HART Settles With STG for $59.9MM

Honolulu Authority for Rapid Transportation has reached a $59.9 million settlement with rail contractor STG.

Courtesy of Honolulu Authority for Rapid Transportation

HONOLULU – Honolulu Authority for Rapid Transportation has reached a $59.9 million settlement with rail contractor STG.

Honolulu Authority for Rapid Transportation has reached a $59.9 million settlement with rail contractor STG, according to Honolulu Civil Beat. On Thursday, December 14^th, the board that oversees construction for Honolulu rail agreed to pay the settlement to Shimmick/Traylor/Granite Joint Venture due to costly construction delays. In early Summer 2023, the STG filed a suit seeking at least $99 million after “all the costs associated with long-standing utility relocation problems near the Honolulu airport.”

According to the report, HART is also trying to set the final cost at $990 million for the contractor to build over five miles of the Skyline rail along with four stations. Back in 2016, the contractor was awarded a contract totaling almost $875 million for that segment’s construction. The contract is still considered a success by FTA standards, according to HART Project Director, Nathaniel Meddings, because the FTA “considers so-called design-build contracts that climb no higher than 15% over budget to be successful. The STG contract has now grown by just over 13%.”

For the $59.9 million settlement, the contractor STG will be paid half up-front with the rest of the settlement coming in five installments “as the venture finishes the elevated guideway and the four stations.” This settlement is reported to not affect the project’s overall cost which currently sits at $9.9 billion for a 19-mile route and 19 stations. 

In April 2020, HART board members disclosed that STG “had leveled a delay claim against the agency related to incomplete utility-relocation work around Ualena Street. HART’s then-chair of the board’s Project Oversight Committee, Glenn Nohara, put the amount at approximately $40 milion.” And, the suit that STG filed over the summer totaling $99 million in damages was never officially served to HART with legal action, according to Meddings, because HART knew in advance of the issues surrounding utility relocation around the airport. Instead, the suit got HART and STG to mediation.

Now, the “HART board’s government and legal affairs committee considered the deal in executive session and opted to pass it on to the full board. The settlement was then posted moments before HART’s general board meeting.” According to board member Michele Chun Brunngraber, the board works “really hard. . . It’s important to keep the working relationship even though we might have differences of opinion and we might have legal matters outstanding.” As of reporting, both HART and STG are expected to release a joint statement on the settlement.

Now, work by the STG is expected to be done by February with service starting in 2025.