BOARD OF WATER SUPPLY
COUNTY OF MAUI
SPECIAL MEETING
AUGUST 24,1999


 

Taken at the Kula Elementary School Cafeteria, Kula, Maui,
Hawaii, at 6:30 p.m.
  
IWADO COURT REPORTERS, INC.

CHAIRMAN TAKITANI:  Good evening.  I would like to
call the Board of Water Supply County of Maui Special Meeting
to order.  It's Tuesday August 24th, 1999.  We're meeting at
the Kula Elementary School Cafeteria.  We have Board Members in
attendance this evening Jonathan Starr, Elmer Cravalho, Orlando
Tagorda, Clark Hashimoto, Mike Nobriga, and myself Bob
Takitani.
We're here tonight to receive testimony from the
public.  We know that you as stakeholders have many concerns
about the situation upcountry, about the developer's request,
and we want to hear those concerns tonight.  We have a special
Board meeting tomorrow scheduled to cover these items, and we
would like your input so we can make a better and more
reasonable decision tomorrow.  What we would like to do this
evening is so everybody gets an idea about the drought
situation, about the systems that we have in place, we have a
brief orientation, a brief presentation by the Department
regarding our water treatment facility and job situation.  And
also on hand tonight is Everett Dowling who will give a
presentation on the Kulamalu project, where he stands to date
and where he intends to be going.  So that is the objective for
this evening.
We hope you will be able to participate and give us
good input.  And from here, we'll go to Jacky Carroll who will
give a -- David Craddick will start it off here.
MR. CRADDICK:  Okay.  What I'm going to do is give a
little a bit of -- for everybody who doesn't know how the
system works, I'm going to try and explain a little bit how it
works here.  Over here is Haliimaile and Makawao here.
Pukalani is over here.  So does that give everybody enough
reference here?  Way up this way off the map is Ulupalakua.
Let me know if you know where Honomanu is, but that's past
Kailua going around to Hana.  We have three systems here what
we call our upper Kula system, lower Kula system and the Kamole
Weir.  And this system here are sources of water from Haipuaena
flume and Waikamoi stream.
There are two 15-million-gallon reservoirs.  There
is a 1-million-gallon damn and a 10-million-gallon damn that is
approximately half filled in with dirt.  The 100-million-gallon
reservoir was put in in 1994.  We have a treatment plant here
with some storage here, not a whole lot.  All the things in red
on here are things that are either in progress or things that
we hope to get in place.  This line actually doesn't end here.
It ends in Kanaio.  The Hawaiian Homes improvement up here,
there are actually three things going on, booster pumps here,
booster pumps here, a tank, a transmission line, more booster
pumps and tanks here.
This system here -- anyways, on the lower Kula
system, we have intakes, seven intakes up there, comes into our
Piiholo treatment plant.  There are 50 million gallons of
storage.  We can treat 6 million gallons a day on the average
day.  We can normally deliver right now between 3 and 4 million
gallons a day.  With this booster station, we will be able to
deliver a full 6.  Then at Kamole Weir, which is just a ditch
system, there's currently no storage at all there, we're able
to treat 7 million gallons a day and we have each one of these
circles here is a booster station, these small triangles are
booster stations, and bring water from Kamole Weir and actually
pump it all the way up here.  To do that cost about a 30 cents
for every 1,000 feet of that about 1,100 feet.  This is
approximately 4,000 feet of elevation.
Some things that you may or may not be able to see
way down here at the bottom is the Kulamalu Well in Haiku.  And
these features over here are part of the system that another
ditch feeds up here to the Kula ag park.  Now, another thing
that is kind of on the very bottom of this, and I'll go to this
one here for detail, is what is called a ground water link with
a surface water system.  Now I'm going to come over to this one
here.  This is, you may have read about it in the paper lately,
upcountry drought emergency program that the Governor allowed
to go forward with his emergency proclamation.  And we have two
wells that are drilled here.  This is Maliko Gulch.  Down here
is the Old Maui High School near Hookipa.  We're planning on
putting in -- if you don't know, the water does have levels of
that are beyond the Federal and State allowable levels, so
we cannot put this water into the system without treating it.
So we're putting in a what's called granular activated carbon
filtered plant.  That water goes through there.  The resulting
water comes out -- comes out with the DBCP as nondetectable.
We were looking at two routes to come up to the Kamole
treatment plant where we have the big booster station and Fran
there has a little map.
This map right here, there's more people than we
have maps, so if everybody doesn't have it, you can share with
the people next to you.  You can kind of follow.  This is on an
8 and a half by 11 sheet, these maps here.  Anyways, by pumping
this ground water up to that system, we can then distribute it
through the whole system with the booster stations that we have
here.  Another thing that is actually in operation, all the
environmental work is complete on it.  It's a new source of
water not necessarily for drought protection right over here on
Kokomo Road in Haiku.  That well is what we call our Haiku
Well.  It serves approximately 300,000 gallons a day downstream
from there over to the West Kuiaha Road.  That road is an
800-foot elevation, and there's no pump to boost the water
uphill.  It just goes downhill.  And that is pretty much how
the system is.  This program here when we put these in, Jacky
will be telling you in a little bit more detail how much extra
water that will be able to get into the system.  Jacky will
take over from there.
 CHAIRMAN TAKITANI:  Before Jacky starts, I want to
introduce Avery Chumbley, recognize Avery Chumbley and
Charmaigne Tavares, our elected officials that are here this
evening.  Good to see you all.  And also I neglected to say we
have staff members present this evening.  Also, David Craddick;
Corporation Counsel, Gary Zakian; Jacky Carroll, Administrative
Assistant; Paul Seitz, Water Treatment Plant; Fran Nago, Board
Secretary and we have Rachelle as our recording secretary.
Mike Quinn is our Fiscal Officer and Ellen Kraftsow, Planning,
and Roy Silva, so we're well represented.
MS. CARROLL:  Good evening, everyone.  I'm Jacky
Carroll and I'm a worker at the Department of Water Supply and
I was hoping it would be a little bit darker so you could
actually see what I prepared.  Well, this one is not that
important anyway, but if you squint, you can see it a little
better.  And I'm just getting over a cold in my head, so if you
can't hear me, because I'm really loud in my head, just go like
this and I'll try to speak up.
What I'm going to talk about today is just the
overall upcountry system and the present water supply status
here in upcountry, and then we'll have Everett Dowling and his
group talk about the Kulamalu project in detail.  Okay.  First
of all, a chronological review of this drought that we're
experiencing.  If you've been keeping up with the Maui News,
you probably know all of this.  We had the drought watch in
May, and that was a 5 percent voluntary cutback.  And we also
did not issue any new temporary meters at that time.  June 16th
we went to the drought warning, which was a 10 percent
mandatory cutback.  Customers with agricultural rates were
given a -- they had the 30-day grace period.  One month later
we went to the emergency, which was the 25 percent mandatory
cutback, and during the warning in the emergency, there's no
new temporary meters issued.  And you notice the warning and
the emergency are one month apart.  So right when the farmers
would have been hit with the end of the 30-day grace period,
the Board approved an exemption for them.  So farmers have not
had any restrictions yet.  Although right now they're in a
60-day grace period, which began July 16th.  So we're going to
see how the situation is for that.
Last month, at the end of last month, we got
Governor Cayetano's emergency proclamation and that was very
important because that's what's allowing us to tap into the two
Hamakua Poko wells for ground water that David was just talking
about.  We've got until the end of September to get the pumps
and pipes in place for that.  Did you know that droughts are
actually a normal part of the weather cycle?  They actually
occur every 3 to 4 years or so, although I guess it seems like
more often up here.
But the hard part of the droughts is the predicting
and the preparing for them.  Because it's not something sudden
and as dramatic as a hurricane, a lot of times the preparation
gets slipped by or it goes unnoticed.  And, in fact, they can
do as much damage as hurricanes.  It just take longer and
people don't realize it until it hits them.
So that's where we are now.  We're still in the
emergency.  Now, just an overview about the water systems
upcountry.  To make it simple, I've divided the upcountry area
into three distinct systems, and I'm going to work my way
uphill.  The first one is what we call the Makawao system, but
it doesn't just encompass Makawao.  It includes Pukalani,
Haliimaile, parts of Haiku and Makawao.  We've got about 5,200
meters.  That's how we measure our customers by meters.  We've
got about 5,200 meters up there and the water source is the
Wailoa ditch.  The Wailoa ditch is measured by flow, million
gallons per day because we don't have a storage facility.  The
water comes and goes.
And we don't have a reservoir there, so it can
fluctuate pretty drastically.  The water comes from Wailoa
ditch.  It gets treated via microfiltration at the Kamole
treatment facility and it flows out to Pukalani and that area.
Like I said, this is a flow.  The water comes and the water
goes, and that's why it can really fluctuate like this, almost
like the stock market on some days.  The maximum capacity is
190 million gallons per day.  And right now as of yesterday, I
don't have today's data, but as of yesterday, we're at 77.1
million gallons per day.  And you can see some of the rainy
days.  We had some rain the beginning of this -- a couple weeks
ago, and that's when it went real high, but it's kind of
dropping back down again.  This is a picture of the ditch.
Paul, isn't the water level usually at least around here or so
and all the way up to there?
MR. SEITZ:  Yeah, you can see it.
MS. CARROLL:  This was pretty bad June 3rd.  It's
since gotten better, but it can go down that low pretty
quickly.  Okay.  The next one up is what we call the lower Kula
system.  This water, and keep in mind all of this is surface
water, okay.  Central Maui, Molokai, Hana, that's ground
water.  That's water from aquifers, so this is different.  This
is surface water.  For the lower Kula system, which has about a
thousand meters, the water comes from the Waikamoi watershed or
the east Maui watershed.  It goes to the Piiholo reservoir,
which can hold 50 million gallons.  You see it's MG, million
gallons.  It's not MGD, million gallons per day like it was at
the ditch, because this is not a flow.  This is a pool of water
sitting there.  Just skipping over, it goes from the reservoir
to the treatment facility, gets treated, goes to lower Kula.
