2026-09-01 - Policy Committee on Environmental and Natural Resource Management

05:03Aloha, ladies and gentlemen, and thank

05:05you for your patience. Uh, today is

05:07September 1st. the time 2026 and the

05:11time is 1:18 p.m. Thank you for all of

05:15those of you who've been waiting for

05:16this committee meeting. So, we're

05:18running a little behind today. Um, this

05:21is the

05:23eighth session of the policy committee

05:25on environmental and natural resource

05:27management. Joining me here today in

05:31Hilo Chambers are Council Member Galima,

05:34Council Member Kimell, Council Member

05:36Connie Lee E Kleinfelder, Council Member

05:38Ena,

05:40Council Member Onishi will be joining us

05:42in a moment, Council Member Kirkowitz,

05:44Council Member Hustus, and Council

05:46Member Kagiada. My name is Rebecca

05:49Viegas, and I will be the chair of the

05:51committee this meeting. Um, this meeting

05:54this meeting today. Uh

05:58at this time we'll go to statements from

06:00the public.

06:03>> Thank you [clears throat] so much chair.

06:04Noting that we do have a handful of

06:06testifiers via Zoom. We have a couple

06:08here in the Hilo chamber. So we'll start

06:09with them. The first of which is I

06:12believe it's Briani Kobayashi Kui to be

06:15followed by Matthew Picket.

06:26Miss Kulie, when you're ready to begin,

06:28you can press that green button at the

06:30base of the mic to turn it on.

06:32>> Introduce yourself and you'll have three

06:34minutes.

06:37>> Aloha, chair

06:39and members of the council.

06:41>> Aloha. My name is Briani Kobayashi Kui

06:44and I'm the general manager of SCP Hilo

06:47Hotel. And for those of you who may not

06:50know, SCP Hilo Hotel is the first

06:52property in the entire state of Hawaii

06:54to achieve a silver benchmark

06:56recognition through Earth Check, which

06:58is the world's leading sustainability

07:01benchmarking and certification

07:02organization for both travel and tourism

07:05in the world.

07:08We have worked hard for this distinction

07:09because SCP at Hilo SCP Hilo is not a

07:13slogan. It's measurable, accountable,

07:15and built in the way we operate.

07:18She's [snorts] excited, too. Uh, for

07:20those who might not know, we've also

07:21eliminated single-use plastics for all

07:23of amenities, water bottles. We provide

07:25filtered water stations. Our solar

07:27panels provide more than 10 megawatt

07:29hours of energy. Uh, anti.

07:32And through our every state does good

07:34program, um, every time a guest checks

07:37in with us, we average tourist brings

07:40about 1.1 pound of trash and we

07:42physically remove 2.2 2 pounds of trash

07:44every time a guest stays with us in

07:45partnership with Hawaii Wildlife Fund.

07:47So, this partnership has helped us to

07:49remove more than 60 tons of marine

07:52debris, so close to 200,000 pounds of

07:54trash so far. Um, so our our most recent

07:58wastewater bill reflects this story in

08:01our 128 room property, SCP Hilo Hotel,

08:04is actually 32% below the national hotel

08:07median for water consumption. 32% below.

08:11and we work hard to to be as sustainable

08:15as we can. As I mentioned earlier, we're

08:17doing what we can and we're constantly

08:18asking businesses and visitors in Hawaii

08:20to do the same, to waste less, to

08:23consume less, and to take responsibility

08:24for our impact. But this bill does

08:26create a hotel wastewater class and

08:28charges hotels a higher rate simply just

08:30because we are hotels. And it doesn't

08:32distinguish between a hotel that

08:33conserves aggressively like ours and one

08:35that does not. And I believe this is

08:37where the policy gets it wrong. If one

08:39hotel consumes dramatically less water

08:41than another, I don't believe uh its

08:43commitment to conservation should become

08:45irrelevant uh just because it's a hotel.

08:48If the goal is to protect our

08:49infrastructure and our resources, then I

08:51feel the actual rate of consumption

08:52should matter. We understand that

08:54infrastructure costs money and we're not

08:56asking to avoid our responsibility or

08:58for someone else to pay our share. But

09:00for a smarter rate structure that would

09:02consider actual consumption, consider

09:04verified conservation performance such

09:06as ours, consider a a conservation

09:08credit or a performancebased adjustment

09:11for businesses like ours that

09:12demonstrate they're using your

09:14resources. Please

09:16>> um if we invest in solar, eliminate

09:18plastics, reduce our water use, and

09:20track our environmental impact and

09:22become the first ever in the state to

09:25use this to in hotel in Hawaii and use

09:2732% of water. I want that to matter and

09:30I don't want the message to be that we

09:34don't reward this. Uh Hawaii County has

09:36an opportunity to create a policy that

09:37does more than just collect revenue. I

09:39believe it can really influence

09:41behavior. Um reward conservations and we

09:44can all have a reason to conserve more.

09:46Uh sorry, we're just trying to be the

09:48example and we don't want to punish the

09:50example.

09:50>> Thank you so much for your time, Miss

09:52Kobe. Your time is up so we're going to

09:53have to move on. Mahalo

09:55>> chair. Your next testifier is Matthew

09:57Picket here in the Hilo Chamber to be

09:58followed by Barbara Bell via Zoom.

10:02>> Matthew, when you're ready to begin,

10:03please introduce yourself and you'll

10:04have three minutes.

10:11>> Good afternoon, Chair Naba, members of

10:14the council. Uh, the Hilo Hawaiian Hotel

10:16respectfully opposes Bill 183 in its

10:19current form. Um we support a

10:21financially self-sustaining wastewater

10:23system. Um we accept that the rates must

10:26rise for the Hilo water wastewater

10:27treatment plant. Um our objection is to

10:30one of the features in the bill. It

10:32creates a new hotel class that charges

10:35far far more than every other customer

10:37connected to the same system without any

10:39published cost basis for doing so.

10:43the bill, what the bill does to the

10:44hotel. Um, as of January 1st, we'll have

10:47a 78% increase in our as the first step.

10:51And by year five, the rates will climb

10:54to $189

10:56per unit, [clears throat]

10:58which is three and a half times today's

11:00cost. What [clears throat] it means to

11:02the hotel, um, it roughly adds $145,000

11:06in year one and almost $500,000 by 2031.

11:12>> [clears throat]

11:13>> um just by being placed in a hotel class

11:16rather than a non-residential class.

11:19The hotel class has no published cost of

11:22service basis. Uh the department June

11:252026 wastewater rate study states that

11:28its purpose is to determine a cost of

11:30servicebased schedule of rates. Nothing

11:33in the study or the bill explains why

11:34the hotel unit costs 22% more than any

11:38other non-residential unit or up to

11:40three times as much as a multi-unit

11:42residential unit, an apartment building.

11:45[clears throat]

11:46So I I don't understand why it would

11:47cost three times more to treat the

11:50wastewater from an apartment building

11:52versus a hotel. um and that um cost of

11:55service study unless it's published um

11:59we don't see any reason why this bill

12:00should be passed in its current form.

12:03[clears throat]

12:06The other issue is the timing and the

12:08escalators. Um we have contracts that go

12:11out as far as a year and a half, two

12:13years. Um this can't cost can't be

12:16passed along to our customers at this

12:18point. Um, we would ask that if the bill

12:20is amended, it be rewritten to um, take

12:23go into effect on July 1st of 2027

12:26versus January 1st, which would give us

12:28more time to pass the cost along onto

12:30our customers. [snorts]

12:33[clears throat] Um, we also request in

12:34if the bill to be amended that um, there

12:38would be a rate review for the later

12:41increases.

12:42>> 30 seconds, please. year 2029, 30 and 31

12:45just so that the costs of a match are in

12:48alignment with the the rate increases.

12:50Um for these reasons, um I respectfully

12:53request that the council either amend

12:55bill 183 as described or in failing to

12:58do that reject it in its current form.

13:00We want to remain a strong partner in

13:02keeping the county's wastewater system

13:04sound and we're prepared to pay our true

13:06cost of services. We only ask that the

13:09rates be based on that cost. I think

13:11that um the way the bill was written, it

13:14probably um has more of an impact on the

13:17Kohala Coast hotels that have a higher

13:19average rate.

13:20>> Thank you so much, Mr. Picket. Your

13:21three minutes are up, so we're going to

13:22have to move on.

13:23>> Thank you.

13:24>> Chair, your next testifiers are all via

13:25Zoom. The first of which is Barbara Bell

13:27to be followed by Georgins. Barbara,

13:29when you're ready to begin, please

13:30introduce yourself and you'll have three

13:32minutes.

13:35>> Oh, you'll have to unmute.

13:37>> Okay. Hello everyone. Can you hear me?

13:41Yes.

13:42>> Yes, we can.

13:43>> Okay. Um, my name is Barbara Bell. I'm a

13:45resident of Puico, uh, South Kohala. I'm

13:49here today to support this bill to

13:51increase sewer rates over the next five

13:53years as the wastewater division

13:55operations move towards being

13:57self-supporting.

13:58Um, the concerns I'm primarily

14:01addressing were from the Environmental

14:03Management Commission, many of which can

14:05be addressed in the future. What cannot

14:08be addressed quickly enough, in my

14:10opinion, is the ongoing reliance on the

14:12county's general fund. You can commit to

14:16establishing new any new rates or

14:18categories,

14:20adjustments for the hotel rate if you

14:21want or exemptions that you see is

14:24needed via a new ordinance in the near

14:27future.

