support of his position. Councilmember Cachola said that he had not seen some of these documents and asked that Honolulutraffic.com supply them. This we have done and the letter with links to all the documents was sent to him today.

 

Reminder: See "NEPA process docs" for the relevant documents:

Just a reminder that virtually all the relevant documents relating to the National Environmental Policy Act (NEPA) process for the rail project are listed in chronological order under the "NEPA process docs" tab to the left. It also includes the relevant federal and state statutes.

 

date May 6, 2010.

Former Gov. Cayetano files complaint about city procurement violations:

Today's Advertiser story says, "The complaint of suspected city procurement violations was filed about two weeks ago with the state attorney general's office and the U.S. attorney's office by a local attorney, John McLaren, on behalf of former Gov. Ben Cayetano and other, unidentified, people."

Click here for the complaint letter, which was originally in a letter to Councilmember Ann Kobayashi.

The Mayor will hold a press conference on this later today.

 

Council reso seeks updated rail financial plan:

The Advertiser wrote, "The Honolulu City Council transportation committee unanimously passed a resolution today requesting that city officials provide the council an updated financial plan for Honolulu's $5.3 billion rail project as well as an accounting of transit fund proceeds and expenses."

"Under the resolution, which now goes for a vote before the full council, the council also is seeking a list of all city and contract employees working on the project along with their qualifications, and an updated list of rapid transit contractors and subcontractors."

"City Transportation Director Wayne Yoshioka said he would provide the council with the requested information. However, he could not say when the information would be available."

 

City admits that traffic congestion with rail will be worse than it is today:

On November 3, 2008, the day before the 2008 rail referendum, KHVH’s Rick Hamada hosted a two-hour panel to discuss the rail issue. The panelists were:

• Cliff Slater, Chair, Honolulutraffic.com

• Mike Schneider, President, InfraConsult LLC, which provides management oversight of the rail project, and was formerly Executive Vice President of Parsons Brinckerhoff.

• Wayne Yoshioka, Director of the City Department of Transportation Services and formerly a local manager for Parsons Brinckerhoff.

• Dr. Panos Prevedouros, UH Professor of Environmental Engineering.

 

Following is a transcript of a four minute segment of the second hour of the program. Click for audio to check the accuracy.

Cliff: “Mike, are you saying that while traffic congestion with rail in the future will be worse than it is today, it will be less worse than it would be if we did not have the rail line.”

Mike: “Of course, that is exactly what I am saying.”

Cliff: “But the point is that 73 percent of the people in Hawaii as polled by the Advertiser believed that by building rail we would reduce traffic congestion and reduce their commute time."

Mike: “It clearly will reduce their commute time. There is no question that those who take the rail will have a reduced commute time."

Cliff: “Oh, no. They are talking about traffic; traffic congestion. “

Wayne: “Cliff, I think you are talking about traffic congestion. Look at the traffic congestion. We are saying that … Well, originally in the Alternatives Analysis we were projecting a 11 percent reduction in traffic congestion. Now, In the DEIS that is now up to 21-22 percent. Over twice what we had projected. Because again, the DEIS was more accurate….” [Wayne then continues his famed Yoshioka two-step trying to get off the subject] …

Cliff: “I wouldn’t argue that point but I am just coming back to the thing that the public has a different take of what is going to happen with traffic congestion in the future than you do or we do. We in the room here all understand that traffic congestion is going to get worse with rail in the future. That is not what the public understands. The public thinks that traffic today — today’s unendurable traffic congestion going from here out to Kapolei — will be reduced from today’s levels once rail goes in. That’s what they believe. We don’t believe it — you and I don’t believe that. But on the other hand that is what the general public believes.”

Wayne: “What the public is asking for … the public is asking for is some kind of relief and I think that the only realistic relief they can expect is through the rail system as opposed to putting more cars, more buses on the already jammed street system. That is not going to give them the relief.”

There you have it. You thought you would never hear the City admit that traffic congestion will be worse with rail.

