‘It’s be­ing rail­roaded’

Bailout mea­sure for strug­gling Honolulu rail could move to House to­day

Hawaii Tribune Herald - - FRONT PAGE - By NANCY COOK LAUER

A bill rais­ing the statewide ho­tel tax to pay for the strug­gling Honolulu rail project cleared an­other hur­dle Tues­day when the Se­nate ad­vanced it on a 17-7 pro­ce­dural vote.

Three Oahu se­na­tors joined all four Big Is­land mem­bers vot­ing no. The fi­nal Se­nate vote sched­uled for this morn­ing is ex­pected to be closer, fol­low­ing a 6-5 com­mit­tee de­ci­sion Mon­day that barely moved it to the floor of the cham­ber.

If it passes the Se­nate, the $2.4 bil­lion bailout bill will be taken up at 1:30 p.m. to­day dur­ing a House com­mit­tee hear­ing.

Leg­isla­tive lead­ers are push­ing for a quick res­o­lu­tion to a loom­ing fi­nan­cial cri­sis for the rail, which faces a Sept. 15 dead­line to present a fund­ing plan to the Fed­eral Tran­sit Ad­min­is­tra­tion. The city risks hav­ing to re­turn more than $800 mil­lion al­ready spent from a to­tal $1.5 bil­lion in promised fed­eral dol­lars.

The mea­sure comes after the cost of the rail project bal­looned from $5.26 bil­lion in late 2014 to $9.5 bil­lion.

The short time frame cre­ated a pres­sure-cooker en­vi­ron­ment at the Capi­tol, with two House mem­bers who were op­posed to the bill re­moved

from the pow­er­ful Fi­nance Com­mit­tee late Sun­day, and se­na­tors cau­tioned about pro­claim­ing too much op­po­si­tion on so­cial me­dia.

The bill was cre­ated by leg­isla­tive lead­ers for a spe­cial ses­sion after House-Se­nate ne­go­ti­a­tions broke down dur­ing the reg­u­lar leg­isla­tive ses­sion. At that time, the House speaker was ousted along with the chair­woman of the Se­nate Ways and Means Com­mit­tee.

Amid a tu­mult of op­po­si­tion from the ho­tel in­dus­try, may­ors, county coun­cils and neigh­bor is­land res­i­dents, leg­is­la­tors were told no amend­ments will be al­lowed or the process will fall apart.

“It’s be­ing rail­roaded, par­don the pun,” said Sen. Rus­sell Ru­d­er­man, a Puna Demo­crat. “This bill was crafted be­hind closed doors and handed to us, with a ‘take it or leave it, and by the way, you’ll take it,’” sen­ti­ment.

Ru­d­er­man doesn’t think there’s such an emer­gency to find more money, es­pe­cially at the risk of cre­at­ing a prece­dent that could lead to more statewide fund­ing of lo­cal projects.

Sen. Josh Green, D-Kona, said he voted against the bill be­cause it’s “fun­da­men­tally un­fair to the neigh­bor is­lands” and it will leech money away from needed projects through­out the state, such as af­ford­able hous­ing, health care and home­less­ness.

“As good as it is to build in­fra­struc­ture, so many other things fall by the way­side when we pay $10 bil­lion for one project,” Green said.

Sen. Kai Ka­hele, D-Hilo, said he’s sur­prised at the level of op­po­si­tion he’s hear­ing to the fund­ing mech­a­nism.

“I don’t feel like the elected lead­er­ship is lis­ten­ing to the peo­ple,” Ka­hele said. “There’s a re­sound­ing op­po­si­tion to this bill.”

Sen. Lor­raine Inouye, a north Hawaii Demo­crat, echoed Ka­hele’s state­ment.

“I have heard from many con­stituents and even con­ducted an in­for­mal sur­vey,” Inouye said. “The over­whelm­ing sen­ti­ment is that neigh­bor is­lan­ders do not want, nor do they feel they need, to sup­port the Oahu rail, a City and County of Honolulu project, not a state project.”

Se­nate Bill 4 levies a statewide 1 per­cent in­crease on the tran­sient ac­com­mo­da­tions tax ded­i­cated to Honolulu rail while set­ting the share of the TAT to be di­vided by the coun­ties at $103 mil­lion per­ma­nently. It also gives coun­ties the op­tion of rais­ing their gen­eral ex­cise tax by one-half per­cent to be used for roads.

The bill also ex­tends Honolulu’s cur­rent half-per­cent gen­eral ex­cise tax for three years, and re­duces how much the state takes as ad­min­is­tra­tive fees. And it re­quires an au­dit and more over­sight for the rail project.

Leg­is­la­tors sup­port­ing the mea­sure say Honolulu is the eco­nomic driver for the en­tire state and res­i­dents’ tax dol­lars of­ten help fund neigh­bor is­land projects. Leg­is­la­tors op­posed to the mea­sure say they’re in fa­vor of mass tran­sit — they’re just skep­ti­cal about the cur­rent project that’s so much over bud­get.

Sen. Laura Thie­len, an Oahu Demo­crat who voted against ad­vanc­ing the bill, said there is tra­di­tion­ally more de­bate when bills are up for fi­nal read­ing.

Be­fore the Tues­day vote, she men­tioned on the Se­nate floor a 2006 news ar­ti­cle that es­ti­mated a $3 bil­lion to­tal price tag for a pro­posed rail line that would have gone as far as the Uni­ver­sity of Hawaii at Manoa — far­ther than the cur­rent pro­posed route.

“When peo­ple say that the rail cost has gone up — you know, it’s dou­bled — it’s ac­tu­ally more than dou­bled be­cause we’re not do­ing the last 2 miles from Ala Moana to Manoa, and that would be a re­ally ex­pen­sive por­tion of rail,” Thie­len told the As­so­ci­ated Press. “So the price is go­ing up and we’re get­ting a shorter rail, and re­ally it’s that last seg­ment that would have given you the most traf­fic re­lief be­cause traf­fic is way worse when UH is in ses­sion.”





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