No, Mayor Caldwell, raising taxes is not the only way to address the spiraling costs of the biggest public works project in Hawaii history.
By Cynthia Thielen – Community Voice
This legislative session, Honolulu Mayor Kirk Caldwell lobbied hard for extending the general excise tax another decade to fund rail, already the most expensive public works project in state history.
Had the Legislature buckled to that pressure, we would have converted a disappointment into a disaster. After burning through a generous $1 billion contingency fund, the mayor offered no honest accounting for past mistakes, no serious pledge to reduce expenses and no reasonable concessions to economic reality.
Instead, he pinched the “too-big-to-fail” argument from Wall Street bankers and demanded yet another bailout from Hawaii taxpayers.
Honolulu Mayor Kirk Caldwell inside the rail project’s first train car.
Anthony Quintano/Civil Beat
Last year, the Federal Transit Administration urged the Honolulu Authority for Rapid Transportation to consider “a smaller project of independent utility” within current budget constraints. It conditioned federal funds on cost containment, interim terminus or deferral of certain stations, or new investment. With characteristic obstinacy, Caldwell pursued only the last option by only a single means: raising taxes.
I support bringing the city center segment from Middle Street to Ala Moana down to street level. This sensible alternative would save about $4 billion and four years of construction, while sparing Honolulu’s waterfront from permanent visual blight. By running the trains sooner, we can also use passenger fares to defray some expenses.
Building a street-level portion would imaginatively and prudently combine the measures requested by the federal government. The city has always reserved this as a contingency option should cost overruns doom the original plan for elevated rail. We have now reached that juncture.
Tax increases in any form will only subsidize Caldwell’s reckless hubris and aggressive incompetence.
Saving taxpayer money is not simply a matter of expediency, but of fairness and principle. Extending the general excise surcharge shifts the burden to our poorest residents, who will pay more for groceries and other necessities. Increasing the hotel and accommodation taxes hobbles our state’s primary economic engine. Raising property taxes further inflates housing costs, while devastating seniors and middle-class families, whose homes are often their most significant investment.
Worst of all, tax increases in any form will only subsidize Caldwell’s reckless hubris and aggressive incompetence. No one has supervised this boondoggle longer than he has. Before running for mayor, Caldwell served as the city managing director from 2008 to 2010, the self-proclaimed “primary point person” for rail. On his watch, bloated red tape, numerous design changes and haphazard contract modifications drove costs skyward.
By January 2010, the FTA had already publicly questioned whether Honolulu could afford a $5 billion rail project. Following that report, Gov. Linda Lingle, an early supporter of elevated rail, warned that the city should revise its financing and construction plans to anticipate a federal funding shortfall.
“I don’t know another project except this one that has made no adjustment from a pre-recession to a post-recession proposal,” Lingle said at the time. But rather than return to the drawing board, Mayor Mufi Hannemann and Caldwell pressed heedlessly forward.
When launching his mayoral campaign two years later, Caldwell again dismissed legitimate concerns about cost and funding.
“The current $5.2 billion budget includes a very large contingency and adequate reserves for short-term financing,” he blithely claimed. “Reports that it will cost $7 billion or more are only scare tactics unsupported by anyone except tea party-style rail critics.”
Today, HART’s own cost estimates for the project stand at $10 billion. We can only expect this figure to increase. Construction has not even reached the halfway mark, and the costliest segment through the dense downtown corridor still lies ahead. On current trajectory, rail will probably wind up costing $13-15 billion.
Mile for mile, that’s roughly the cost of the Channel Tunnel connecting England and France (adjusting for inflation). But the “Chunnel” was among the most complicated engineering feats of the last century — 20 miles undersea — and running high-speed trains that could load cars onboard. Moreover, at Prime Minister Margaret Thatcher’s insistence, private shareholders funded the whole project.
By contrast, under the best case scenario, we will receive a slightly fancier version of the Pearlridge monorail at ruinous cost to ordinary taxpayers. Nor does this include the price for continuous maintenance and repair. Because HART acquired substandard material at premium rates, we have already seen cracked guideways and broken shims before the first train has left its station. Unless we correct course now, these problems will only accumulate and compound.
Enough is enough. Honolulu deserves responsibility, accountability and fairness. Let’s bring this project back down to Earth.
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About the Author
Rep. Cynthia Thielen is a member of House committees on Judiciary; Energy and Environmental Protection; Water and Land; and Ocean, Marine Resources and Hawaiian Affairs. She is also a member of the Women’s, Keiki, and Kupuna caucuses.