14:29So um treating waste water one of one

14:32major concern was affordability and

14:35treating wastewater to healthful

14:37standards it's expensive. So the

14:40question for the council as a policy

14:42question is how much do you think the

14:44general public should subsidize the

14:46benefit of a sewer connection on

14:48individual properties? The wastewater

14:51division operations I believe should pay

14:54for themselves and so does the EPA.

14:57So, you kind of have to do this. Um,

15:00capital costs are always paid by geo

15:03bonds. Therefore,

15:06there's already a continuing financial

15:08sub financial subsidy happening

15:12um from the general public in

15:13recognition of the value of a clean

15:16environment.

15:17So, the reliance on general funds has

15:20been a problem for decades. Uh,

15:23honestly, this is not happening soon

15:25enough. Uh there's been deferred

15:28maintenance due to a lack of funding.

15:32That's kind of a sad situation that

15:33we're in now. Um one concern was pricing

15:38based on usage. Well, it's somewhat it's

15:41rather impractical because because water

15:43usage is unrealistic in dry areas and if

15:47you want one rate, you really can't base

15:49it on water usage.

15:52um short-term vacation rentals. Okay. If

15:55they're a small business and the

15:57assumption is they're generating more

15:59wastewater because they have a higher

16:01occupancy, you could amend the ordinance

16:04in the future to add a specific rate for

16:06STVRs.

16:08Seems it seems fair to me that

16:10businesses

16:12uh pay more than residents.

16:13>> 30 seconds, please.

16:14>> Okay. So

16:17um I just wanted to mention that um

16:20you're going to need some new rates in

16:21the future. Uh in Puo we're in final

16:24design phase for a low pressure

16:26collection system and this will need a

16:28new rate at some point where just

16:31collection rather than collection and

16:32treatment and uh sometimes it's just

16:36liquids going to a treatment system. So,

16:40um, I'd be happy to help brainstorming

16:42this. Uh, the Environmental Management

16:45Commission off also suggested that

16:48recycled water should have a rate.

16:50That's a great idea.

16:52And I'm sorry, Barbara, but your three

16:54minutes are up, so we're going to have

16:56to move on. Our next testifier is

16:58Georgins to be followed by Kico Mleen.

17:01Georgin, when you're ready to begin,

17:02please introduce yourself and you'll

17:04have three minutes.

17:05>> Okay. My name is Georgins. I live in a

17:08condo at Monolani Resort down current

17:12from Puco. Uh and I pay for private

17:16wastewater treatment. Uh also was

17:20associated with the environmental

17:22management commission. Um just as a

17:25general statement of of belief, I think

17:28anyone who puts stuff down the drain

17:30needs to provide their kana to take care

17:35of those waste uh to the best of their

17:38ability.

17:39Also we need to have a sustainable

17:43funding mechanism for the county for

17:46anybody actually who is doing the

17:49operations and maintenance and

17:51preventative maintenance for the

17:53infrastructure to treat wastewater.

17:56Um

17:58we all have responsibility. I am paying

18:01for private wastewater treatment, but I

18:04think everybody who benefits from the

18:06fact that we have or should have uh

18:09pristine clean waters in Hawaii should

18:12contribute to the funding. Um that's

18:16beyond general funding uh allocations

18:20that go up and down depending on what

18:21the politics are. some sustainable way

18:24to say yes, I care about having clean

18:28water. Um, bill 183, I think, is the

18:31first step. Differentiating as best you

18:35can to figure out who should pay how

18:38much. Um, is a very complicated thing.

18:41We don't necessarily have the data to be

18:43able to do that. Um, but I think it's

18:45it's the as Barbara was saying, it's the

18:48first step to start making sure that

18:50we've got funding that is going to be

18:53continuous and reliable as they work on

18:56expanding the county system. I would

18:59definitely recommend you talk with Steve

19:01Holmes about Enterprise Fund and some of

19:04the things that they've been able to do

19:06on Aahu. Um, but at at base, we've got

19:10to start getting serious about this. it

19:13isn't going to cure itself. We need to

19:15work on taking care of our environment.

19:18Thank you.

19:20>> Thank you for your testimony, chair.

19:22Your next testifiers are KOA Mlen to be

19:24followed by Cyrus Johnson. KO, when

19:27you're ready to begin, please introduce

19:28yourself and you've got three minutes.

19:30>> Aloha Awin, committee chair Viegas, Vice

19:33Chair Kagiada, and the honorable members

19:35of the committee. Uh for the record, my

19:37name is K. Mullen testifying today on

19:39behalf of Outrigger uh Hospitality Group

19:43and the Havi Hotel Alliance. I will rely

19:46mostly on the comprehensive written

19:48testimony submitted by HHA President uh

19:51Jerry Gibson on behalf of our Havaii

19:53County membership as well as our

19:55detailed written testimony submitted for

19:57Outrigger. However, I would appreciate

19:59the time to briefly emphasize some of

20:01the core content of of that testimony

20:04today. Uh we fully respect the county's

20:07need to fund critical wastewater

20:10infrastructure.

20:11However, we respectfully ask this

20:14committee to consider deferring Bill 183

20:17or amending the measure to eliminate

20:19category F altogether, the creation of a

20:23new targeted super tax rate class for

20:26hotels.

20:28Isolating our brick and mortar hotels

20:31with rate increases of more than 300%

20:34disproportionately burdens local

20:36properties that already contribute tens

20:39of millions through real property taxes

20:42and the county tat which was

20:44specifically contemplated for county

20:47infrastructure.

20:49Meanwhile, short-term rentals escape

20:52this classification under residential

20:54rates, noting that there are more

20:56short-term rentals throughout the county

20:57of Havi than hotel units.

21:01Just this morning, acting Lieutenant

21:03Governor Keith Rean on behalf of

21:04Governor Josh Green proclaimed today,

21:07September 1st, 2026, as National Hotel

21:10Employee Day across Havi. Mr. Regan was

21:14joined by the House Tourism Chair,

21:16Representative Adrien Tam, and the

21:18Senate Tourism Chair, Linda Decoy, who

21:20who praised our hotel community for the

21:22investments our members continue to make

21:24in their most important assets, the

21:27people who work in and operate them.

21:31Hearing stories of employees who have

21:33served at a single property for 20, 30,

21:35even 50 years really reflects the core

21:37values of an industry that truly invests

21:39in its people. And targeting the hotel

21:42industry with a super tax like this,

21:45especially one that impacts our

21:47mid-market Kama hotels so egregiously

21:51feels in congruent with our shared

21:52values of a thriving visitor economy

21:55that supports our people and our

21:57community. Cost spikes like this

21:59threaten operational stability,

22:02impacting local families who rely on our

22:04hotels for gatherings, stations,

22:06>> 30 seconds, please.

22:07>> And their jobs. We respectfully urge the

22:10committee to defer this measure or to

22:13eliminate category F altogether. I am

22:16available to answer any questions to the

22:18best of my ability. Mahalo for your

22:20leadership and consideration. Aloha.

22:23>> Thank you for your testimony. Chair,

22:25your next testifier via Zoom is Cyrus

22:27Johnson. Cyrus, when you're ready to

22:28begin, please introduce yourself and

22:30you've got three minutes.

22:33>> Right on. Thanks. Uh, thanks

22:35[clears throat] Turk. Uh, aloha, Chair

22:37Vegas and Vice Chair Kagawada and

22:39representatives of the council. Sorry I

22:40had to uh leave you folks. Um, but

22:43anyway, I just want to to testify on

22:45this particular measure 183. Um, mostly

22:48because

22:50um I agree that the wastewater um our

22:54wastewater systems, you know, having

22:55worked in county government uh need all

22:58the love and support we can possibly

22:59give them. um including funding outside

23:01of the general fund to really help um

23:04bolster our um

23:07bolster our systems and make them more

23:08sustainable. However, you know, when I

23:11when I first read the bill, I thought,

23:12"Oh, this is great. I totally support

23:13and agree with the idea." However, the

23:16um it just seemed like an attack to me

23:19with the hotel class. When I thought

23:21about our Hilo hotels, I thought, you

23:23know, what hotels are on wastewater

23:26systems and really three of the three of

23:29the ones I could think of were all in

23:30Hilo and those are the hotels, you know,

23:33our Ohana use when they come down from

23:34Monarch, Highly Tournament,

23:37um you know, [clears throat]

23:39uh coming across island for soccer

23:41tournaments, football, Pop Warner, and

23:43you know, they're really the only

23:44affordable options that we have and the

23:46only accommodation options that we

23:48really have on on the east side in

23:49general. And so when I think about, you

23:50know, banning drive redevelopment and I

23:53think about the economic economic

23:54opportunities um for our community out

23:57here in Hilo, um I really, you know,

24:00think that we should be careful on

24:04who we are charging more for when really

24:07that they're, you know, it's not that

24:09they're serving a volume of of malini

24:13that the Westside guys are, you know,

24:14like every other person when I go to the

24:16lobby or when I have dinner at one of

24:17these restaurants or places at these

24:19hotels, you know, these are um they're

24:22servicing a lot of our local people and

24:24whether they're from out of town or or

24:26even from Hilo and just doing a

24:27stationation. Um I think that this is a

24:30really unfair or or [clears throat] the

24:32the hotel clause or class in this bill

24:35um just offers a really unfair

24:37um kind of jab at hotels that are barely

24:42uh able to stay alive as is at our

24:45current um visitor flow and and current

24:47um economy. So, I just really feel for

24:50them and I thought I would just jump on

24:51and voice that um just speaking for

24:54myself. But that's it everybody. Sorry

24:55to take up your time. Uh hopefully you

24:57folks can either amend or defer that

24:59particular um this bill until that's

25:02taken care of. Malo,

25:05>> thank you so much for your testimony.

