BOARD OF WATER SUPPLY
COUNTY OF MAUI
CAPITAL PROGRAMS COMMITTEE MEETING


Held at HGEA Conference Room, David K. Trask, Jr. 
Office Building, 2145 Kaohu Street, Wailuku, Maui, 
Hawaii, commencing at 9:00 a.m. on April 9, 2001.

REPORTED BY:   LYNANN NICELY, RPR/RMR/CSR #354
IWADO COURT REPORTERS, INC.

A P P E A R A N C E S

COMMITTEE MEMBERS:
Howard Nakamura, Chairman
Peter Rice
Jonathan Starr

STAFF PRESENT:
David Craddick, Director 
Mike Quinn, Fiscal Officer
Herb Kogasaka, Engineering
Miles Fujinaka, Engineering
Howard Fukushima, Corporation Counsel
Fran Nago, Board Secretary

IWADO COURT REPORTERS, INC.

MR. NAKAMURA:  I would like to call the 
meeting of the Capital Programs Committee of the Board 
of Water Supply, County of Maui, to order.  It's 
Monday, April 9, 2001.  We're meeting in the HGEA 
conference room, David Trask, Jr., office building, 
2145 Kaohu Street, Room 207, Wailuku, Maui.  Present 
here today are committee member Peter Rice and myself, 
Howard Nakamura, the Chairman; also Board of Water 
Supply member Jonathan Starr, Director David Craddick, 
Fiscal Officer Mike Quinn, Herb Kogasaka and Miles 
Fujinaka from engineering, board secretary Fran Nago, 
and Sally Raisbeck.
 We have no minutes to approve today.  Item IV,  
testimony from the public.  Is there any testimony 
from any member of the public on items either on the 
agenda or not on the agenda?

MS. RAISBECk:  Mr. Chairman, I had a question.  I notice --

MR. NAKAMURA:  Could you identify yourself, please.

MS. RAISBECK: Sally Raisbeck.  I live in 
Wailuku.  And I wondered, the first item on the 
agenda, the exploratory well within Camp Maluhia, 
there wasn't an amount given for how much would be 
transferred.  And I also wondered, is there a plan for 
development of wells up in that area assuming on the 
hypothesis the exploratory well shows good water?  
What is the plan for developing wells north of the 
present wells? 

MR. NAKAMURA:  Okay.  I would suggest, Sally, 
that when we get to this item, the director can 
explain the request and at that time if you have any 
questions, we will provide you the opportunity to ask 
them again, if that is okay with you.

MS. RAISBECK:  Thank you. 

MR. NAKAMURA:  Okay.  Any other testimony?   
If not, let's move on to V, items before the 
committee.  Item A, Director'S Report 01-03, request 
for funds for an exploratory well to the north of 
Kupaa Wells No. 1 on state land in Maluhia leased by 
the Boy Scout camp.  Mr. Craddick? 

MR. CRADDICK:  Actually, this request is not a 
request for funds.  The funds are already part of the 
budget.  It's just called Kupaa Well in there.  And 
what we're doing, as the report says here, our 
consultant is saying that he doesn't think we can get 
much more water from the area of North Waihee that we 
purchased from Wailuku Agribusiness, so we're trying 
to keep going further north, spreading the pumping out 
and this is just the next increment in doing that.  
It's still developing the North Waihee aquifer which 
was the plan that the board approved back in 1996. 

MR. NAKAMURA:  The amount, Mike, was $500,000, 
as I recall.

MR. QUINN:  That's right, Mr. Chairman.  It 
was $500,000 appropriated for the Kapaa Well under the 
Iao portion of the capital improvement budget for 
fiscal year 2001. 

MR. NAKAMURA:  And David, your proposal is to 
transfer the entire amount; is that correct?

MR. CRADDICK: Yes.

MR. NAKAMURA:  Okay.  Any questions from 
members of the committee? 

MR. RICE:  Yeah.  So do we know what we're 
budgeting for this exploratory well?

MR. CRADDICK:  Half million.

MR. RICE:  But that's for the whole process of 
drilling exploratory wells, a half a million.

MR. CRADDICK:  Yeah.

MR. RICE:  Is it to go to bid or is the bid 
documents prepared for that or how far along are we?

MR. CRADDICK:  No, we haven't done anything yet. 

MR. RICE:  So we haven't even begun the process.

MR. CRADDICK:  Right.

MR. RICE:  So with the transfer of the money, 
then we would prepare some specs for that exploratory 
well project and we would go out to bid. 

MR. CRADDICK:  Right.

MR. RICE:  That's right. 

MR. NAKAMURA:  Anything else, Peter?  I have 
another -- I have a question.  It somewhat relates to 
what I think Sally was starting to get to and that is, 
what is going to be the process?  You know, you make 
specific reference to a location, but has there been 
an actual study of the area by either yourself or the 
department or Dr. Mink to identify the most desirable 
location for an exploratory well? 

MR. CRADDICK:  Not really, no.

MR. NAKAMURA:  So your reference to a specific 
site, is that -- at this point is that appropriate or 
is that premature?

MR. CRADDICK:  I don't think there is any 
specific site in there.

MR. NAKAMURA:  You made reference to the 
proposed site as located in state land which is leased 
by Maluhia Boy Scout Camp.

MR. CRADDICK:  Well, that state land goes all 
the way to Kahakuloa.

