Committee adds preservation water rate and ties discount to agricultural tiers for nonprofits

The Maui County Budget, Finance & Economic Development Committee recommended passage on first reading of Bill 99 (substituted CD1), which adds a preservation water rate to the Department of Water Supply rate schedule and makes the rate retroactive to July 1, 2025. The committee substituted a CD1 to correct the rate name to "preservation rate" and then adopted an amendment setting the preservation rate structure to match the county’s agricultural tiers.

The committee approved the amendment to align the preservation rate with the agricultural rate structure by roll call, 7 yes, 1 no, 1 excused; the main motion as amended passed by voice vote (8 yes, 1 excused).

Budget Director Leslie Milner and Water Director John Stufflebean described the change as an insertion of a previously approved category into the FY26 rate schedule. Milner told the committee the administration’s original recommendation established the preservation rate at $4.98 per 1,000 gallons for general usage, with water‑shortage stage rates at $4.98 (stage 1), $5.23 (stage 2) and $5.49 (stage 3). Stufflebean said the preservation rate “simply puts into our rate schedule the rate that has already been discussed and approved by the county council.”

Members questioned the rationale and equity of the level of discount. Director Stufflebean said the administration chose a mid‑point between general and agricultural rates to provide a discount but not as large as agricultural. Committee Member Keoni Rollins Fernandez moved to amend the preservation rate to use the agricultural tiers; Budget Director Milner said the agricultural tiers apply and that the department had no objection. Rollins Fernandez argued preservation work contributes to watershed recharge and other public benefits and that matching agricultural pricing would support nonprofit reforestation efforts.

The amendment set the preservation tiers (per 1,000 gallons) as follows: 0–5,000 gallons $2.24; 5,001–15,000 gallons $4.42; ≥15,001 gallons $1.25. Water‑shortage stage rates were read into the record as part of the amendment and adopted as amended. The department estimated the revenue impact as de minimis and said two nonprofits currently fit the eligibility criteria: Hawaii Land Trust and a foundation that participated in wildfire restoration work; additional nonprofits could qualify if they meet ordinance criteria.

Royal House of Hawaii testified in favor of accessibility for Native Hawaiian beneficiaries and asked whether people returning to patented lands would be eligible for water if they filed paperwork and built distribution systems; staff said eligibility and infrastructure questions would be considered case‑by‑case under the ordinance criteria.

Corp. Counsel Christina Toshikio and Legislative Attorney Peter Hanano advised the committee on process and said the council may amend the rate for this new category because it was established outside the annual budget process; Hanano advised that established procedural steps for setting water rates include review by the Board of Water Supply.

Committee members said they expect continued monitoring; Member Tom Cook urged waiting to change the structure until there is a usage record. The committee instructed staff to include the CD1 corrections (title language) and forwarded the bill to the council for first reading with the preservation rate set to the agricultural tier structure.