ÌìÃÀÊÓƵ

The chairman of Infrastructure Management Group (IMG) is defending the independence of a that shows the city underestimated the cost of completing and operating the system by about $1.7 billion.

Honolulu Mayor Peter Carlisle responded to the report Friday afternoon, calling it “biased,” “shoddy,” and an “appalling waste” of taxpayer dollars. (Gov. Linda Lingle called for the outside review, which the Hawaii Department of Transportation released Thursday).

“Considering the mayor’s response … We do not second-guess the City’s decision to develop a rail line, nor do we conclude that it is financially infeasible,” Steve Steckler, IMG’s founder and chairman, wrote to Civil Beat in an e-mail Saturday morning. “Rather, we conclude simply that the current financial plan should be improved and that the City will need additional resources to complete and operate the rail system.”

Steckler also emphasized that Tom Rubin — a longtime transit consultant and well known bus advocate — did not help with the financial analysis, which was the major thrust of the report.

“Mr. Thomas Rubin, an independent transit accounting expert, was added to review the rail project’s operating plan and the experience of other rail projects,” Steckler wrote. “These standalone components were not inputs to the GET and financial analysis.”

But in the report itself, Thomas Rubin is included in descriptions of the financial review:

“A review of the current Financial Plan
This task was led by IMG with assistance from Thomas A. Rubin and CB Richard Ellis. It was
based upon the Team’s collective experience with other rail projects as well as FTA and industry
databases.”

“A peer project review and benchmarking analysis
This task was conducted by IMG and Thomas A. Rubin using FTA data, Congressional reports,
contacts with the peer project sponsor agencies and previous internal and published reports on the
peer projects. Information from these peer projects informed the financial risk assessment and
provided lessons for Hawaii on the management of its rail project and post-rail operations.

In a news conference Friday, Carlisle said “red flags went off all around town” as soon as Rubin’s involvement with the project was known. Steckler said he hadn’t personally worked with Rubin before the Honolulu rail review, but said they had crossed paths over the decades. He also denied knowing Rubin’s reputation as a rail critic.

“Tom has been a longtime fixture in the consulting industry because of his accounting expertise,” Steckler told Civil Beat in a phone call. “His ability to really dig into some of the numbers.”

Steckler also points out that his firm’s work on a Chicago area transit review — with Rubin’s help — won a national award for “independent auditing of a government entity.”

“The independence of our assessments is critical,” Steckler wrote. “Public and private investors, underwriters and lenders — and taxpayers — rely on our work to guide their investment decisions.”