Now, it can flow from Piiholo to Makawao and other
areas as needed, and also as needed water can come from Kamole
to the lower Kula system.  We've had to pump quite a bit of
water, 92.8 million gallons from the Kamole treatment plant.T
at's water that comes from the Wailoa ditch, gets treated at
the Kamole water treatment facility and then gets pumped
 uphill.  Now, the water starts out at about 1,200 feet or Dave
 said 1,100 feet in elevation.  That's in Haliimaile.  To go to,
I believe it's the Kula Kai tank, if any of you know which tank
is which, it goes to the Kula Kai tank, which is at about 2,800
feet.  The cost, total cost for that 92.8 million gallons was
92,500.  That's a very conservative estimate.
So you can think about it when the water has to go
up, so do the electric bills, a real easy way to remember
that.  Of that 92.8, 30 million gallons went straight back into
the Piiholo reservoir.  This reservoir actually holds what we
call raw water, untreated water.  And so if we're sending water
from the Kamole treatment plant to the Piiholo reservoir, then
it has to get treated again, so that's another cost we have to
incur when we have to do this.  This is a breakdown of that
92.8 million gallons that we pumped up from the Makawao system
into the lower Kula system by month.  You see it went way up in
June when we didn't have much rainfall.
Now, keep in mind that the Piiholo reservoir holds
50 million gallons which is not too far off from what these
amounts are per month, so we've really had to put a lot of
water into the lower Kula system.  And because of this -- next
slide -- Piiholo is currently full.  Without that additional
water from the lower system, we wouldn't be at that 50 million
gallons where we are now right.  This is a picture of the
 Piiholo reservoir.  It looks like a lot of water and I think
it's a really nice picture taken buy Paul Seitz, our Water
Treatment Facilities Manager, but look at this.  This is the
concrete on the side.  The water should be up to here, but it's
not, it's very low.  So this is actually not a good picture.
This was actually taken the same day.  This water is
coming from the Waikamoi reserve through all the intakes and
flumes.  Usually the water is just gushing in through the pipe,
but it's just a trickle.  Okay.  The third system and the
highest system is the upper Kula system.  The water here also
comes from the Waikamoi watershed or the East Maui watershed
and it has about 1,750 meters, almost 2,000, but not quite.
We've got two reservoirs up there.  Waikamoi is 30 million, and
then there's the dam which holds about 6.  Kahakapao holds 100
million.  The water goes to the Olinda treatment facility which
is actually a smaller treatment facility.
This one uses the microfiltration, too, just like
the Kamole treatment plant, gets treated and flows out to upper
Kula and all the way out to Ulupalakua and down.  The furthest
tank we have is the Kanaio tank.  Now, this one is the one
where the water levels are still critically low.  As of
yesterday, out of 136 million gallons capacity, we only had 50,
okay, and that's as of yesterday.
You can see it just went way down and then we had a
little bit of rain, but it's decreased in the last couple of
days.  But it's still not up to where it should be where it
would be safe.  This is a picture of Wakamoi, just a little bit
of water left and some mud here and it still looks like that.
This was June, but it hasn't changed.  And this is Kahakapao.
This is on Haleakala Ranch land, right?
MR. CRADDICK:  Board of Water Supply.  We own it,
and some State land.
MS. CARROLL:  Okay, sorry.  And the water looks nice
and blue, but see this is where the water should be.  This is
actually very low.  You can see how low it is, that big border
around the edge.  So it hasn't changed much from that date.
Okay.  So that's the supply.  This is the demand in millions of
gallons, consumption basically.  And I've plotted where the
watch warning and emergency were.  You can see the demand did
not change much when we went from the -- when we started the
voluntary cutback, although it did drop quite a bit when we
went to the 10 percent mandatory cutback and then even further
when we went to the emergency cutback.
Demand before the drought was actually closer to 9
million gallons per day.  Now, it's at about 6, so I do need to
say thank you to all of you for cooperating because I know it's
not easy to cut back on your water consumption.  Notice that
this, by the way, Monday after the drought warning was issued,
demand went up to 9.4.  About a week before the drought watch
was issued, demand was also at 9.4.  The highest within this
period was May 23rd, 9.6 million gallons for demand, which is
pretty high.
So that's the supply and demand.  What do we do
about it?  One thing we've asked you to do is reduce demand.
Conservation, retrofitting, water reuse, and we do have the low
flow shower heads, the kitchen faucets and the bathroom faucets
there.  Please take what you need and just fill out the form,
and that will help you also.  And check your homes for leaks.
Leaks are one of the biggest causes of water waste, okay.  A
lot of people don't know that there's leaks.
In fact, back there in the basket, those aren't
breath mints.  Those are toilet leak detection dye tablets.
Take a couple.  Put them in your tank and wait a while, wait
about ten minutes.  If the blue shows up in your bowl, you've
got a leak, and please fix it.  Those things don't show you
where the leak is and they don't fix the leak either.  They'll
just tell you if you have a leak or not, and you've got to do
the rest of the work yourself, but help yourself to those leak
tablets.
On our side, we need to work on increasing supply,
more water storage and tapping into ground water, and also
customers need to pay for the cost of service so that we can
increase that supply.  Let me go into detail about these two.
Okay.  Water storage, I mentioned the Kahakapao reservoir.
That one we got in service in 1994 at a cost of $20 million.
That reservoir increased our upcountry storage by 250 percent.
The Piiholo raw water reservoir, which is still in planning,
it's in people's minds still.  It's not actually, you know,
being dug yet.  That one we expect it to hold about 200 to 300
million gallons.  And so far we've got money from the State, $2
million for the design process.  That one should help the water
supply significantly.
Those two are the raw water storage, the untreated
water.  After the treatment, we've also installed two clear
water tanks, the ones that hold this treated water.  This one
is the lower Kula tank and that one is off Olinda Road and it
will hold 2 million gallons.  The County put in one and a half
million dollars for that.  We couldn't do it by ourselves.
This picture was back in March.  The construction is pretty
much completed by now.  Okay.  Next one.  This is the Waiohuli
tank.  It will hold a half-million gallons.  It's a steel
tank.
You can see the size by the people right there and
this is at the middle road and Polipoli Road intersection, and
that will be in service before the end of the year, too.
They're progressing pretty well in that.  That picture was from
June 23rd.  Okay, next picture.  So increasing storage and
tapping into ground water.  So far we've got the Haiku well on
line, got that going June 1999.
This picture is the tank right next to the well.  I
had a picture of the well, but wells are really boring, so I
have a picture of the tank instead.  It's just something
sticking out of the ground in a little house.  That one
provides about half a million gallons a day, and it serves 600
customers I believe, maybe a little bit more now.  Hamakua Poko
wells, as David had mentioned, we're working on.  That has to
be on line by the end of September.  That's the agreement we
have with Governor Cayetano, and this leads right into the next
one which has -- should be on line by December.
That's Everett Dowling's well, the Kaupakalua well,
and that should provide about a million and a half gallons per
day.  With that, I'll just leave you with the next slide about
ground water, and then we can go into the next presentation.
This here is a diagram of the aquifers around our
island.  Okay.  The green ones are the ones that we're focusing
on the East Maui side.  These numbers, I don't know if you can
see them, 31 million gallons per day sustainable yield, which
means how much we could take out basically safely; 31, 29
million gallons a day, 46 million gallons a day, 96 million
gallons a day.  And that only makes sense because you think of
where the trade winds bring in the clouds and where the rain
falls, it's basically over there.  So Maui actually has a lot
of water.  It's just all underground.
We don't have access to it yet, so with that, I
would like to ask Marilyn to continue and go into detail about
the Kulamalu project and the well.  Thank you.
MR. MAXWELL:  Can we ask some questions or pose some
corrections, ma'am?
MS. CARROLL:  Sure, go ahead.
MR. MAXWELL:  As a Kupuna, I'm sitting here and
listening to you pronounce Waikamoi and Haliimaile, two of the
major waters and places that you should know.  Haliimaile is a
bed of maile.  In ancient times, there was a natural forest
there.  Maile was planted for the build up, so it's halii.
Halii means a bedding.  Also Waikamoi means the waters of the
royalty.  Waikamoi, just something so you remember in the
future.
MS. CARROLL:  I'm sorry, I was born here and I lived
in Kahului and went to Baldwin High School, and that's how I've
been pronouncing it all my life, sorry.
MR. DUNN:  Would it be possible to see one of those
slides again?
MS. CARROLL:  Which one?
MR. DUNN:  The one that shows the graphic of the
storage of the upper Kula system.
MS. CARROLL:  The one that had the storage of --
MR. DUNN:  Upper Kula system, the graph that showed
the amount of storage.
CHAIRMAN TAKITANI:  Could we ask you to state the
names.
MR. DUNN:  My name is Bob Dunn, and I live on
Kokomo.
MS. CARROLL:  This one?  That's the upper Kula.
MR. DUNN:  Yes, that's okay.
MR. CRADDICK:  That last jump that you see up there
is from Hurricane Dora, too, not necessarily a normal
occurrence where we would happen to have a hurricane come along
during a drought situation.  Had we not had that, we would be
in very, very dire straits right now.
MR. DUNN:  I just have a question relative to that.
It doesn't really go back quite far enough.  I would like to
have seen what April figures look like.  But I'm wondering why
in the middle of May we are that many gallons below capacity
when we had so much rain through the early part of April.