25:07[clears throat] And with that, chair, I

25:09believe yes, with that those are all the

25:11testifiers you have for this meeting.

25:14>> Thank you so much. Um with that, we'll

25:17go to you Mr. Click to read it in for

25:18us.

25:19>> Bill 183 amends chapter 21 articles 1

25:22and four of the Hawaii County Code 1983

25:242006 condition [clears throat] as

25:25amended relating to sewer service

25:27charges increases wastewater service

25:29rates and establishes a new service

25:31class with new service rates for hotels

25:33introduced by council member Viegas by

25:35request.

25:37>> All those chair motion to board bill 183

25:41to council with a favor recommendation.

25:43It's been moved by Council Member Hustus

25:45and seconded by Council Member Galima.

25:48And with that, we will go to the

25:51presentation by the Department of

25:52Environmental Management. Thank you for

25:54being here, Director Gervon. I'll hand

25:57the floor to you.

26:00>> Well, good afternoon. Uh, I'm Dan Gerin,

26:04director of the Department of

26:06Environmental Management. We have Kelly

26:08Hartman today and Robin Bowman with us

26:11also. and uh we're going to be bringing

26:14on a group called LG. They're a

26:18consultant to us and they um provided a

26:21lot of help for putting this new rate

26:23structure together and they'll have a a

26:26presentation that we'll go through and

26:28then after that we'll have some

26:29questions

26:32[clears throat] and if you'll please

26:33excuse me I'm dealing with some

26:34congestion

26:36but uh there have been some questions

26:38concerning specifically the rate

26:41structure for hotels and I just want to

26:43give a preliminary response to some of

26:46that uh first off the entire

26:50rate study is uh just been posted. It is

26:55currently available on our county

26:57website on our department website. So

27:00the people that would like to uh review

27:03that study in greater detail, it is

27:05there and available and we would welcome

27:08any um any questions or comments you

27:10have on it after you've gone through it.

27:12One of the things you will find in that

27:14rate study is that considerable

27:18amount of effort was put into

27:20determining this new class of hotels. Uh

27:24FG did quite a bit of research work to

27:27come up with the numbers to support the

27:29rate structure as we have put it in in

27:32this bill. Uh the number is not an

27:35arbitrary number and in fact uh we are

27:39required by both federal and state

27:41statutes that any number we put in a

27:44rate structure becomes supportable and

27:47um therefore there are a lot of

27:50calculations behind those numbers. We

27:52cannot change the department cannot

27:55change those numbers based on political

27:58objectives or personal objectives. They

28:02must reflect the cost of service for

28:05each class of customer. Now when you

28:09look at the rate study, you will find

28:11that the driving factors for the hotel

28:14group are concentration of waste

28:18specifically BOD and total suspended

28:21solids and the volume of the waste from

28:25that that kind of industry. And the

28:29finding is that for hotels, uh, BOD

28:32numbers are unusually high. Total

28:34suspended solid numbers.

28:36>> I'm sorry to interrupt. Could you get,

28:38um, define the acronym for BOD?

28:40>> Oh, I'm sorry.

28:40>> That's okay.

28:41>> Okay. Um, BOD is biological oxygen

28:46demand. And that what that means is the

28:51there's organic material in this

28:53wastewater. And in order to do a

28:57biological digestion process requires a

29:01certain amount of oxygen to be mixed

29:04with that water to support the organisms

29:08that do the biological digestion. TSS is

29:12total suspended solids. So it's by and

29:16large by weight the percentage of

29:20suspended solids typically dirt, soap

29:23scum, etc. that's in the water. So, um,

29:27in in both cases, we have discharge

29:30standards that we have to perform to

29:33with our NPDS permit, which requires us

29:37to at least diminish, if not completely

29:41remove those materials.

29:44The more BOD, if I may use the acronym,

29:47uh that's in the water, the more we have

29:50to airate the water, the longer it has

29:52to spend in our system to for the

29:55organisms to dig digest those organic

29:58materials. Well, in the wastewater

30:01business, time is money.

30:04So the more time that this these waste

30:07waters have to spend in our digestion

30:09process, the more we have to run blowers

30:12that have very large motors that use

30:13lots of electricity

30:16and the bigger electric bill we have to

30:18pay. So uh that's all tied to the cost

30:21of operation

30:23and those numbers are in that study.

30:26Councilman, you had a question.

30:28>> Yeah, director is the study has the

30:30study been transmitted to the council?

30:33Not yet. I'm sorry. I apologize for

30:36that, but we will do so.

30:37>> Okay. Let's get that over as soon as

30:39possible so it can be in the public

30:41record as well. Thank you.

30:42>> Um, so that you know the cost of

30:45treating that water goes up. And what

30:48they found was because hotels not always

30:52but sometimes have restaurants, they

30:55have high density of population, they

30:57have industrial gradeies to keep all of

31:00their linen clean. And by the time you

31:03receive all that wastewater, it is an

31:05unusually large volume and it's an

31:08unusually large large concentration of

31:10materials that we have to treat. So I am

31:14sensitive to the idea that the price is

31:18higher and what that really means is

31:21that for a very long time we have been

31:23undercharging

31:24for that for that grade of customer and

31:28that um we're comfortable that the

31:30numbers we have in this rate study are

31:32supportable. Uh you will be able to read

31:35the study and make that determination

31:36for yourself. But um you know we believe

31:41that the number is in fact the correct

31:43number and um I apologize that it

31:47increases the budgets [snorts] for some

31:48people but like one of the presenters

31:51just said a little while ago it costs

31:54money to have clean water. So uh at this

31:58point is our is FG ready to go?

32:03>> Okay. Well, we'd like to present uh Art

32:05from uh FG and we'll let him make his

32:07presentation.

32:15Uh good afternoon everybody. My name is

32:17Art Griffith and I'm with FG Solutions

32:19and as uh Director Durban said I I am

32:23with the firm that completed the rate

32:25study on behalf of the county. I am

32:27going to share the PowerPoint

32:29presentation

32:33and please confirm that you all can see

32:37it.

32:38>> Yes, we can.

32:39>> Excellent. Thank you.

32:40>> Thank you.

32:42>> All right. So, uh, council, members of

32:44the public, uh, this presentation is a

32:47overview of the wastewater division

32:49wastewater rate study. And first, I want

32:53to ask the question and answer the

32:54question, why are we here today? And to

32:56do that, I'm going to uh quote from the

32:58wastewater division's mission statement.

33:00I'm going to read it and then emphasize

33:02a few words. To protect public health in

33:05the and the environment to h enhance

33:07quality of life when managing the county

33:10wastewater system, respect the community

33:12while spending wastewater public funds

33:14efficiently and appropriately, and

33:16nurture responsibility, professionalism

33:18in the wastewater division workplace.

33:20So, um, we're going to return to the

33:23themes of protecting public health in

33:26the environment and spending wastewater

33:29public funds efficiently and

33:31appropriately.

33:33What is a wastewater rate study? It is a

33:35projection of wastewater utility

33:37revenues, expenses, and rates over a

33:405-year period. It defines how to pay for

33:42the wastewater system expenses and it

33:46determines a cost of servicebased

33:48schedule of rates that incorporates and

33:51meets the county's needs for its

33:53wastewater system.

33:56Uh brief description of wastewater

33:59facilities. Uh there are six wastewater

34:01treatment plants that the county

34:03operates. Two are larger at Hilo and

34:06Calakehe. Four are smaller at Papaya Po,

34:09Kulmano, Capeu, and Napona.

34:12Combined, they treat about 5 million

34:15gallons of waste water every day. There

34:17are two large capacity ces pools at

34:19Bajala and Nallejo.

34:22120 miles of underground sewer manes, 16

34:24pump stations, and currently about 20

34:28million or 20 miles of sewer manes are

34:31cleaned each year. Here they are on a

34:35map

34:36and you can see where the various

34:38facilities are at Hilo Calake.

34:45Some photos. This is the Hilo wastewater

34:48treatment plant. This is an example of

34:50the infrastructure that uh the county

34:52operates. This a replacement for this

34:54plant is currently under construction

34:56right now.

34:59This is uh a pipe installation project

35:02and these photos speak to the effort

35:05that the county um goes through on a

35:07day-to-day basis to keep the waste water

35:10flowing to the treatment plants and

35:12treating the wastewater um to standards.

35:15So things to look at here are how deep

35:19the trench is and how hard it is as you

35:22all know to uh excavate a trench in a

35:26rocky soil.

35:30Uh the county regularly

35:34uh does pipe repair using slip lining

35:36techniques and that is a less expensive

35:40more efficient way of repairing aging

35:42infrastructure when appropriate.

