You could tell it was a big deal by the throng that had gathered October 15 at the `Iao Congregational Church to hear final arguments in the Na Wai `Eha contested case hearing. People filled the dozen or so rows of mismatched chairs, crowded the narrow aisles and spilled down the steps into the yard.
Judging by the resounding applause that followed arguments by Pamela Bunn, an attorney representing the state Office of Hawaiian Affairs, and Isaac Moriwake, who represents Hui O Na Wai `Eha and the Maui Tomorrow Foundation, the crowd clearly favored the large-scale restoration of Waihe`e River and `Iao, Waikapu, and Waiehu streams, collectively known as Na Wai `Eha (the four great waters).
The Hui, made up largely of kuleana landowners and taro farmers, and the non-profit Maui Tomorrow Foundation initiated the hearing in 2006, prompted by evidence suggesting that the Wailuku Water Company, LLC (WWC), which owns and operates the Wailuku Ditch, had begun selling the water instead of using it for agriculture. WWC and its predecessors in the sugarcane industry have diverted Na Wai `Eha for roughly a century to water crops in Central Maui, mainly sugarcane. The groups, which saw WWC’s actions as an attempt to continue to monopolize a public trust resource for private gain, filed a petition with the state Commission on Water Resource Management to amend the interim instream flow standards (IIFS) of Na Wai `Eha.
As the petition morphed into a contested case hearing, the Maui Department of Water Supply, Hawaiian Commercial & Sugar (a subsidiary of Alexander & Baldwin), and WWC joined in to lobby for an adequate share of the 67 million gallons of water a day that flows through the four waterways. OHA, whose interests aligned largely with the Hui’s, also intervened in the case.
Oral arguments began in December 2007 and concluded the following year. In April, hearing officer and water commissioner Lawrence Miike issued his 200-plus-page recommended Findings of Fact, Conclusions of Law, and Decision and Order.
Miike recommended amending the IIFS below the uppermost diversions of each stream to allow for a total flow of 34.5 mgd. He also suggested that the commission require minimum flows at the mouths of Waihe`e River and Waiehu and `Iao streams to ensure water runs uninterrupted from the mountains to the sea. For Waikapu Stream, Miike recommended a temporary release of 4 mgd. If that does not result in water reaching Kealia Pond, or if it does not improve the recruitment of gobies and other amphidromous animals, then he recommended that the existing interim instream flow standard not be amended at all.
The parties filed their responses to his recommendations in May.
Now that final arguments have wrapped up, the Water Commission will take the next few months to deliberate before issuing a final decision, which has the potential to change the face of Maui. As commissioner William Balfour put it, “To say we have a tiger by the tail is an understatement. This is big, big, big, folks….It’s going to be very, very far-reaching. God help us we make the right one.”
‘I Object!
Divining the best solution from the case’s thousands of pages of evidence, dozens of witness testimonies, and oral arguments was always going to be a daunting task. But HC&S’s decision last May to attach several exhibits, containing a boatload of new information, to its response to Miike’s recommendation will almost certainly make it even more difficult for the Water Commission.
Before HC&S could begin its final argument at the October hearing, Moriwake objected to those May exhibits, containing what he described as a variety of “black box” calculations and charts, because they were submitted months after the hearing’s official record closed.
During his own final arguments, Moriwake accused HC&S of “sandbagging” and of repeated “trial-by-ambush” tactics. He added, “Similar attempts were made to poison the well in the Waiahole case,” referring to the 1994 landmark water case that resulted in the restoration of flow, long diverted by O`ahu Sugar Company, to windward O`ahu streams.
Despite Moriwake’s initial objection, the commission allowed HC&S general manager Chris Benjamin to include most of the information presented in the exhibits in his final arguments.
Benjamin said that HC&S, the last functioning sugarcane plantation in the state, is barely surviving and the adoption of Miike’s proposed IIFS would effectively kill the company.
“HC&S operates on a very thin margin,” Benjamin said, adding that the company made only $2.6 million in 2006 (its last profitable year), which amounts to a mere 2 percent profit. He continued that the company is expected to post losses of $25 million this year as a result of a 25 percent decline in production caused by the 2007-2008 drought. Miike’s proposed IIFS would have the same effect as a drought, he said.