MR. CRADDICK:  The reason for that is that the
drought started back in April, and because of the large volume
of storage up there before when we didn't have this reservoir,
what would happen is the 30 million gallons probably ran out in
March, and that's all the storage we had before.  So we would
have been taking all the water from the lower system.  It would
have run out probably sometime in April or maybe May at the
most.
And all the water would have been coming from Kamole
Weir.  Kamole Weir went down to 20 million gallons.  Once we
get to that low a level, we're trying to take all the water out
of that system.  It can go to the point where you have to
decide whether the mill is going to shut down or the water
system is going to suffer.  The mill provides 12 percent of the
firm power for Maui.  Those booster systems use about that much
electricity to boost all the water up.
MR. DUNN:  But in middle May, were we on a drought
watch yet?
MR. CRADDICK:  No.
MR. DUNN:  I don't understand why we're still 40
million gallons below capacity in the middle of May.
MR. CRADDICK:  Well, that's the weather.  That's the
weather.
MR. SEITZ:  I think the other answer to your
question is also a lot of times when you experience rain down
here, that doesn't mean it's raining at the 4,000 foot level
and that's where this collects water, anything above the 4,000
foot level.  So there are a lot of times when we have rain down
low, but that doesn't necessarily mean that it's raining up
high.  And unless it's raining above the 4,000 foot level, this
particular system will see no effect from it.  So you have to
be aware of that also.
MS. CARROLL:  Does that answer your question?
MR. DUNN:  I'm not sure.
CHAIRMAN TAKITANI:  Can we move on to Everett
Dowling's presentation?
MS. CARROLL:  Is that it then?
CHAIRMAN TAKITANI:  So we can get on to the
testimony.
MR. DOWLING:  Hello, my name is Everett Dowling.
I'm with The Dowling Company.  We're the developers of the
Kulamalu project.  And Kulamalu, for those of you who might not
know where it's at, is located directly across the street from
Kula 200 a little bit mauka of Five Trees.  It's a long narrow
piece of property that runs from Kula Highway down to Liholani
Street in Pukalani.  The property was originally planned and
put on the community plan back in the early '60s.  And it was
actually approved when Mr. Cravalho was mayor.  I think he
signed the ordinance approving it in a 1961.
The property sat in an undeveloped state for years
due to lack of water.  We got involved with it about, oh,
probably 6 and a half years ago, and we started looking at it.
We were looking for some development opportunities.  We started
investigating the property.  At that time, it was owned by
Sports Shinko, the owners of Pukalani Golf Course.  As we were
going through the process of looking at the old plans, the
plans that were done back in the '60s up through the late '80s,
when we first got involved, it was planned for approximately
1,600 houses.  And it was houses from Kula Highway down all the
way down into Pukalani with the back yards along Kula Highway.
So we started looking at it and we realized there
was a water problem.  We went to the Department of Water Supply
to see what plans they have for upcountry in terms of source
development to satisfy the project requirements.  And we
learned that we basically would be on our own at that point
because there is no water to service the property.  While we
were investigating that, we came in contact with Bishop
Estate.  Bishop Estate was looking to put a high school,
actually K through high school on Maui.  And they were looking
at a variety of sites.
We met with them, brought them up to Kulamalu to see
if they would be interested in the Kulamalu property, which
they expressed some interest in.  So at that point, we wanted
to proceed with the project.  We knew we had a problem with the
water.  We, once again, went back to the Department of Water
Supply to see if we could pay a fee and get water meters like I
assume many of you -- how many people here are on the list?
UNIDENTIFIED SPEAKER:  What list?
MR. DOWLING:  Waiting list, the water list.  Just
like you, we went to the Department, we tried to obtain water
meters for the project.  We're not water developers.  We're
land developers and builders.  We have no desire to get into
the water business.  But water was not available, and the only
thing we could do is go out and find a piece of property and
negotiate for the property and invest the money into drilling a
well.  And that's basically what we were told by the
Department.
Once we knew that's what we had to do, we started a
very lengthy processes of negotiating a water agreement with
the County, the Department of Water Supply, that occurred over
a period of months.  While we were negotiating that, we were
out looking for different sites that might be favorable to
drill a well at.  We ended up finding one.
The negotiations -- after negotiating with the
Department, we ended up having public hearings.  We ended up
going to the full Water Board and ultimately the agreement was
approved in March of '96.  March 21st, 1996, we started working
on the well as there's a lengthy process to drill the well.
It's by far the riskiest thing I've ever been involved with.  I
hope it's something I never have to do again.  You don't know
if you're going to hit water or not until after you've got an
awful lot of money invested in it.  If we had hit a dry hole,
we would have had about a million-and-a-half-dollar loss at
that point, and fortunately, we did not.
Actually, we hit a very good, a very good hole and
plenty of water.  We went to the State after a series of very
lengthy process of testing.  We went to the State and they
approved a 2-million-gallon-per-day pump.  We came back and
negotiated with the Department of Water Supply, and ultimately
we were reduced down to a 1.6-million-gallon-a-day pump and
Kulamalu is entitled to about 45 or actually exactly 45 percent
of the installed pump capacity which provides the partnership
of that 738,000 gallons of water.
We paid for 100 percent of the cost of the well.  We
also, of course, are doing our own -- we're also paying for our
storage and transmission.  Once again, the well was a very,
very good well in terms of quality.  This is what we have
invested in our water improvements.  Not all of this has been
incurred.  Into the well right now we've got about $2.1 million
invested.  The pump is actually on island now, and it will be
installed probably next month starting --
MR. FUJIMOTO:  The ending part of September.
MR. DOWLING:  -- the ending part of September.  I
want to put this in perspective.  Our preference, just like all
of you, would be to go to the Department of Water Supply, pay
the 3,350 per meter that we do in every other area of Maui that
we develop and get our water meter.  We're not water
developers.  We don't want to be in the water business.  It's a
risk that we don't like taking, and it's just not our principal
business.  The next slide.
In terms of what our costs are going to be per meter
versus our cost per meter everywhere else on the island, when
you go to get a water meter, you pay $3,350 per meter.  Of
that, 750 is allocated towards source development.  Our source
development cost per meter is going to be about $2,700, four
times approximately what we normally pay, so it's not something
that we want to do.  It's not something that we've enjoyed
doing.  It's something that was necessitated by the lack of
water up here, and it's the only way we could get water to
service the project.
We're before the Water Board now for three things.
We're asking, one, for an extension of the deadline to
construct a tank.  We've awarded the construction contract.
Our contractor for dredging tells us it should be done by the
end of the year, but just as a sake of safety, we're asking for
an extension for four months.  We're also asking for, it's a
million-gallon tank.  We're paying our pro rata share on that
million-gallon tank.  We're cooperating with the County.  We
only needed -- originally we thought we only needed 350,000
gallons of storage.  We're asking the Water Board to allow us
to increase that to 450,000 gallons of storage so we can meet
the fire flow requirements for Kamehmeha's campus.
Our third request is since the State gave us
approval for a 2-million-gallon pump and the County gave us an
approval for a 1.6-million-gallon pump with the rationale if
they want to test it and see how it operates over a long period
of time.  If a couple years out, the well proves out to be --
continues to be a good well, it's not diminishing in quality,
we would like the right to go back and use that
2-million-gallon permit that we have and have 45 percent of
the -- at our cost put the 2-million-gallon pump in and get the
45 percent of the incremental 400,000 gallons.  And that's why
we're here tonight, and that's what the Water Board is
considering.  I would be happy to answer any questions or, Bob,
if you would rather have public testimony.
CHAIRMAN TAKITANI:  If there are any questions for
Everett Dowling, probably now is as good a time as any.
UNIDENTIFIED SPEAKER:  Just one question. The water
coming from the well is not contaminated like the H'Poko well?
MR. DOWLING:  Not at all.  Actually, we had it
thoroughly tested, the State and Federal standards.  For
instance, chlorides is 16 parts per million.  You can drink 250
parts per million, so it's almost distilled water.
MR. MAYER:  You have five-eighths-inch meters, but a
lot of the uses you're going to put it to are for shopping
center, the school, larger facilities, mostly family housing,
things of that sort.  How would those meter costs be?
MR. DOWLING:  It's relative throughout.  The
comparison stands throughout.  We're paying basically 3 to 4
times the cost of what we would pay if the County had water and
we could walk into the County building and buy a meter, we're
paying 3 or 4 times the cost, not by choice.
UNIDENTIFIED SPEAKER:  I think you're very brave.
MR. DOWLING:  Either very brave, or if it had been a
dry well, it would have been stupid.
UNIDENTIFIED SPEAKER:  That's why I said you're
brave.
UNIDENTIFIED SPEAKER:  How many gallons per day will
Kulamalu use, the school, the shops, the homes?
MR. DOWLING:  That's a good question.  Right now
we're about, including Bishop Estate campus, including our use,
we're probably around 530, approximately 530.  Right now we've
got 738,000 gallons of water under a 1.6 million gallon pump.
UNIDENTIFIED SPEAKER:  So the extra water?
MR. CRADDICK:  You have to keep in mind that's on an
average day basis.  That's not their peak demand.  You saw how
the graph changed day by day.  You have to keep in mind that
number he's talking about is on an average day basis, not their
peak demand.
MR. DOWLING:  In that usage, 538,000 gallons per day
usage will occur upon total build out of the project.  By the
end of this year, we're turning that well over to the County.
And our demand will probably be in the neighborhood of 15,000
gallons per day, so the County has the use of our water until
such time as we need it, but ultimately, when we're fully
developed, we'll use all 538,000.
UNIDENTIFIED SPEAKER:  You made the total
investment, tank, berms, et cetera.  When you give it to the
County, will they run it from there, or will you run it?
