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Thursday, December 21, 2000

Kauai Water
proposes rate increase
to fund new pipes

By Anthony Sommer
Kauai correspondent

LIHUE -- A two-step rate increase that would boost the typical residential water bill by 68 percent has been proposed by the Kauai Water Department.

The monthly costs for an "average" family home using 10,000 gallons of water per month would go from the current $23.50 a month to $30 per month on July 1 and $39.50 per month in 2003 under the proposed rates, said Ernie Lau, Kauai County Water Department director.

The proposal also calls for rates to automatically adjust to reflect increases or decreases in the department's electric bills to run its pumps.

The higher rates are proposed to help fund a 20-year program to replace 127 miles of the Water Department's 400 miles of pipe. Kauai County operates 13 separate water system, all originally built by sugar plantations with none of them connected. Much of the pipe is 60 to 80 years old.

The higher rates are expected to yield $273 million over the next 20 years. The replacement pipe costs would be paid with a combination of bond proceeds and pay-as-you-go funds. The county has about 18,000 customers. Princeville, the island's only planned community, has its own water plant for its residents and sells water to the county. Many rural homes have private wells.

The Kauai Water Board, which ultimately will vote on the new rates, has scheduled a public hearing on the proposed rates for 9 a.m. Jan. 24 at its office complex at 4398 Pua Loke Street, Lihue.

The last rate increase was approved in 1994 and its final step implemented in 1997.

One of the key differences is a change from a flat rate for all Kauai water customers to a sliding scale based on meter size. Users with larger meters, usually commercial customers, would pay higher rates. And a new use charge will be applied, giving cheaper prices to users who conserve water.

Agriculture customers, including "gentlemen's farms" that file a federal tax form showing income and expenses from agriculture products, receive a large price reduction. Lau said that policy will not change under the new rate scheme.

If approved as they are now drafted, water prices on Kauai would be "very similar" to new rates being considered on the Big Island, Lau said.

Kauai is the only major island that does not face a water shortage, but its limited delivery capability has hindered development in many areas of the county.

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