WAILUKU - The litigants in the five-year-old legal battle over how much water should be taken from Central Maui's four largest streams said they may have taken a significant step last week toward dramatic victory.
A top state official Thursday proposed putting about half of the up to 70 million gallons of water diverted each day from streams to mostly sugar plantations and the county water system back into its natural environment.
Earthjustice attorney Isaac Moriwake announced Saturday that state Commission on Water Resource Management Hearings Officer and Commissioner Dr. Lawrence Miike issued a 210-page "proposed decision" that would restore 34.5 million gallons a day to Na Wai Eha, or "The Four Waters" from the century-old plantation irrigation system.
The decision - if it holds up to a vote among the rest of the seven-person commission - would completely alter the Waihee River and Waiehu, Iao and Waikapu streams, which make up Na Wai Eha. Earthjustice filed the petition to the commission on behalf of the community groups Hui o Na Wai Eha and Maui Tomorrow, supported by Maui County and the state Office of Hawaiian Affairs in order to bolster native stream life and support water use by people who live along the streams, most notably taro farmers.
However, if the decision stands, it could also translate into further agricultural and financial troubles for the state's last sugar producer, Hawaiian Commercial & Sugar Co.
HC&S, which is a division of Alexander & Baldwin Inc., announced just last month that it lost $13 million in 2008 and expects to lose more this year as the company continues to struggle with three years of severe drought conditions that continue to produce lower sugar yields.
Moriwake said he expects the Commission on Water Resource Management to have a final decision by the end of 2009 but said appeals are likely regardless of the ruling.
Commission Chairwoman Laura Thielen, who also heads the state Department of Land and Natural Resources, said the water commission will hear more oral and written arguments from both sides before conducting a hearing and then determine whether to accept, reject or make changes to Miike's proposal.
Thielen added Saturday that she has not yet read the proposed decision, so has no comment on the specifics.
HC&S Plantation Manager Chris Benjamin said Saturday that the company had just received a copy of the lengthy recommendation and wasn't prepared to make a specific statement.
"However, as we have said on many prior occasions, any substantial reduction in the amount of irrigation water available to HC&S or resulting increase in operating costs will seriously jeopardize the plantation's viability, particularly given today's extremely difficult operating and financial environment for the plantation," Benjamin said.
Wailuku Water President Avery Chumbley said on Saturday that there will be plenty of opportunities to debate his company's concerns since the proposal is still preliminary. He called Miike's approach uncompromising and unbalanced in that it gives in-stream uses a priority over all other uses.
He also said Miike erred in his assessment about whether constant flows can be maintained in all the streams, and he did not take into account the damage his decision would have on small farms and businesses that rely on Wailuku Water. The Maui Tropical Plantation and Waikapu Golf Course are two that would be harmed, he said.
Moriwake said that the U.S. Geological Survey determined that HC&S, the Maui County Department of Water Supply and Wailuku Water Co. combine to divert nearly 100 percent of the base-flow of 60 million gallons a day from all four streams before it reaches the ocean. Base flow does not include storm water runoff.
"Pretty much those stream-beds are bone dry," he said. "Of course, this decision is not final yet, but what we can say is it's the first cut at where the agency is headed. It's a first step, but it's encouraging because it's heading in the right direction."
Miike's proposed decision would continue to give HC&S up to 21.59 million gallons a day; Wailuku Water Co. 2.02 mgd; and the county 12.2 mgd. Nine million gallons of the county's water would be dedicated to A&B's proposed $30 million water treatment plant in Waiale, which would serve Central and South Maui customers.
Meanwhile, OHA released a statement hailing Miike's recommendations. Restoring mauka-to-makai flow in these streams would bring them back to life and restore traditional and customary practices, such as taro cultivation, that depend on flowing water, said spokeswoman Crystal Kua.
OHA Chairwoman Haunani Apoliona said in the statement that the group also seeks permanent watershed protection and sufficient water for the kuleana users "who have legal rights to these waters, rights that have not been enforced."
In his proposed decision, Miike stated that the ability of Native Hawaiians to practice their culture will result in the betterment of the conditions of the people by restoring spiritual well-being and a state of "pono" or goodness, righteousness and balance.
This is how Miike proposed distributing water:
* Waihee River, 14 million gallons a day.
* Waiehu Stream, 2.2 million gallons a day for North Waiehu Stream and 1.3 million gallons a day for South Waiehu Stream.
* Iao Stream, 13 million gallons a day.
* Waikapu Stream, 4 million gallons a day.
Benjamin said HC&S remains committed to doing everything it can to keep alive the sugar plantation and mill - which combine to employ about 800 people on Maui - but can't do it alone.
"We need to have government policies and decisions that reflect important kuleana, cultural and biological needs but which also fully support the many jobs, greenery and other important benefits HC&S provides to our community," Benjamin said.
Maui Tomorrow Executive Director Irene Bowie said Saturday that HC&S chooses to go the cheaper route to get its water. The company could pump millions of gallons a day from its wells and prevent the loss of up to another 12 million gallons a day by lining all its reservoirs and ditches, Bowie alleged.
Miike's proposed decision was based on the testimony of 77 witnesses during an administrative trial that ran from December 2007 to October 2008. He also sifted through hundreds of pages of exhibits and legal briefs. He gave the sides a May 11 deadline to file their written objections.
Last April, the Commission on Water Resource Management approved a petition to designate the surface waters as a state water management district. The designation requires all existing users to apply for permits to take water from the streams.
Then, at the beginning of this month, the commission asked Na Wai Eha users to apply for those permits by April 30 or lose their water rights.
In January, the state Public Utilities Commission also took action on this issue and suspended the application of Wailuku Water to become a public utility until the Commission on Water Resource Management makes its final decision on Na Wai Eha. The company was the former Wailuku Sugar Plantation but over the years has sold all its farmlands while maintaining water rights. HC&S is one of the companies that receives water from Wailuku Water's ditches.
Developer Mike Atherton has purchased much of Wailuku Water's real estate, including Maui Tropical Plantation. Before the PUC stepped in, Atherton had been negotiating a lease for much of Wailuku Water's remaining assets, which include 13,000 acres of watershed and the ditch system.
Moriwake and his clients have fought the attempt by Wailuku Water to become a public utility, calling it "water profiteering."
* Chris Hamilton can be reached at chamilton@mauinews.com.
