Council committee advances revised sewer rate package after debate over bond risk and customer relief

The Honolulu City Committee on Budget on April 1 advanced changes to Bill 60, a proposed 10-year sewer rate package, approving a revised CD1 that sets a 4% increase for 2025 and sends the ordinance to second reading and public hearing while leaving later-year rate figures to be determined.

Committee members and department officials spent more than two hours on the sewer fund's capital needs and the rate study that supports them, focusing on the Sand Island Wastewater Treatment Plant upgrade, multi‑billion dollar capital needs and the tradeoffs between a larger multi‑year rate path and using general fund dollars to blunt rate shock.

The proposed comprehensive rate path presented by the Department of Environmental Services called for a front‑loaded series of rate increases — “9% per year for the first six years, then 8, 7, 6 and 5 percent” — to meet revenue requirements for operations, reserves and a capital program the department estimated at roughly $10.1 billion over 15 years. Director Roger Babcock said the plan comes from a finalized rate study that evaluated alternatives including shifting more charge to volumetric pricing and establishing a customer assistance program.

Why it matters: the sewer enterprise issues revenue bonds whose ratings and borrowing cost depend on the fund’s financial…