Sewer conversion tax credit passes

A $10,000 sewer conversion tax credit will allow 500 homeowners a year to defray the cost of converting from cesspools to sewer systems. The income tax credit with a $5 million yearly cap was approved in legislative conference committees on Friday.

The credits apply to sensitive areas within 200 feet of shorelines and streams and near public drinking water wells.

The Lono Kona subdivision, where residents will have to pay an average of around $9,000 for a public sewer system — plus the bill for all of the work on their property to hook up — does not qualify for those credits. However, the subdivision could potentially engage in a limited pilot program created by the bill. Through two introductory projects statewide, the program extends the credits to homeowners who are hooked up to large capacity, or “gang” cesspools, said Kona Rep. Nicole Lowen, who authored the bill.

Lowen said the legislation is a good start, and the first year will be a test of the credit’s popularity.

“It gives us something to come back to next year to see if it makes sense,” she said. “It’s good to have $5 million to work with.”

Several Lono Kona property owners have been cited by the U.S. Environmental Protection Agency for being on gang cesspools, prompting the subdivisions residents to request the formation of a sewer improvement district. The $6.4 million county project is set to go out to bid in the spring of 2016, and will connect the 43-acre area in Kailua-Kona with the Kealakehe Wastewater Treatment Plant.

The subdivision is above Kailua Bay but is not close enough to the shore to qualify under the provisions of the bill. Lowen said the 200-foot limit was kept in place because of funding limitations.