MR. DOWLING:  We're not in the water business.
We're more in the water business already than we desire to be.
We'll be dedicating all these improvements to the County.
UNIDENTIFIED SPEAKER:  Will they refund you?
MR. DOWLING:  I wish.
UNIDENTIFIED SPEAKER:  So you're paying about 10 to
$12,000 per meter.
MR. DOWLING:  It's less than that, about $6,000 per
meter.
UNIDENTIFIED SPEAKER:  So on that graph where you
were saying normally somebody pays $3,500 for a meter or
whatever, and then if that 750 goes to the developer, what does
that mean, that's what the Water Department puts to the
developer?
MR. DOWLING:  Right, the Water Department, when you
pay for a water meter, they allocate a portion of the purchase
price to source development, a portion to transmission and a
portion to storage.  So of the 3,350, 750 is allocated toward
source.
UNIDENTIFIED SPEAKER:  So the graph is showing
they're putting that much toward that, but you had to put
almost what it would cost to get a meter to just develop and
not transmission?
MR. DOWLING:  Right.  Now, our transmission cost and
storage cost wasn't that big a difference.  Storage was much
more expensive, but not to the same magnitude as source
development.
UNIDENTIFIED SPEAKER:  (Unintelligible.)
MR. DOWLING:  If the economy stays like this, a very
long time.  Normal economy, I would hope eight years.
UNIDENTIFIED SPEAKER:  Will all your excess water go
to the upper Kula system?
MR. DOWLING:  We've got the right under the water
agreement to assign that water to various properties.  We'll
either go out and acquire property and use it for that property
or sell it.
UNIDENTIFIED SPEAKER:  That's the water that you're
putting back into the system?
MR. DOWLING:  No, this is the incremental difference
between 738 and 530.
UNIDENTIFIED SPEAKER:  Why did USW only approve 1.6
million gallons a day when the State approved 2?
MR. DOWLING:  I think, David, you want to --
MR. CRADDICK:  The well draws down quite a bit below
sea level.  For every gallon it draws out, you get about 80 or
82 gallons of water per minute.  And normally when we operate
wells, we don't draw them down below sea level.  Now, the
theory is that in this type of well, the transmissivity of the
formation is such that all the losses are what they call
entrance losses into the well, so instead of even though the
aquifer is drawn down below sea level, the actual, the head in
 
the aquifer is not drawn down below sea level.  It's only drawn
down below sea level right next to the well, and it's a theory
that quite frankly I believe in, but it's also a risk that I'm
not prepared to ask the Board to take.  Because if the well
does go bad and goes salty, we're not getting any benefit from
anything.  You know, we're not involved with the land.  We're
just in the water business and we have to have water that we
can give out for as long as those people live on that land,
meaning in perpetuity.
Because once people get a water meter, they expect
when they turn on the tap water, it's going to come out.  And
unless we feel that we have that reliable a source of water, we
can't give the water out, or I wouldn't recommend to the Board
that we give it out.  And Everett has been nice enough to cut
his capacity down, not make a big issue out of it because he
did get approval from the water commission.  But our agreement
with him says that we have final approval authority, and he
went along with that.  So again, you know, once we do some
testing -- for right now, the well has been tested for a week.
Once we've got a few years of testing in there, then
I think the Board may have a lot higher comfort level on how
the well operates and can decide whether additional water can
be taken out of it.
UNIDENTIFIED SPEAKER:  Did the agreement contemplate
any amount of water, or was it completely at risk whatever is
there is what it covers?
MR. CRADDICK:  Yeah, if they got like half a million
gallons a day maximum production, it would have been 45 percent
of that.  It could have been more than this, potentially they
could have gotten more.
UNIDENTIFIED SPEAKER:  So it was a roll of the
dice?
MR. DOWLING:  Too much of one.  Never again.
MR. CRADDICK:  Bob is the Chairman.  You're going to
have to ask questions of him.
CHAIRMAN TAKITANI:  We need to be moving on to the
other items, but we'll allow three more questions here for Mr.
Dowling.  This gentleman had his hand up.
MR. ERDMAN:  I'm just curious, how is that water
transferred, what's the transmission system from your well up
to the Makapu system?
MR. FUJIMOTO:  Don Fujimoto from Kulamalu.  The plan
is to connect the well directly into the Haiku system.
UNIDENTIFIED SPEAKER:  Which part of the Haiku
system?
MR. FUJIMOTO:  Right on Kaupakalua Road.  What will
happen is this well will be serving Haiku.  (Unintelligible).
It's like a replacement of -- developing a new system by
replacing it.
UNIDENTIFIED SPEAKER:  What's the elevation, and how
much does it cost to bring the water up to Kula service?
MR. FUJIMOTO:  The elevation is about 1,300 feet.
David might have a better idea of what the pumping cost might
be.
MR. CRADDICK:  1,300 feet.  It's going to be
somewhere between probably 50 and 70 cents per thousand.
UNIDENTIFIED SPEAKER:  So is that water in the upper
Kula system going to Haiku?
MR. DOWLING:  It's staying in Haiku.  It's not going
there.  It's actually staying there.  One point I didn't make
that I should make is we were I think pretty efficient in
drilling the well.  I mean, you know, we hit water the first
time.  We had a very reliable contractor.  We were pretty, the
process was about as efficient as I can imagine.  And it cost
us $2,700 per meter in development costs.  So I look at the 750
and we're really getting a bargain when we go to -- when I say
we, I mean taxpayers in general -- are really getting a bargain
when we go to buy a water meter and pay 750 for source.
UNIDENTIFIED SPEAKER:  In general if you get 45
percent of the 2 million and, you know, that's about double of
your development of 300 acres, so there's another 300 acres
that can be developed in the upcountry area, and I just don't
see for the next 20 years on this well itself will not give to
any of the guys on the waiting list.  So I see another 20 years
of waiting for meters while another 300 acres are built up.
MR. DOWLING:  I would --
UNIDENTIFIED SPEAKER:  And I just wanted to add that
I'm certain you can convince somebody to pay 20,000 a meter
where there's no meters out there, so recovering the cost on a
$12,000 meter, an average person can't even pay 100 to get
one.
MR. DOWLING:  In terms of how long the wait, you
know, I mean that's something we have absolutely no control
over.  I mean this is our, this is our introductory and last
class in water development, so, you know, that's completely
with the Board of Water Supply and the Department.
UNIDENTIFIED SPEAKER:  What was your total cost on
that to develop that well?
MR. DOWLING:  3.3 million.
CHAIRMAN TAKITANI:  We'll allow the last question to
Doug MacCluer there.
MR. MacCLUER:  It appears to me this chart may be in
there because the way I see it, Haiku is only consuming 1
million gallons.  Would the Haiku well addition of another half
plus Everett Dowling's 1 and a half, that's 2 million gallons,
but we only have a consumption in Haiku of 1.  We don't have
some way to get the water from the Haiku system back mauka.  It
appears we have a an excess of 1 million gallons makai, but we
don't have enough mauka.
MR. CRADDICK:  The well is right next to the ditch,
so the excess water in a drought situation will go into the
ditch.
MR. DOWLING:  It goes into the ditch up to the
treatment plant, right, Dave; so, in other words, what you're
saying is the excess will go into the ditch to the treatment
plant?
MR. CRADDICK:  Yeah, anything that Haiku is not
using for the interim could go in the ditch.  Now, for the long
haul, obviously, we don't want to pump it up to the elevation
and have to retreat it again.  So I would expect eventually
we're going to have a way to get it into the system without
having to retreat it.
UNIDENTIFIED SPEAKER:  In normal language, the end
of the ditch means sucked out and put somewhere else, or end of
the ditch means goes to the ocean?
MR. CRADDICK:  No, the ditch goes to the treatment
plant.
UNIDENTIFIED SPEAKER:  I just wanted to hear that.
Thank you.  I don't know what that means obviously.
CHAIRMAN TAKITANI:  The Chair recognizes Mr.
Cravalho.
MR. CRAVALHO:  Mr. Chairman, I had assured you I
wasn't going to say very much this evening, just listen.  My
understanding is the purpose of this meeting tonight is to
receive and respond to the requests that came to us with
respect to the three proposals coming up in our meeting
tomorrow, which have been deferred.  That is with respect to
increasing the storage capacity, extending the contract period,
et cetera.  That was my understanding, not that we were going
to become involved with respect to Mr. Dowling's project and
the presentations made by Mr. Craddick.  So I'm not quite
prepared to get into that.  But I assure both of you I'm
prepared to do it tomorrow in our special meeting because not
all of the information has been presented to the public.  And
it has not been completely and totally accurate either.
Now, just one small little thing, Mr. Craddick, a
very small little thing.  You make reference to the excess
water from the Haiku pump going into the ditch.  That may mean
 -- can mean absolutely nothing because you have a limitation
 as to the total amount that can be withdrawn from that ditch.
Also, there is a limitation as to the total amount that can be
treated, so if you can treat only 7.5 million and you put in 10
million or 20 million, that excess amount is accrued to the
plantation, and there's nothing wrong with that.  We need to
understand that, but we need to know it also.  So that we look
at our total resources and we present to the public of this
community the complete picture as to what really is taking
place.
I am prepared to go with you tomorrow and Mr.
Dowling tomorrow and any subsequent time to take it point by
point with respect to the contract that you have signed with
the County, the reservations that we have expressed ourselves,
reservations which legal counsel advised me that I am right,
that these reservations do exist.  And I would like to comment
on one other thing, Mr. Dowling.  You made reference that you
would prefer not being in the water business, you're not in the
water business.  I agree with you that you shouldn't be in the
water business, and the excess water development should not be
at your total discretion to assign to whoever you may wish to.
