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Friday, July 23, 2010
Will rail plan collapse before November?
By News Release @ 2:09 AM :: 5569 Views :: Maui County, Education K-12, Energy, Environment

Is the elevated railway in its death throes?

From www.HonoluluTraffic.com

Obviously, our former Mayor and now gubernatorial aspirant, Mufi Hannemann, must keep the elevated railway alive until after the November elections. Hannemann even declared that he had made sure before resigning as mayor "that no future mayor, no future City Council, can reverse the course we are embarking upon" with the rail project.

This is pure and simple braggadocio — strutting his stuff to the November election. Note that he did not mention the Federal Transit Administration or the current Governor.

The FTA has said that the City’s current financial plan is insufficiently robust to warrant entry into the next stage, Final Design. The Governor has said that she needs to see a plan that is robust enough to warrant entry before she will “accept” the Final EIS.

Mufi can continue this standoff by not having the City produce a new financial plan; Caldwell will do what he is told. Mufi can then continue to blame the Governor for holding up the project while deflecting blame from himself.

As we have written before (see our “misstatements” entry on July 17), the financial plan cannot be made robust enough without some highly improbable event whereby some hundreds of millions are dropped in the City’s lap. Not likely. They only have two real sources of funds — the GE Tax surcharge and federal funds. The GE tax is shaky and the fed funds are maxed out.

In 2006, the City forecast it would collect $759 million from the GE tax surcharge during fiscal years 2007-2010 ending June 30, 2010. It actually collected $536 million, 30 percent less than projected.

The three full fiscal years of tax collections have shown continuing declines — $169 million in 2008, $161 million in 2009 and $158 million in 2010.

While the Mayor and the Star Advertiser headlined record tax collections, that is editorial, not news. The news is that for the last quarter ending June 30, 2010, which included the record month, collections declined by 11 percent compared to the year earlier. This is why the Federal Transit Administration and the Governor want an independent projection of GE Tax collections.

At the moment, without using bus funds, the City is at the very least $300 million short. Mufi said yesterday, “Bus service will not be compromised; we will not use the bus fund for this rail transit system.” He can say that but the fact is, that the City’s formal financial plan given to the FTA plans to use bus funds.

Add to this the lack of progress on the Section 106 Programmatic Agreement regarding historic properties and native Hawaiian burial grounds. Then on top of that is the City’s agreement with EPA to spend $4.7 billion on our sewer systems. FTA is already worried about “competing demands on funding sources.” On top of that comes the revelation (see below) that our working age population, which is to say commuters, is declining. What does that do to ridership projections?

We do not see how rail proponents can overcome all this. However, all this delay will get Mufi to a safe haven beyond the November election. Then he can easily rationalize why the elevated railway did not happen.

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