Benjamin disputed Miike’s decision to base his impact analysis on long-term average stream flows, which he said underestimated the impacts to offstream users. Based instead on USGS flow data for the last four years, Benjamin said, the proposed IIFS would leave HC&S without water at its Waiale Reservoir for 159 days out of the year. It would also leave the county’s proposed 9-mgd Waiale Water Treatment Facility without water 73 days of the year and would result in the county’s `Iao Water Treatment Facility operating below capacity for 129 days.
“These are the actual effects,” he claimed, adding that Miike’s proposal would leave kuleana users with less water than they have today.
Benjamin also disputed Miike’s determination that there are alternative water sources – Well 7, in particular – for 1,500 acres of sugarcane served by Na Wai `Eha. He said Well 7 water could not be transported to where it was needed, and that it would cost too much to use. Without those 1,500 acres, total productivity would drop by five percent, which would wipe out any profit HC&S might stand to make, he said.
In light of the recent losses, the board of directors of A&B will make a decision on the future of HC&S by the end of the year, he said, noting that if HC&S goes away, so will 35 percent of the island’s renewable energy. While HC&S is looking at using its lands for energy production, the crops and technology aren’t ready yet for the company to make a go of it, he said.
“We cannot shrink our way to profitability,” he said. Instead, he proposed reducing the amount of water restored to `Iao Stream and Waihe`e River. Under HC&S’ proposal, the IIFS for Waihe`e River and `Iao Stream would be amended to 5 mgd and 4 mgd, respectively, which would still leave a total of 16 mgd in the streams.
When it came time for the commissioners to question Benjamin, Miike immediately addressed the late submission of evidence.
“Most of your [arguments] are based on evidence submitted after closing,” he said. With regard to the new information on revenues, “I would have wanted that information [during the hearing],” he said.
Miike asked Benjamin to comment on possible incremental impacts of amended IIFS (rather than the total impact to HC&S and all of Maui). In reply, Benjamin said only, “Every acre we lose is revenue lost.”
“At the hearing, you didn’t provide any of that information,” Miike noted.
‘Harsh result’
WWC also argued for a less ambitious restoration of stream flow.
“You want to avoid the law of unintended consequences” associated with broad actions such as the IIFS amendments, said Paul Mancini, attorney for WWC. Mancini admitted that the issues in the Na Wai `Eha case are too complex to avoid all unintended consequences, but tried to describe how the proposed IIFS would be insufficient for offstream users.
Miike’s proposal would leave only about 29 mgd for “reasonable” existing uses that already total 26-28 mgd. That leaves little to no water left for the county’s proposed Waiale Water Treatment Facility or several other existing uses, Mancini said.
He added that under the proposed IIFS for Waihe`e River, there will be a “serious shortfall” of water available for offstream use 50 percent of the time. For `Iao Stream, one-third of the offstream demand would not be met 50 percent of the time.
The “harsh result” Miike’s IIFS would have on WWC could cause the company to shut down, Mancini warned. As an alternative, he proposed restoring 5.4 mgd to Waihe`e River and 4.2 mgd to `Iao Stream (both HC&S and WWC proposed no amendments to Miike’s proposed IIFS for Waiehu or Waikapu streams.) Under these IIFS, all demands of offstream users would be met 50 percent of the time, he said.
The Maui DWS also had concerns about meeting demand. County corporation counsel Jane Lovell said, “It would be more prudent for this body to start with lower numbers.”
Attorney John Van Dyke, also representing the county, said that the commission should consider the needs of public offstream users when setting the IIFS, not just when considering water use permits, which are issued if there is water in excess of the IIFS.
“The county is concerned there won’t be enough [water] left to the county if the [proposed amount of] water is put into the streams,” Van Dyke said, adding that the commission must consider the Waiale Treatment Facility as well.
“There’s not going to be enough water for that plant,” he said. Lovell added that if 13 mgd is returned to `Iao Stream as proposed, the amount left would “be inadequate for the `Iao treatment facility.” She said that even the 11.5 mgd the county had originally proposed for `Iao Stream may be too high.
Lovell ended her arguments with stern words for HC&S. She said it was “utterly inexplicable” that HC&S did not submit any of the new numbers before the hearing closed months ago.
