Water rate hikes not being sought for fiscal year 2019
Proposed purchase of Wailuku Water Co. not yet budgeted
WAILUKU – Department of Water Supply officials said on Wednesday that they are not seeking to hike water rates next fiscal year, and the department has not yet budgeted for Mayor Alan Arakawa’s plan to purchase nearly 9,000 acres of Wailuku watershed property owned by Wailuku Water Co.
Water Deputy Director Gladys Baisa and staff members presented the department’s preliminary budget request Wednesday to the Maui County Council’s Water Resources Committee.
The new fiscal year begins July 1 and runs through June 30, 2019.
Arakawa will have the final say on the department’s budget. He is scheduled to deliver the administration’s proposed budget to council members on March 23.
Baisa continued the tradition of the Water Department making a preliminary budget presentation to the committee, a practice started by suspended Director Dave Taylor. He remains on administrative leave, which began in November, pending unspecified administrative and criminal investigations, according to officials in the Arakawa administration.
Taylor has filed a lawsuit in 2nd Circuit Court, demanding to be returned to work. The County Council rejected Arakawa’s proposal to remove Taylor. The Maui County Charter requires the council to approve the mayor’s removal of the water director.
Neither Taylor’s attorney nor county officials could be reached Wednesday afternoon for an update on the Taylor litigation. On Feb. 13, a council committee refused to fund Arakawa’s legal fees in the case.
Reportedly, Arakawa and Taylor differ on Arakawa’s proposal for the county to purchase 8,764 acres of Wailuku Water Co.’s infrastructure and water resources. Wailuku Water President Avery Chumbley has said Taylor has raised concerns about the purchase, but “has never been outright opposed to it.”
In Arakawa’s final State of the County address Tuesday night, the mayor reiterated that he would like to purchase Wailuku Water’s assets, which come with an asking price of $9.5 million.
During Wednesday’s presentation, Council Member Kelly King asked Baisa if there were funding for the purchase in the department’s preliminary budget.
Baisa said not for now, at least. For now, there’s a proposal out for an appraisal of the water system, she said.
After an appraisal is done, then it could be decided whether the purchase would be made, she said.
In October, the council approved $150,000 for an appraisal of Wailuku Water Co.’s land and surface water conveyance system.
“Everything we are presenting to you is preliminary,” Baisa said of her department’s budget request. “Now (the water department budget) is going to the mayor. We don’t know what kind of tweaks he is going to make.”
County spokesman Rod Antone did not disclose details of the water department’s budget on Wednesday.
“The mayor’s Budget Office is busy putting all those numbers together,” he said.
No update was given about the appraisal.
In the department presentation, Baisa told council members that due to a “windfall” savings of $3 million from overhead expenses and due to the department not having to use some $5 million for electricity as budgeted, the department is not seeking to raise water rates.
Council Member Elle Cochran questioned that, pointing out that costs continue to climb across the board.
Baisa said she felt the same way, but knowing about the department’s savings in past years, “we don’t need really this year to ask for rate increases.”
She said that, on the other hand, there is a need to build reserves for the future if large capital improvement projects need to get done, but currently the department does not want “to go to our citizens to pay more money.”
“They are already paying so much,” Baisa added.
Current general and agricultural water rates have been in effect since July 2016, according to the presentation.
Now, the department is expecting revenues of $90.7 million for fiscal 2019. Of that money, $59.7 million is expected to be used for expenses and $31 million for the department’s capital improvement budget.
In response to a question about new water sources from Council Member Yuki Lei Sugimura, department engineering program manager Wendy Taomoto said that development of a West Maui Well No. 2 is the current new water source the department is seeking to develop.
But she noted that other water development projects are coming on line, such as the nearly completed Iao treatment plant upgrades, which will increase water production from 1.7 million to 3.2 million gallons per day for Central Maui consumers.
The project is expected to be completed in October, according to a PowerPoint slide on Wednesday.
* Melissa Tanji can be reached at firstname.lastname@example.org.