MR. NAKAMURA:  It's all leased by the Boy Scouts?

MR. CRADDICK:  No.  But this area here going 
all the way to Makamakaole Stream is leased by the Boy 
Scouts, which is a pretty big area.  So somewhere in 
that area. 
 The state had already planned to do a well 
back in 1989 or '90 in the area a little bit closer to 
Makamakaole Stream than what we're planning on doing.  
But there was already one well planned for that area.  
And we would expect the state would probably still go 
forward with that well next year because it's in  
their budget and still hasn't been knocked out, so we 
would expect the state to go forward with that well 
next year.

MR. NAKAMURA:  Okay.  Mr. Rice?

MR. RICE:  You referenced the board's approval 
of this drilling plan in 1996.  Would that have been 
based on some study that was done in that area?

MR. CRADDICK:  I believe it was, yeah, Mona 
Kiyo had done some kind of study.

MR. RICE:  So the board wouldn't have made a 
decision to place that area in the drilling expansion 
without having some background as to water 
availability there, right?  Or no? 

MR. CRADDICK:  Well, again, this is part of 
North Waihee aquifer, so pretty much anywhere you 
drill, you're going to get water.  It's just a matter 
of how much you're going to get.  This is all -- we've 
developed 4, a little bit over 4 right now in half of 
North Waihee aquifer and now we're trying to get the 
other 4 in the other half of North Waihee aquifer.  
But the plan all along was always to develop 8 from 
North Waihee.

MR. NAKAMURA:  Anything else, Mr. Rice?  Mr. Starr?  

MR. STARR:  I'm interested to hear the number 
8 because I've certainly heard that USGS feels that 4 
is the max that we're going to long term get out of 
North Waihee.  So there is definitely some dissention 
about it.  But I do agree that it's good to spread the 
pumping out, so I do feel we're going in the right 
direction by moving this out to Maluhia. 
 I do have a problem, though, you know, this is 
something that I see over and over again is that we're 
calling this an exploratory well.  And I kind of would 
like a little bit of background from the director why 
we call it an exploratory well because we're looking 
to drill a well that we're going to use for 
production.  And that's good because we need the 
water, but I would like to have a bit of understanding 
why we keep calling them exploratory wells until they 
hit water and then we call them a production well.  I 
would be much happier if we were saying the words 
we're drilling a well that will hopefully add water to 
our system, which is what we're really trying to do.

MR. CRADDICK:  We wouldn't know that until the 
well is drilled.  We would have to get test 
information to find that out.  I'm not going to sit 
here and tell you I know right now what the well is 
going to produce and what the water quality is.

MR. STARR:  I just don't want to create any 
kind of misleading, you know, misleading belief that 
this is a scientific experiment.  This is an attempt 
for us to spread out the pumping and to utilize a 
resource out there.

MR. KOGASAKA:  One of the tests that's 
conducted is the production of the well itself, so we 
pump it at various rates.  We do a step test where you 
pump it like 500 million gallons per day increment, or 
500 gpm, I'm sorry, and then we do a sustained pump 
test to see what it's effect is on the chloride and 
other levels. 

MR. STARR:  And then we decide how --

MR. RICE:  But just to clarify where Jonathan 
is going, but if we pick the wrong site and it's dry, 
we've wasted -- I shouldn't say wasted because we've 
got -- but it's a half million dollar --

MR. CRADDICK:  You've got an exploratory hole then.

MR. RICE:  You've got a half a million dollar 
risk.  And that's not necessarily bad.  Because 
wherever you drill, it's a half a million dollar risk.  
Hopefully you've done the geological work in advance 
so that it's not a bomb.

MR. STARR:  My belief to my limited knowledge 
we are drilling in the right place.  It's really going 
to be a question of whether we're going to get, you 
know, a half or one million gallons out of it.  And 
the real question is, you know, over long term that's 
20, 30, 40 years, whether, you know, how much we're 
going to get out of the whole thing or whether we're 
going to have to cut that back.  I don't think anyone 
knows that, but, you know --

MR. CRADDICK:  You're only going to find out 
by doing these wells and testing them. 

MR. RICE:  But there is some science to it.  
You're picking a spot based on some knowledge, right? 

MR. CRADDICK:  Mainly the rainfall in North Waihee.

MR. NAKAMURA:  So just so there is a clear 
understanding, semantics aside, the procedure of the 
department is to drill a well that they hope to be 
ultimately a production well and you would then test 
it to determine whether or not in fact it can be a 
production well.

MR. CRADDICK:  That's correct.

MR. NAKAMURA:  What about Mr. Starr's question 
about the 4 and the 8?  Can you clarify that, David?

MR. CRADDICK:  Again, I don't know if they're 
talking about the portion of North Waihee that we 
bought from Wailuku Ag -- I mean, I myself have always 
told the board we would only get 4 from that area.  I 
know when we were in the negotiations for purchasing, 
Wailuku Ag tried to lead the board to believe you 
could get 8 from that area, but I don't think there is 
any studies that showed you ever could have gotten 8 
out of that area there.

MR. NAKAMURA:  My recollection is basically 
the same, that we talked about 8 in the context of the 
entire what is called North Waihee.  Perhaps the 
confusion is because -- partly because the first two 
wells are identified as North Waihee wells.  However, 
I think the director has been consistent in 
identifying 8 as the capacity for the entire aquifer 
and in maintaining that the portion that has been 
developed to date has a capacity of 4. 