 

date May 5, 2010.

Advertiser reveals native burial issues for FEIS:

Today's story in the Advertiser about protecting native burials deals with a recent Resolution by the Oahu Island Burial Council (OIBC) asking that the Department of Land and Natural Resources comply with Hawaii statutes regarding burial grounds along prospective rail routes. The Resolution is as follows:

    "Whereas, the current [Programmatic Agreement (PA)] for the City's rail project includes a phased approach for archaeological inventory survey, and

    Whereas, [Hawaii Revised Statutes (HRS)] Chapter 6E-8 and 6E-42 preclude a phased archaeological inventory survey approach, and

    Whereas, the State Historic Preservation Officer has the ability to safeguard the full authority of State historic preservation laws and the integrity of historic properties and burial sites, and

    Whereas, the [O’ahu Island Burial Council (OIBC)] Rail Task Force has been guaranteed in numerous PA meetings that State laws would not be circumvented by the PA,

    Therefore, the OIBC strongly recommends that the State Historic Preservation Officer object to any version of a PA that allows for a phased archaeological inventory survey approach, and that the OIBC communicate the same to the PA signatories in our capacity as consulting parties to the PA."

The relevant Chapters referred to in the Resolution are at http://hawaii.gov/dlnr/hpd/hrs_6_e.htm In particular, the following excerpts would seem to be the most important.

    "HRS §6E-43 Prehistoric and historic burial sites. (a) At any site, other than a known, maintained, actively used cemetery where human skeletal remains are discovered or are known to be buried and appear to be over fifty years old, the remains and their associated burial goods shall not be moved without the department's approval.

    "(b) All burial sites are significant and shall be preserved in place until compliance with this section is met, except as provided in section 6E-43.6. The appropriate island burial council shall determine whether preservation in place or relocation of previously identified native Hawaiian burial sites is warranted, following criteria which shall include recognition that burial sites of high preservation value, such as areas with a concentration of skeletal remains, or prehistoric or historic burials associated with important individuals and events, or areas that are within a context of historic properties, or have known lineal descendants, shall receive greater consideration for preservation in place. The criteria shall be developed by the department in consultation with the councils, office of Hawaiian affairs, representatives of development and large property owner interests, and appropriate Hawaiian organizations, such as Hui Malama I Na Kupuna O Hawai`i Nei, through rules adopted pursuant to chapter 91. A council's determination shall be rendered within forty-five days of referral by the department unless otherwise extended by agreement between the landowner and the department."  

What is most important about the City's failure to address the OIBC's concerns, is that the City did not review a possible "feasible and prudent avoidance alternative" that the Section 4 (f) statute requires. Had the City done that during the Alternatives Analysis phase in 2006, they would have had to face the fact that both the Kamehameha Schools' at-grade light rail proposal and our Managed Lanes Alternative proposal would have met the requirement of Section 4(f) and been preferable to the elevated rail project. For further detail see our letter to the Federal Transit Administration of November 4, 2009.

 

date May 1, 2010.

FAA to  approve airport rail move. Really?

Today the Mayor announced that the Federal Aviation Administration (FAA) will approve the move of the rail line one block mauka from the original alignment along Aolele Street.

The fact is that a couple of months ago the City was told by the FAA that the rail line was too close to the end of airport runways and the City had two choices. They could either move the rail line one block mauka or pay for moving the affected runways.

Then a month ago the City announced that it really had no choice, because of the cost of moving runways, and so would move the rail alignment one block mauka.

Now we get today's "news" release telling us what they have already told us; they have taken one of the two choices that the FAA had given them.

This is just another case of the Mayor creating news out of thin air in an attempt to show that rail is not dead yet, folks, it's still a done deal. Maybe it is, but we don't see it that way and, in any case, there's still a long road ahead.

 

date April 24, 2010.

