Joint letter sent to FTA as city and HART meet all deadlines for rail project
News Release from City and County of Honolulu, November 17, 2018
Honolulu – In a letter to the Federal Transit Administration (FTA) signed by Mayor Kirk Caldwell, Honolulu City Council Chairman Ernest Y. Martin and Honolulu Authority for Rapid Transportation Executive Director and CEO Andrew Robbins, the city and HART requests the FTA to “reengage its active financial participation in the construction of the [rail] project” now that all of the deadlines set by the federal agency have been met. A copy of the joint letter is attached. (No letter attached. Will update.—Editor)
The three FTA deadlines that were met thanks to action by the mayor, the City Council and HART includes the following:
- A decision on the procurement method for the City Center Guideway Segment (CCGS) by October 20, 2018 (completed October 2, 2018).
- $44 million identified by HART’s previous financial plan be fully committed towards the project by November 20, 2018 (completed Tuesday, November 13, 2018).
- A revised Recovery Plan – with a financial plan sufficient to cover the total estimated project cost by November 20, 2018 (approved by HART Board on November 15, 2018 and transmitted to the FTA no later than November 20, 2018).
Mayor Caldwell, Chairman Martin and Executive Director Robbins are asking the FTA to release “a portion of the remaining $744 million federal share of the funding for the [rail] project” once the federal agency completes its review of the updated Recovery Plan.
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City completes issuance of $44 million in short-term commercial paper for rail funding
News Release from City and County of Honolulu, November 16, 2018
Honolulu – On Tuesday, November 13, the Department of Budget and Fiscal Services completed the issuance of $44 million in Tax Exempt Commercial Paper (TECP) which will be used to help fund construction of the rail project.
The $44 million was shown as part of a city subsidy in the September 15, 2017 Recovery Plan submitted by the Honolulu Authority for Rapid Transportation (HART) to the Federal Transit Administration (FTA). The FTA set a deadline of November 20 for the funds to be paid to HART. The TECP transaction was recorded by HART on Tuesday, and the funds are now available for use.
In a recent communication with the city the FTA confirmed that the agency accepts this as a demonstration of the commitment of the $44 million and has no further questions.
“I never favored the use of city funds for the construction of rail and repeatedly stated my position before the passage of Act 1 by the state Legislature last year,” said Mayor Kirk Caldwell. “However, leadership in the state House demanded ‘skin in the game’ from the city and this $44 million is the result of that demand. I want to thank the City Council for lifting the restriction on the use of city funds for the construction of rail, which has been capped at $214 million and no more than $26 million in any given fiscal year. Like me, a majority of the City Council recognizes that rail will be transformational for our island and we must complete the minimal operating segment from East Kapolei to Ala Moana.”
The interest rate for the $44 million of TECP is 1.80 percent. In accordance with Resolution 18-132 approved by the City Council on October 30, the Department of Budget and Fiscal Services plans on issuing long-term bonds to pay off the TECP in January. The $44 million in TECP will mature on January 31, 2019, the date the city anticipates closing on the long-term bonds.
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