Contract Dispute Moves From Court Room To City Council Chambers
The city is on the verge of executing a $1.4 billion contract with rail car builder Ansaldo, but the Honolulu City Council still has some unanswered questions.
The Council’s Budget Committee Wednesday considered — and then deferred — that would urge Mayor Peter Carlisle and the Honolulu Authority for Rapid Transportation to cut its ties with Ansaldo and start the process over again.
Council members want to know why Bombardier, a losing bidder, was disqualified from the running, and that’s actually why the resolution was deferred: So Bombardier can come testify in person.
Council member Tom Berg, who introduced the resolution, made an elaborate football analogy, saying the city needs instant replay to review if Bombardier made the catch with both feet in bounds for a “$250 million touchdown” for Honolulu taxpayers. That’s roughly how much Bombardier’s offer would have saved over the life of the contract versus Ansaldo’s bid.
The core systems contractor will design, build, operate and maintain the rail cars and train system. Ansaldo was picked in March and ever since has been fighting off protests, appeals and criticism of its past performance and financial stability.
In legal documents, the city has repeatedly explained its reason for disqualifying Bombardier: because the company refused to accept liability for potential problems down the road. Bombardier has argued there were never “meaningful discussions” — basically, that they were never warned their offer was deficient. The city has said it made clear that Bombardier needed to make changes to its bid or risk being labeled “unresponsive.”
At Tuesday evening’s rail town hall in Kapolei, Interim HART Director Toru Hamayasu told Berg that Bombardier’s contract offer might not have been so much cheaper if it had complied with the same liability provisions that the other bidders did. But on Wednesday in the Council committee meeting room at Honolulu Hale, Hamayasu, Budget Director Mike Hansen and Deputy Corporation Counsel Amy Kondo were reluctant to answer Berg’s questions because the case could still be appealed in court.
They all said the decision to disqualify Bombardier has been upheld three times: In a protest to the city, an appeal to the Hawaii Department of Commerce and Consumer Affairs, and finally a lawsuit in First Circuit Court. They told Council members to review the case records and they’d understand the rationale behind Bombardier’s disqualification.
Berg pointed out that the Council has never heard the explanation directly. And while his characterization of the rationale for disqualifying Bombardier as a failure to correctly fill out a form was plainly inaccurate, his resolution did get a hearing. In the public forum, in front of the Olelo cameras, the administration’s ducking and dodging ending up raising the hackles of others on the Council.
Council Vice Chair Ikaika Anderson and Budget Chair Ann Kobayashi said they were disappointed in the lack of answers, particularly the refusal to discuss a public document.
Anderson in particular seemed baffled. He said Kondo’s suggestion that he submit his questions in writing and wait for an attorney-client-privileged response wouldn’t help him assuage the concerns of frustrated constituents. Kobayashi said she wanted the lawyers to read key passages from filings and rulings so the Council members wouldn’t have to read through all the pages themselves.
But those frustrations don’t necessarily mean the resolution will pass whenever Bombardier does testify. Anderson acknowledged that it’s not in the Council’s purview to handle contracts — that’s generally an executive branch function. There are laws and rules and processes in place governing the way government contractors are picked. Legislators can’t go in and play Monday morning quarterback, to adapt Berg’s football analogy.
Even if the resolution does pass, it’s likely nothing will change. The resolution doesn’t have the force of law; it merely urges an action that HART has fought against in each of the three venues mentioned above.
Wednesday’s Budget Committee fight shows the City Council is still paying attention to progress on rail, whether its members can have an impact or not.
