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All Aboard! City Awards Two More Big Rail Contracts.

March 22, 2011

A view of Honolulu from Ansaldo Honolulu's rapid transit vehicle

Mayor Carlisle announced yesterday that rail transit contracts valued at close to $1 billion were awarded to Ansaldo Honolulu and Kiewit Infrastructure West. Ansaldo won the contract for building the rail cars and control systems ($574 million), while Kiewit will construct the elevated fixed guidway for the second phase, from Pearl Highlands to Aloha Stadium ($372 million). This brings the total of the four contracts now awarded to $1.6 billion.

Ansaldo's state-of-the-art rail car decked out with bus-like graphics

In spite of continued criticism from anti-rail advocates, the Mayor has pointed out that securing contracts now, during a slow economy, is saving the taxpayers millions.

“Not only are we creating much-needed jobs with these and other rail contracts, but we are also saving taxpayers’ money by making the most of the competitive bids coming in for the project,” said Mayor Carlisle. “This process reinforces the City’s commitment to ensure the rail project comes in on time and on budget.”

All but one of the first four contracts has come in well under the estimated budget, saving the $5.5 billion rail project approximately $315 million so far.

Estimate                 Contract Amount             Savings

Core Systems                 $792 million          $574 million                      $218 million

Second Phase Work    $319 million          $372 million                      ($53 million)

First Phase Work          $572 million          $482 million                      $90 million

Maintenance Facility  $255 million          $195 million                      $60 million

Total                                $1.938 billion        $1.623 billion                   $315 million

Anti-rail stallwart Cliff Slater complained that these contracts are premature and meant only to ensure the project is harder to obstruct, but the strategy of locking in contracts during an economically depressed period is proving successful. Both labor costs and building material costs are down, and major contractors are short of work. The economic downturn is international in scope so that rail car manufacturers from throughout the globe are also more competitive.

“We are pleased that three of the four major contracts have resulted in a net savings of more than $300 million. This contributes significantly to the confidence and stability of the financial plan,” Mayor Carlisle said.

Train service for the first leg of the transit route from East Kapolei to Aloha Stadium is scheduled to begin in 2015, with full service along the entire 20-mile route from East Kapolei to Ala Moana Center in 2019.

One Comment leave one →
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