Last year, the public first got word to expect a big-ticket change order for the major rail construction that’s taking place near the airport, due to yet another snafu involving utility relocations.

On Thursday, local board members overseeing Honolulu’s elevated transit project gave preliminary approval to that change order, priced at $34 million. The money will go to Shimmick Traylor Granite, the primary contractor handling rail’s airport-area construction.

Honolulu Authority for Rapid Transportation officials say the added costs were largely caused by new, unforeseen safety standards for utility equipment set in 2018 by Hawaiian Electric Co.

HECO roundly disputes this, however. Instead, the local utility company pointed to what it says was poor utility design work by STG and the contractor’s falling behind on its own schedule for that critical design work to get done.

Nonetheless, some HART board officials, led by Chair Colleen Hanabusa, are fretting that HECO wields too much control over HART under an agreement that the two agencies signed on how to handle rail construction. The deal allows HECO to require new safety standards along the rail line regardless of where HART is in the construction process, they said.

“The MOU (memorandum of understanding) in my opinion is written in HECO’s favor,” Hanabusa said at Thursday’s Project Oversight Committee meeting. “It is an agreement that allows HECO to do a lot of these unilateral type changes. I have issues with the way this agreement was written.”

Hanabusa went further, saying that HART has borne the cost for some HECO upgrades because otherwise the utility company would have to seek approval for that work from the state Public Utilities Commission.

“I think that was the thinking,” Hanabusa said of such a maneuver for taxpayers to foot the bill instead of utility ratepayers.

The new HECO safety standards required larger manhole sizes and fewer electricity splits to nearby buildings in a tight industrial corridor near the airport, according to East Area Construction Manager John Moore.

According to Moore, the HECO standards were issued in April 2018 — just two months after Shimmick Traylor Granite completed its designs for utility relocation around Waiwai Loop.

They prompted STG to redo much of the design work and also led to some 219 days of delay on construction, Moore told members of the committee on Thursday.

“The delay in STG’s design is not due to the new construction standards,” HECO said in an email Thursday.

The utility shared a December 2017 letter in which HECO Project Director Kathy Yonamine expressed lengthy concern over STG’s handling of the utility designs for the rail corridor running near the airport.

STG, Yonamine wrote, “has fallen behind in their design schedule and missed many of its own targeted infrastructure drawing review submittal dates.”

“A year has passed since the Notice To Proceed was issued to STG and yet, there are still no final approved infrastructure design(s),” Yonamine wrote. She added that HECO might not be able to support what it expected to be STG’s very aggressive construction schedule to make up for its design delays.

HECO had kept STG informed about the looming changes for safety standards and it grandfathered in the old safety standards for all approved rail utility designs, the company stated in an email Thursday.

Top rail and HECO executives held a 4.5-hour meeting to try and resolve the matter in February 2019, about 10 months after the issue first arose.

HART board member Anthony Aalto called that lag “unconscionable” on Thursday.

HART Interim Director Lori Kahikina, who took the lead at the agency this year, said she didn’t want to throw prior HART leadership under the bus but added that she’s been in better contact with HECO executives since she joined.

The two agencies hope to avoid similar problems with utility designs and new safety standards along the rail line going forward, Kahikina said.

The $34 million change order will next go before the full HART board for final approval at its next meeting. The cost, rail officials said, has already been factored into the mega project’s latest cost estimate, at some $12.4 billion to complete the full 20 miles and 21 stations to Ala Moana.

Read HECO’s December 2017 letter outlining its concerns on STG and the contractor’s utility design work here: