Waikoloa Utilities seek large rate increases; residents and consumer advocate call for closer review

The Hawaii Public Utilities Commission (PUC) heard public testimony in Waikoloa Village on a request by Waikoloa Resort Utilities — operating as West Hawaii Utility Company, West Hawaii Sewer Company and West Hawaii Water Company — for multi‑million dollar net revenue increases that, if approved, the utility says would raise some customer bills in the village by well over 30% and certain water rates by as much as about 67.9%.

The request, described in the utilities’ amended application filed Dec. 17, 2024 and presented at the hearing, asks the Commission to approve separate net revenue increases for several Waikoloa systems and related tariff changes, including a credit tied to corporate tax changes and a surcharge to recover deferred COVID‑19 costs. The Consumer Advocate said it will independently evaluate the company’s request and that public comments will inform that review.

Jeff Volk, general manager of Hawaii Water Service, told the PUC that rates for the Waikoloa systems have been unchanged since Feb. 8, 2019 and that the company has invested nearly $33 million in the Waikoloa system since that last adjustment. "Current base rates have not been increased for 6 years, and they no longer reflect the actual cost of providing safe and reliable water service," Volk said, summarizing the company’s justification for the filing. He said the company’s capital spending since 2019 includes about $11 million in treatment and pumping plants, $8 million in transmission and distribution work and $6 million in supply and generator projects.

The utilities’ amended application, as described at the hearing, requests the following 2025 test‑year net revenue changes: for one West Hawaii utility entity about $1,543,408 (water), $635,062 (sewer) and a $31,040 decrease for irrigation; for West Hawaii Sewer Company about $1,242,020 (sewer); and for West Hawaii Water Company about $1,876,050 (water). The companies propose an overall rate of return of 8.01 percent and two tariff riders: a roughly $122,000 credit to return over‑collected tax expense from the Tax Cuts and Jobs Act and about $32,000 to recover deferred COVID‑19 expenses. The company proposed phasing the increases in two steps as a mitigation measure and provided an example that a typical village household using 11,000 gallons could see a water bill rise to roughly $69.46 (about a 34% increase) in phase one and to roughly $92.24 in phase two; the example also estimated a sewer bill rising to about $131.16 in phase one and $163.51 in phase two.

Michael Angelo, executive director of the Division of Consumer Advocacy in the Department of Commerce and Consumer Affairs, said the Consumer Advocate will "independently review the reasonableness of the Waikoloa utilities' requested rate increases and tariff changes" and will conduct discovery, request supporting data from the company, and later file recommendations with the Commission. Angelo encouraged written and oral public comment and provided the office’s contact information (dca@dcca.hawaii.gov; (808) 586‑2800).

Dozens of residents and homeowners‑association representatives testified in opposition. Jim Anderson, president of the 17th Fairways Villas homeowners association, said, "This increase will impact our homeowners association substantially," noting his HOA’s collective monthly water and sewer bill and warning that the proposed increase would force large HOA‑dues hikes. Other speakers, including longtime residents and HOA presidents, said the proposed increases would be especially difficult for fixed‑income households and urged the PUC to require more justification or a phased approach.

Several speakers questioned why resort irrigation rates appear lower than village residential rates and urged that new development pay for expansion costs through tap fees rather than shifting those costs to existing residents. Jane Dater Friedman said, "There should not be a price on water and people shouldn't have to lose use their last dollars to afford it," describing the proposal as unaffordable for many in the village. Multiple speakers asked the Commission to order an independent audit or third‑party review of the company’s books and allocations before approving large increases.

Community wildfire preparedness was raised as a separate public‑safety concern. Bob Yuki of Waikoloa Wildfire Safety Advocates said the community needs evidence that the upgraded system will provide adequate emergency water supplies during a large fire. "The water needs during wildfire are much greater than the average need," Yuki said, asking the Commission to require analysis showing the system’s ability to meet fire‑defense demand before concluding the rate case.

No decision or vote was taken at the hearing. Chair Leo Asuncion opened and closed the public hearing and reminded attendees that the proceeding’s scope is the issues listed in the utilities’ amended application. After the hearing the Commission and the Consumer Advocate will continue their reviews and the PUC will issue a written decision. The Commission accepted written comments on docket 20240224 at puc.comments@hawaii.gov or by mail to 465 South King Street, Room 103, Honolulu, HI 96813. Representatives from Hawaii Water Service and the Consumer Advocate remained after the hearing to speak individually with attendees.

Details presented at the hearing — including the company’s investment figures, the exact proposed net‑revenue amounts, the tariff rider amounts, and the example household bill impacts — were taken from the Waikoloa Utilities' amended application and the company’s oral presentation to the PUC. The Consumer Advocate will produce its independent review as the case proceeds and the PUC will make its final decision in a subsequent written order.