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The City and County of Honolulu today released the Federal Transit Administration’s (FTA) final Jacobs Oversight Report on the Honolulu Rail Transit Project, which concludes the Project is ready to advance to the Preliminary Engineering (PE) phase. PE is the next stage of the Project and further defines its engineering and design features. It is also a critical step in securing more than $1 billion in federal funding from the FTA’s New Starts program. The City expects a decision soon from the FTA on when the Project can enter PE.


The report calls the current Project cost estimate reasonable and accurate and also says the Project will likely be completed in 2019.


“We are pleased that we continue to receive high marks from experts and consultants hired by FTA to review the financial aspect of our project.  First, Booz, Allen Hamilton last year, and now Jacobs Engineering this year are reporting extremely favorable results,” stated Mayor Hannemann.


“In the interest of openness and in keeping the public informed about the rail transit project, I am pleased to share this most favorable report,” said Mayor Mufi Hannemann.  “This FTA report shows that we are taking our responsibility for the rail transit project seriously and professionally.”


Hannemann pointed out that the Draft EIS cost estimate for the Project is $5.4 billion.  The City’s current budget had lowered that figure to $5.172 billion. The Jacobs report concludes the budget should be $5.288 billion.


“The report has the cost at $143 million less than our DEIS projection, and only 2% higher than our current projection.  For a project of this scope and magnitude, we are pleased that the figures are certainly very close,” Hannemann said. 


Hannemann also pointed out that the report includes a total contingency of $1.2 billion dollars, nearly a third of the project budget.  


Hannemann noted that the Project has worked closely with the FTA from the start of the Project and that support in Washington, DC, is strong. Mayor Hannemann noted that he will travel to the nation’s capitol during the first week of August to meet with Peter Rogoff, the Federal Transit Administrator.


Rogoff has already met with the Mayor once in Washington, and has toured the transit route. Rogoff was a Senate staffer during Honolulu’s rail transit effort in the 1990s and witnessed the Honolulu City Council’s rejection of more than $600 million in federal funds for rail construction.


Hannemann added that the Valley Metro in Arizona and Sound Transit in Seattle, which opened new rail systems earlier this year, went through the New Starts process and received federal funding.  “History shows us those transportation agencies that proceed carefully and meet the FTA’s milestones, as this report states we are doing, receive federal funding to help build their rail systems.”


Hannemann pointed out that once construction begins, it will create about 10,000 jobs, according to the project’s Draft Environmental Impact Statement. He said that economic benefits of rail transit construction are as critical in this recession as rail’s benefits to traffic and mobility.


“Right now, the construction industry is flat, at best.  While most of the jobs created will be in the construction industry, it is important to note that every job created means more money flowing through the local economy.


A construction worker’s paycheck will be spent on food, retail, housing, and clothing. With this project, we can help reverse this negative economic trend and at the same time reduce traffic congestion in the long-term.”