Friday, September 13, 2002

Critics of the city's handling of the Hanauma Bay project say that rushed plans led to expensive changes to the park's new education center, shown above, and other improvements at the bay.

Hanauma shortfall

The $3.3 million it is expected
to earn is $300,000 below costs

By Gordon Y.K. Pang

The Hanauma Bay Nature Preserve is expected to bring in $3.3 million this fiscal year, about $300,000 less than the $3.6 million it costs to run.

Members of the administration of Mayor Jeremy Harris, however, say they expect to make up that difference from $1.4 million left over in the Hanauma Bay Nature Preserve Fund from previous years. But they did not explain how the shortfall would be covered in the future.

City & County of Honolulu

City officials say they also expect to see added revenues from the recently opened gift shop, whose revenues were not factored into the $3.3 million figure.

"We don't foresee the necessity of raising fees or taking general fund money," said acting Budget Director Chris Diebling yesterday afternoon.

"There are no general funds involved. The bay is being paid for by the operating revenues of the bay," said Deputy Managing Director Malcolm Tom.

Diebling told members of the City Council's Budget Committee earlier yesterday that the city was spending $4 million this year on the bay -- $1.4 million in debt service for the more than $13 million in construction projects, and $2.6 million in operations and maintenance. But Diebling said several hours later that he had given the Council incorrect information.

City officials have said entrance fees would cover construction project costs, including debt service.

Budget Chairwoman Ann Kobayashi held the informational meeting yesterday to get answers on the recently completed improvements at the bay.

As reported in the Star-Bulletin, the original $10.6 million contract has now sustained 25 change orders, raising the cost of the project by nearly 23 percent.

Eric Crispin, city deputy director of design and construction, acknowledged to Budget Committee members that planning and design for the project were rushed to prevent construction money from lapsing.

Critics of the city's handling of the project have repeatedly stated that many of the problems were the result of rushed design plans.

Largely as a result of that, project consultant Group 70's original contract of $450,000 was amended several times and leaped to $2.05 million.

"You get a contract for $10 million, that's good," said Councilman Gary Okino. "We should save the $3 million, put it back in the bank. But this seems to be, 'Well, we've got $13 million, let's go spend the money until we spend all of the $13 million.'"

"The problem is, we gave them a blank check," said Council Chairman John DeSoto. "And they're going to do whatever it is they're going to do, however they're going to do it."

Future Council members should learn a lesson from the project, said DeSoto, who is ineligible for re-election this year after 16 years on the Council.

Crispin said the $10.6 million bid was an extremely low bid for a project originally anticipated to cost $12.5 million.

And after 20 years in the construction business, he said, "I know of very few, if any, projects that have gone through construction that have not had changes."

Crispin also said repeatedly that a majority of the changes were from unforeseeable costs and to address concerns raised by area residents.

"Community input results in revisions that have to be made," Crispin said. "In this particular case ... the entire site had to be revised."

That comment drew criticism from Dick Baker, former president of the Friends of Hanauma Bay, who showed the committee documentation proving that a task force he led had only made suggestions and not insisted on changes, as suggested by Crispin and others.

"The primary reason for the process errors and the overspending on this project was the mayor's personal sense of urgency about completing the project in a time span that was simply not realistic, and his continuous personal and often impulsive interventions in the details of the project," Baker said.

Baker urged voters to approve an amendment to the City Charter that would set up an independent auditor's office to look into questionable funding of projects such as Hanauma Bay.

David Washino, a representative of the opposition East Honolulu Community Coalition, said his group has been vindicated by the numbers the administration gave yesterday.

"We did the math back in November 1999, and the numbers just did not add up when you factored in the new debt service incurred by this job and the additional maintenance for the new structures."

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