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Thursday, June 08, 2017
GE Tax Hike Cornerstone of McDermott Plan to Rescue Rail
By Rep Bob McDermott @ 12:32 AM :: 2829 Views :: Rail, Taxes

Dear Governor:     June 8, 2017

I’m writing to urge you to convene a Special Session of the Legislature immediately to deal with the issue of financing the rail project. We cannot wait any longer. The delay in establishing a sound financial basis for funding the completion of the system to Ala Moana is estimated to be costing taxpayers an additional $15 million per month. In addition, failure to act now puts an additional $800 million in Federal funds at risk.

There has been a complete lack of leadership and, indeed, a lack of urgency, on this issue. I feel strongly that it is your responsibility to convene a meeting now with yourself, Senator Kouchi and Representative Luke to negotiate an end to this impasse and forward your agreement on to the Legislature for approval.

Since no one else has provided a serious basis for discussion, let me propose the following plan as a means for resolving the issues of concern to both the Legislature and the public. Here are the basic points with more detail later in this letter.

1. Extend the GET for 10 years.

2. Order a Comprehensive Financial Audit

3. Conduct Regular Management Audits for HART

4. Establish an Accountability Incentive Plan for Contractors

5. Market Ancillary Development Rights to Private Investors

6. Provide the Public Continuous Online Financial Transparency

We are well beyond having to make the case for the economic and environmental benefits on completing the system. For the residents of West Oahu who have suffered through years of delays because of a failure of political will and leadership, it has become a question of transportation equity.

Governor Ige, it is time for you take a leadership role in resolving this crisis. Put the House and Senate leaders in a room with you, work out an agreement to extend the GET and call a Special Session of the Legislature to get it done.

Thanking you in advance for your prompt attention to this matter.


Representative Bob McDermott


Plan to Rescue Rail

Immediately Extend the GET for 10 Years  

The 10 year extension will provide the necessary financial base to complete the system to Ala Moana. Reduce the State’s skim to 1%. Increase the food tax credit to offset the regressive impact.

Order a Comprehensive Fiscal Audit       

To restore public trust and confidence, it should be executed by the State Auditor and provide a detailed list of overspending and the respective causes The goal is to implement procedures that ensure future financial statements are accurate and complete, and financial projections are conservative.

Conduct a Regular Management Audit of Hart

It should be conducted by a private sector firm that has expertise in large public works projects and focus on business processes, organizational management, strategic planning and employee deployment.

Establish an Accountability Incentive Plan for Contractors

In order to foster a culture of accountability, contractors shall be given a bonus if they finish ahead of time and or under budget. They shall be penalized financially if they finish behind schedule. The cost of mistakes and misjudgments by contractors shall be borne by their E/O insurance carriers, not by the tax payer.

Market Ancillary Development Rights to Private Investors

Public - Private partnerships can help generate additional revenue to support rail through the sale of development rights to a private entities that do not yet own the actual property within a Transit Oriented Development Zone. The concept is similar to the sale of “air rights” to a potential developer who has not yet secured a targeted property. This will provide the city income and a degree of control in the mix of development it wants to occur in certain zone

Provide the Public Continuous Online Financial Transparency

HART shall publish the project financials on a monthly basis, along with a monthly press availability to update the public on progress of the project and all financial activity. It should aggressively promote data on Facebook and other online platforms.


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