35:47Uh, one of the ongoing repair projects

35:49is the uh, a clarifier at the Papeyo

35:52wastewater treatment plant.

35:54But this is what a clarifier looks like

35:59and pipe installation. You can see the

36:01size of some of the larger uh wastewater

36:05conveyance transmission mains that the

36:09these are examples of the facilities

36:11that are necessary to build, operate and

36:13maintain 247 to provide to protect

36:18public health and the environment.

36:21The priorities and goals again, safe,

36:24reliable sewer service, public health,

36:26the environment, and that requires

36:28predictable funding was a priority and

36:31goal when looking at the rate study. So

36:34why is a rate increase necessary? Aging

36:37infrastructure, pipes, pumps, treatment

36:40plants, all need maintenance and

36:42replacement. There are regulatory and

36:44compliance mandates that this the county

36:47is required to meet. rising operating

36:50costs for energy, chemicals, labor, and

36:53insurance, and land repairs and upgrades

36:56to facilities.

37:00So during the uh presentation to the

37:03environmental management committee, the

37:06uh

37:07uh the topic of median household income

37:09arose. So as a followup to that

37:12feedback, we wanted to provide some

37:15clarification. the median household

37:17income on for each of the main counties

37:20and we acknowledge that Hawaii's median

37:22household income is the lowest of the

37:24four shown.

37:27Some additional context for uh

37:30historical rate sewer rates and

37:33inflation. So this graph has two lines

37:36on it. The green line is the monthly

37:39wastewater rate for single family

37:40residents and since 2002 and you can see

37:44the scale going up the left side of the

37:46graph. The blue line is the uh consumer

37:51price index for urban Hawaii since 2002

37:54and you can see it gradually climbing

37:57each year as inflation has occurred. So

38:00this graph compares wastewater rates and

38:03inflation. You can see the graph flat

38:05line, the green line flatlines for 16

38:08years when there wasn't any rate

38:10increases. What this graph doesn't show

38:12is the level of service that the

38:14counties provides in its wastewater

38:16service. The county is providing a

38:18higher level of service now than it has

38:21in the past. And that level of service

38:22will continue to increase uh with the um

38:27proposed budgets and financial

38:30projections. And that level of service

38:33means more staff to adequately staff the

38:36wastewater system and the wastewater

38:38treatment plants including the

38:40wastewater treatment plants that are

38:41under construction now. Uh it means more

38:45maintenance. It means addressing needed

38:49repair and replacement expenses

38:55as

38:57in comp to complement the median

39:00household income data. The county

39:02acknowledges that rate increases have

39:04financial impacts and the county is

39:06addressing this by evaluating a new

39:08low-inccome assistance program. The

39:10amount of a discount is unconsider under

39:12consideration right now and the county

39:14is also considering use of existing

39:17assistance programs including matching

39:21eligibility criteria. The benefit here

39:24is that it would simplify administration

39:26for the county and also make it easier

39:28for eligible customers to sign up.

39:33Okay. So here we're going to show some

39:34projected wastewater expenses through

39:37fiscal year 3031. So through the

39:40five-year period and so what you see is

39:42a graph

39:44um with the fiscal years uh along the

39:48bottom of the graph that large the

39:50largest section in the light green are

39:52on and m expenses

39:55in the middle there's a small dark band

39:58that's an allocation for emergency

40:00repairs. The top band in blue is

40:03additional facilities repairs. These are

40:05repair replacement projects in the

40:07collection system that are being started

40:09in this current fiscal year will be

40:11continued on an ongoing basis and will

40:13increase to $5 million per year to

40:17address needed repair and replacement

40:20projects.

40:22Uh the projected expenses would increase

40:24from about 27 million to over 35 million

40:30uh at the end of fiscal year 3031.

40:34The reason for this increase is

40:37inflation on O on M expenses,

40:40filling existing budgeted staffing

40:43positions that are currently vacant to

40:45adequately staff the utility, hiring

40:48additional staff for the treatment

40:50plants that are under construction,

40:52including those at Pahala and Navle,

40:55and also to

40:59be able to complete to be able to fund

41:02the additional facilities repairs in the

41:04collection system that are needed.

41:08So, we took the same graph of expenses

41:11and now we're adding a red line. This

41:14red line is what your current wastewater

41:16system generates in revenues.

41:20So, look at the large area above the red

41:23line. Those are expenses that still need

41:26to be paid

41:28that wastewater rates don't cover. That

41:31current wastewater rates don't cover.

41:33And this money needs to come from

41:34somewhere. The general fund is where

41:37this money has been coming from. If the

41:40general fund continues to pay for the

41:42expenses above the red line, the

41:44cumulative total over the next five

41:46years is projected to be $65 million.

41:49That's over a 5-year period.

41:52If the proposed rates are adopted, the

41:54general fund contribution decreases

41:56significantly and drops to zero at the

41:58end of this 5-year period.

42:07Okay, now we're going to shift gears a

42:08bit and talk about the proposed rates.

42:11And the this slide shows the wastewater

42:14rate customer classes. Uh the

42:17the methodology we used to calculate

42:19rates was a cost of service analysis

42:22where each of these customer classes

42:24would pay their fair share of what it

42:25costs to provide wastewater service

42:28based on how much stress each types of

42:30customer puts on the wastewater system.

42:33Uh going forward with these proposed

42:35classes non-residential would include

42:37all commercial customers except hotel.

42:40You can see in red the new customer

42:42classes of hotels that are proposed and

42:45also private haulers. Private haulers

42:48are third parties that bring their waste

42:50to Hilo and Kala. This hauled waste is

42:54strong and it costs more to treat. There

42:57will be three different customer classes

42:59reflecting the differences between the

43:03strength of septage and cesspool waste,

43:06portable toilet waste, and WWTP

43:10wastewater treatment plant waste. Well,

43:11what that last item is, WWTP means

43:15hauled waste from noncount wastewater

43:18treatment plants.

43:20Here

43:22are the proposed monthly wastewater

43:25service charges for residences.

43:27Residences pay a flat rate each month.

43:31Current rate is 52. It would increase as

43:34proposed on January 1st to 63 and with

43:38further annual increases every January

43:41reaching $125.

43:44gang cesspools.

43:46Those are customers that use a county

43:52operated and owned collection system but

43:54did not discharge to a treatment plant.

43:56So these customers from the cost of

44:00service analysis are not paying for

44:01treatment plan expenses. You can see

44:04their rate would increase from the

44:05current 25 to 32 and increasing up to

44:09$62 per month.

44:12Non-residentidential rates are

44:14non-residential customers

44:16uh pay

44:18their their wastewater bill in two

44:21parts. The first part is a monthly base

44:23charge per non-residential unit. You can

44:25see how that is projected to increase

44:27and then non-residential customers pay a

44:31monthly usage charge per thousand

44:32gallons of water use. And you can see

44:35how those uh rates also increase uh over

44:40the course of the 5-year period.

44:45New customer class hotels. Here are the

44:47proposed rates. Uh similar types of

44:51increase. And as Director Gerbin

44:54mentioned, the hotels have stronger

44:57wastewater than uh other non-residential

45:00customers on average. So the rates

45:04proposed are higher than the

45:06non-residential rates.

45:09Okay. Now we have a monthly wastewater

45:11bill comparison for an average single

45:14unit resident so household.

45:16And so what this table shows it's a

45:20comparison of monthly bills between the

45:22county of Hawaii and four other sewer

45:26utilities. County of Maui, County of

45:29Kauaii, City County of Honolulu, and the

45:31West Hawaii Sewer Company. And in

45:33particular, this is the uh uh sewer

45:36system that serves Waloa village.

45:40Uh the county of Hawaii's proposed rates

45:43for each year are shown in italics.

45:47And what this table shows are

45:51in other islands, uh, county of

45:54Kauawaii, West Kauawaii Sewer Company

45:56and City County of Honolulu have already

45:58adopted rates that become effective in

46:01the future. So where rates have been

46:03adopted already, they are shown in this

46:06graph or this table.

46:09What you can see is currently, this is

46:12as of July 1st of each year, the

46:14county's rate of $52 is much lower than

46:19everyone else. And even in 2031, the

46:24county's proposed rate is lower than

46:27what the city and county of Honolulu

46:28charges now and what West Hawaii Sewer

46:32Company uh will charge as of 2027.

46:40have the same information on a graph.

46:43Now, the County of Hawaii's existing

46:45rates are in black at the bottom, uh,

46:47where it's flat, and then where the

46:49graph slopes is the proposed rates. And

46:52you can see the other monthly wastewater

46:55bills for a single unit residents um of

46:59um for Kawaii, for Maui, for West Hawaii

47:04Sewer Company in the city and county of

47:06Honolulu. Um I want to point out that

47:10this data shows a sewer bill based on

47:14water use of 9,000 gallons per month.

47:17And although the county of Hawaii does

47:19not charge residential customers based

47:22on water use, other utilities do,

47:25notably Maui, West Hawaii Sewer Company,

47:28and the city and county of Honolulu.

47:32>> Can I just interrupt you for one second

47:34with a question,

47:35>> please? Yes.

47:36>> Um, can you provide a little bit of

47:38information about West Hawaii Sewer

47:40Company?

