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A challenge to a billion-dollar Honolulu rail contract
was thrown out by a state agency Tuesday, removing one hurdle from the
train’s path.

The appeal, brought by Bombardier after the company’s proposal was
disqualified by the city for being nonresponsive, was denied by a hearings officer
with the Hawaii Department of Commerce and Consumer Affairs.

“Bombardier said, ‘We see your language, we don’t like it and we’re
not going to be bound by it,'” hearings officer David Karlen told
assembled parties. He granted summary judgment motions filed by both
the City and County of Honolulu as well as the winning rail bidder,
Ansaldo. That means there won’t be any further hearings for
Bombardier, unless the company decides to take the matter to circuit
court.

The first phase of the contract to design, build, operate and maintain the rail line, including providing the rail cars, is worth $574 million. The next phase is worth $506 million.

Andy Robbins, Bombardier’s vice president of business development,
told Civil Beat after the decision that he wanted to huddle with his
team before making comments to the media. A representative for Ansaldo
declined to comment while the matter is still pending.

Bombardier’s appeal had been a narrow one. It argued it was
unfairly disqualified from the competitive bidding process because it
had a different interpretation of the liability arrangements laid out
in the Request For Proposals. It argued that the city had the
responsibility to make sure there was no misunderstanding — merely
instructing bidders to re-read the rules wasn’t enough.

“State law requires something more than a charade,” Bombardier
attorney Terry Thomason told Karlen Tuesday, saying that the
requirement for “meaningful discussion” means the city should “lean
across the table” in private and warn a prospective bidder when
they’re in danger of being disqualified. Doing so would maximize the
number of potential bidders and would help the city get the best
product and best value for the public.

But the city insists it did everything it could to make itself clear.
In one addendum to the RFP, it acknowledged Bombardier’s question. And
in one face-to-face meeting, the city told Bombardier that conditioned
responses would not be considered.

“Was there a hammer involved that needed to be hit over their head?”
asked attorney Joseph Stewart, a partner in the Kobayashi Sugita and
Goda law firm representing the city.

David Minkin, an attorney for Ansaldo, put it this way: “You can lead
a horse to water, you cannot make the horse drink.”

Karlen largely agreed with the city and with Ansaldo, saying that “the
Bombardier theory does not apply.” He also endorsed the city’s
argument that allowing one bidder to rewrite the rules to fit its needs — particularly on a matter like dividing liability between a
contractor and the government in the event of a serious accident —
would not be in the public interest.

“You can’t compare the Bombardier offer and the other offers because
it’s apples and oranges,” he said.

The other losing rail bidder, Sumitomo, will make its case to Karlen
Wednesday. Its complaint is significantly broader and focuses on the
evaluation of its bid versus Ansaldo’s.