The long, long road to rail construction:

We dealt briefly a month ago with the lengthy procedures yet to be dealt with before rail can be built. Here we enumerate them in more detail:

First, the Council must pass the budget bill including $1.3 billion for rail and also authorize the first bond issue for rail. The Council must be reminded that if they authorize construction funding for rail they are really authorizing the entire $5.3 billion. Once construction on rail lines is started they are always finished.

The City Administration must settle the airport situation to the satisfaction of the Federal Aviation Administration, the Federal Transit Administration and the State of Hawaii Airports Division. Council Chair Todd Apo said this might take three to six months. It may take longer if the FTA decides that a Supplemental Draft EIS is needed.

The City Administration must make sufficient changes to the Programmatic Agreement, which is required to be a supplemental part of the FEIS. We understand that still to be resolved are the dispute over surveying of the Hawaiian burial grounds that almost certainly lie along the rail route, the impacts on historic properties, and the city ordinance protecting mauka/makai view planes.

If all this occurs the City and the FTA will produce a Draft Final EIS, together with the financial plan that is part of its application for entry into the Final Design phase. We question whether this plan can be made “robust” enough (see April 23 entry below) to satisfy FTA, let alone the Governor.

Next would be the Governor’s approval of the Draft FEIS. The Governor’s office has said that this should take about three months to complete this work. Financially “robust” means that the analysis has to take into account the likelihood that the Environmental Protection Agency (EPA) will make the City bear the cost of a new $1.2 billion sewage plant to bring the system into EPA compliance and the detrimental effects that the Akaka Bill will have on City finances if it passes this year (see April 22 below). In addition what must be weighed is the almost certainty of cost overruns for rail’s construction and operations. All this will have to be weighed against the State’s own fragile financial situation and the current $6 billion unfunded liability in the State’s public worker pension fund.

In the unlikely event that the Governor finds the financial plan reasonable then she would sign off and the City and FTA would issue the Final EIS. After this there will be a thirty day period for public comments, and then another thirty days for the FTA to respond to the comments before it issues its Record of Decision (ROD).

Once the ROD issues the project is then legally “ripe” for a lawsuit to be filed, which we will do immediately.

Even when the ROD issues it still does not mean that the city can begin construction of the elevated rail line. Councilmember Cachola filed a formal report (see April 2 entry) to the Council after the delegation returned from Washing ton and he tells us that FTA was quite clear that, “No construction shall be done until the Full Funding Grant Agreement (FFGA) is signed, except for portions of the project to be constructed after receiving a Letter of No Prejudice (LONP). The City can only work on portions of the project as spelled out in the LONP.”  

 

date April 23, 2010.

How can the City fund a "robust" financial plan for rail?

The Federal Transit Administration’s October 16, 2009, letter to the City approving its entry into the Preliminary Engineering (PE) phase of the project warned the City that,

“the City should be aware that FTA's standards for the financial rating are higher for entry into final design [the next planning phase] than for entry into PE. The higher standard for final design includes an assessment of the robustness of the financial plan against increases in costs, shortfalls in revenue streams, and competing demands on funding sources. Some elements of the current financial plan may not fare well in the stress tests that FTA will apply to evaluate robustness. These elements include the projected revenue stream from the General Excise Tax, the diversion of FTA Section 5307 funds from ongoing capital needs of the bus system, and the increasing share of the City's annual budget that is required to fund the transit system. Were this plan submitted today in support of a request to advance the project into final design, its weaknesses would likely cause FTA to deny the request Therefore, continued development and strengthening of the financial plan will be a crucial part of the PE effort.”

The City is constrained by Council ordinance to only construct the line from GE tax surcharge revenues and any federal, state or private revenues:

“The city administration is authorized to proceed with preparation of an environmental impact statement for the locally preferred alternative (LPA), and with planning and preliminary engineering for that portion of the LPA (including any portion of any section of the LPA listed in section 2 above) that may be constructed within financial constraints (capital cost and any interest to finance that capital cost shall be paid entirely from general excise and use tax surcharge revenues, interest earned on the revenues, and any federal, state, or private revenues); provided that this portion shall constitute a minimum operable segment (MOS) for purposes of Federal New Starts funding eligibility.”

