Big Island households will see a water rate increase beginning Jan. 1, but the approximately 8% hike in the basic rate is expected to be tempered by a decrease in the power cost charge in the near future.
The county Water Board approved the rate hikes Tuesday, while also setting a public hearing for Nov. 24 on a power use charge decrease.
The approved hike translates into a $5.06 increase in monthly bills for a household on a 5/8-inch meter, the smallest, using 12,000 gallons. That’s 8% higher than the existing bill, said consultant Ann Hajnosz of Harris & Associates.
Households using more water would see higher increases, as the rates increase as water consumption rises.
The proposed reduction in the power use charge, meanwhile, would drop the charge from $2.10 to $1.71 per thousand gallons, or a $4.68 monthly decrease for a household using 12,000 gallons. That would start Dec. 1.
The Department of Water Supply is required by law to calculate the power cost rate based on actual power costs and consumption every two months or for the period since the last revision to the power cost charge.
People submitting written testimony on the water rate increase generally were opposed, said board member Kenneth Sugai. But facing an estimated 3.5% decrease in consumption because of a depressed COVID-19 economy, plus an increase in bad debt of 1.5% in 2021 and 3% in 2022, the board believed an increase was the best option.
“I did look at some of the letters. … None of them are really in the positive light,” Sugai said, “(but) .. I think we discussed this thoroughly and I think we just need to move forward on the rate increase.”
The board voted 8-0 in favor of the increases as presented by Hajnosz.
The facilities charge, a hookup fee for new connections that was last increased in 2003, will increase 11%. For a 5/8-inch meter the rate will go to $5,500. That money, less than $2 million annually, is used to increase capacity of the system, not to maintain existing infrastructure.
Board member Zendo Kern said the board should also look at opening up water availability to certain areas to allow “some basic estate planning,” and to bring in more revenue to the water department.
In addition to the rate hike, utility management plans to cut 2% from its operations and maintenance budget by cutting vacant funded positions. The plan trims the utility’s operating reserves to 47 days, compared to the goal of 60 days.
The water bill includes an energy charge, a water consumption charge, a set standby charge and a power cost charge that fluctuates with the price of electricity. The water department, a semi-autonomous agency, doesn’t get tax dollars but is funded by charges for its water service.