“HC&S did not make its case then in the legal evidence. The county might have been able to accept those numbers and would be here advocating for them….It’s a crime that, given the importance, a better case was not made,” she said.
An End to Waste
“It is well past time to restore the balance to Na Wai `Eha,” OHA’s Bunn said. And while she acknowledged that it was important to allow for municipal water, the evidence presented in the case did not establish that 9 mgd was required for the Waiale plant.
“What happened to the water Wailuku Water Company couldn’t find a use for?” Bunn asked, referring to letters WWC wrote a few years ago detailing how much it had available for sale. That water eventually went to HC&S, where, she said, it was squandered on a marginal, low-yielding field – Field 920 – that could have been left fallow.
Between 2004 and 2006, Bunn said, HC&S used 11,000 gallons per acre per day (gad) on Field 920, when the optimum requirement was only 5,750 gad. Bunn said that the over-watering of Field 920 and of HC&S’ Waihe`e-Hopoi and `Iao-Waikapu fields wasted 5 mgd between 2004 and 2006. That amount alone could restore Waikapu Stream, she said.
Bunn added that between 2004 and 2006, 9 mgd of WWC’s surplus was lost through seepage at HC&S’ Waiale Reservoir, and 3 to 4 mgd was lost from the plantation’s smaller reservoirs. In total, Bunn calculated that HC&S wasted about 14 mgd of Na Wai `Eha water between 2004 and 2006.
“OHA doesn’t believe that’s how you treat a resource that’s necessary for survival,” Bunn said.
With regard to HC&S’ claims that Well 7 is not a viable alternative, Bunn said that using HC&S’ numbers, it would cost less than $0.20/1,000 gallons to operate Well 7. Bunn hedged her calculations, saying that she was not sure where HC&S’ cost figures came from and that they changed from one document to the next. She added that she spent a lot of time trying to replicate HC&S’ numbers and, “I couldn’t do it.”
Moriwake’s arguments were similar to Bunn’s. He called out WWC for providing no proof – only paper contracts – of actual use. At one point, he noted, WWC had been spraying 1 mgd of Na Wai `Eha water “into the air in dry Ma`alaea, all day, every day” and had called it a reasonable use.
As for HC&S, he, too, said Well 7 – the largest well in the state – was a viable source, noting that HC&S had drawn in excess of 20 mgd from that well for more than 50 years. Reclaimed water was another alternative, he said.
“How would HC&S use water if it had to pay for it like everyone else? ….Would it dismiss using the largest well in the state? No,” he said.
The fact that there may not be enough water for the Waiale Treatment Facility did not bother Moriwake, since, under an agreement with the county, the plant would mainly serve A&B development projects.
“Municipal and domestic are two different animals,” he said, adding that the 9 mgd is not a public use, nor is it an existing one.
A Rebuttal
HC&S attorney David Schulmeister had the last word. With regard to the “extra evidence” he provided in May, he argued, “There is no rule that says it has to be in the record.” The commission has to consider the best information available, including potential impacts to offstream users, and must do so at every stage in the planning and permitting process, he said.
He noted that while the interim instream flows for Na Wai `Eha were being determined through a contested case hearing, those for several East Maui streams were not.
“You cannot put on blinders. In this case, it would have been impossible to say what the impacts would be until the recommendation was made,” he said.
At the hearing’s close, Water Commission chair Laura Thielen said that Na Wai `Eha and East Maui interim instream flow cases will be ground-breaking decisions and that the commission will be comparing the different processes – contested case hearings versus a more open, legislative scheme – to determine how best to proceed in the future.
For Further Reading:
Environment Hawai`i has published several articles that will provide additional background to the current dispute over West Maui surface water:
• “Commission Struggles with Conflicting Claims Surrounding West Maui Stream Diversions” (February 2006);
• “Commission Orders Contested Case, Mediation for Maui Water Disputes” (March 2006);
• “Finally, a Schedule for Contested Case over Charge of Wasting Maui Stream Water” (January 2007)
• “Hearings Begin in Contested Case over Diversion of West Maui Streams” (December 2007)
• “Commission Tightens Grip on Waters of Central Maui” (May 2008)
• “Hearing Officer Issues Recommendations for Na Wai `Eha Contested Case Hearing” (June 2009)
–Teresa Dawson
Volume 20, Number 5 November 2009
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