The City currently plans to use $300 million in federal bus money to build the rail line and substitute bus capital funding from the General Funding. Since it is plain that the underlying reality is that the City is using $300 million from its General Fund to build the rail, it is of doubtful legality.

The FTA says it is concerned about the “robustness” of the City’s financial plan. Given the likelihood of cost overruns, the financial threat of the Akaka Bill (see below), a shortfall of GE Tax revenues, and a smaller federal contribution, one must ask what the additional revenue sources will be.

The State Legislature is in no mood to either increase the GE tax surcharge or increase its life. The planned federal contribution relative to other cities is already totally out of line so that cannot possibly be increased. Private sources have already dried up. The State has its own funding issues to worry about.

So how can the “robustness” be ensured? Where are the funds to come from? Are we missing something? If any of our readers knows something that we do not, please let us know. I

 

date April 22, 2010.

Akaka Bill adds more uncertainty to rail financing:

If the Akaka Bill passes this year in the U.S. Senate, it will likely add considerable uncertainty to the City's financial projections. A study last year by the Beacon Hill Institute found that the outcome of the state transferring land to the sovereign Native Hawaiian Governing Entity would be a significant reduction in the state's Gross Excise Tax revenues upon which the rail depends to build the rail transit line.

Beacon Hill found that depending on how much land was transferred the state could lose between $320 and $536 million, of which about $25 to $40 million annually would be the shortfall to the City.

 

date April 14, 2010.

Prevedouros makes the case that rail will reduce jobs:

Dr. Panos Prevedouros, in a press release issued today, argues that the amount of taxation and debt we are encumbering ourselves with for rail transit will reduce jobs, not create more. He gives great examples of how it has happened elsewhere. This is a must read.

 

Our report on the Council Budget Committee hearing:

We spent a total of five and a half hours yesterday at the Council Budget Committee hearing. The plan was to testify on the $1.3 billion for rail transit expenditures in the Budget and secondly, the authorization for the City to sell $1.1 billion in General Obligation Bonds to fund the first segment of the rail line. However, other appointments kept intruding and we missed the key bills.

We had wanted to remind Councilmembers that if they voted for either one of these, and construction began without assurances of federal funding, as DTS Director Yoshioka had said would happen (see below 4/10), then we would be assured of financial chaos. There has never been a case where rail transit construction has begun and never been finished no matter what the financial situation.

Secondly, we heard for hour upon hour the plaintive and emotional testimony of the non-profits that the City relies upon to provide much of the social services. Of course, they are not union members and so their budgets are the first to go. These folks do good work and the contrast between their requests for $500,000, $200,000, and $50,000 stood in stark contrast with the expenditure of $5,500,000,000 that was about to come up on the agenda.

The video for the entire hearing is not up at the time of posting but check the council video site for the latest postings.

 

City has now the sixth largest budget deficit in the nation:

 

Honolulu's per capita budget shortfall is exceeded by only five other cities in the nation, Harrisburg PA, Detroit, Los Angeles, San Francisco, and New York City according to Business Insider Magazine .

 

date April 10, 2010.

Council Budget Committee Meeting Monday:

The City Council Budget Committee will meet this Monday, April 12, at 9:00 AM, to consider among other matters:

  • The City Budget, which contains $1.1 billion for the first phase of rail transit.
  • Authorization to sell $1.1 billion of city general obligation bonds for rail.
  • Increases in real property tax for renters.
  • Increase of 3˘ a gallon in the city gasoline tax.

The City Council welcomes constituents who wish to gripe about these issues. You may sign to speak ahead of time with the City Clerk, or, if you prefer, wait until the end of the hearing on that issue and the Council Chair will ask if there is anyone who still wishes to testify on the matter.

