Hawaiian Homes Commission approves temporary water-bill subsidy for Kailapa lessees

The Hawaiian Homes Commission voted Monday to approve a temporary water-bill subsidy for homestead lessees served by the Department of Hawaiian Home Lands (DHHL) Kauaihai/Kailapa water system, saying the measure will ease immediate household costs while staff develop longer-term fixes.

The commission’s action waives the bimonthly base meter fee for Kailapa residential customers and provides rate stabilization for the first two usage tiers for lessees; the subsidy does not apply to the Kailapa Community Association’s flat usage tier. "The recommended motion action for item G‑1 is that the Hawaiian Homes Commission approve the temporary water bill subsidy for Kailapa Homestead lessees on the DHHL Kauaihai water system," Planning Program Manager Andrew Choi told commissioners at the meeting. The motion passed with the commission adopting the staff proposal.

Why it matters: Kailapa lessees have raised repeated concerns that recent DHHL rate increases and the system’s high per‑thousand‑gallon charges make bills unaffordable. Commission and staff presentations showed DHHL buys treated groundwater from Kohala Ranch Water System and that wholesale purchase and energy costs are the largest drivers of the system’s bills. The temporary subsidy aims to blunt the financial impact of scheduled FY2026 and FY2027 rate increases while DHHL completes a statewide review of its water administrative rules and pursues alternate water sources and midterm infrastructure work.

What commissioners and staff said: Louie Makaiwa, DHHL district staff who detailed system costs, told the commission that the department’s FY2023 total operating cost for the Kailapa system was about $245,000 a year, including roughly $175,000 paid to the Kohala Ranch water source. Staff estimated the department would forgo roughly $69,000 in billed revenue in FY2026 and about $206,000 in FY2027 if the full subsidy were applied; staff also said the actual additional out‑of‑pocket cost to DHHL would be roughly $30,000–$40,000 per year given existing operating expenditures and expected payments.

Beneficiaries urged action. Testifiers from the Kailapa community urged approval. "As a single parent, my water bill is the same cost as my car payment," Kailapa resident and Kailapa Community Association board president Shauna Kalukui said. "We're really dependent on this right now as financial relief." Several residents described months when bimonthly bills exceeded several hundred dollars.

Longer‑term steps: DHHL officials said the subsidy is explicitly temporary. Staff will continue pursuing midterm and long‑term measures that include (1) an expedited update to DHHL’s administrative rules and a cost‑of‑service water rate study, (2) discussions with the County Department of Water Supply about interconnections and equipment upgrades, and (3) exploration of alternate water sources — including agricultural/non‑potable options and new wells — that could reduce reliance on purchased water.

Final tally and next steps: The commission approved the motion during its regular session; the motion was moved and seconded and the chair called for the vote. "All those in favor, say aye." "Aye." "Those opposed? Motion carried," the chair said. Staff said they will return to the commission with implementation details and timing and will pursue beneficiary consultation as part of the rule‑making and rate‑study work.

The commission scheduled a community meeting this evening at the Kailapa Community Association Center to continue discussion and share additional implementation details.