MR. STARR:  I believe what we're seeing from 
USGS is that they feel that 4 is what we're going to 
get out of the whole thing long term.

MR. RICE:  Four wells or 4 million?

MR. STARR:  Four million.  You know, just as 
Iao was looked at to theoretically on paper have a 
much higher sustainable yield than has been practical, 
they're starting to back pedal now that we're 
producing and we're seeing the actual results.  So in 
any either case, I think we should go ahead with this 
well, this is a good project.  But I for one don't 
want to really believe until it's proven that we're 
going to get another 4 million gallons out there.  
That's kind of where I'm getting at. 

MR. RICE:  Don't go projecting our --

MR. STARR:  Yeah.

MR. NAKAMURA:  May the record reflect that 
Ellen Kraftsow is present. 

MR. RICE:  Two other questions.  So let's say 
that we do this exploratory well and it's a good one.  
What additional dollars would we then need to make it 
permanent, roughly? 

MR. CRADDICK:  One and a half to 2, would be my guess. 

MR. RICE:  More. 

MR. CRADDICK:  Yes.

MR. RICE:  And then what's the time frame on 
completing the exploratory well to the point where we 
know that it's good or no good?

MR. CRADDICK:  I would say, depending on what 
environmental work we have to do, certainly no later 
than this time next year.

MR. RICE:  We were talking before the meeting 
about the fact that when we say we're going to do a 
project, that sometimes the design phase of the 
project is -- people think, oh, we're doing the 
project, they think start work.  Well, there is design 
time and approvals that are required that extend it.  
So a year.  Okay.

MR. NAKAMURA:  Sally, do you have any further questions? 

MS. RAISBECK:  Yes, thank you, Mr. Chairman.  
I wanted to ask whether Kupaa 2, which must have been 
drilled with part of the money because that well was 
drilled, Kupaa 2?

MR. CRADDICK:  No, it hasn't been drilled at all. 

MR. STARR:  Kupaa 1.

MS. RAISBECK:  Oh, Kupaa 1 was drilled.  But 
that will be able to be pumped within the 4 million 
gallons a day limit that John Mink put on all of that.  
You won't -- with all of the ones in the North Waihee 
aquifer so far, you won't be exceeding 4 million 
gallons a day?

MR. CRADDICK:  We're currently pumping I think 
about 4, 4 and a half, somewhere in that neighborhood 
right now.

MS. RAISBECK:  So you are exceeding the sustainable yield.

MR. CRADDICK:  No.

MR. RICE:  Wait, wait, let's -- I think you 
need to go back to what Jonathan said.  The yield of 
the aquifer is not yet determined.  So while it might 
not be 8, it might not be 4.  So let's not go saying 
what the sustainable yield is yet.

MS. RAISBECK:  I'm sorry, I was quoting Mr. Mink.

MR. STARR:  Yeah, I think there was a letter 
from John Mink saying that he felt it would top out at 
4.  Let me -- I think Ellen can give us the facts. 

MS. KRAFTSOW:  The state defines sustainable 
yield of all the aquifers on the island, they find 
where aquifers are and what the yields are of each 
one.  The sustainable yield as legally defined of the 
Waihee Aquifer is 8.  However, what David is referring 
to and what Mr. Mink was referring to is I think it's 
the northern -- is it the northern portion, one 
portion of that aquifer, fairly extensive portion of 
that aquifer which our lands sits within, we shouldn't 
try to take more than 4.  In other words, to get 8, 
we'll have to spread it throughout.  And of course as 
you know, the state is reviewing all the sustainable 
yields to some extent.  There were water budgets.  So 
that's all that is. 

MR. RICE:  Right.  So as to her question or 
comment, I thought what we said earlier we are 
spreading this drilling out so that we don't get stuck 
on that 4 million -- is that right?  That was your 
point, Jonathan?

MR. STARR:  Yeah.  And the fact --

MR. NAKAMURA:  Can I ask that everyone please 
raise your hand before attempting to speak?  Sally. 

MS. RAISBECK:  If I could just read what 
Mr. Mink said, which I believe you all have in your 
packet.  The last page of his memo, he says, "A 
serious misrepresentation about the sustainable yield 
of the North Waihee Kupaa and Kanoa wells as totaling 
8 million dollars a day has appeared in newspaper 
reports and repeated at public hearings.  The 
sustainable yield of 8 million gallons a day is that 
proposed for the entire North Waihee aquifer system 
which extends from the axis of Waihee Valley to 
Kahakuloa Valley.  The portion of the system to be 
exploited by the existing wells extends from Waihee 
Valley to the Brewer property line at the south 
boundary of the Makamakaole [inaudible] segment of the 
North Waihee aquifer system, the sustainable yield has 
been estimated at just 4 million gallons a day." 
 So I just wondered if that means that the 
existing wells including Kupaa and Kanoa, they should 
only be drawing 4 million gallons a day, so 4 and a 
half would be exceeding the sustainable yield.

MR. NAKAMURA:  Mr. Craddick, any comments?

MR. CRADDICK:  Well, again, I think everybody 
knows we've been trying to play catch up here since 
the start of this last 10 years.  So right now the two 
North Waihee wells that came online first have the 
been operating 24 hours a day, each well, and we don't 
expect that's going to go on for the long term.  We 
expect that one of those wells will be as a backup.  
Even the Kanoa well or -- yeah, Kanoa well, one of 
those two wells is a backup.  So you're going to 
really have three wells functioning in there.  And I 
think if you go on further to read what John Waihee 
says applying our factor for peak day and having 
equipment backup, you'll get about 3 and a half out of 
the current wells that are in there for the long term, 
which is less than the 4.

