Honolulu rail CEO blames cost overruns on legal challenges, but critics say it is incompetence

PROGRESS OR NOT? HART CEO Dan Grabauskas believes the city will prevail and the project will be built
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HART CEO Dan Grabauskas
HART CEO Dan Grabauskas

HONOLULU – Honolulu Area Rapid Transit director Daniel Grabauskas pledged on his watch, the city’s $5.26 billion Honolulu rail project would come in “on time and on budget.”

But as the Honolulu Star Advertiser notes, that’s not the case: “Construction of Honolulu’s rail transit system is on track to cost many millions of dollars more than originally thought. Rail officials this week opened the three bids they received to build the $5.26 billion project’s first nine stations. All three bids exceeded by well more than $100 million what they had originally budgeted for the work. The least expensive of the bids was still about 60 percent greater than what they had expected.”


Grabauskas is apparently blaming the cost escalation on two legal challenges that halted the rail’s construction for just over a year.

As reported by the Star-Advertiser, Grabauskas told his HART’s board Thursday: “The time we lost because of those lawsuits … is what put us in this bid environment, and the market forces are what they are.”

The rail project was challenged twice in court.

The Native Hawaiian Legal Corporation and attorney David Frankel represented Paulette Kaleikini when she challenged the city’s decision to begin construction in the state’s highest court. She is a native Hawaiian with family members buried in Kakaako, possibly in the rail’s path. They won their case in August 2012, bringing the project to a halt for more than a year.

In a unanimous 82-page opinion in Kaleikini v. Yoshioka, Hawaii Supreme Court justices said the City did not comply with the State’s historic preservation and burial protection laws when it failed to complete an archeological inventory survey for the 20-mile route before starting construction. The court maintained: “it is undisputed that the rail project has a ‘high’ likelihood of having a potential effect on archeological resources….”

In a separate lawsuit, filed in 2011, eight plaintiffs including businessman Cliff Slater, former Gov. Benjamin Cayetano, retired Judge Walter Heen, University of Hawaii Law Professor Randal Roth, the Small Business Hawaii Education Foundation, Dr. Michael Uechi, Hawaii’s Thousand Friends and the Hawaii Outdoor Circle, challenged the city and FTA’s plans for the rail. The plaintiffs argued the project will bankrupt the city and destroy important cultural sites and the environment.

In their lawsuit, they maintained the city’s actions were “arbitrary” and “capricious” when:

  1. The city did not adequately consider viable transportation alternatives in its 2006 Alternatives Analysis before selecting heavy elevated steel on steel rail as the city’s mass transit system;
  2. The city did not vet alternatives in the Environmental Impact Statement, which may negatively impact Oahu’s historical sites and violated the National Environmental Policy Act;
  3. The city decided to conduct the archeological inventory in four phases, rather than surveying the entire 20-mile route before starting the project.

Slater, who heads HonoluluTraffic.com, disputed Grabauskas’ claim that legal challenges have increased the cost of the project.

“The delay was not caused by Honolulutraffic.com and its members. We had originally filed our lawsuit challenging the Final EIS in early 2011. Lawsuits in such cases cannot be filed until the Federal Transit Administration files its Record of Decision on the Final EIS so we could not have filed earlier. Our attorneys were well experienced in environmental law cases. In fact, our lead attorney wrote the regulations that implemented the National Environmental Policy Act (NEPA). At the time we filed the lawsuit our attorneys believed that it would all be resolved by the end of 2011. In the end, it was settled in 2014, over two years later,” Slater said.

“The City caused the delay by doing everything possible to impede a verdict; they believed that if they could get a sufficient portion of the rail line built before the verdict that the judges would allow that to influence their decision. I guess they were right. If you talk to our attorneys about the inordinate number of motions filed by the City, or review when we finally got the Administrative Record versus the time that it normally takes, you will see clearly that the City was fighting a delaying game the whole time,” Slater added.

“In addition, I do not believe that the City was ever precluded from putting the stations out to bid should they have wanted.”

Panos Prevedouros, PhD., a professor of engineering at the University, who has been a vocal opponent of the rail project, also dismissed Grabauskas’ claims.

“Anyway he cuts it, inflation is responsible for less than 10 percent of the 75 percent disparity,” Prevedouros said. “What should be startling is city’s and HARTs incompetence to price their project. Two of the three bidders offered to build it at double the cost the city budgeted.”





  1. Being colossally overbudget shouldn't be a surprise for a project headed by Dan "Big Dig" Grabauskas. My guess at the final cost of the rail: 12 billion.

