Print This Article City Says Rail Contracts Coming in Under Budget; Critics Not Convinced
The city says it saved $165 million on two contracts awarded recently on its Honolulu Rail Transit Project, and that added to prior contracts that came in under estimates, has saved $315 million against what was budgeted.
“The important aspect of this is that three of the four major contracts have resulted in a net savings of more than $300 million,” said Honolulu Mayor Peter Carlisle at a Monday press conference.
“That is news they’ll look at in Washington, D.C. and be very, very impressed that we are in fact on time and under budget in terms of where we are expected to go.”
The city administration has been letting contracts for the $5.5 billion, elevated fixed-guideway project that will connect Kapolei to Ala Moana Center. The project is moving forward after more than four decades of debate, with work to relocate utilities underway in the first phase of the project.
The awards are 16 percent less than what had been anticipated for the first four major contracts and in aggregate total$1.62 billion. The announced savings undercut what a criticism that the project will cost $1.7 billion more than what the city says it will.
But critics took issue with the city’s announcement, saying they are incredulous that contracts could be let out for bid without a final design being available. Panos Prevedouros, a former Honolulu mayoral candidate and who campaigned against the project, said it would be difficult to get exact contract estimates with just the preliminary engineering.
“This is really a joke that (former Mayor Mufi) Hannemann started and Carlisle is perpetuating,” Prevedouros said. “This is totally outrageous.”
Moreover, he said that contracts often jump above bid amounts because of change orders. He said some of the rail project designs may be for just essential work with more to be added in later.
“Costs rise with change orders,” said Cliff Slater, one of the project’s staunchest critics. “Ask anyone in the construction business, that’s how you make money.”
Slater said he believed the letting of contracts at this stage was for public relations purposes designed to get people thinking the project was a done deal. He said he and others will announce shortly a third lawsuit that will be filed against the 20-mile rail plan.
Plaintiffs in one of the two prior lawsuits are seeking a temporary injunction on the project with a ruling expected shortly. Carlisle, a former prosecutor, said he believes the city is in good shape with respect to the lawsuits.
He said the city is scheduled to award the design contract for the third second of the route, between Aloha Stadium and Honolulu Airport, later this year.
MAJOR HONOLULU RAIL CONTRACTS
Contract Name Estimated Amount Winning Bid Savings
Core Systems $792 million $574 million $218 million
Second Phase Work $319 million $372 million ($53 million)
First Phase Work $572 million $482 million $90 million
Maintenance Facility $255 million $195 million $60 million
Total $1.938 billion $1.623 billion $315 million
Source: City and County of Honolulu
The $946 million of contract awards announced Monday included those for the project’s core systems, which include the rail cars and system control center, and another for the design and construction of the second phase of the elevated guideway between Pearl City and Aloha Stadium.
Ansaldo Honolulu submitted a bid of $574 million, or $218 million less than had been anticipated, winning the core systems contract over two other bidders. Ansaldo is a joint venture of Ansaldo STS and AnsaldoBreda, both part of the Finmeccanica group of Italian companies that are known for their mass transit systems and driverless metro rail cars.
Ansaldo will be responsible for manufacturing the initial order of 80 cars and providing power and communications for the system. It will also operated and maintain the system under a separate five-year contract.
Kiewit Infrastructure West Co. put in a bid of $372 million for the elevated guideway work known as the Kamehameha Highway design-build contract. It beat out one other bidder with its bid, which was $53 million more than the city had anticipated.
Kiewit will be responsible for building the 3.9-mile stretch of elevated guideway between Pearl City and Aloha Stadium, installing train tracks and restoring the road surface along the route.
Carlisle said the city was able to achieve the savings because the economic downturn has made labor and materials less expensive. He said the project should provide some much-needed work for Oahu’s construction trades people who have been hard hit by the economy.
“The rail project represents a real hope that there is a future for our industry,” said Ron Taketa, head of the Hawaii Carpenters Union.
“We look forward to it softening the blow the next two or three times the economy takes a dip.”
The city said it expects to have a financial plan for approval by the Federal Transit Administration in coming months and for work to begin on columns and structures sometime this summer.
Carlisle hesitated to say the total project costs will be lower because of the savings with the initial contracts.
“The 5.5 is still on the table because we don’t know what the final amount is yet,” said Carlisle, noting the potential for future bids to come in over estimates.
But he said, “Right now we’re doing very, very well.”
Short URL: http://www.hawaiireporter.com/?p=31717
Loading ...
Connect with Us