MR. NAKAMURA:  Okay.  So in summary, the 
intent is that the five existing wells will ultimately 
be utilized in a way that would produce approximately 
4 MGD in that portion of the aquifer and we need to 
further develop the northern portion of the aquifer to 
potentially develop an additional 4 million gallons, 
"potentially" being the operative word.  Okay? 

MR. CRADDICK:  Yes.

MR. NAKAMURA:  Any further questions? 

MR. STARR:  Just one other thing is that the 
geology does change on the other side of that next 
gulch.  So, you know, I've heard from USGS that this 
well we're going to drill now, this is kind of the 
last sure thing after there has been no, you know, 
there has been no test drilling and they say the rock 
formations may be different. 

MR. CRADDICK:  That's wrong.  The Wailani 
Ranch has a well, the Maluhia Ranch Estates has a 
well.

MR. STARR:  Those are all very small.  Very, very small. 

MR. CRADDICK:  Still, we have information, we 
know where the head is and the head is enough to -- 
maybe can't get a million and a half gallons a day per 
well, but looks -- the head is higher than it is out 
in the Haiku area. 

MR. STARR:  In other words, we might, but 
let's just be a little bit -- you know.

MR. RICE:  I think Sally's point and your 
point is we don't want to be pumping to exceed the 
sustainable yield of the aquifers.  No question at 
all.  So to that end, this drilling of this well is 
necessary.  It's in the right place.  Right?  

MR. STARR:  I do have another question.  
What's the status of the right to drill there?  I 
understand that there is estates involved, that the 
Boy Scouts are involved, and that [inaudible] is 
involved.  What permissions do we have and what do we 
need to get to be able to drill, and also to be able 
to get access to drive to that site and to be able to 
run a pipeline from that site to where we'll be able 
to connect to our system? 

MR. CRADDICK:  We've already got the keys from 
the Boy Scouts to go in and do preliminary site 
investigation.  And we had talked with the Boy Scout 
executive director this morning, Brian Gray, and he 
felt he'd already sent us a letter.  We don't have it 
in our record.  He said he's either going to prepare 
another one or send us a copy of the one he already 
sent.  The next step --

MR. STARR:  Will that letter give us what we need from them? 

MR. CRADDICK:  Well, it gives us enough to 
where we can go to the land board and get the real 
permission.  But because it's an active lease, you 
actually have to get permission from the landlord, not 
just the lessee. 
 So we have done the part that we need to do on 
getting the information available to go to the land 
board and that will be one of the next steps.

MR. NAKAMURA:  I think the Chair's 
recommendation on this item is that the committee 
recommend approval of the transfer of funds and 
request the staff to provide the board with an actual 
plan for how this process is to move ahead.  I think 
there is some confusion in terms of whether it's a 
specific site or it's not a specific site.  I believe 
that there needs to be some further investigation done 
and a recommendation made to the board as to the 
location of the exploratory well.

MR. RICE:  I would so move. 

MR. CRADDICK:  Before you vote on that, I need 
some clarification.

MR. NAKAMURA:  Basically we want to see the 
plan, is what I'm saying. 

MR. CRADDICK:  Well, you won't get the plan 
unless this money is approved because in the scope of 
work would be to come up with the plan.

MR. NAKAMURA:  That's what I'm saying, we're 
approving the transfer.  The first step being the 
preparation of whatever you want to call it, a 
preliminary plan or -- in other words, I guess what 
we're saying is we don't want you to construe this as 
being able to run out there tomorrow with a drill rig 
and start, you know, drilling a hole in the middle of 
capital hill or wherever else.  Okay.  Is that -- if I 
have a concurrence, the committee will make that recommendation. 
 Okay.  Next item, Director  01-05, approval 
for funding of Oki Place Seaside Street waterline 
replacement.  Mr. Director. 

MR. CRADDICK:  This particular project is over 
on Molokai, isn't it, Herb?

MR. KOGASAKA:  Yes.

MR. CRADDICK:  Just another one of the 
pipeline replacement program.  They are small lines 
there that are below the level needed to provide fire 
protection.  It's near town. 

MR. RICE:  $50,000 job?

MR. CRADDICK:  No, no, that's just design.

MR. RICE:  That's just design.

MR. NAKAMURA:  A couple of questions, David, 
or Herb.  Looking at the drawing, this particular 
system looks like it doesn't -- there is a stretch on 
Kamehameha V driveway that doesn't loop into the 
existing system; is that correct?

MR. KOGASAKA:  There is a project that's under 
construction right now closing the gap, 12-inch pipes 
are connecting them from, yes.

MR. NAKAMURA:  In that what seems to be an 
open break in the line.  So then this will tie into 
that system.

MR. KOGASAKA:  That's right.

MR. NAKAMURA:  And secondly, this is the 
location where the Pau Hana Inn is located, isn't it? 
Pau Hana Inn right on the corner there?  No?  
 I guess my question was I was just reading in 
the paper about the desire to basically restore and 
get Pau Hana Inn back in operation, and I was 
wondering if this improvement will be adequate to meet --

MR. CRADDICK:  Actually it won't, no, it 
won't.  They would need probably about a 12-inch line, 
right, Herb?