47:43Um, West Hawaii Sewer Company is a

47:47investorowned utility that

47:51serves in this case for the example

47:52shown serves Waloa village. Their

47:56ability to raise rates or they are

47:58regulated by the um Hawaii public

48:00utilities commission and so they need

48:03permission from the HPU

48:07in order to raise rates. They have

48:11and is standard for these types of

48:13utilities. They submit a procedure

48:15called a rate case and to the PUC and

48:19that through a quasi judicial process is

48:25approved or modified and approved by the

48:28PUC. So this

48:30>> that's good. That that's just very

48:31helpful. I was just a little confused. I

48:33hadn't heard that name specifically

48:35before, but that's very helpful. Please

48:37proceed. Oh, sure, sure. Well, I'm

48:40proceeding to the end of the

48:41presentation. Uh, thank you for your

48:43time. And this is a picture of the

48:46groundbreaking of the uh construction of

48:48the Hilo treatment plant uh with an

48:51inset for Dan and Craig who uh joined

48:55the county in the in their current

48:56positions after this photo was taken.

49:00Uh, but that's all I have for my

49:02presentation. So, I'm going to turn it

49:03back over to Dan. Thank you very much

49:06for your time. Uh, Art, are you going to

49:08be able to stay online to uh answer any

49:10questions that may come up?

49:12>> Absolutely.

49:13>> Thank you. Okay. Um, well, I think at

49:17this time we're open to address any

49:18questions that you may have.

49:20>> Thank you. At this time, I'll go ahead

49:22and extend that invitation to my

49:24colleagues. Council member Hustus.

49:26Questions for the director.

49:27>> Thank Thank you, chair. Thank you,

49:28director. I appreciate that presentation

49:30from the consultant as well. um

49:34kind of taking a a bigger step back, how

49:37many users are in the system and in each

49:39of these classes that are that you have

49:41currently and then would be proposed?

49:44>> We have a total of 14,800 users. Um I'm

49:48sorry I don't in my head have a number

49:50in each class. If if you need that, we

49:53can get that for you.

49:54>> Yeah, that'd be I think that's I think

49:57that's part and parcel to kind of

49:58understanding the breakdown and Okay.

50:00and and kind of the metrics there for

50:02the rate change. Um

50:06the

50:08current rates so there are two entities

50:11on the west side. I mean there was some

50:13testimony about resorts and hotels on

50:15the west side. There are two entities on

50:17the west side. There's the one that

50:19chair asked about uh West Hawaii Sewer.

50:22Um they're in partnership with Hawaii

50:25water service I believe and then you

50:27also have Hawaii American Water. So

50:29there are two, but the study only looked

50:30at and targeted one of the two. Is that

50:33correct?

50:35>> Uh yes, but I actually

50:37>> as a as a comp as kind of like a

50:38comparison model.

50:40>> I hate to pick on the same company

50:41twice. Unfortunately, I do not have any

50:44documentation for the other company. But

50:47as um as he pointed out, the way that

50:51these um investorowned companies file a

50:55rate case is they have to go before the

50:58Hawaii Public Utilities Commission. And

51:01it turns out that Hawaii Water Service

51:04Company has just filed with the uh

51:08utility commission. We have a copy of

51:10that filing or we we have a page out of

51:12the copy of that filing. Filing was 421

51:15pages long.

51:17But um

51:19>> that's for West West Hawaii.

51:20>> It is for the

51:23>> It is for the Hawaii water service

51:26company that is suing serving forgive my

51:29pronunciation here.

51:31>> Cukio.

51:32>> Yeah. Cukio. Yeah.

51:33>> Cookio.

51:34And they are filing for a rate increase.

51:37>> So that's a notice of public hearing for

51:39a docket then.

51:39>> That's a notice.

51:40>> And then when is that one going before

51:42the PUC?

51:44>> I'm sorry. What what's the date

51:45scheduled for that one for the PUC?

51:51>> I don't see that on here. It's a recent

51:54filing.

51:57>> Uh it's docket number 2025-0421

52:03>> 4021

52:05>> 0421

52:07>> 0421.

52:10And um now one of the commenters earlier

52:14made the distinction

52:17uh there's two ways to finance

52:19wastewater treatment. Uh you can

52:24you can have the fixed cost the capital

52:27cost uh paid by and and as we do in this

52:31county by the taxpayers. So we're

52:34spreading a very large expense including

52:38these bonds that are now being sold for

52:40our uh upgrading uh over the entire tax

52:44base and then we are charging

52:48uh the users for the direct cost of

52:51operation. That's the way that you've

52:53chosen to do it here in in Hawaii

52:56County. With the investorown

53:00facility, they do it differently. they

53:02charged the customer the user they have

53:05to recover that capital investment

53:07somehow.

53:09So um they that user has to pay both the

53:12capital investment and the user fund. So

53:16with this new rate filing the fixed

53:19charge per month and this kind of takes

53:21your breath away is $735

53:25per month.

53:28In addition to that, for up to 7,000

53:32gallons, and I think the one that we

53:34just were talking about was 9,000

53:36gallons, uh that is an additional $231

53:41per month. So these these people are

53:44going to be paying pretty close to

53:46$1,000 per month to have their

53:48wastewater treat. Now it's not quite

53:52apples to apples because they are also

53:55paying repaying the capital investment

53:58that was necessary to do this. In our

54:01case, the taxpayers are paying the

54:03capital investments. But even the u you

54:07know our projected expense of out five

54:09years from now is $125 per month. It's

54:14still much smaller than the $231 per

54:17month that um Hawaii Water Service

54:20proposes to charge.

54:23>> Okay. Um thank you. stepping back to

54:25this just a little bit because um I want

54:27to talk a little bit about the

54:29where my question was going in terms of

54:31the the comparison model and the studies

54:34because you like I said there there are

54:36two private entities and I understand

54:38that the difference there in terms of

54:40investment the capital stacks and those

54:41sort of requirements within those um

54:44private entities there but the study

54:47only looked at one

54:49on the west side. So if you're if if

54:51we're talk, you know, we had testimony

54:52and we have there are probably some

54:54questions about the hotel class, but you

54:56only looked at one of the private ones

54:59on the west side. There's another one

55:01with Hawaii American Water. They had a

55:03docket filed in 2024 with the rates and

55:06just, you know, in the Monolani area for

55:08that resort community, they had a they

55:09had a set rate.

55:12what the residential units in the condos

55:15in the HOA commercial sewer and

55:16commercial tow were all set at the same

55:18rates at $75. That was a proposed rate

55:22change there for the last docket. So I'm

55:25I'm just I'm just pointing that there's

55:26a little flaw in the study in terms of

55:27we weren't looking at the the entirety

55:30of the island perspective here and some

55:31of the other resorts resort communities.

55:34I I recognize the need to increase the

55:36rate. I'm just saying that the study is

55:38missing some of these pieces in terms of

55:40looking at the entire picture. Well, um,

55:42and that that may be No, we don't have

55:45any information from that wastewater

55:48utility, but is the $75 per month their

55:51current charge?

55:52>> I I don't know. I'm just looking at

55:54notice of public intent here, the public

55:55hearing they had. So, I don't know if it

55:56it I'm I'm pretty certain it it went

55:58forward. They do have some other rates,

56:00too. They talk about ina with their

56:02residential units, and those are

56:03proposed rates at 143. So, those are

56:06kind of on par what you're showing in

56:08some of these other spaces, too. and

56:10where the county is still yet below

56:12those proposed rates. Um, but it would

56:14be worth to kind of track this as well.

56:17Um, unfortunately, this wasn't in the

56:19study. But if we're all Well, I'm trying

56:21to say is that just don't have a

56:22complete picture here in the in the

56:24study. That's all.

56:25>> Okay. Thank you.

56:27>> I'll leave it there for now. Thanks,

56:28Chair.

56:29>> Thank you, Council Member Hustus. Uh,

56:32Council Chair Nava,

56:34>> thank you. Um, I'll just start off by

56:36saying I I can't support moving this

56:38forward today. I'm not opposed to

56:41getting there eventually, but we should

56:44have had that study prior to today. And

56:48looking at the city and county of

56:50Honolulu's um sewer or proposed sewer

56:54fee increases, I'm trying to understand

56:57how we came up with the

57:02what the the collections would be on

57:04page 22 of this study. Um, so I don't

57:08know who wants to answer that, but when

57:10we look at for let's say the year 2028,

57:13it's saying it's $157.81

57:16per month.

57:18I'm not tracking when I look at the city

57:20and county of Honolulu's various rate

57:23structures how we came up with that

57:24number. So can we

57:25>> Oh, can you answer that?

57:33>> Um, yes. Hello. Yes, I can answer

57:36question. Yes, I can. [clears throat]

57:38Hello.

57:39>> Yes.

57:40>> Okay. So, the city and county of

57:44Honolulu

57:45has a

57:48uh wastewater rate structure that

57:52includes a fixed charge and a volume

57:55charge.

57:58And the fixed charge is added to the

58:01bill every month. The volume charge is

58:04added to

58:0680% of the metered water use. So the way

58:12to calculate this number is

58:16to take the fixed charge take the volume

58:19charge times 80% of the water use. And

58:23uh that that's how the the numbers are

58:26calculated.