And if we wish to talk about the assignments that
have been contemplated and the assurances that have been given
to other developers under the assignment procedures, let's talk
about it.  Let's see whether this is, in fact, keeping up with
the mandate of the County Charter with respect to preservation
of agriculture and farming industries and the mandate that's
contained in the Upcountry General Plan both the previous one
and the current one.  To me those are mandates.
And no contract, no contract that makes or obviates
these mandates would be legal.  And in the interest of all
parties concerned, all parties, people who are here, us, the
water users and what have you, we have a right and they have a
right to know what the facts are so that we can make decisions
so that we utilize these assets in the best manner for the
entire community.  And I think this is very important.
Any delay in these procedures is going to mean a
great loss for the County.  I want to acknowledge, Mr. Dowling,
the work that you have done and the investments that you have
made, but that's part of the business processes.  You're not
taking any profit.  If you make any, you're donating to the
County.
In the same manner, if you experience a loss, that's
part of the free enterprise system and we need to recognize
that.  And when we're dealing with water, which is a basic
commodity that is guaranteed to all of the public, then I think
we need again to be totally honest and totally open so that we
take our resources, be they water, be they human beings, be
they geographic, and we put them together for the working of
this community and let us be totally, totally open and reveal
all the information and reveal all the commitments which may
have been made with respect to utilization of water in that
area which would have an impact on what happens here.
Let us work together to get it done, all together,
not make misrepresentations by not being totally, totally and
completely open and honest, and I think we need to do that.
MR. STARR:  Mr. Chair, I have some comments and
questions also but I would like to first yield to the public
and allow them to testify and ask questions they have, and then
perhaps if we still have some time, we might continue this
discussion.
 CHAIRMAN TAKITANI:  Yes, thank you, Jonathan.  We
would like to then go to Item 4 on our agenda, discussion and
possible action, and this is where we would like testimony from
the public.  Fran, would you read the Director's Report 99-31,
32, 33 so that the public will know the specific items they may
wish to comment and offer testimony on.
MS. NAGO:  Director's Report 99-31, and that is
request approval to extend the deadline for the completion of a
new well in Haiku and a storage tank in Makawao/Kula.
CHAIRMAN TAKITANI:  Okay.  The procedure we would
like to have is any member of the public is allowed three
minutes of testimony time.  And if anyone else has spoken on
that particular item number, they will be allowed three minutes
further to comment, they need to respond to some other points
that were made, so that would allow you a total of six
minutes.  But with a crowd we have here, six minutes times 30
means a lot of time, so we would like to expedite this as much
as we can.
But we want to hear everything that you have, so
would the secretary call the roll of those that were offering
testimony and allow them to come down.  And would you come
forward to the front where everybody can hear you as she calls
your name as was submitted for testimony.
MS. NAGO:  I have Mr. Robert Fevella which is to
address the drought.
MR. FEVELLA:  My name is Robert Fevella, and I'm a
resident of Kula.  Anyway, what I like to say is I've lived all
my life upcountry, and we've gone through all these droughts.
It's much better today than it has been.  But my question to
the Board to Mr. Craddick is how come Mr. Dowling can go and
drill a well and find water and we have been year after year
after year waiting for new water sources just depending on
runoff and storage.  The storage is greatly improved, but we
have to look at other sources.
Those of us that own property, want to give it to
our kids, we cannot get meters.  Me, as a citizen of this
County, I feel like a second class citizen.  The people down
below there never have to wait for a meter.  Last week there
was a series of wells in the paper drilled for those people
down there.  They can take the water from there to Makena, but
the people up here waiting for the well they going to drill.
Something is wrong.
Another thing, a person applies for a subdivision.
You can't get final approval because we don't have a water
source, a new water source.  How long we going to wait for a
water source?  I can't get a meter, so I can't give the
property to my children.  I got three lots.  One house is on
one lot.  I live on another, and there's a third lot.
Now they're telling me I cannot get a meter for the
house that is there.  They're on the system.  What is the
rationale of that?  I don't understand it.  They're on the
system.  The third lot yet, that's our new draw on the system.
I don't know.  It doesn't make sense.  You know, water from
there to Makena, water in deserts.  They should be planting
cactus.  Thank you for your time.  Mahalo.
UNIDENTIFIED SPEAKER:  How about some answers?
MR. STARR:  Can I speak to that, Mr. Chair?  We are
the Board of Water Supply.  We are at fault.  It's our duty to
fix this and that's what I'm here to do and that's what our
other members are here to do.  If we don't fix it in a good
deal of time, please request us to get out of the way and let
someone else fix it.  But we take this very seriously and this
situation should not be as it is.
MR. FEVELLA:  Just 30 seconds.  Another thing, Mr.
Craddick, those two wells down in Haiku next to pineapple
fields, you've been talking about those wells for years, and
every time a drought comes up, oh, we've got to activate those
wells.  You should get out of those wells and don't spend that
money.  Get the money, get up the mountain and drill a well in
a good location where you're not going to be bothered with
DBCP.  Thank you.
CHAIRMAN TAKITANI:  Fran.
MS. NAGO:  We have Warren Watanabe from the Maui
County Farm Bureau.
MR. WATANABE:  I'm giving testimony on behalf of the
Maui County Farm Bureau.  My name is Warren Watanabe,
President, regarding Director's Report 99-33, request approval
of Kulamalu's request for the option to increase well
production.
Chairman Takitani and members of the Board of Water
Supply:  Maui County Farm Bureau requests that the Board deny
approval of the Director's Report 99-33 requesting expansion of
the well capacity at this time.
We question the intended use of the increased well
production in view of the current water situation.  We
recognize that private funds are being utilized to develop this
source and hence the developer should have a right to its use.
However, we are not in a normal situation.  Expansion of a
strained system, regardless of the source of water, seems to
send the wrong message to the public about the circumstances
concerning the upcountry water supply.
Our request was submitted and an emergency
declaration was made by the Governor.  Talk of expansion during
an emergency situation with no relief plans in place may result
in questions by the State of the declaration.  If supply were
not an issue for existing users, we would not question this
request by the developer.
However, a critical situation does exist, and
decisions should be made accordingly.  We urge a rethinking of
the strategic plan for improving water availability on the
upcountry system.  As an alternative, consideration should be
given to the possibility of an agreement with the developer for
use of this resource to alleviate the current critical
situation with rights reverting to the developer as the
situation improves.
The sustained drought of the past few years has
repeatedly exposed the agricultural community to production
losses due to water shortages.  Many farmers were in the
process of repaying loans undertaken during the last drought as
this year's water restrictions were instituted.  While
exemptions were enacted for agriculture, farmers are conscious
of the seriousness of the drought.
As a result, farmers have reduced their plantings of
new crops.  This is placing a tremendous burden on the farmers
with no certain improvement in sight.  It is aggravating an
already bad situation for our farmers who face competition from
 Oahu farmers.  We feel this warrants an holistic approach to
the entire upcountry system rather than a case-by-case
decision.  That concludes that testimony for Director's Report
99-33, and I would like to make comments on the upcountry
drought situation.
Maui County Farm Bureau is very concerned about the
repeated occurrence of droughts over the past few years.
Continuation of these droughts have serious impacts of not only
the agricultural sector but the health of the entire County's
economy.  There is an urgent need for an immediate
implementation of long term solutions ensuring reliability
during these annual drought periods.
Success of existing agricultural enterprises, as
well as the upcoming Hawaiian Homes agricultural developments
are dependent upon reliable water systems.  Funding has been a
major impediment for improvements.  We understand that there is
an effort undertaken by the Department of Agriculture and
Department of Land and Natural Resources to amend the
definition of "Western Region" by the Bureau of Reclamation to
include Hawai`i during the Reauthorization process in
Congress.
This is critical since the bureau has funding
available for drought mitigation measures.  We urge the Board
and the Department to support these efforts.  We urge the Board
and Department to seriously pursue additional storage as soon
as possible.  Fast tracking of projects is needed along with
prioritizing of projects.
During the last Hawai`i State Legislative session
Maui County Farm Bureau and the County submitted bills
assigning tax credits for water conservation and storage by
private entities.  While passing through all preliminary
stages, it failed in the final Ways and Means Committee.  We
thank the County's support of this initiative.  We feel
strongly that this is a significant way to encourage private
investments toward the betterment of our water system.
We request the support and assistance of the Board
and Department in our efforts during the next session.  One of
the major sources of water at this time for agriculture is the
Wailoa ditch.  This dependence results in one agriculture
sector benefitting only by the deprivation by another sector.
Solutions should seek reduced dependence on this system.
Improvement for agriculture means all sectors of our
agricultural industry.
In the meantime, a thorough review should be
conducted of the existing infrastructure to determine whether
all that can be practically done is being done to maximize the
efficient collection and delivery of existing systems.
Necessary improvement should be made to address shortcomings.
And finally, while recognizing this is not a popular
issue, Maui County Farm Bureau requests a reevaluation of a
moratorium on new uses until there is relief to the existing
shortage situation.  A sunset date of six months could be
assigned for a reassessment of the situation.  Thank you.
CHAIRMAN TAKITANI:  Thank you, Mr. Watanabe.
MS. NAGO:  Charles Maxwell, Sr., and Mr. Maxwell,
I'm so sorry, my Hawaiian is worse than Jacky.
MR. MAXWELL:  Hui Ai Pohaku, you're excused.
First of all, I would thank the Chair and all the
Members of the Board of Water Supply.  And, you know, I grew up
here in Kula.  We moved here in 1940, so there's a lot of
people here that I see, I recognize the former Mayor Mr.