 

Yoshioka waffles on the new rail alignment:

At the City Council Transportation Committee hearing on Thursday, April 8 Transportation Director Yoshioka did not sound like the rail alignment was a done deal. It was more like they were exploring what they believed would be the preferred alternative but that it was not yet certain; even the owners and tenants had yet to be informed about it. The Advertiser covered it well as did KITV.

 

City tells Council an LONP is unnecessary for the first phase:

Also at the City Council Transportation Committee hearing on Thursday, April 8, Transportation Director Yoshioka told the Committee that once the City gets a Record of Decision (ROD) from the FTA they can proceed with construction because the first segment is a Design/Build program. In other words, a LONP is not necessary.

This is a highly dangerous development, if true. It would mean that with passage of these budget measures, the City has the funds to go forward. If they did start construction and the federal funds were not forthcoming we would be left with a financial mess.

Earlier at the 47 minute 50 second mark, Okino asked Yoshioka, "Why aren't there any federal funds after 2011 to support the preventative maintenance". In the dialog that followed it is obvious that the Council majority does not want this issue to surface to the public. This is the matter of federal funds normally used for buses being used to shore up the otherwise defective rail finance plan.

 

date April 2, 2010.

Romy Cachola reports on FTA meeting:

Four of our City Council members, Todd Apo, Ann Kobayashi, Romy Cachola and Ikaika Anderson, met on March 9, with FTA Administrator Peter Rogoff, Jim Ryan and other FTA staff. Councilmember Cachola posted his take of the meeting this week.

The highlights, from our perspective, were:

  • Confirmation by Rogoff that the Federal Aviation Administration will not sign off on the Final EIS until the airport issue is resolved.
  • The Native Hawaiian burial grounds issue is still not resolved. The statutes require that a Archeological Inventory Survey be performed at the time of the Alternatives Analysis; this was not done.
  • Councilmember Kobayashi told FTA that the City ordinance affecting mauka/makai viewplanes must be addressed.
  • FTA confirmed that they will not bank on an extension of the GE tax collection beyond 2022, or an increase in the GE tax. They will rely on the City’s current financial plan.
  • FTA confirmed that in addition to the Final EIS, FTA has to issue a Record of Decision, approve the project’s entry in the Final Design phase, and then approve a Full Funding Grant Agreement with the City. No construction shall be done until the FFGA is signed, “except for portions of the project to be constructed after receiving a Letter of No Prejudice (LONP). The City can only work on portions of the project as spelled out in the LONP.”

date April 1, 2010.

Honolulu Weekly scoops us with Draft FEIS:

Honolulu Weekly is running “Rail: The EIS, unbound.” That’s embarrassing. The Weekly apparently did not know that the feds NEVER accept FOIAs (Freedom of Information Act) for documents that are still in draft form, so they asked the FTA for the Draft FEIS — and got it!

That leads us to the main question: Why did the FTA release the Draft FEIS? Was it an error or some strategic move?

Rather than comment on the Weekly’s story, we have made a FOIA request ourselves and will comment on it when we receive it.

 

date March 29, 2010.

Why the Governor wants an independent review of rail:

The Mayor is constantly saying that he does not understand why Governor Lingle wants a truly independent look at the City’s financial plan for rail transit.

Let us help him understand it:

First, Parsons Brinckerhoff prepares the financials for the city. However, PB has a potential conflict since if the project moves forward PB stands to gain hundreds of millions of dollars in future planning revenues.

PB’s financials are then reviewed by the Federal Transit Administration. FTA has a little conflict here because they lean to favoring rail projects rather than buses on highways as it differentiates them from the Federal Highways Administration, another US DOT agency.

FTA hires Financial Management Oversight Contractors to review the various applicants’ financials. In our case it is Ben Porter & Associates of Seattle. They would have the usual conflict in that if they stray too far from what FTA wants to hear, it might jeopardize future contracts.