MR. KOGASAKA:   Yes, but I'm not too sure 
where Pau Hana Inn is at.

MR. NAKAMURA:  You see that one big parcel at 
the corner of Oki Place and Seaside Place.

MR. CRADDICK:  I'm pretty sure you're correct 
because that one right by the page number 9, that's 
the pier going out.  And so that is -- I would say 
that is Pau Hana Inn.

MR. NAKAMURA:  I think it's right over there 
where you see that 112 fire hydrant.  You see the 112 
fire hydrant?  I think that's where Pau Hana Inn is.  
So you're saying if that's the case, if they were to 
then go back to try to redevelop that or restore it as 
a hotel, they would in all likelihood have to upgrade 
that.

MR. CRADDICK:  We can look at that and if that 
portion should be 12-inch, we'll make it that way.

MR. NAKAMURA:  That will probably come out 
during the design portion.

MR. KOGASAKA:  Yeah.

MR. RICE:  My question related to the request 
on the agenda is for funding for the water 
replacement.  The request is really for funding for 
the design phase.

MR. NAKAMURA:  That's right. 

MR. CRADDICK:  It says engineering design services.

MR. NAKAMURA:  And this project is in the 
budget, correct, Mike?

MR. QUINN:  It's within the appropriation that 
we anticipated this budget within the pipeline 
replacement portion.

MR. NAKAMURA:  Okay.  Any other questions? 

MR. RICE:  Recommend approval.

MR. NAKAMURA:  Okay.  By concurrence, the 
committee will recommend approval of this project. 
 Item C, Director's 01-06, request approval for 
funding for Upper Kula/Kaonoulu transmission line 
replacement.  David?  

MR. CRADDICK:  This project here, there's 8" 
line currently in this area, and we're having problems 
getting water to the new tank that we just built out 
there.  And we think that this -- by doing this 
improvement here, it will help with that situation.

MR. NAKAMURA:  Which new tank are you referring to? 

MR. CRADDICK:  The one that we just put up, 
Waiohuli.  That half million gallon tank out there.  
During the summertime we noticed last summer we had -- 
we couldn't keep it full all the time.  And this is 
something that can be done at less cost than the 
Alalai tank there and reduces some friction loss on 
that line coming out to that Waiohuli tank.

MR. NAKAMURA:  Is that Waiohuli tank shown on 
this drawing?

MR. KOGASAKA:  No, it's not.  It's beyond that 
-- beyond the map.

MR. NAKAMURA:  Further toward Keokea?

MR. KOGASAKA:  On the second map, it's shown 
on that --

MR. NAKAMURA:  On the second map? 

MR. CRADDICK:  There is no second map.

MR. KOGASAKA:  I'm sorry. 

MR. CRADDICK:  That little line bubble around 
there is the project and then if you look a little 
further down, you see the Waiohuli tank on there.

MR. NAKAMURA:  So this is right above where 
the upper -- the old road and the new road come 
together, right?  The upper -- I'm sorry, the upper 
Kula road, the upper highway and the lower highway 
meet.

MR. KOGASAKA:  Yes, that's right.

MR. NAKAMURA:  It's around that area, right?   
So you're saying this is kind of an incremental 
improvement that is occurring and leading toward 
getting out in the Keokea/Ulupalakua direction.

MR. KOGASAKA:  Yes.

MR. NAKAMURA:  Is that --

MR. CRADDICK:  Yeah.

MR. NAKAMURA:  So there would continue to be 
improvements over time to this line?

MR. CRADDICK:  We would expect so, yes.

MR. KOGASAKA:  Yes.

MR. NAKAMURA:  So from the terminus point of 
this particular improvement, what is -- how big is the 
line?

MR. CRADDICK:  Eight inch.

MR. NAKAMURA:  So it's 8" until --

MR. CRADDICK:  It's actually 8" all the way to 
the -- what is it, the Kamole tank?

MR. KOGASAKA:  It reduces to a 6-inch before 
Kula San and 6-inch to Kamole.

MR. NAKAMURA:  Any questions, Peter?  
Jonathan?

MR. STARR:  What are you planning to put there?

MR. CRADDICK:  Twelve inch.

MR. STARR:  And do we need this before the 
Hawaiian Homes can come online?

MR. CRADDICK:  No.

MR. STARR:  This is independent of that or --

MR. CRADDICK:  Yeah.  We just -- there is a 
lot of farming that goes on in this walker area there 
and low pressure.

MR. STARR:  But this has nothing to do with 
the Hawaiian Homes tank and the problems with that; is 
that correct?

MR. CRADDICK:  No.  Just trying to improve the 
line going out to the Ulupalakua area. 

MR. RICE:  This is part of our overall Upper 
Kula Road replacement project?

MR. CRADDICK:  Upper Kula Road?  Upper Kula 
transmission line, yes. 

MR. RICE:  Right.

MR. NAKAMURA:  So this is a pure transmission line.

MR. CRADDICK:  Yes.  Well, I don't know, I 
think there is a lot of services off of it, but --

MR. KOGASAKA:   Right now.

MR. CRADDICK:  -- that's what it was supposed 
to have been.  So somehow I think that other 8" line 
may still be in use there as the distribution line.

MR. NAKAMURA:  So your plan is to retain that line.