Cravalho was our Mayor for 35, 37 years.  But, you know, when I
was 12 years old, we had a drought here in Kula that lasted 18
months.  We even had to go to Wailuku to take a bath and we had
tanks coming up here.  Let us all pray that we are not in that
kind of drought, a 40 and 50-year drought because it really is
not funny.
I'm so happy that the chairman of the former CAC
said that we should know all the facts, that all the facts
should be brought out to the public.  Three years ago, I served
with Elmer, who was the Chair of the CAC and Dick Mayer, who
was the vice-chair.  We had like 26 meetings, 18 meetings that
we had up here, Pukalani, wherever.  Mr. Dowling came.  He came
with a proposition that he build 1,800 homes in Kulamalu.  We
told him no way you going to do it.
After these 18 meetings, we said that you will have
to go find your own water.  You will not use the water system
here in Kula.  Go find your own water.  That's the only way
you're going to build it.  And in the meantime, Kamehameha
Schools got in, the drilling of this well in Kaupakalua took
place.  I know.  I personally blessed that well, and that's why
you got them.  That's why you got the water.
But anyway, I have two hats here as a member of the
CAC.  What I'm asking the Board of Directors, I mean the Water
Board, this is not the first time you have an agreement with
developers.  What about HC&S?  What about Maui Pine?  There
have been water credit issued to these people in the past, so
is this Board going to reevaluate all the former water credits
with these companies?  Are we, or is it because we have this
drought?  I think it's because we have this drought upcountry
and everybody is afraid.
The second hat I wear is that Everett Dowling gave
us five acres of land and we are dotting the I's and crossing
the T's to the Hawaiian Cultural Center in Kulamalu, the
highest part of the land above Kamehameha School.  And I'm the
executive director of Hui Ai Pohaku.  Every place in that gulch
and all around that area is totally historical.  Dr. Emory said
it was a place of makemake in ancient time.  King Kekaulike,
the school I named King Kekaulike was the place for Piilani's
son to stay up there, one of the kings of Maui.
But what I'm saying is that I am here in a twofold
kind of situation because I have interest and that's what I
want to lay on the table.  I was not bought out by Everett
Dowling, but anybody can ask me or tell me, is there another
cultural center in Hawai`i here on Maui, on any other island?
No.  I jump for that opportunity.
But what you should do as a Board Member, make sure
he gives us water.  You know, that's what you should do, make
sure, insist that when you approve that or you take it apart.
MR. DOWLING:  Charlie has got his water.
MR. MAXWELL:  That's what I want to hear.  Anyway,
Board Members, thank you for giving me the time to talk, and I
hope you take all the facts into consideration.  Remember fair
is fair.  We put this guy through the grinds as a CAC member,
and, Elmer, you know, also sometimes you cannot really believe
the newspaper, but my friend Eager over here, he mentioned that
Elmer said that Hawaiian Homes is second, agriculture first.
No, no, no, Hawaiian Homes has first call.  They
call that first call.  We have first call for Waiohuli.  I am
so happy that I'm finally coming back to Kula.  When it's
built, I have one acre there.  So, you know, that's the
clarification.  We're in the same church Elmer, right?
CHAIRMAN TAKITANI:  Thank you, Mr. Maxwell.
MS. NAGO:  Sumner P. Erdman from Ulupalakua Ranch.
MR. ERDMAN:  I would like to say one thing.  We've
recorded rainfall in Ulupalakua since 1925.  This is the worst
drought.  It's 75 years.  Members of the Board, thank you very
much for inviting us.  I'm really here to talk on, to follow
what Warren was talking about in the interest of farmers and
ranchers.  We are hurting, especially those of us in the
ranching industry.
This drought is probably going to have a severe
economic effect on us for somewhere between 3 to 5 years, a
severe economic effect.  We seriously need to take a look at
storage and collection, especially on the upper system.  One of
the things that's scaring me right now is all I'm hearing is
everybody talking about drilling wells.  Every time you drill a
well, that means you got to pump it.  The minute you got to
pump it, that means the cost of the water goes up and that
scares me.  The farmers and ranchers, right now the
agricultural rate here in Maui is the second highest to Lanai
in the State of Hawai`i.  It's four to five times higher than
what it is on the Big Island and Molokai for agricultural
water.
Our water is incredibly expensive and the more we go
to start pumping and pumping and pumping from lower areas to
pump it up, that means it's going to be in effect because the
reality is we've all got to pay for the system and I am scared
for that, and I would like to look at putting more emphasis on
some storage in Piiholo and better collection up in the
Waikamoi/Kahakapao area and looking at trying to get that water
out to those of us, especially in the upper line that are
farmers so we don't have to be relying on pumping that water
from some place down below.
And I would like to reiterate what Warren said to
back him to look into support for us to try and join the
Western States Bureau of Reclamation, and that might be a
possible way of us getting funding to build reservoirs and
catchment facilities.  And something you said I think is
important.  I think it is if we are in agreement, I think it is
important that Government honor agreement with private
enterprise, so I'm not making an attack one way or the other.
I think we really seriously need to think about it.
If that water is down in Haiku where we already have the water
but the water going for this development is coming from another
 system, I'm just a little concerned about that particular piece
of logistics that didn't make sense to me.  Thank you.
MS. NAGO:  Mr. Kenneth Okumura.
MR. OKUMURA:  Members of the Board of Water Supply,
my name is Kenneth Okumura.  I'm a vegetable farmer in the
area.  I'm a third generation head cabbage farmer.  I raise
mostly head cabbage.  I'm also a farm bureau member and I
wanted to concur with the testimony of our President Warren
Watanabe.
But I especially wanted to take this opportunity to
thank you for the seemingly, you know, the understanding and
sensitivity that you have shown the farmers and ranchers during
this drought period as compared to in the past.  It's a big
improvement over the past.  I say this because thus far you
haven't imposed any mandatory restrictions on us.  And for the
farmer and rancher, it's a really hard, difficult thing.  It's
not like the household cutting back 25 percent.  Twenty-five
percent mandatory cutback would mean 50 percent reduction in
our return, you know, to make a living.
So it's just like asking, you know, the public to
reduce their takehome pay by 50 percent during the drought
period, so I appreciate your understanding in this.  You know,
farmers have been going through some hard times.  There have
been a lot of competition from like Oahu, but I think we're
showing that we can hold our own.  But we need to be, you know,
very competitive.  We can raise a good supply of product at a
good quality.  But we need a steady supply of water and
consistent supply of water to be able to compete in the market
place and hold our markets because the markets demand
consistency from us.  So thank you very much.
CHAIRMAN TAKITANI:  Thank you, Mr. Okumura.
MS. NAGO:  Mr. Doug MacCluer.
MR. MacCLUER:  Thank you, Members of the Board of
Water Supply for coming up and spending your evening with us.
I know that this is a contentious time to be here.  I'm Doug
MacCluer and I'm Chair of the Central Maui Soil and Water
Conservation District.  In 1988 I was a member of the upcountry
water committee under the leadership of the then Mayor Elmer
Cravalho.  The USDA assisted you in the comprehensive study of
the upcountry water system published in April of 1989.  The
study recommended the following:  Additional storage and
collection for the Waikamoi system, a 50-million gallon
additional reservoir on the Piiholo line and an improved
collection system.  Number three, a separate ag water line for
the Piiholo system and additional storage for the ag park.
The study expressed concern that continued urban
growth without more water would destroy upcountry agriculture
as we know it.  This was in 1989.
Guess what?  The study was right.  Unreliable,
expensive water is killing agriculture and our rural life-style
right before our eyes.  In ten years, we have completed only
the increased storage in the Waikamoi system.  What good is
this new storage if we are using a 70-year-old limited wood
flume collection system that can't fill the new reservoirs?
We have added no storage as recommended on the
Piiholo system and yet we have added consumption from Hawaiian
Homes, the Dowling subdivision, King Kekaulike High School and
the new Kamehameha School, plus numerous family subdivisions
and additional meters.
Water restriction upcountry has become a way of life
for us.  Farmers have become unreliable suppliers of crops and
many are going out of business.  The homeowners have grown
tired of excuses from the Department of Water Supply over
whether it is El Nino or La Nina.  I quote the H.A.R. Austin
and R.M. Towill study of the water supply for the Kula area
dated January 1962.
"From its early beginnings, the Kula system has
been one which has experienced many dry periods with resulting
mandatory curtailment of water service to the consumers who are
farmers, homeowners and ranchers."
Well, little has changed since 1962.  The Water
Department has still failed to provide reliable water service
to our people and at a reasonable cost.  Isn't it time that we
add more storage and improve our collection system rather than
adding more consumption to an already taxed system?  Thank
you.  Mr. Dick Mayer.
MR. MAYER:  I first want to thank the Water Board.
It was at my request last week at the meeting that I ask them
the please come up and meet with the residents upcountry.
Warren Watanabe and I were about the only two residents down
there speaking, and maybe you were working during that hour.
Tomorrow morning we will meet again about the things we are
talking about tonight.  So those of you who have the time
tomorrow morning, you will have an opportunity at their meeting
tomorrow morning down in Wailuku.
Two items I want to talk about.  One is the drought
and second is the Kulamalu development.  With regard to the
drought, I think we've heard testimony that this is something
that we can expect up here.  It's been continual, almost
perpetual.  It will probably be there into the future.  One of
the reasons why we seem to be always in this problem, although
we have added reservoirs, some water source some pumps, is
because we keep adding new meters to the system almost without
control.
There was a period in the late '70s, early '80s that
we had a Kula rule which regulated the number of meters that we
had up here to zero supposedly with some exceptions of family
subdivisions.  What I would like to ask is that to protect the
farmers, protect the Hawaiian Homelands areas and to protect
all the residents who are already here, that we have that rule
implemented perhaps with an updated version of it in which no
new meters would be issued until we get to a situation where we
have storage capacity of approximately six months.