58:30on which residential

58:32or non

58:34you're saying average single unit

58:36residents on page 22 of your

58:38presentation. So which are you using the

58:40metered water or not on city water?

58:44>> Uh metered water.

58:48>> Okay. Okay. And the 9,000

58:51gallons per month is what we're basing

58:56our normal use on for a regular

58:58household.

59:00>> Yeah. It's an approximate average of uh

59:02what it a resident uses. Correct.

59:06>> Okay. Yeah. So, you know what? If we had

59:08this ahead of time, we would have been

59:10able to ask these questions ahead of

59:11time. We didn't have it.

59:14We have family in Honolulu and I see the

59:17the rate for wastewater on the monthly

59:20water bill as $63 per month. So that's

59:23why I'm really confused about what this

59:25means. I recognize the testimony

59:28provided by some of these hotels.

59:31I also recognize, as you pointed out,

59:34director,

59:35how some of what they provide us into

59:37our system, it takes more to process.

59:41So again, I won't be supporting moving

59:44this forward today. We need not only the

59:47study, but we need to also have a simple

59:50calculator that shows us the different

59:53classes and the number of um users

59:56within each class that allows us to

59:59really have an opportunity to make an

1:00:01educated

1:00:03um decision on this matter. And you did

1:00:05mention at the beginning of the

1:00:07presentation that we we are required to

1:00:11make it make sense or something along

1:00:13those lines. Is that by state law,

1:00:15county code?

1:00:17>> Uh that is by state law and federal law.

1:00:21>> Okay. So, if we can be provided all of

1:00:24that information, um, because I don't

1:00:28think anyone here is, we're just trying

1:00:29to find something that makes sense, but

1:00:32we have not been provided anything to

1:00:34allow us to come to that conclusion

1:00:36based on what's been provided to us

1:00:37today. Thank you.

1:00:40>> Thank you, Council Member Nava, Council

1:00:41Member Connie E. Kleinfelter.

1:00:43>> Thank you. Couple questions for you

1:00:46folks. Uh, residential. What is a unit

1:00:49in the residential class of water usage?

1:00:55[clears throat]

1:00:55>> I'm sorry.

1:00:56>> Single unit residential. $63 monthly

1:00:59charge per unit.

1:01:01>> Yes.

1:01:01>> So, it's just the house. $63. That's it.

1:01:03No charge for a unit of water beyond

1:01:05that.

1:01:07>> Not for the residential. No, there was

1:01:09fixed fixed charge per month.

1:01:11>> And not for multi-unit residential.

1:01:13>> That's correct. And for non-residential,

1:01:18we do

1:01:22>> non-residential does include a volume

1:01:24charge.

1:01:28>> Okay.

1:01:35>> Thank you. Um the private haulers

1:01:38discharge fee

1:01:41is a 500gallon or fraction thereof.

1:01:47What is the current rate for a private

1:01:49hauler discharge fee?

1:02:04minimum charge is $38

1:02:07and then depending on what they're

1:02:08bringing in the acceptage, it's an

1:02:10additional 100. If it's portable

1:02:13toilets, it's 84

1:02:15and if it's solids from a wastewater

1:02:18treatment plant, it's 95.

1:02:21>> What is the What is the average home's

1:02:23septic system

1:02:27haul or fill?

1:02:30I'm sorry.

1:02:31>> Like the average home septic system is a

1:02:33certain amount of gallons, right?

1:02:36>> More than 500 gallons.

1:02:38>> Pumping out a septic tank.

1:02:39>> Yeah, correct.

1:02:40>> Oh, I'm sorry. Um

1:02:44>> I think it would be probably in the 3 to

1:02:46500 gallon range.

1:02:48>> Okay. So, the average home because we're

1:02:49pushing for more septic systems. So the

1:02:51average home when they pump their septic

1:02:53system every

1:02:55>> well every few years do has some

1:02:59regulations on how often that should be

1:03:03>> so say what every seven years five years

1:03:06>> every five years every seven years.

1:03:09>> So they're going to get charged the

1:03:10$100.

1:03:12Well, you're going to be charged not

1:03:13only this disposal fee, of course, which

1:03:15the hauler will

1:03:18pass on to you, but you're also going to

1:03:20pay the service fee to the hauler.

1:03:22>> I understand that. That's why I'm asking

1:03:24about the the rate that we're charging

1:03:26because we push septic

1:03:30and I'll get to my next point. We push

1:03:32septic, but septic system does

1:03:35contribute to our overall wastewater

1:03:38treatment.

1:03:38>> Oh, absolutely. Yes. But you're also

1:03:41handling on your own. You're paying for

1:03:42the cost of the septic system and the

1:03:45drainage field on your own and then

1:03:48we're charging you when you bring your

1:03:49waste in. Albeit on a

1:03:525 to sevenyear,

1:03:54>> you know, period. Yeah.

1:03:57But yes, you will get hit by the fees of

1:03:59hauling which get more expensive as

1:04:01diesel gets more expensive than the cost

1:04:02of trucking. So just trying to walk

1:04:04through that.

1:04:07Uh

1:04:09what what was the I'm not sure this is

1:04:11for art or for you folks. What was the I

1:04:14mean how do you how do you get down to

1:04:16non-residential

1:04:18hotel

1:04:20and then differentiating between

1:04:22multi-unit residential which is almost

1:04:25borderline non-res.

1:04:27>> Oh arc can you address that?

1:04:29>> Uh sure. So

1:04:32that is done in the cost of service

1:04:34analysis. So

1:04:38the the first step in a cost of service

1:04:42analysis, you split all of the things

1:04:44you have to pay for into a couple

1:04:48different bucket. One is collection

1:04:50system bucket, wastewater treatment

1:04:52plant bucket, customer related bucket or

1:04:54an administrative bucket. And then you

1:04:57take those costs once they're split that

1:05:01way and you split them a different way.

1:05:04characteristics of the wastewater. So

1:05:09wastewater

1:05:11biochemical oxygen man BOD wastewater

1:05:13total suspended solids TSS for example.

1:05:18What that allows you to do is identify

1:05:22how much money you need to collect

1:05:24associated with the strength of the

1:05:27wastewater, how much money you need to

1:05:30collect associated with the volume of

1:05:32the waste water in both the collection

1:05:34system and the treatment plant. Then we

1:05:38have to make some

1:05:40um estimates of how strong the

1:05:42wastewater is from each type of

1:05:45customer. rely on published estimates,

1:05:47estimates used in other utilities or in

1:05:50the case of the private haulers, the

1:05:52county actually sampled the wastewater

1:05:55at Hilo and I think Cook Calahhe

1:05:58because that wastewater is one very

1:06:02strong and two might vary depending on

1:06:05you know from island to island or from

1:06:08system to system. So when you have those

1:06:11estimates, you can estimate in total how

1:06:14much BOD and suspended solids is treated

1:06:18at each of the plants. And what you do

1:06:20then is you check the reasonleness of

1:06:22those estimates by comparing with the

1:06:26how much waste or how much uh flow and

1:06:29loading is measured at the treatment

1:06:32plant in FL. So that's what we did.

1:06:37>> Okay. So basically how much work it

1:06:39takes you to process the waste water

1:06:42coming from the homes equals the cost

1:06:44passed on to the different categories of

1:06:49users.

1:06:51>> Very well said.

1:06:52>> Okay.

1:06:55If I just took your 2027

1:06:58projected rates, what percentage of your

1:07:01current cost of wastewater services is

1:07:04that covering?

1:07:06I'm sorry what

1:07:07>> your your existing users everybody pays

1:07:10their bill

1:07:12>> and your total cost to run wastewater

1:07:14department is x what percentage is being

1:07:18covered by this rate

1:07:19>> right now with our current budget the

1:07:22revenue from wastewater operations

1:07:26covers approximately 52% of our annual

1:07:29budget.

1:07:31>> Okay. And with 2027,

1:07:34if 2027 passed, what you have right

1:07:37here,

1:07:38>> it would improve the situation. Um, I'm

1:07:41sorry, I don't know what the percentage

1:07:42would be in 27, but for this year, uh,

1:07:47revenues about u about 52% of our

1:07:51budget. So, we don't know what the

1:07:54projected

1:07:56rates would equate to as far as covering

1:07:59the percentage of our

1:08:01revenues versus our expenses for the

1:08:03wastewater fund.

1:08:04>> The intent is with this five-year plan

1:08:07that by 31, our revenue would equal our

1:08:11budget

1:08:13>> and just for operations.

1:08:15>> Just for operations.

1:08:16>> That was that was a huge distinction you

1:08:18made and it was important. I'm glad you

1:08:19said that because

1:08:21and you look at this face value,

1:08:23everyone pays their sewer bill. You

1:08:25think that covers wastewater, but it

1:08:27doesn't because the reality is we got

1:08:29about

1:08:30how much billions of dollars worth of

1:08:32wastewater improvements that's being

1:08:34serviced through bonds.

1:08:35>> Hilo alone is 340 million.

1:08:37>> Okay. I think it's what half half a

1:08:39billion dollars in bond float that's

1:08:41going to cover the islandwide

1:08:44infrastructure improvements we have to

1:08:45make which is serviced by bonds which is

1:08:48serviced by general fund.

1:08:51>> Yes.

1:08:51>> Correct. Okay.