MR. CRADDICK:  If we can.  It's a lead joint 
line and we'll have to look at that whether it can be 
continued in use.

MR. NAKAMURA:  Okay.  Any other questions on this project? 

MR. RICE:  Is this for design?

MR. CRADDICK:  That's correct, yes. 

MR. RICE:  Funding request is how much? 

MR. QUINN:  A hundred thousand.  It was within 
the appropriations that the board approved for 
pipeline replacement.

MR. CRADDICK:  It's that one second from the bottom.

MR. RICE:  I just want to be clear on that.

MR. NAKAMURA:  Roughly what would you expect 
the construction costs to be, about a million dollars?

MR. CRADDICK:  Could be in that area.  It's 
4,000 feet of line, so I would expect it to be 
somewhere in that neighborhood.  Because of the 
terrain and stuff like that. 

MR. RICE:  I would move that we recommend 
approval, Mr. Chairman.

MR. NAKAMURA:  By concurrence, the committee 
will recommend approval of this project to the full 
board.
 Item D, Director's 01-07, approval for 
construction change order for Alaniu Place/Halama 
Street project.  Mr. Director? 

MR. CRADDICK:  Okay.  Miles, do you want to 
try this one here?  Miles was the project engineer for 
that one.  He knows that one I think better than any 
of us. 

MR. FUJINAKA:  On this project, there were 
three water meters that were not shown on the 
construction plans.  This is a little different from 
the [inaudible] job.  These meters were probably 
installed after the plans were completed.  That's part 
of this change order. 
 Another part of the change order is we wanted 
to install a new 8" valve at one intersection.  We 
were just going to tie into an existing T, but we 
decided we should be a valve at that T also. 
 And the bigger part of the change order is 
where we were going to tie into an 8" waterline on 
Waiohuli Street, but when the contractor dug it up it 
was found that it was only 4" in size and this is an 
8" waterline project so we wanted to upsize that 
existing waterline to 8".  For some reason that end of 
that segment of waterline on Waiohuli Street was only 
4 inches, whereas the rest of the waterline going up 
Waiohuli Street was 8 inches. 

MR. RICE:  So it reduces from 8 to 4 and then ties in.

MR. FUJINAKA:  Yeah.

MR. RICE:  For how far?

MR. FUJINAKA:  About 40 feet. 

MR. RICE:  We ran out of 8" pipe.

MR. KOGASAKA:  Actually, the portion that we 
were replacing was 4" and we were extending it to -- 
Waiohuli waterline was 8" installed up to a point 
where the development ended and then tied into the 4" 
and our plans didn't reflect where that 4" to 8" 
transition took place and -- but it was -- the end 
result was that we had to extend that 8" 40 feet to 
tie into the 8".  So it is a 8" loop completely around 
now. 

MR. RICE:  The amount of the change order? 

MR. FUJINAKA:  The total amount of the change 
order is $15,797. 

MR. QUINN:  We're proposing that that come out 
of the contingency portion of the budget.  And there 
is approximately $476,000 left in that lump sum 
contingency. 

MR. RICE:  What was the original cost of that project? 

MR. QUINN:  This was a prior year encumbrance 
and the encumbrance was $561,000, of which only $7,000 
roughly is currently encumbered. 

MR. RICE:  That sounds like a reasonable 
amount for a change order, Mr. Chairman.  I keep 
forgetting to raise my hand, I apologize.

MR. NAKAMURA:  That's all right.  You're 
forgiven.  Can I ask one quick question?  So Mike, 
when you encumbered the funds from the prior year 
budget, basically you just encumbered the amount of 
the contract that --

MR. QUINN:  Yeah, they were already -- we 
carry them over.

MR. NAKAMURA:  So there was no contingency at 
that time.

MR. QUINN:  No.

MR. NAKAMURA:  I'm going to agree with my --

MR. RICE:  I would move that we approve that 
change order.

MR. NAKAMURA:  Any other comments?  If not, 
the committee will recommend approval of the change 
order. 
 Okay.  Item E, Director's 01-08, request for 
funding for construction of Koali pipeline 
replacement.  Mr. Craddick.

MR. CRADDICK:  Okay.  On this one here, I 
think we talked about this before, the problems that 
we're having out at that Koali booster station.  And 
the money that we're asking for here, I think about 
$45,000, it was assuming that our crews do the work 
and it will be part of our assets once it's completed.

MR. NAKAMURA:  Any questions?

MR. STARR:  Where is this?

MR. NAKAMURA:  This is in Hana, right, or 
outside of Hana.

MR. CRADDICK:  Right.  From the Koali booster 
station going up the hill a ways.  Just a place where 
we were having a lot of breaks in the line because 
there is about -- I think there is about 200 pounds 
pressure down at the bottom of the hill there and that 
plastic pipe isn't holding together.

MR. NAKAMURA:  So this is just a portion of 
the plastic line where you have the most problems.  
The rest of it for now is going to remain plastic.

MR. CRADDICK:  Right. 

MR. RICE:  I think we should recommend 
approval.  That's funding from --

MR. QUINN:  Small pipeline.  Almost $79,000 
remaining in that category.

