HONOLULU -- The city's new high-tech Smart Card System for city buses has been delayed for a third time. The city may also have to spend more money to get the fare system operating.

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KITV 4 News first raised questions about the Smart Card System last August. That's when investigative reporter Keoki Kerr found that it may have been rushed and unrealistically low-priced and pointed out the city awarded to contract to a company with no transit experience. Ten months later, the cards are still not being tested.

Timeline of Smart Cards And Royal Contracting Project

Commuters in New York City have been using smart cards for years.

Bus, rail and ferry riders use them in cities from Washington, D.C., to Seattle. Electronic readers deduct the value for each bus or train trip and riders recharge them by purchasing more value at transit stations or retail shops.

When the city of Honolulu awarded a contract for smart cards, the original plan was to have bus riders using them on Oahu by July 2003.

"And here we are, how many? Almost a year later and we have seen nothing," Councilwoman Ann Kobayashi said.

Kobayashi, who heads the council's Budget Committee, is concerned because the city awarded a $2.2 million contract to Royal Contracting. The construction company has no experience doing high-tech bus work. The company said it relied on experienced sub-contractors to do the smart card work.

"How could a construction company do a smart card? It's such a technical thing," Kobayashi said.

City records show the project has been delayed three times. It was originally supposed to be tested in April 2003, but testing was put off until September, when the bus strike happened. Then smart cards got delayed a second time, until March of this year. That testing never happened and city sources say testing has been delayed a third time and may start this month.

Meanwhile, Mayor Jeremy Harris' Administration is asking the City Council to approve another $125,000 to purchase smart card vending machines and thousands of smart cards for bus riders.

"We cut that out, because we don't know what's going on with that smart card," Kobayashi said.

At $2.2 million dollars, the city's smart card contract cost far less than those in comparable cities. Houston, for example, spent $8 million, nearly four times as much as Honolulu.

"Maybe we are not paying enough for the card to be a viable card, because other cities of comparable size spend a lot more on a card that really works," Kobayashi said.

City transportation officials and a city spokeswoman did not return KITV's phone calls and e-mails asking for comment.

Last fall, Royal Contracting Vice President Leonard Leong pleaded no contest to making illegal donations to Harris' campaign. Leong paid a $1,000 fine and his company was fined $20,000.

City officials have said Leong's political connections did not get his company the contract. They say his price was half that of the other company that bid on the contract.