1:08:53>> So it's not just rate payers for the

1:08:55sewer system paying for

1:08:58the sewer system.

1:09:00>> The rateayers are only paying the

1:09:03operating cost of the sewer system.

1:09:05>> That's incredibly important. Right.

1:09:07Yeah, that's Thank you. Okay. So, right

1:09:10now 52% of your revenue comes from your

1:09:13fees collected. We don't know what

1:09:16happens when the 2027 projected. We

1:09:19don't know what percentage that would

1:09:21equate to.

1:09:22>> Not exactly. I would guess high 50s,

1:09:25maybe 60%.

1:09:26>> Okay, that'd be good.

1:09:27>> It's it's progressive from there to 31

1:09:30and then 31 it would be 100%.

1:09:34And that's that's given inflation, cost

1:09:36of goods, everything increasing.

1:09:38>> Yes.

1:09:39>> Okay.

1:09:40>> My last question for right now, unless

1:09:42you say something crazy,

1:09:45>> um, did does any part of this study look

1:09:49at increasing your users?

1:09:52Did you did you take that into account?

1:09:54because I there's certain pieces of code

1:09:56that actually help,

1:09:58>> but I also know more users equals less

1:10:01cost for everybody because you're using

1:10:03a broader usership.

1:10:04>> I have an answer to that, but I'd also

1:10:06like Art to answer that if you can.

1:10:08>> Yes. Yes, please.

1:10:10>> Hello. I we incorporated a 1% annual

1:10:15system growth rate into the financial

1:10:19projections and that's consistent with

1:10:20the average uh growth rate over about

1:10:23the last five years. So we assume that

1:10:26whatever growth has been happening in

1:10:28the past will continue into the future.

1:10:31Uh we did not

1:10:34incorporate any increase in customer

1:10:36base from collection system extensions

1:10:40because we did not have a funding plan

1:10:47for

1:10:49building those extensions.

1:10:54>> That's all I have. D.

1:10:55>> Yeah, thank you Art and I completely

1:10:57agree with his answer. We don't have

1:11:00funding to support extension of our

1:11:02existing collection system. Therefore,

1:11:05we would be unable to project any

1:11:07significant growth in rate payers.

1:11:11Okay. I think there's a problem there.

1:11:13And I want you guys to to readjust your

1:11:15thinking a little bit.

1:11:17We push development. We push affordable

1:11:20housing. We push density.

1:11:22A lot of the bills that have passed

1:11:24recently have increased density,

1:11:25especially in urban areas. If I go from

1:11:28one house to four houses on the same lot

1:11:31somewhere in your multi-unit residential

1:11:33or non-residential or single unit

1:11:34residential, that that's up to you

1:11:36folks. But the more we increase density,

1:11:38the more we build development. The

1:11:41department needs to really hone in on

1:11:44how far you willing to push developers

1:11:46to have to connect to your system. So,

1:11:48you're not paying for the cost or they

1:11:50put that cost on the 35 homes they build

1:11:54that's within a thousand feet of an

1:11:56existing sewer line. Make them pay for

1:11:59it. Make them connect to it. Increase

1:12:01your users and cut your cost for the

1:12:03rest everybody and stop pushing

1:12:06everybody into septic department of

1:12:09health variances so they can get the

1:12:11development built without having to deal

1:12:13with the cost of the infrastructure.

1:12:16>> Well,

1:12:19Uh the answer to your question is the

1:12:22requirements for developers to build a

1:12:24collection system is already in the

1:12:26code. Uh certainly the county is not

1:12:29pushing either prospective buyers or

1:12:32developers into some place where they

1:12:35don't have to make their contribution.

1:12:38They have worked hard and have found

1:12:40ways around the edge of the code. But

1:12:43the existing code says to a developer,

1:12:46if you're going to develop a new

1:12:47community, you must include a sewer

1:12:50collection system as part of that

1:12:51development, it must be extended to

1:12:54connect to the existing county system

1:12:57and it must be turned over to the county

1:13:00at the end of the development. So the

1:13:03legal requirements to do exactly what

1:13:06you're suggesting are already in place

1:13:09and I support them very strongly. So, if

1:13:13we get any growth, it's going to become

1:13:15because those codes are in place. All I

1:13:18was saying is that the county can't pay

1:13:22for sewer extensions to bring new

1:13:24customers online, but certainly

1:13:27developers not only can, but are

1:13:29required to.

1:13:32I'd actually I think I'd argue with you

1:13:34the other way. Maybe we can do that

1:13:37separately, but there's been a number of

1:13:39different bills and a number of

1:13:40different structures built that make it

1:13:43easier to develop outside of urban areas

1:13:45where it need development, which allows

1:13:48them to use existing variances and

1:13:50different abilities to create those

1:13:52projects outside of where we should be,

1:13:55which actually pushes them all into

1:13:56septic systems,

1:13:58>> which means your private haulers are

1:13:59going to be doing the work that we

1:14:00should be doing and development should

1:14:02be done closer to our existing sewer

1:14:04lines to be in alignment with what we're

1:14:06trying to do

1:14:06>> and and and if that's happening uh one

1:14:08that's unfortunate and maybe that's

1:14:10something that county council want to

1:14:12take a look at.

1:14:14>> I agree. Or environmental management

1:14:16commission can take up how to make

1:14:18developments or existing households

1:14:20connect to sewer lines when it was when

1:14:22it's within a certain range of that line

1:14:27already.

1:14:28>> Yeah. Again on you know

1:14:29>> there's one in Kona that came in front

1:14:31of us before you came on. I can I'm very

1:14:33very cognizant of that last project

1:14:35where he had to install a dry sewer as

1:14:38part of his development. He didn't want

1:14:40to he got a variance and his project was

1:14:43within like 500 ft of an existing sewer

1:14:47line, but he didn't want to do it.

1:14:49>> I doubt that variance came from my

1:14:51office.

1:14:51>> No, it was before you.

1:14:52>> Thank you, council member Kleinfielder.

1:14:55>> Thank you, director. Um I'll go ahead

1:14:57and go to council member Kimble and then

1:15:00come back to you council member.

1:15:02>> Yeah. Um first I just want to make a

1:15:04procedural comment um for my colleagues.

1:15:07So this will need to be referred back to

1:15:09the environmental management commission

1:15:12um notably if we were to send it and

1:15:16then have it come back and make

1:15:18additional amendments um then we would

1:15:20have to send it back again. So, it's

1:15:23probably advisable to keep it here and

1:15:26tinker with it if we're planning on

1:15:27tinkering with it before sending it over

1:15:30there. Um, I just had one question for

1:15:33the department. Um, we were anticipating

1:15:36in Q1 the delivery of the integrated

1:15:39wastewater management plan. Where what

1:15:41is the status of that particular

1:15:43product?

1:15:45>> Good to hear.

1:15:47>> Kelly Hartman, regulatory administrator.

1:15:49Um, we're actually going to be coming

1:15:51before you next committee meeting. I

1:15:53believe it's September 15th. You'll see

1:15:56two presentations by the department.

1:15:59There are two parts of our larger

1:16:01integrated plan, the cesspool evaluation

1:16:04report and the wastewater facility plan.

1:16:08So, September 15th, we'll we'll be

1:16:10coming to see for that.

1:16:12>> Okay. I'm going to I'm going to hold

1:16:14further comments. I I agree with Council

1:16:16Member Naba. We need to see this study.

1:16:18I also need to see the integrated water

1:16:21uh wastewater management plan before

1:16:23commenting further. Um just because I'm

1:16:26I I'd like to evaluate the robustness of

1:16:29some of the assumptions used in the

1:16:31calculations. Thank you.

1:16:35>> Thank you, Council Member Kimell.

1:16:36Council member Onishi.

1:16:37>> Thank you, Madam Chair. So, a couple

1:16:39questions. Um first one is I just I had

1:16:42seen a document before that before the

1:16:46critical areas in Hilo is all hooked up

1:16:51certain

1:16:53charges or certain things wouldn't

1:16:55happen. Would you folks know what are

1:16:58they talking about? What what is a

1:17:00critical areas in Hilo?

1:17:03>> Uh I believe I've seen that same

1:17:04document. It's an older document. dates

1:17:07back to

1:17:08>> 1991 or something like that.

1:17:10>> Okay, so it's a 30-year-old document.

1:17:13Um,

1:17:15I can't I'm I can't give you the

1:17:17definitive borders, but there are

1:17:19multiple

1:17:21areas within the city of Hilo that at

1:17:24that time the people writing that

1:17:27document thought that it was important

1:17:29to get focused on bringing in these

1:17:32additional,

1:17:34you know, subp parts of the community

1:17:36and getting them hooked up. um

1:17:40you know that was over 30 years ago and

1:17:43I know I can't speak to how that did or

1:17:46did not move forward but um yes it is

1:17:49out there and somebody had some plans at

1:17:52the time to try and bring more

1:17:54communities online. We certainly have

1:17:57capacity at the treatment plant to do

1:18:00so.

1:18:01>> And at the department, you folks cannot

1:18:03find any documents [snorts]

1:18:06talking about that critical areas.

1:18:08>> Oh, I'm I'm I'm I'm saying that I am

1:18:11aware of the document. I have seen it.

