Water-rate hike set Jan. 1

LIHU’E — The first of five annual, 8.5 percent rate increases will go into effect Jan. 1, 2006.

Ed Tschupp, manager and chief engineer of the County of Kaua’i Department of Water (DOW), said the increase is required to meet operating costs for the next fiscal year.

“We’re operating in the red. Our current revenue doesn’t cover our cost,” he said. “DOW revenue is no longer adequate.”

Water rates are established by DOW administrative rules and adopted by members of the county Board of Water Supply.

The DOW officials operate in a “semi-autonomous” environment, with limited oversight by the mayor and other county leaders, and rely on water-sales revenues to fund operations, maintenance, and new projects.

The cost of service for fiscal year 2006 is estimated at $13.3 million. Water department leaders expect a revenue shortfall of more than $1 million. Water department officials do not receive any general-fund revenues.

Tschupp said the first of two, 32-percent rate increases went into effect on July 1, 2001. The second increase had been deferred from July 1, 2003 until Jan. 1, 2006, in part due to lag in capital spending.

“If we don’t take action now, the (second), 32-percent increase will go into effect Jan. 1. We do need a rate increase, just not as much as is on the books,” he said, referring to the 32-percent increase.

“If we didn’t make the change now, the $9 charge would increase to $12.”

A public hearing on the rate increase will be held tomorrow, Wednesday, Oct. 19, at 10 a.m. at the DOW conference room on Pua Loke Street in Lihu’e. Tschupp said the increase needs only the final approval of members of the county’s Board of Water Supply before it becomes official, and is enacted Jan. 1, 2006.

The county Board of Water Supply is the governing, policy-making entity of the water department. Its members are responsible for the adoption of administrative rules. They are expected to sign off on the increases by Wednesday, Nov. 16.

As of Jan. 1, 2006, for a standard, 5/8-inch meter size, which represents the majority of residential customers, for first-block consumers, the rate per 1,000 gallons of use will increase from $2.10 to $2.25. The charges go up after consumption exceeds 20,000 gallons (2nd Block and 3rd Block, depending on amounts of consumption) during the bi-monthly billing period, Tschupp explained.

“The bill amount will vary (based) on water usage. It will have a small impact on low-volume rates,” he said.

Rates are subject to meter sizes.

In 2001, DOW leaders adopted an “inverted-block structure” that applies to general use rates, and a block structure for its agricultural use-rate consumption charges.

According to the rate structure, the bill structure for large agricultural water users will be more equitable, he said.

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