The check may not be in the mail, but the application is.
On Thursday, the Honolulu Authority for Rapid Transportation (HART) submitted an application to the Federal Transit Administration for a full funding grant agreement, the first step in securing up to $1.55 billion in federal subsidies for the city's controversial rail project.
"We now begin the process...over the next 30 days, negotiating (and) working with them on what will become the final document," said Dan Grabauskas, HART's executive director and CEO.
After the FTA review is complete, a copy of HART's FFGA application will be forwarded to the White House Office of Management and Budget for another 30-day review.
Once the White House review of the FFGA is finished, the FTA can inform Congress of its intent to sign the document as part of a 60-day notification process. The FFGA will then go to the appropriations committee of both the U.S. House and Senate, where lawmakers can agree to the request, or make their own recommendations. If the House and Senate are at odds over the final amount, any difference in the FFGA would be worked out in conference committee.
Rail critics like Cliff Slater of HonoluluTraffic.com are skeptical House Republicans will set aside $1.55 billion for a project that polls show a majority of the public on Oahu is against. He said that's especially true with Ben Cayetano running for a mayor, a former two-term governor and anti-rail candidate who's leading in the polls.
"They're not going to fund anything that doesn't have strong political support, because they're just asking for problems down the road," said Slater.
However, Grabauskas notes Republicans in the House Appropriations Committee have already set aside $100 million for the rail project in a draft of the Transportation and Urban Development bill for fiscal year 2013.
"The fact that we got a $100 million from the House given the contentiousness and given the fact that we are not a grantee yet, we are only an applicant, put me in a good mind to think that we're in a very good position," said Grabauskas.
Still, the $100 million agreed to by members of the House Appropriations Committee was $150 million less than what President Barack Obama requested for the Honolulu rail project in his FY-2013 budget.
Submittal of the rail project's FFGA application also came with a revised financial plan. Grabauskas said the overall cost of the project has been lowered to $5.16 billion, mostly due to a drop in finance charges. The project's final environmental impact statement had placed the total cost of the rail line at $5.51 billion.
"This is the third time in about 18 months that after having examined the project cost, the project has actually decreased," said Grabauskas. "We're moving in the right direction," he added.
However, the updated cost of the rail project presented Thursday by HART failed to include about $100 million the city spent on planning and designing the system, which means the total price tag is actually closer to $5.26 billion.
Although HART insists the cost of the elevated rail line has decreased, so has the project's contingency fund. Currently, the fund stands at $645 million, $220 million less than the $865 million the project began with.
Grabauskas said the drawdown of the rail project's contingency fund is mostly due to change orders from contractors, but the remaining balance is well within what the FTA finds acceptable.
Slater and other opponents of the project remain concerned rail planners have not considered what would happen if construction of the rail line encounters cost overruns of 10 percent or more. A cost overrun of 30 percent would bring the total cost of the rail line to $6.7 billion.
Grabauskas said concerns over cost overruns are overblown, and the revised financial plan actually shows the city ending up with a balance of $193 million at the end of construction in 2019.
The revised financial plan also includes $210 million in Section 5307 funds, a federal subsidy normally used to replace aging city buses. The financial plan in September of 2011 called for the use of $244 million of federal bus subsidies.
"That to me is flat out dishonest," said Slater. "All along we've been saying that we cannot use the city's general funds to build rail."
While the Section 5307 funds are not technically part of the city's general fund, Slater argues the city will have to replace those monies with funds that come from city taxpayers.