The Federal Transit Administration gave Honolulu a $55 million vote of confidence yesterday in the city's planned commuter rail line from East Kapolei to Ala Moana.

The support helps build momentum for the rail project just days after Gov. Linda Lingle raised concerns about whether the city could afford the estimated $5.35 billion price tag.

City officials have been hoping the FTA will contribute $1.55 billion toward building the line, and yesterday FTA Administrator Peter Rogoff said they can count on it. The FTA plans to sign an agreement before October 2011 to provide the money, Rogoff said.

The first installment of $55 million was included in the FTA's proposed fiscal 2011 budget announced this week.

"We would not have included funding in the president's budget for this project if we thought it was falling off the rails," Rogoff said in a conference call with news media yesterday. "We expect to continue to work with the city and county to continue to strengthen their financial plan and we will be evaluating a new financial plan when they make an application to go into final design."

Rogoff acknowledged that concerns remain with the viability of the financial plan for the project. However, he said those concerns aren't expected to prevent the grant agreement from being signed by a Sept. 30, 2011, deadline.

"It's a great day for the city of Honolulu," said Mayor Mufi Hannemann during a news conference at Honolulu Hale. "Certainly it couldn't have come at a better time, especially when the chief executive of the state is expressing strong concerns and reservations about going forward."

Hannemann said he hopes the FTA announcement will spur Lingle to expeditiously approve the project's environmental impact statement, once it's released by the federal government. The city wants Lingle's approval to come relatively fast. However, Lingle has said she'll conduct a thorough analysis to ensure that the project's financial plan is feasible and that alternatives were adequately considered.

"We would really hope that she would start sending some positive messages and signals ," Hannemann said. "Whatever it is that's holding her back, cast it aside for the good of the people.

"This is a train that will bring economic benefits for people for years and decades and generations to come."

Groundbreaking on the elevated commuter rail was supposed to take place in December, but has been indefinitely delayed by an ongoing federal review of the project's final environmental impact statement.

The delay could be extended by Lingle's plan to conduct an independent analysis of city tax revenue forecasts that are the basis of the project's financial plan. Her concern is that the project could hurt the state's finances if it fails.

Lingle based much of her concern on an Oct. 7 memo from the FTA to the city warning that the city's financial plan may not be sufficient to allow the project to proceed into the final engineering phase this year.

STANDARD MESSAGE

The FTA's Rogoff yesterday said that warning is often given to cities seeking federal transit funds. Basically, it means that federal scrutiny rises as a project proceeds through the federal funding process, he said.

Rogoff also said he was perplexed by Lingle's concerns that city officials did not adequately study street-level alternatives to an elevated train. Numerous state agencies failed to raise that concern when provided an opportunity to examine the project's environmental impacts, he said.

Lingle has suggested the city consider building the rail partially at street level to cut cost, given tax collections for the rail have been less than anticipated.

"The governor has an important role to play in the approval of this project, especially as it relates to state environmental law and I do not begrudge the governor having an independent look at the financing of this project," Rogoff said. "But please know that the FTA also takes an independent look at the finances of this project and we will do so again when they submit a financial plan to get into final design."

Lingle yesterday said she plans to move forward with an independent review of the project's finances.

"We are pleased that FTA Administrator Peter Rogoff confirmed the federal government is continuing to work with the city to strengthen the financial plan and that they will evaluate a new financial plan when the city submits its application for the final design," Lingle said in a written statement. "We are also pleased that Administrator Rogoff recognizes my role in the approval process and understands why I will move forward on an independent review to ensure the financial viability of the project."