That will mean that those people who are here will
not have to worry, will be able to water their plants, take a
shower or whatever.  Also, with regard to family subdivisions,
I realize that there are some families who would still like to
subdivide.  The problem is the rule that was set up before was
wide open for abuse.  A next-door neighbor of mine came to me
and said I've got the land to divide into three.  As soon as it
was subdivided, he sold it for a million dollars.  That's been
done all over the place.  And as a result, we have almost
uncontrollable growth even when we had supposedly a rule.
That's my comments with regard to the drought.
With regard to the Kulamalu pump, and that's the
particular item I want to talk about, the question that comes
to my mind is who owns that water.  Just because a person has a
piece of land at the surface and drills down X number of feet
and pulls up some water, is that necessarily that developer's
water?  What about the people makai of that property where that
water would have flowed?  I've talked to a resident in that
area below that who says the water they used to get from the
area down below they're not getting adequate supplies.
So water that may be taken out of a pump taken up
from the bottom may be affecting people down below.  With
regard to the sequencing of events, something Mr. Cravalho
mentioned, not all the facts came out.  The agreement was drawn
up I understand between Kulamalu and the County in March of
1996.
And it said that the developer would get 45 percent
of the water.  The reason that the developer is now coming back
is because he wants to have additional water and get 45 percent
and needs your approval for that, but in between those two
dates that date of March '96 and today, the County passed the
upcountry community plan.
In that community plan it said that the highest
priority for the water should go to Hawaiian Homelands and to
farmers and then to all the residents.  And we put a priority
in the upcountry region to make sure those two needs were met.
That's the rule that now guides your vote, not the agreement
per se.  That was an agreement on the first part of the water.
But rather now if there is an extra 400,000 or whatever it is
gallons, you would be entitled to the highest priority goes to
farmers and Hawaiian Homelands, in whatever sequence you want.
One possibility would be that instead of the
developer having that 400,000, the County has it and allow the
County Water Department to have complete access to that money
to that water perhaps paying for the extra pumping of that
water, but it would be then at the discretion of the County to
be done in a proper manner, not by a developer who may do
developments that diverge from the upcountry plan that we
have.
So I urge you in your voting to consider not giving
the developer the use of that water.  If the water is
available, it should be allocated for the benefit of the public
guided by the plan and there should be no meters put on board.
The water should go to the existing residents, the existing
farmers, to Hawaiian Homelands prior to any developments going
in there.  Thank you.  Thank you.
MS. NAGO:  I don't have anymore that signed up.
(Recess taken.)
CHAIRMAN TAKITANI:  We would like to reconvene the
meeting.
MS. NAGO:  We have Mr. William Blietz.
MR. BLIETZ:  My name is William Blietz and I have a
farm on West Kuiaha in Haiku.  And I want to compliment you
folks on the job that you're doing to get more water,
especially in my area.  I'm in line for some water meters on my
property, and I don't think that Mr. Craddick is going to be in
any way embarrassed by the fact of water flowing into a ditch
and going to somewhere where it's not going to be used.
There's a great deal of facilities that could be
used for that area for the water, Mr. Cravalho, in the existing
line that's there for water meters.  Now, I know folks that are 
anti-development don't want to hear this, but what I'm trying
to say is that there are meters, people in line waiting for
meters in that area.  There's also the well that has recently
gone on line, was it 300,000 gallons a day; is that correct?
MR. CRADDICK:  The Haiku well, yes.
MR. BLIETZ:  The Haiku well, so I'm saying that
water is not going to be all flowing into the ditch and
possibly lost.  So I would really request you to consider
giving Mr. Dowling the extension.  You know, it's not often
that somebody will shoot craps for 2 million bucks to try to
bring water in.  And, of course, as I sit here, and I think
another gentleman alluded to it, if Mr. Dowling is willing to
spend $2 million to draw water from a well, why wouldn't the
Board be also trying to say, gee, we could draw some water from
some wells, that we could do?
And I know the first thing that comes up is where is
the money going to come from, who is going to pay for it.  And
I know that positively that money is available.  And I would
think that bonds, you say, well, we don't like revenue bonds,
we want to pay as we go, we want to do this, we want to do
that.  But I'm sure that there's a positive way to finance this
possibility to give you the money.
Because, you know, that's the first thing you ask,
people want everything, and you say, who is going to pay for
it?  Where are we going to get the money?  There's positive
ways I'm sure, and I know that you folks have enough wonderful
knowledge on the Board to figure out how you can get the
money.  And maybe you should consider making wells of your own
in different areas.  But I encourage you to give Mr. Dowling --
I don't know the gentleman.  I've never seen him before.  I've
had no business dealings with him.
But I've got to say thank you Mr. Dowling for doing
what you did.  I don't know if I probably would like to take
you to Las Vegas.  Because if you get that kind of luck -- if
you get that kind of luck on the first well -- and maybe
there's other folks here, maybe you can tell me, did anyone
ever drill a well here that wasn't good?  Does anyone know?
Well, maybe there is a chance for that to go sour,
but, you know, water is our lifeblood, so we need it.  And it's
there.  We know it's there.  We're sitting on top of it.
Probably right down here we're sitting on top of it.  I thank
you very much.  Give Mr. Dowling what he needs.  What a guy to
shoot craps for that kind of money to get water.
I know Avery is grinning over here.  I don't think
he would do that, and I don't think I would do it.  I really
have got to give him a nice hand for doing that.  Thank you.
MR. STARR:  I would just like to respond.  It's not
my bad experience that's stopping the Board from drilling
 wells.  I think the Board would drill wells if we could.
There's some litigation which at present time is prohibiting us
from drilling East Maui wells, and it does however permit other
parties to drill wells and turn them over to the Board.  It's
not money that is stopping us from drilling wells.  It's
something we would like to do and hopefully will be able to
pursue.
CHAIRMAN TAKITANI:  Thank you, Mr. Starr.
MS. NAGO:  That's all who signed up.  I don't know
if there's anyone else wishing to speak.
CHAIRMAN TAKITANI:  Is there any other testimony
from the public regarding any of the three matters or the four
matters?  Sir.
MR. BAAR:  Thank you.  My name is David Baar.  I'm a
businessman here in Kula and a priest as St. John's Episcopal
Church in Keokea.  This is less a matter of testimony than
raising a question which I'm having difficulty with having
listened to all that's gone on thus far.  I understand that Mr.
Dowling will gain about 1.64 million gallons a day from --
MR. DOWLING:  728,000.
MR. BAAR:  You get 45 percent of that.  But what I
don't understand is if a well is being drilled in the Haiku
area and that well contributes 1.64 million gallons a day into
that system, does Mr. Dowling -- do you then have a right to
withdraw 45 percent of that from the lower Kula system
regardless of whether any water, anymore water reaches the
lower Kula system or not?
What I don't hear here is a guarantee that when that
well produces X amount of water that a similar amount of water
will actually get into the lower Kula system.  I would like to
hear Mr. Craddick speak to that.
MR. CRADDICK:  First of all, he's not getting water
out of the lower Kula system.  The water that goes to his
subdivision is coming off of what we call our Malahia tank
which is just slightly above the Austie Rice Arena and that is
pumped up from Kamole Weir which is the same system that
supplies Haiku.
Right now the water from Haiku comes from Kamole
Weir pumped up to Pookela tank to 1,500-foot elevation and then
goes downhill into Haiku.  Now, there is nothing preventing
that well from being hooked up to a permanent line to also feed
that Pookela tank without having to dump the water in the
ditch.  It's only an interim time because this well is just
coming on line.  We don't know what the maximum production of
it is.  He's doing a two-year test or agreed to do a two-year
test to use that well.
And if you don't understand when I say that the well
draws down 15 feet below sea level, if he puts in a pump that's
2 million gallons a day, once the water goes below sea level,
you have the potential of pulling salt up.  The way the water
works is for every foot that you have above sea level, you have
40 feet of water below sea level.  And in his particular well
or the Kulamalu well, the head there is what, about 11 feet,
Ivan?  Ivan Nakatsuka is an engineer for the project there.
Anyway, that 11 feet translates to about 440 feet of
fresh water below sea level.  If you're going to draw that well
15 feet down below sea level, I would like to know that for the
long haul that water, that well is going to be producing good
quality water just like the tests show, the one week test.  You
have to keep in mind that was only a one-week test and there is
the potential of that water going salty if you're going to
operate it drawing it down so far below sea level all the
time.  And we hope it doesn't do that.
I believe it will not do that, but again, I cannot
ask the Water Board to take on the developer's risk for
something like that.  And that is all that is going on here.
He has got the permission from the Water Commission, but the
Water Commission, what they do when they give you permission to
put a pump in, they say as long as it's good, you can use it.
If it goes bad, we're just going to cut you back.  Once they've
cut it back, if we've already given meters on that, we're in
trouble.
So we can't be giving meters that we don't have
water for, and we're very fortunate he's willing to work with
us and cut the capacity of his pump without everybody else
saying I want a piece of it when we don't even know if the
Board has it yet.
MR. DUNN:  One question.  What's the relationship
between the --
MR. CRADDICK:  Actually, I think you need to address
the Chairman.
MR. DUNN:  I would like to ask a related question.
What's the relationship of the draw of that well to the
sustainable yield of the aquifer that it's in?  I believe from
the chart you showed on the slides earlier it was 31 million
gallons per day.
MR. CRADDICK:  Okay.  The State chart shows 31
million, but if you actually get into the book has the
sustainable yield in it, there's a slash there and it says 15.
And why they have that 31/15, I don't know.  But let's say that
that collection of aquifers is half of what they say it is and
it's around 15.  If he was getting the 700,000 out of that,
what's one other 15 there?  That would be the percentage that
he was getting out of that.
