The embattled agency overseeing Honolulu’s rail transit project has received a second grand jury subpoena, officials disclosed Thursday.

The latest order, which rail officials say they received late Friday, focuses on the Honolulu Authority for Rapid Transportation’s overpaying of relocation costs for property owners along the rail line — a potential violation of federal law.

Specifically, the U.S. District Court subpoena calls on HART to provide the files for 18 of the rail agency’s relocation cases, most of which were found to have missing documents, math errors and “payments made without justification.”

HART first reported those overpayments a year ago.

“Certainly there may have been mistakes, errors, mathematical errors — things of that nature,” HART Executive Director Andy Robbins told the press gathered outside of the agency’s offices Thursday. “But personally I haven’t seen anything that rises to the level of criminal activity.”

Cory Lum/Civil Beat

A rail subcontractor, W.D. Schock Co. Inc., started uncovering the discrepancies and excess relocation payments in 2017 as part of its review of those files for HART, records show. The payments took place under the transit project’s previous right-of-way consultant, Paragon Partners, which left the project in 2016 when its contract wasn’t renewed.

Some 15 of the 18 files had problems, according to the review. The sample represented fewer than 20 percent of Honolulu rail’s 103 total relocation payments to that point.

In February 2018 HART sent a letter to the Federal Transit Administration flagging the widespread problems with the payments to property owners. HART informed the FTA that it would repay the agency the $3.8 million it had contributed. Since then, HART has covered all of rail’s relocation expenses, Robbins said.

There are no plans to seek reimbursement from property owners who were overpaid, he added. HART reported paying $13.2 million in relocation costs as of January 2018. It’s not clear how much of that was affected by the discrepancies.

This latest grand jury subpoena demands that HART provide the court with the 18 relocation files themselves, plus the audit reports on those files done by Overland Pacific & Cutler — a firm hired by W.D. Schock.

It further asks for records that identify “the companies and personnel who worked as right-of-way consultants or staff for HART to administer relocations services.”

A Revolving Door

Unlike the first sweeping federal order that requires HART to provide tens of thousands of documents across multiple construction issues, this new subpoena is tighter in focus. It appears to probe whether there was criminal fraud or malfeasance associated with the errors, deficiencies and overpayments flagged a year ago.

Robbins, who took over HART in September 2017, said that any of the agency’s property acquisition and right-of-way managers who were in the loop during the time in question have since left.

Indeed, the agency has seen high turnover and struggled to retain top-level leaders, including those who oversee the relocation of property owners. HART has had three different right-of-way directors come and go in the past three years, and the position is currently vacant.

The most recent director, Richard Lewallen, left the agency in recent weeks after just a months-long stint and returned to his previous employer, the city’s corporation counsel office, Robbins said Thursday.

Lewallen’s predecessor, Abbey Mayer, left in May 2018 after 16 months in the post. Online records show he went on to work for Jacobs Engineering, a firm that for years oversaw rail on behalf of the FTA.

Cory Lum/Civil Beat

Prior to Mayer, Jesse Souki served as right-of-way director and left in 2016, around the time Paragon wasn’t renewed.

In 2018, Souki said he hadn’t seen problems with Paragon’s work on relocation payments but added in an email that “it appears that W.D. Schock’s work is helping to improve the program. That is good news.”

The new subpoena further raises the question of whether HART will see its remaining $744 million in federal funding, which is vital to getting the 20-mile, 21-station line to Ala Moana Center.

The FTA has not responded to questions of how the prior subpoena might impact its approvals to release those dollars, if at all.

According to Robbins, the federal agency told him last week that it would send a specialist to Honolulu in March to review the relocation cost files.

Two days later, HART received its latest subpoena, dealing with those same relocation costs, Robbins said Thursday.

“You can imagine when someone has to relocate, that’s a disruption to their lives, to their businesses, so I know that there was always a sense of fairness in dealing with people,” he told local media.

“There’s a review process that has to take place to make sure that we’re paying what’s within the guidelines and not paying anything more. It gets complicated.”

Read the latest HART subpoena here: