Highway Projects Come to a Halt in Hawaii

Gov. David Ige's decision to defer indefinitely almost all major new projects to increase highway capacity and reduce traffic congestion on state roadways is a major policy shift, but Ige says he had little choice.

By Kevin Dayton

Gov. David Ige's decision to defer indefinitely almost all major new projects to increase highway capacity and reduce traffic congestion on state roadways is a major policy shift, but Ige says he had little choice.

In an interview with the Honolulu Star-Advertiser, Ige said the complex, large-scale "capacity" highway projects being deferred are often hugely expensive, and that the Department of Transportation must focus more of its resources on highway maintenance.

"The reality is, we only have so much dollars, and we're trying to manage that as best as we can," Ige said. "If we do one of those capacity projects, it pretty much obliterates the funds available for, like, a long time. I think it is about trying to find balance."

Public opinion polls in recent years show traffic congestion is regularly at or near the top of the list of Hawaii voters' concerns, and many of the projects the administration is deferring were promised to communities years ago. Many residents are frustrated at the amount of time they sit in traffic, but Ige said people are also concerned about the condition of state highways.

Shifting more state highways funding away from capacity projects to maintenance is partly "catch-up, because we haven't been spending what we should have been spending to maintain existing roadways," he said.

"For those of us especially on the West side and in the rural communities, we've all had the experience where the state didn't repave, and we had broken-down, almost undrivable roads for a long time because all of the money was going into these capacity projects," Ige said.

One specific capacity project Ige discussed was the expansion of Highway 130 from two lanes to four along more than nine miles of road between Keaau and Pahoa on Hawaii island. That heavily used road is a commuter route for thousands of Puna residents and is frequently jammed during morning and afternoon rush hours.

State transportation officials completed an environmental assessment for that widening project in 2011 which concluded the population in the area will likely more than double over the next 20 years, which would "further exacerbate the existing traffic congestion."

State highways officials said the Highway 130 project is the state's top-priority capacity project for the Big Island, but it is now listed with dozens of others that will be deferred unless the state finds more money for new construction. The department said the project "will be delivered and phased as funding allows."

Transportation officials estimate widening that highway will cost $160 million, which Ige said underscores the problem.

"We would take all the statewide money and put it in this project," Ige said. "I think that's the challenge with these capacity projects. You know, they're so important to every community that they are targeted to help, but they are significantly more costly because typically they're expanding rights of way or creating new roadways, which is a lot more expensive to do.

"So, one of these major projects consumes such a large portion of the funds available that you can probably only do one or two at a time anyway based on the existing funding level," he said.

Tax hikes defeated

Other projects that are being deferred include the eastbound H-1 widening from Waiawa to Halawa, which is in the planning stages; the Kahekili Highway widening project to four lanes from two from Haiku to Ahuimanu for $66 million; and the Maui "Lahaina Bypass 1c" project, which would connect the Lahaina Bypass to Kaanapali Connector for $60 million.

Also being deferred indefinitely is the Paia Bypass project on Maui, which is expected to cost $280 million to $300 million; the Kapaa Bypass Road on Kauai; and the Kawaihae Bypass on Hawaii island.

Ige rejected any suggestion he is deferring popular highway capacity projects to pressure lawmakers into improving increases in the state's gasoline tax, weight tax and vehicle registration fee. Ige proposed those tax increases this year and waged an all-out lobbying effort to win approval for those proposals, but lawmakers rejected them all.

Ige now says he will ask lawmakers again next year to approve those tax increases, mostly because he sees few funding alternatives.

"I think we were pretty honest with the Legislature in presenting what options we had," Ige said. "I mean, one of the reasons when we pursued the increases is that we see existing funding for highways statewide is not sufficient. ... We tried to present it as best as we could.

"We informed them that one of the reasons that we were seeking the fee increases is because we believe we don't have the funds available to maintain existing maintenance and safety kinds of improvements (while) at the same time increasing capacity," he said.

The administration estimated that altogether that package of tax and fee increases would cost a typical motorist an extra $83 a year and would boost the amount of annual funding for highways maintenance and capacity projects to $370 million a year from about $300 million.

House Majority Leader Scott Saiki said House Democrats were unwilling to approve the increases to the gas tax and other taxes this year because they had just approved a five-year extension of the general excise tax surcharge for Oahu in 2015 to support the Honolulu rail project.

"I think the consensus was it would be difficult to advance a broad-based tax increase a year after we had authorized the rail GET extension," Saiki said. "That was where the consensus was."

The city rail project is again over budget with an estimated $1.5 billion shortfall, and Honolulu Department of Transportation Services Director Mike Formby has said city officials will ask House and Senate leaders whether lawmakers might agree to another excise tax extension to help pay for the rail project.

It's unclear how that city proposal might affect the Ige administration's request for increases in the state gasoline and weight taxes and the registration fee, but Saiki said lawmakers will consider Ige's request.

"It's going to come up again next year," Saiki said. "The Legislature will have to deal with it. We'll have to decide."

Ige's proposal would raise the state's gasoline tax to 19 cents a gallon from the current rate of 16 cents a gallon. The counties impose their own separate county gasoline taxes on top of the state's tax, and those county taxes range from 8.8 cents a gallon on Hawaii island to 23 cents a gallon on Maui.

The proposed gasoline tax increase would be the first for the state since 2007, but the American Petroleum Institute calculated that Hawaii's combined state and county gasoline taxes were already the fourth highest in the nation as of Jan. 1. The state last increased the weight tax and vehicle registration fee in 2011.

A hard sell

Senate Transportation and Energy Chairwoman Lorraine Inouye said she was "a little apprehensive" this year about the administration plan to increase the gasoline tax, weight tax and registration fee all at one time. It would have been more palatable to increase just one tax at a time, she said.

"It was rather hard to do this increase for the general public," she said. "We've got constituents calling" to complain, especially about the registration fee.

Inouye said she worked to advance the Highway 130 project in Puna when she last served in the Legislature before 2008, but the project stalled. Now, "I don't know where we're going to get the funds," she said. "For this upcoming session, I'll do the best I can to make sure that that project proceeds, hopefully soon."

The Federal Highways Administration has criticized the state in years past for allowing a large pool of unspent federal dollars to build up.

Known as the "Pipeline" funding, that pool of unspent federal funds reached a high of $940 million six years ago, and federal officials warned the state in 2014 that unless Hawaii spent the money more quickly, it could lose federal highway funds.

The Ige administration says it has made great progress in spending down those funds, and that the highway Pipeline pool was reduced to $524 million by the end of June, according to a transportation spokesman.

However, transportation officials say those Pipeline funds are not available to fund the dozens of capacity projects that the Ige administration is deferring because the Pipeline money has already been committed to other specific projects under agreements with the federal government.

Examples of projects that were funded with funds from the Pipeline include the Phase 2 Queen Kaahumanu widening project in Kona on Hawaii island and the H-1 westbound widening from Waimalu to Waikele on Oahu.

Ige said his administration now plans to take a hard look at less expensive options that would allow the state to "use existing infrastructure more efficiently."

Ige said an example of that would be more widespread use of contra-flow projects to ease the flow of traffic during peak periods, "because obviously it doesn't require huge investment." Those efforts will allow the state to make "what we believe to be significant, cost-effective improvements," he said.

Saiki said the decision to defer capacity projects might help draw public attention to the funding problem.

"If the public starts to see how projects are being delayed or how they are having to be put on the side for now, hopefully the public will have a better appreciation or understanding of the need for us to do something," he said.

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