”FOIA Release Shows FTA’s Worries About Rail Funding:”

As part of a FOIA package we received from the Federal Transit Authority (FTA) two days ago, there was an internal FTA memo dated October 7, 2009, describing the Honolulu rail project. The following are quotes; our added explanatory comments are in square brackets only.

“The City is highly focused on a groundbreaking before the end of calendar year 2009 to fulfill early promises project schedule and to deter the State Legislature (that convenes in January) from diverting funds from the rail-dedicated tax revenue stream to meet shortfalls in the State budget. To achieve this milestone objective, 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-mile segment sometime in December. This schedule appears unlikely due to the delay of the FEIS for the reason enumerated above in the NEPA section of this document.” [This reference is to the following paragraph from an earlier section of the document.]

“The City’s schedule calls for publication of the Final EIS very soon after approval of the project into PE and receipt of a Record of Decision in November 2009. However, this ambitious schedule now appears to be unlikely because of protracted meetings on historic and cultural issues. In an unusual step, the Advisory Council on Historic Preservation has weighed in on the development of a Programmatic Agreement (PA) that needs to be finalized prior to the release of the FEIS.”

“Finally, while the City already has in place a dedicated funding source [ 1/2% GE tax increase], 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 [normally used for buses]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 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 [preliminary engineering] approval letter.”

OUR COMMENT: It is quite interesting to go back to earlier totally positive comments by the City about their financing plan and you would have no idea that the FTA has doubts about whether the City will survive the next test of their financing plan.

”Governor Slams Elevated Rail and City’s Handling of It:”

Both the ‘Honolulu Star-Bulletin’ and the ‘Honolulu Advertiser’ recent cover the Governor’s press conference held yesterday on the elevated rail issue. Here are some quotes:

From the ‘Honolulu Advertiser’ “Honolulu’s rail costs put state at financial risk, governor says”:

“Honolulu should consider adjustments to its planned $5.3 billion elevated commuter rail line

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