1:18:13No, no, but within the department,

1:18:15within your office, like whoever was the

1:18:18previous administration at the time had

1:18:21these plans of the critical areas of

1:18:24Hilo to be hooked up.

1:18:26>> Yeah, I'm not even Was that a US EPA

1:18:29document or was that a county document?

1:18:31>> I I don't know what it but it came from

1:18:33the the department from from the county.

1:18:35>> I've seen it. I'm sorry. I can't

1:18:36remember the details.

1:18:38Uh the bottom line is bringing anybody

1:18:41else on the line requires money,

1:18:44>> right? Okay. So that's another thing I

1:18:46have. So have you your department

1:18:48reached out for the to the federal

1:18:50government or the state government for

1:18:52funding to help increase or expanding

1:18:56sewer lines.

1:18:57>> We are already receiving a revolving

1:19:00fund money and that is part of the

1:19:02funding for the Hilo rehabilitation

1:19:05project.

1:19:06>> Okay. And how you have a number on how

1:19:09much and what areas?

1:19:10>> Um

1:19:1217 million 22 million.

1:19:16>> 27 27 million.

1:19:19>> In what areas? What area? In Hilo.

1:19:24>> Ask that again, please.

1:19:26>> In what areas in Hilo?

1:19:28>> Oh, that's uh departmentwide. That's the

1:19:30funding we've received from the

1:19:32revolving fund

1:19:33>> and that's

1:19:34>> for upgrade project. Yes,

1:19:36>> for existing projects already.

1:19:39>> Yeah. Keep keep in mind that that

1:19:41funding comes from federal money.

1:19:44>> Okay.

1:19:45>> And when money comes from federal money,

1:19:48there are a lot of additional

1:19:51requirements that you have to do in

1:19:54order to use the money. So, it has to go

1:19:57to a project that has been pre-approved

1:20:00for federal money use. So, so this is

1:20:03for the I guess the reconstruction of

1:20:05the new Hilo wastewater facility. So,

1:20:08it's nothing expanding to getting more

1:20:12lines out there to connect. So, so my

1:20:15question is yeah, so is the department

1:20:19trying to get funding to get money to to

1:20:23get funds to increase the lines to

1:20:26getting more users.

1:20:28>> We are trying to get money. I guess I

1:20:31couldn't commit to exactly what it would

1:20:33go to once we received it, but if it's

1:20:36federal money, it has to go to a project

1:20:39that is capable of using federal money.

1:20:41>> You were on the call or on the the Zoom

1:20:44meeting when a state legislator got

1:20:48>> certain state department some some money

1:20:51to do some infrastructure, right?

1:20:53>> That was the $4 million.

1:20:55>> Yes, correct. So, have you folks reached

1:20:57out to any of our legislators to see if

1:21:00they can help us?

1:21:01>> Oh, my understanding is that was not our

1:21:03money. That was DHHL money.

1:21:05>> Right. No, but then it came from this

1:21:07the the green fees.

1:21:10>> Oh, have we reached out independently to

1:21:12the same source?

1:21:13>> Yes. [snorts] Correct.

1:21:14>> We have not.

1:21:15>> Okay. So, I think that would should be

1:21:17something where your department should

1:21:18be reaching out. I mean you guys like

1:21:22the other question is like and was

1:21:25mentioned before for future investments

1:21:28right and for future users because as I

1:21:32mentioned to you before about this rates

1:21:35is that you need or to me you need to

1:21:39implement future users too when you do

1:21:43this increase right because I cannot see

1:21:45putting all the burden upon just what we

1:21:48have the user for and if you if the

1:21:51department is not going to be looking at

1:21:53increasing the users right because

1:21:56you're already on [snorts] the west side

1:21:57looks like they have private entities in

1:21:59Punalu I think they have their own

1:22:01private entity too so we don't even

1:22:03touch them right except for when they

1:22:05dispose their waste right but for now

1:22:09the operations like you mentioning

1:22:11because I thought in the slide it

1:22:13mentioned about the increase of fees

1:22:16would help with also projects or with

1:22:20improvements

1:22:21and not only operation costs.

1:22:24>> Well, let's continue to make this

1:22:26distinction between capital costs and

1:22:28operating costs. Um

1:22:32if we bring on additional

1:22:36users, rateayers

1:22:38that would help potentially to

1:22:40distribute the capital costs over a

1:22:44wider base.

1:22:46If but at the same time uh if we have

1:22:50our rates structured properly which

1:22:53means the rates should reflect the true

1:22:56cost of operation.

1:22:58Um, additional user means more gallons

1:23:02to treat each day. Correct. Which means

1:23:04more operating cost.

1:23:05>> Correct.

1:23:06>> So I don't think that bringing

1:23:09additional users on would provide very

1:23:13much or any relief from a monthly user

1:23:18fee standpoint, but it would help to

1:23:21distribute the um the capital costs.

1:23:24>> Okay. You know by you saying that

1:23:29this upgrades for Hilo wastewater

1:23:31facility what is the capacity

1:23:36that we have to increase more users?

1:23:39>> The design capacity for the plants is 5

1:23:41million gallons per day

1:23:43>> and and today how much are we using of

1:23:46that?

1:23:46>> Approximately three.

1:23:48>> Okay. So there's like two million more

1:23:50gallons that we could Okay. So there

1:23:52there is that

1:23:54>> there is room to grow the

1:23:55>> right to to get the Okay. Good. Good.

1:23:57Yes. So at least that's good. Not not

1:23:59like we're doing it and then it's up 3

1:24:02million and we won't be hitting that and

1:24:03Yeah. And there's no increase. Okay.

1:24:05Good.

1:24:06>> Um again like I said I in the past like

1:24:09I told you I it's hard time for me to

1:24:12support this right now. Right.

1:24:17Yeah. the numbers I don't think needs to

1:24:19be changed and um I guess we still have

1:24:23to get that discussion within my

1:24:26district on certain crit certain areas

1:24:30that is being impacted

1:24:32>> right and so I'll reach out to you folks

1:24:35again your department thank you I'll

1:24:37yield

1:24:37>> thank you um I our chair had to step out

1:24:40for a moment I'm the vice chair of this

1:24:41committee Jen Kagiada so I will be

1:24:44taking over temporarily at 2:38 am. Um,

1:24:48Council Member Hustus, please go ahead.

1:24:50>> Chair, motion to postpone bill 183 to

1:24:52our September 15th committee.

1:24:56>> Okay. I have a motion by Council Member

1:24:57Hustus and a second by Council Member

1:24:59Kirkowitz to postpone

1:25:01um this discussion until I'm sorry,

1:25:03what?

1:25:03>> September 15th.

1:25:04>> September 15th.

1:25:06Uh, Council Member Inava on the motion.

1:25:09>> Is that enough time for you folks to get

1:25:11us what we've asked for? September 15th.

1:25:15>> Yes, I'm comfortable with that. Okay.

1:25:16And if you can get it to us this week,

1:25:18that'll be good. Not the day before the

1:25:21September 15th meeting.

1:25:23>> We won't we won't meet the deadline to

1:25:25transmit um September 15th, but we can

1:25:28certainly transmit. I think the the

1:25:30deadline to transmit before the se

1:25:32September.

1:25:33>> Yeah, it's going to be for the agenda,

1:25:35but it's going to be on the agenda for

1:25:37this motion. Thank you. I yield.

1:25:39>> Thank you. Uh council member Onishi on

1:25:42the motion.

1:25:42>> Thank you.

1:25:43one question. But on that day too, you

1:25:46have two other presentations.

1:25:48So is it better that we postpone this

1:25:51one to

1:25:53the next month and then I mean because

1:25:56you're going to have like three.

1:25:59>> Well, how many times we we have to meet

1:26:01to talk to each other. That's fine. Um I

1:26:04think it's better to

1:26:08have the information that people need to

1:26:10make a decision. And my sense is you

1:26:13would like some additional information.

1:26:15Let's postpone it till we can get it in

1:26:17your hands. I guess that would be my

1:26:19thinking. And

1:26:20>> so would that would the 15th be

1:26:23>> sufficient? Yes.

1:26:24>> Okay. And also the other documents for

1:26:27the presentation that you guys going to

1:26:28be doing on the 15th. You guys going to

1:26:30be providing us all that too?

1:26:32>> Well, before we promise that, what

1:26:34documents do you have in mind

1:26:36>> the for the presentation?

1:26:47Okay, we're good. Okay,

1:26:50>> thank you. Okay. Uh, seeing no other

1:26:52lights, all those in favor and

1:26:53postponing bill 183 to September 15th,

1:26:57please say I.

1:26:59>> Any opposed?

1:27:01Mr. Clerk, you have one, two, three,

1:27:04four, five, seven eyes with council

1:27:06members Viegas and Galima excused.

1:27:11And that is the end of this committee

1:27:14meeting. We will take a short break

1:27:16>> to um to transfer the tapes and we'll

1:27:19begin the policy committee on planning,

1:27:22land use, and economic development short

1:27:24in five minutes. Thank you.

1:27:25>> Uh Councilman Kajiada, are are we done

1:27:28with the consultant?

1:27:29>> Yes.

1:27:30>> Okay. Thank you. Thank you very much,

1:27:32Art.

1:27:35>> Thank you.

1:27:36>> Have a good afternoon. Bye.

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