Will sky-high Skyline costs ever stop climbing?

by Keli'i Akina, Ph.D., President / CEO, Grassroot Institute of Hawaii

Honolulu officials recently received a national innovation award for the safety and technology of the city’s Skyline rail — the country's first driverless rail system — but the recognition coincides with more bad news about the project’s ever-ballooning budget.

A Honolulu Civil Beat article last week revealed that a new risk analysis conducted by the Honolulu Authority for Rapid Transportation puts the potential final cost of the project at $10.19 billion, a $111 million increase over the current estimate. This has triggered a Federal Transportation Authority consultant to review the system’s budget.

Of course, nobody in Hawaii should be surprised by this. 

The pattern goes all the way back to 2006, when the city unveiled a draft transportation plan projecting the cost of a 28-mile rail line at $2.5 billion. Just four months later, the estimate jumped to $3 billion for a 24-mile system, not including the cost of the train cars. Now, having surpassed $10 billion, the track has been whittled down to just shy of 19 miles.

The Skyline’s Wikipedia page tracks the steady creep of the rail’s price tag, allowing the nostalgic reader to remember 2010, when residents were outraged that construction costs were expected to blow past a mere $5.5 billion.

Meanwhile, we are left to wonder if Honolulu’s allegedly temporary general excise tax surcharge, which helps pay for the project, will ever go away. It was initially set to run from 2007 to 2022 but was extended to 2027 and later to 2030. An effort earlier this year at the Legislature to extend it again quickly fizzled.

Even after the rail is fully completed, we can expect operations and repair costs, plans for expansion and an endless list of other demands for taxpayer dollars. 

Do we trust that HART, or any of our elected officials, will ever use our money wisely, or are they — and thus we — merely the victims of the sunk cost fallacy when it comes to the rail?

As the National Institutes of Health defines it, the sunk cost fallacy “describes our tendency to follow through on an endeavor if we have already invested time, effort or money into it, whether or not the current costs outweigh the benefits.”

So far, every request for more money or an extension of the county’s GET surcharge has come with detailed justification. What we haven’t seen is any attempt to reassure taxpayers that fiscal accountability is an important part of the plan. 

Instead, in the nearly 18 years since Honolulu voters first approved the project, it has become the most expensive rail line per capita in the world and one of the most delayed and over-budget public works projects in U.S. history. 

The completion date is currently March 2031, but HART officials expressed a lack of confidence in making that deadline during the board’s July meeting. 

Hawaii residents should not be shy about demanding transparency and accountability regarding the rail or any other government project. And we must be incredibly cautious about committing to more expensive, taxpayer-funded public construction plans.

In the end, the money we earn for our families is at stake. We must demand whatever oversight is needed to rein in the rail’s runaway budget.

E hana kākou! (Let’s work together!)