We note from the Governor’s agenda this week that she is meeting with the Western Region head of the Environmental Protection Agency. This may be to clarify EPA’s comments on the Draft EIS that they could not understand why at-grade light rail, or express buses on exclusive busways were not studied in the EIS. Or it may be to discuss the city’s liabilities for the $1.2 billion sewage treatment upgrade; if this upgrade is imminent it would have a profound effect on our city’s finances.

All in all, it is easy to see why the Governor wants to ensure that there is no financial spillover from the City onto the state. See also our January 29 posting below, “Governor, mayor at odds over financing for rail.”

 

City commits an unpardonable sin:

Government agencies do not seem bothered when another government agency lies to the voters. But have one government agency lie to another and the gloves come off.

According to Friday’s Advertiser, Brennon Morioka, Hawaii DOT’s Director, said, “There is a lot of misinformation out there about the Honolulu rail transit project and the public deserves to know all the facts.” He can say that again.

The current disagreement between the state and the city is over when the city was aware of the rail project encroaching into the airport runway safety perimeter (see our March 17 entry below).

The city says they did not know about this until recently; in response the state’s Morioka has posted an August 2006 letter (stamped with a City receipt) wherein he warns the City to “be aware of height restrictions, especially at the area near Lagoon Drive, which is the runway approach area for Runway 4R and 4L.”

For anyone with an interest in the City’s endless playing with the truth see our comments on the Draft EIS that are over a year old: Strategic misrepresentation in the Draft EIS and Strategic misrepresentation outside of the Draft EIS.

 

date March 28, 2010.

Pritchett does it again:

Once again we are indebted to John Pritchett for illustrating and enlivening the rail transit discussion. See more of his work at www.pritchettcartoons.com

 

date March 21, 2010.

Advertiser: “Tax revenue for rail falling short":

Today's Advertiser details the rail tax shortfall. Originally the City forecast GE Tax collections for the ˝ percent rail tax surcharge of $198 million for fiscal year 2010. Subsequently they reduced it to $164 million and through the first eight months of the 2010 fiscal year has been four percent short.

 

date March 18, 2010.

Advertiser: “Number of rail jobs is anybody’s guess”:

A recent Advertiser report has the UH Economic Research Organization essentially discrediting the City’s claim of 10,000 jobs being created by the rail project.

UHERO’s last prediction was that the rail project would only generate 2,000 direct jobs, which is less than half that projected by the City.

A statement by the winner of the bid for the first third of the rail project, excluding stations and rail lines, was that they would be hiring 350 workers for the project. Since the entire project will take eight years to build it may well be the same 350 workers building each of the next segments.

Many of the other direct jobs will be skilled jobs peculiar to rail lines and most of these would of necessity be workers imported from the Mainland.

This is typical of all cities building rail lines; they understate the costs and overstate the benefits.

 

Will the rail project be another “un-done” deal?:

The Airport problem is not the only issue: The Programmatic Agreement, which covers issues relating to Historic Properties preservation and historic burial sites, does not appear to have agreement yet among the required signatories and the FTA.

Then there are timing issues: If we assume that there is no easy solution to the airport problem, then the delay is likely to be three to six months according to Council Chair Todd Apo. That gets us to a completed draft Final EIS, which requires Governor Lingle’s review and that should take at least four to six weeks.

Assuming that the Governor then signs off on the Draft Final EIS, the FTA would issue the Final EIS and then wait 30 days for comments from interested government agencies and the general public. The FTA will then respond to the comments and after legal review and mailing within, say, another 30 days. Some 30 days after the FTA issues their responses to the comments, the FTA would issue their Record of Decision. That would take us to, at the earliest, mid-October.

After that the City needs the FTA to issue a Letter of No Prejudice allowing the City to spend local tax money to begin construction of the rail line. The Final Guidance from FTA on LONPs makes it quite clear that the FTA is not going to allow the City to begin actual rail construction before the City is much further along in the process and closer to being granted a Full Funding Grant Agreement.

 

KITV video shows airport problem:

This KITV video together with the map below gives a great explanation of the problem the City faces

 

date March 17, 2010.