    To move 1/6 the number of people per hour as a bus-dedicated highway lane.

  2. Stop it now! It's gonna bankrupt the City. It cheaper to just tear everything down now and put things back where they were before. Make Dedicated lanes on the freeways in both directions for Buses only. Utilize the transit centers more by having them as major hubs for express buses and have shuttle buses take passengers to other parts of the island. There should be 3 types of routes. Express routes which only go between transit centers, Mainstream routes that stops at the transit centers, then run along major road arteries and shuttle routes that pick up from stops along the main arteries near their area and service the interior areas.

    • Going to in all bus system will bankrupt the city because of higher maintenance and personnel costs. That was one of the alternatives looked at before going to rail, which is cheaper over the long run than buses.

      • "higher maintenance & personal costs" You considered the 21 stations need sanitation workers, security for keeping out homeless, ticket personel, & mechs to fix train problems. BTW what about this 7 billion up front costs?
        So our bus system is bankrupting now? Where's the 7 billion debt the bus system is doing. Are you an idiot?
        And these stations still look like dinos.
        See KITV's report titled; Upcoming public workship centers around Ala Moana rail designs
        Plans on display at 6 p.m. Wednesday meeting" BE there.
        Read more: https://www.kitv.com/news/upcoming-public-workship

  3. Forget the rail, it's too small for tourisim arrivals/departures anyway.
    KITV reports:
    Luggage still an issue as HART unveils airport rail station
    'We will be working with HART to make sure that whatever HART allows, we accommodate on the buses,' said the city's director of Transportation Services…"

    Read more: https://www.kitv.com/news/luggage-still-an-issue-a….

  4. Oahu resident deserve this disaster and they voted for it. They want a 19 mile concrete behemoth, costing 50,000 dollars a foot, that will not alleviate our traffic problems. Cayetano ran a fair campaign, squarely laid out all these facts, and my neighbors and fellow citizens, made the moronic choice of electing Caldwell and essentially giving the green light to continue on this project. It is a mind boggling waste of time and money and will do nothing to solve the traffic problem. But this is what our educated electorate voted for, so here it is to stay. Way to go Oahu.

    • Yes, residents voted for it, because it is the right thing to do. Rail by far is the most efficient, and yes, cheaper way to transport people than cars, unlike freeways. We simply cannot afford to build freeways anymore.

      If you want to solve traffic problems, then you must ban all free parking, institute congestion pricing, zone for more housing in the central city, ban housing in Eva plain, stagger private school star times, and yes, build rail. There are two silver bullets to solving traffic–a bad economy where everyone loses their job, and when people stop having kids.

      Cayetano's campaign was full of lies. Local people were tried of his negativity and accusations.
      They wanted a mayor who was positive, optimistic, honest, and a team player. I have the utmost respect for Caldwell, unlike Cayetano.

  5. Some where in Alabama a village is missing it's idiot. cause he is here in hawaii. M
    essing with our aina and our keiki who will be for ever displaced and burdened.

    • Malia, Kitv4 reports this haole wants to stay longer! People need to call thier concilperson to protest!
      "Grabauskas was hired in April 2012 at a salary of $245,000 per year. With housing and transportation allowances, his annual salary stands at $287,000. The CEO's three-year contract is set to expire next April and the HART board deliberated his new contract for more than two hours behind closed doors."

      Read more: https://www.kitv.com/news/hart-board-starts-talks-

  6. […] Honolulu Space Speedy Transit director Daniel Grabauskas pledged on his watch, the town’s $ 5.26 billion Honolulu rail undertaking would are available “on time and on price range.” Hawaii Reporter. […]

  7. […] Honolulu Space Speedy Transit director Daniel Grabauskas pledged on his watch, the town’s $ 5.26 billion Honolulu rail undertaking would are available “on time and on price range.” Hawaii Reporter. […]

  8. The snail rail should be called, " The Developers Dream", it IS NOT going to decrease traffic. The best way to alleviate the traffic problem from the West is to build an elevated Toll Road System. They did this in Tampa, Fl. and it is a success.
    Stu, you are either a Banker, Developer, Union Worker, Government Worker or a paid Idiot.

  9. Panos is correct – the fact is that construction costs have not risen by the amount that this portion of the project is over budget. Not to mention the City & County of Honolulu should have anticipated and budgeted for delays, which are almost certain for a project such as this. It's disingenuous for the director of HART to make such inaccurate comments, but that's been the unfortunate pattern throughout this project's history.

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