An update of Honolulu's contested $5.3 billion rail project was released Tuesday by the Honolulu Authority for Rapid Transportation.

Known as the Project Management Oversight Contractors assessment, the September report calls into question the city's ability to accurately forecast existing design-build contracts.

"The PMOC had expressed some concern with the adequacy of the grantee's ability to forecast costs for the existing Design-Build (DB) contracts," the report stated. "The grantee's Estimate At Completion (EAC) did not accurately provide an assessment of the contract costs."

To date, HART has issued three design-build contracts for the first two sections of the elevated guideway from East Kapolei to Aloha Stadium, as well as a maintenance and storage facility near Leeward Community College. All three contracts are estimated to cost $1.05 billion. However, a ruling by the Hawaii Supreme Court Aug. 24 suspended all construction until an archeological inventory survey is finished along the entire 20-mile route.

The September PMOC report points to the high court's ruling as having a "significant" impact on the rail project's anticipated budget and schedule for completion.

"The grantee's preliminary analysis indicates that the cost impact for the three design-build contracts could range between $64 and $95 million," the report concluded. "However, this does not include additional cost impacts due to escalation for future contracts and extended agency and consultant staffing."

Earlier this month HART Executive Director Dan Grabauskas told KITV4 the Hawaii Supreme Court's decision, coupled with previous contract change orders, could cost city taxpayers as much as $114 million.

As far as completion of the rail line, the latest PMOC assessment predicts a nine to 12 month delay because of the court ruling.  That means construction may not begin again until next April at the earliest, or possibly as late as August of 2013.  

HART spokesman Scott Ishikawa said the transit authority has taken several steps to mitigate the PMOC's concerns about the forecast of design-build contracts.  Among the initiatives taken up by HART are cost/schedule workshops with the PMOC, the first of which took place on July 10, as well as addressing any pending, probable and potential changes to each contract.   HART has also provided additional information to the oversight committee in regards to cost projections, without divulging information that could be used by contractors for pending or future change orders.

Other issues that could impact the overall cost of the rail system include the acquisition of land in the so-called Banana Patch area of Pearl City, the late turnover of rights of ways, and changes to baseline documents.

Ben Cayetano, the former two-term Democratic governor and anti-rail candidate for Honolulu mayor, told KITV4 the latest PMOC report mirrors his concerns about the project, which he believes is too expensive for Oahu's population of 963,000.

"Basically, it reiterates what we've been saying all along," said Cayetano. "The city does not know what the final segment downtown is going to cost.  They can't know because they don't have the final engineering plans (and) they haven't done the underground borings."

On July 30, HART awarded a $44 million contract to Aecom to design the rail project's guideway in the "city center" from Middle Street to the Ala Moana Shopping Center. Aecom will also be responsible for overseeing the relocation of utilities.

The PMOC report however, was not devoid of ammunition for Kirk Caldwell, the city's former managing director and Cayetano's opponent in the Nov. 6 election. Caldwell has pledged to continue building the rail project, saying it will finish on-time and on budget.

According to the oversight committee, the project is still on track to receive $1.55 billion from the Federal Transit Administration in new starts funding.  The amount represents 30 percent of the anticipated cost of the project.

"I believe that we can afford to build this system," said Caldwell.  "We have two sources: the excise tax, (where) we're ahead of collections, and the federal money. They'll be no mortgage (and) no debt at the end of it."

On Tuesday, Cayetano and Caldwell appeared in front of the Rotary Club of Honolulu at the Royal Hawaiian Hotel for a candidate forum. It was the final joint appearance by the two men before voters go to the polls.