Rail has an airport problem:

Today’s Advertiser covers rail’s airport problem very well including graphics showing exactly the problem; the mauka end of the runway that parallels Lagoon Drive is only 1,000 feet from the four-story high rail line and that is too close.

It would appear that either the state will have to make major changes at the airport or the City will have to move the rail line adjacent to the H-1 freeway. Either way it is almost certain to trigger a new EIS for the State for airport changes or a new Supplemental EIS for changes to the rail line. We are talking lengthy delays and greater expense.

 

date March 11, 2010.

People's Pulse release results of a highly biased poll:

The Winter 2010 People's Pulse was released today by its sponsors the Hawaii Business Roundtable and Pacific Resource Partnership, the latter being the large construction companies and the Carpenters' Union. It's headline was "2 in 3 residents oppose conducting another transit study."

Their statement said, "Last month, the State government informed the Federal Transit Authority that it would conduct its own study of the proposed mass transit financial plan before deciding whether or not to approve it. The City and County of Honolulu responded that the current Environmental Impact Statement (EIS) is sufficient for decision-making."

"The People’s Pulse asked residents which option they prefer. In this either/or question, a large majority of residents (67%) favor making a decision based on the existing EIS study rather than waiting for another audit. A little over 1 in 5 prefers having another study done on the financial plan, which suggests that by a margin of more than 3:1, residents prefer action over more study. However, 1 in 10 remain undecided between these options.

The Governor’s response was: “The vested interest shared by the People’s Pulse Survey co-sponsors Hawai‘i Business Roundtable and Pacific Resources Partnership resulted in a poorly worded and misleading survey question.

“Also, the question failed to identify the Governor’s legal obligation to review and approve the final Environmental Impact Statement (EIS). “

"Under the law, the Governor must review the final EIS to ensure that it satisfactorily describes all impacts on the environment, economic and social welfare, and cultural practices; incorporates an objective review of opposing alternatives; and responds to each substantive comment received during the draft EIS review process.

“As part of this review, the Governor will conduct a thorough independent analysis whenever the City submits its final financial plan to determine whether or not the plan is financially feasible and sustainable, especially given the current economic situation and the revenue outlook."

OUR COMMENT: It is appalling that the Business Roundtable would tarnish their reputation by standing behind such a biased poll question. Further to the Governor's response, the poll question spells out the $3 to $5 million cost of the Environmental Impact Statement but does give an estimate of an independent financial review, which would be a tiny fraction of the EIS cost. Instead, by leaving out the review's cost, it implies that a similar cost would hold for the Governor’s review.

 

date March 4, 2010.

City Council Chair reports on Rogoff meeting:

At a City Council Transportation Meeting this morning, Council Chair Todd Apo made a brief presentation (video) about the meeting he, the Mayor, and Toru Hamayasu had with FTA Administrator Peter Rogoff.

He said that Rogoff told them he was hoping for a conclusion within two weeks or so to the rail transit project’s difficulties with the Federal Aviation Administration at the Honolulu airport.

Rogoff also said that the last financial plan he has from the City is the one made as part of the City’s request to enter Preliminary Engineering. The next plan will be that made as part of the City’s request to enter Final Design and that, he said, will have to be far more robust than the one they already have.

Apo reported that Rogoff also said that the Section 106 Programmatic Agreement had been released by FTA and that all the required signatories to the PA were ready to sign it.

Apo also said that he together with Councilmembers Ann Kobayashi, Romy Cachola, and Ikaika Anderson would meet with FTA’s Rogoff next week in Washington DC. Anyone with specific questions for FTA should send them their councilperson before close of business tomorrow.

Editor’s note: First, it is going to be interesting to see how the financial plan can be made more robust. That can only be done with new taxes or extension of existing ones, or larger state or federal contributions. These are hardly likely options given the current economy.

Second, the required signatories for the PA do not seem to be aware of it being released by FTA.