MR. NAKAMURA:  Okay.  By concurrence, the 
committee will recommend approval of this request. 
 Item F, status report on FY 2001 Capital 
Improvement Budget.  I think that as we discussed a 
little bit before the meeting informally, one of our 
concerns is to get some feel as to, you know, how much 
of the capital program can be actually realistically 
accomplished during the fiscal year.  And perhaps a 
good guide for that would be to review quickly the 
present year's budget since we're nearing the end of 
the fiscal year.  So if we could do that, Mr. Quinn or 
Mr. Craddick, whoever.

MR. CRADDICK:  Well, Mike, since you made this 
here, I'll let you explain it.

MR. NAKAMURA:  Maybe you can give us an 
overview first, Mike, in the terms of the total 
amounts appropriated and what has actually been 
encumbered.

MR. QUINN:  Just focus in right now on the 
pipeline replacement projects because that's -- the 
board just recommended approval for the projects.  If 
you turn to the second page of the handout, the top 
portion, you'll see the pipeline -- the board might -- 
should recall we appropriated $5,865,000 for pipeline 
projects.  Of that amount, as of March 31, $3,877,724 
have been approved, leaving a balance of $1,987,275  
that the board has not taken any action on and remains 
available.  Less, of course, if the board -- full 
board approves today's recommendations.  The board 
just approved roughly $211,000 worth of projects.  So 
there is still ample funding left in the pipeline 
replacement portion. 
 And that's really the purpose of this handout 
here because the pipeline portion, as you know, was 
the portion that was a lump sum appropriation and 
required specific committee and board approval before 
we could move forward with those projects. 

MR. RICE:  Mike, just a point of 
clarification.  When you say that these were approved 
by the board, has nothing to do with the status of the 
jobs.  It just has to do with action taken by the 
board for the budgeted amounts.

MR. QUINN:  That's correct.

MR. RICE:  And I think the committee wants to 
also know where are we with those projects that have 
been approved.  Have they been completed and the funds 
expended or what status are they in their -- if 
they're designed, they're halfway designed, that kind 
of thing.  So we can get a feel for how much work we 
can do in a fiscal year basis.  I realize things go on 
because there is the design and then the construction 
and they go on from year to year, but I mean we don't 
have any idea where we are with some of these projects. 

MR. QUINN:  I have a report here.  If the 
committee wants to, I could go into the whole -- it's 
based on dollars spent.  It won't tell you the exact 
status, however, of the project.  That's an 
engineering-

MR. NAKAMURA:  Why don't we do that, Mike.

MR. QUINN:  Okay.  I believe every month Herb 
hands out a report that has the status of projects on 
it from an engineering standpoint.  This gives you a 
feel for the prior year's projects as well as the 
current projects. 
 So for instance, if you take SDWA compliance 
projects, you can see that the prior year encumbrance 
was $689,000, which in essence we have to keep 
tracking that money because we've encumbered it on 
prior year projects.  And also you'll get a feeling 
for in terms of dates when you look at the job number 
on the far left-hand side. 
 And the amended budget is essentially the 
budget that you approved.  For instance, in SWA 
compliance, you approved $250,000 worth of projects.  
So we have a working budget combining the prior year 
encumbrances in this fiscal year's budget.  That's the 
working budget.  And we have to track that. 
 And then we have spent $244,589 on those 
compliance projects.  We've encumbered $488,243, 
leaving a balance of $206,294.  And this particular 
report in front of you tracks all those projects that 
are currently within fiscal CIP tracking schedule and 
they're broken down -- as the CIP budget is -- in the 
major categories of compliance, Iao aquifer, drought, 
pipeline replacement, et cetera.  And of course, 
pipeline replacement being a rather large amount of 
projects in terms of both number of projects and 
dollar value. 
 So from a financial standpoint, this will give 
you an idea -- and then of course at the very end 
you'll have a grand total of how much has been 
encumbered and spent based on the total working 
budget.

MR. NAKAMURA:  Mike, what is the basis of 
making an encumbrance?  Is it something which would be 
under contract?

MR. QUINN:  That's right.

MR. NAKAMURA:  That's the only basis of an encumbrance?

MR. QUINN:  That's right.

MR. NAKAMURA:  So for some of these projects 
that go back to 1992, for example, there is still a 
contract outstanding on those encumbrances, there is 
things that are still pending then under the contract?

MR. QUINN:  Apparently.  I don't know what 
those are.  I mean, maybe engineering would be able to --

MR. NAKAMURA:  Actually, I think that was -- 
it's the Chairman's intent at a subsequent meeting to 
get into some of these older projects to determine 
whether or not they are funds that should be lapsed 
and reappropriated.  Because I notice there is a '92, 
'95, you know, I guess '92 is about the oldest.  But I 
think there is quite a few of those and we probably 
need to get some handle on that.

MR. CRADDICK:  You may have to go into 
Executive Session on some of those because like that 
192, Mahinahina, is a labor dispute out there and 
court cases have been filed and things like that. 

MR. RICE:  If we look at the first, just for 
example, Napili Well A construction, that's done.

MR. CRADDICK:  Not really, no.  What happened 
was during the job, we decided we were going to change 
the controls.  The controls that were put in there are 
pretty old, and I think they go back to the late '60s, 
so about 30-plus-years-old.  And I think since 1994 
when the well was taken out of service, I think a 
number of parts were used elsewhere.  So in the end, 
we figured it wasn't worthwhile putting all that stuff 
back in, we might as well just replace the whole 
controls.  And my understanding is they're supposed to 
arrive sometime this month and then will probably be 
operational next month.

MR. RICE:  But that would be a change order 
because there will be additional cost.

MR. CRADDICK:  No, no, that's already --

MR. RICE:  So there is no other financial 
obligation, it's just not -- we're waiting for parts 
to come in.

MR. CRADDICK:  Right.  I don't believe there 
is any other financial obligations. 

MR. RICE:  Are the contactors done?

MR. CRADDICK:  Oh, yeah, that's all done.  
Looks pretty sharp, too.

MR. NAKAMURA:  I guess the concern is I think 
pretty clear because if you go to the grand total, you 
have the so-called working budget which is a total of 
the present year's capital projects together with the 
prior year encumbrances, totals $23 million.  And 
expended and encumbered to date this year is about 10, 
and that leaves a balance available of 12.  It's a 
pretty big remaining balance.  And I'm not sure how 
much we're going to -- how much more we're going to be 
expending or encumbering by the end of this year.  I 
would suspect a couple million maybe at the most.  I 
think that's part of the concern that the committee 
has is to really understand this.

MR. RICE:  If I'm missing something, tell me.  
And then following up with what the Chairman said is 
that then we have all these projects yet to be done, 
effectively $12 million worth of projects, and we're 
going to go ahead and budget for more projects in this 
coming near year.

MR. CRADDICK:  No, we lapse any stuff at the 
end of 12 months that we can't get done.  The state 
law allows 18 months, but we just ourself, to keep 
track of things better, we lapse them at the end of 12 
months.  So if -- I mean, this $12 million is -- and 
whatever you can set aside from next year's budget is 
all we have for the CIP.  So --

MR. NAKAMURA:  So in all likelihood, there 
will be a fair number of projects that will have to be 
lapsed and reappropriated in the '02 budget.

MR. QUINN:  I would think so.

MR. NAKAMURA:  Any other comments?  Mr. Rice?  Mr. Starr?  

MR. STARR:  I think it would be great to have 
a workshop to go through all of this.  I know I'm 
confused by a lot of this.

MR. NAKAMURA:  I think there is a lot of 
projects, I don't know that we can go through them 
individually, how long it would take to go through 
them individually, whether or not it would be 
worthwhile.  But I think we should perhaps start by 
looking at some of the ones that are very old and just 
get a better feel for those.  And maybe we could do 
that at our next meeting, set aside the morning at 
least.

MR. CRADDICK:  That's in May you're talking about?

MR. NAKAMURA:  Our next meeting -- next 
committee meeting, whichever that happens to be.

MR. CRADDICK:  Okay.  Because that decision is 
already going to have to be to be made which ones are 
lapsed for the budget by then.  So what you're looking 
at then -- well, I'm not sure what you're going to be 
looking at then because it's going to change radically from --

MR. NAKAMURA:  When do we take final action on the budget? 

MR. QUINN:  Well, perhaps it would be 
appropriate to do it at the workshop or whenever the 
board -- how the board wants to handle this upcoming 
budget.  We plan on submitting that to the full board 
I think in the April meeting, so soon after that it 
would be a good idea to have a workshop or a committee 
or however the board wants to handle it. 

MR. NAKAMURA:  So perhaps when the board and 
however they decide they are going to do it, takes up 
the capital program's budget for the next fiscal year, 
that would be a time to perhaps, as Member Starr 
suggested, have a workshop and go into projects in 
detail, especially some of the past projects.  In 
addition to the new projects. 
Mr. Rice?

MR. RICE:  I wonder if, Mike, can you just 
pull out all of the projects that are going to lapse?  
It's obvious a lot of them are.  And just sort this 
differently and pull out all the lapsed ones so that 
then we can look at the active ones and the list would 
be reduced greatly and it would probably make it a lot 
easier for us to review in two segments.

MR. QUINN:  Pull out the ones that we think will lapse?

MR. RICE:  Yeah, you know, 95 percent of the 
ones you're going to pull out any way at this point.  
It's April, right?  And then we're going to look at a 
much smaller list, so then we can look at the lapsed 
to be put back in the budget as a separate group and 
then we're looking at everything that's active in a 
separate review.  And it might be easier for David and 
staff to explain that way and people to follow.

MR. CRADDICK:  Yeah, that's what I was trying 
to explain.  If you set up a workshop on this list and 
then a bunch of it is missing because we've already 
lapsed it or expect to lapse it for the budget.

MR. NAKAMURA:  We would have to order lunch, 
dinner, and breakfast.  Okay.  That's a good idea. 

MR. RICE:  Then the stuff that's lapsing, 
we're going to be saying well, it's still a valid 
project to be recommended for the coming year.  The 
committee is going to review those and make 
recommendations. 

MR. NAKAMURA:  Okay. 

MR. STARR:  I have a question on one item.  
What's the Iao water treatment plant Memcor filter 
that's encumbrance -- what's that --

MR. CRADDICK:  Where are you reading that?

MR. STARR:  Right in the middle of that page one.

MR. CRADDICK:  Good question.  I don't know.  
Probably nothing. 

MR. NAKAMURA:  I guess that justifies having a 
workshop.  Any other questions?  Peter?

MR. RICE:  No, Mr. Chairman. 

MR. NAKAMURA:  Okay.  Anything else, David?

MR. CRADDICK:  No.

MR. NAKAMURA:  Okay.  If not, the meeting is adjourned. 

(WHEREUPON, the meeting was adjourned at 10:00 a.m.)

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