MR. DUNN:  If the sustainable yield is 15 to 31
million gallons a day in the aquifer, what's the danger of
pumping capacity of the permitted 2 million gallons?
MR. CRADDICK:  There is probably not much
likelihood, but again, the Board of Water Supply, as Jonathan
 said, we have a number of wells planned in East Maui.  And we
don't want to end up having a situation like we have in Central
Maui where we've got very large wells very close together that
have a net effect on each other where the draw down is much,
much higher because of the close proximity of the other wells.
MR. DUNN:  The East Maui wells are not for upcountry
use, are they?
MR. CRADDICK:  Once you have a link where you can
bring water up, that's certainly when we redo the EIS, it is
going to talk about the upcountry situation.  The first EIS did
not talk about that.  And again, that East Maui EIS does not
prevent the Board from drilling wells for upcountry.  If the
Board wants to drill a well say at Pookela tank site, they have
every right to do that and can proceed doing that as soon as
they wanted to budget it.  So that is not stopping any wells
for upcountry.
MR. CLARK:  No testimony, but a question.  Sam Clark
from Haiku.  Mr. Dowling's allocation of 45 percent of 738
gallons --
CHAIRMAN TAKITANI:  Thousand.
MR. CLARK:  Yeah, 738,000.  His build out usage is
500-and-some-thousand, so what is he planning -- what are you
planning to do with the other 200-plus-thousand?
MR. DOWLING:  Either sell it or we'll use it to
develop our properties.
MR. CLARK:  Additional properties, and those are all
in Kula?
MR. DOWLING:  No.  They have to be below the 2,000
foot elevation served by the same water --
MR. FUJIMOTO:  The Makawao system.
MR. CLARK:  And the same thing, if it goes to 2
million gallons a day, you want an additional 45 percent of
that additional water?
MR. DOWLING:  Right.
MR. CLARK:  Again, to use for other development?
MR. DOWLING:  Our personal or private.  We've sized
the well.  We've sized -- all of the infrastructure for the
well is sized for 2 million, so we are paying for that now.
The only thing that's not there is the 2-million-gallon-per-day
pump, but everything else is signed for 2 million at our
expense.
MR. CLARK:  You don't want to be in the Water
Department, but you've got extra water you're going to sell?
MR. DOWLING:  I would love to recoup my investment.
Right now I'm three to four times at a loss and I'm at a
competitive disadvantage when it comes to water.
MR. CLARK:  But are you not going to make that up in
selling the property anyway?  Doesn't that cost get put on to
the customer?
MR. DOWLING:  It just increases the cost of housing;
whereas, if I sell it, more people have water.
MR. CLARK:  Is somebody in line to buy that water?
MR. DOWLING:  I bet I've received 50 phone calls for
water.
CHAIRMAN TAKITANI:  The Chair recognizes the man
in --
UNIDENTIFIED SPEAKER:  I've got a question for
Dowling.  Suppose the water wasn't good.  He drilled these
things.  What would happen?
CHAIRMAN TAKITANI:  What was your name, sir?
RUBEN:  Ruben.  Being that he's a developer, he's
like he's gambling, and I think in the end, he'll be coming
ahead, way ahead for what he's done.  But he's gambling now.
Developers don't go ahead and develop all these places and then
say, okay, I'll put a well in.  Now, if the well is good, don't
worry.  What's going to happen?  That's what I want to know.
You're taking the water from Haiku where the guys cut me off
and bring it all the way up here?  Tell me that, are you
gambling?
MR. DOWLING:  We're certainly gambling.  The water
that we developed stays in Haiku.  If we had drilled that well
and it had been a dry well, a bad well, we would have had to
drill another one.  Our agreement with the County required us
 to drill another one.
RUBEN:  So you're going to keep going and going and
going.  So you're saying that you would be losing money.
You're talking about losing money.
MR. DOWLING:  Right.
RUBEN:  You mean to say you're going to do that?
MR. DOWLING:  Fortunately, that's not the
situation.  Fortunately, our well was a good well.  Had it been
a bad well, we would have to drill another one.
MR. STARR:  Mr. Chair, I would like to make a
comment in this regard, which is that after that well is turned
 over to the Board, if at that point it goes bad or is not able
to provide as much as its -- as it was originally, then it
would be the Board and the ratepayers who will suffer.  And if,
as Mr. Craddick has stated, we allow a larger pump to be
installed in it, but then I know Mr. Craddick is of the opinion
that that would eventually cause the level of the water to sink
below sea level and become salty.  Then it will be the Board
and the community that will have to provide water from other
sources and turn that well off.
RUBEN:  Then you would be taxing us again?
MR. STARR:  Yes.
RUBEN:  We're on the losing end.
CHAIRMAN TAKITANI:  Ma'am.
here for the beginning of the meeting, but I was just wondering
 if the environmental impacts showed the impact of pesticides
and herbicides and dioxins and all the rest of it in the water,
and if it is in the water, what level is the impact of the
chemicals, and if you added that well that you drill that has
the chemicals in it to the whole water system that everybody,
you know, drinks and uses on their skin and all that kind of
stuff, you know, you have negative impact upon the health of,
you know, the community.  And so I just was wondering if that
was addressed by Mr. Craddick or the Water Board.
MR. CRADDICK:  First of all, on our wells that we do
the environmental work on, the Haiku well and these Hamakua
Poko wells, we cannot put water in the system that does not
meet the EPA and Department of Health standards, and if you
don't know, the State of Hawai`i Department of Health standards
are five times stricter than the Federal Government.
 MS. HEMMING:  But what we do, we receive letters in
the mail saying, oh, well, you know, your water hasn't met the
water standards and, sorry, and you get the letter in the
mail.
MR. CRADDICK:  When is the last time you received
that letter?
MS. HEMMING:  I was at a house, and it was received
last year.
MR. CRADDICK:  Yeah, last year.  Currently all the
treatment plants, Kamole, Piiholo and Olinda have all met the
compliance to date.  There are no fines and those letters are
not being issued anymore.  Now, the new wells that we have
coming on, they're not surface water.  They're ground water and
the carbon filter will take out all trace of that.  You cannot
measure it anymore in the water.  It may still be there, but
it's not measurable.  So in the levels that we're talking about
are in the parts per trillion.
MS. HEMMING:  But that still has an effect upon the
body just like homeopathic remedy.
MR. STARR:  I have a question for the Director.
What is the parts per trillion of DBCP in the Haiku well?
MR. CRADDICK:  Ten.
MR. STARR:  So just to be honest with the community,
the Haiku well is currently being pumped; is that correct?
MR. CRADDICK:  That's correct.
MR. STARR:  It is currently being pumped into the
Haiku system.  It has half of the MCL, which is the --
MR. CRADDICK:  One-quarter of the MCL.
MR. STARR:  I'm sorry, one-quarter of the MCL or the
minimum -- the maximum contaminate level allowed by the State
that's what percentage of the Federal level is -- the federal
level is a lot higher.
MR. CRADDICK:  Five percent of the federal level.
MR. STARR:  But there is some trace amount in Haiku
well, going into the Haiku system, but I'm convinced that the
H'Poko wells after treatment will be below the level that's
able to be measured, which is extremely, extremely low.
CHAIRMAN TAKITANI:  Bob.
MR. DUNN:  Bob Dunn from Haiku again.  I would like
some clarification about whether or not we're able to drill
wells at this time.  I believe a few minutes ago Jonathan said
that it was not money that was keeping us from drilling wells,
it was legal matters, and I believe David just said that above
that lower area there, the EIS was not a constraint and that
there was nothing to keep us from drilling wells at this time,
so let's drill some wells.
MR. CRADDICK:  Perhaps, you know, we have
corporation counsel over here, and I think he may be able to
give you a better analysis of the East Maui court case and --
MR. DUNN:  But didn't you just say there was nothing
to stop us from drilling wells?
MR. CRADDICK:  Nothing that I know about.  And you
can ask him.
MR. ZAKIAN:  With regard to the East Maui water
development plan which the Water Department and the Water Board
sought to implement back in the early 1990's before I started
working with the Water Department, the Water Department did an
environmental impact statement.  They were sued.  The suit
alleged that the statement was not complete enough.  It went to
court.  The court basically said it was not complete.  It was
not sufficient.  It was lacking, go ahead and you need to do a
supplemental EIS that addresses certain key factors, among them
water contamination from the H'Poko wells.
Currently, the department needs to complete the
supplemental environmental impact statement to implement the
East Maui Water Development Plan.  The Department can proceed
to drill other wells that are not part of the East Maui Water
Development Plan as it may see fit.  They would still need to
do the proper environmental studies, get those approved, get
State Water Commission approval, appropriations from the Water
Board to drill and everything else.  That they can do at any
time.  It's just the East Maui plan.  That is currently under
restriction.
MR. CRAVALHO:  Question.  That's partially correct.
If you go through the EIS process for any other well that you
want, you dig in any other area which is not part of that East
Maui development proposal that the Board initially had.  If you
wish to drill additional wells, you have to provide an EIS,
either an EIS or environmental assessment.  As soon as you have
an EIS, it doesn't mean ipso facto you can proceed to dig.
Because that is subject to a court case and court testing in
the same manner that the EIS statement for the East Maui
development portion back in the early '90s were subjected to
the court case.  And that's where the hangup is right now, so a
statement saying in effect you can go ahead and proceed to dig
wells, any other place is really only partway correct because
you have to have an EIS and that EIS is subject to challenge in
the court.  So the ability to dig is -- has a caveat to it,
subject to the EIS and meeting all the criteria and not being
challenged, so it's yes and not really yes.
MR. DUNN:  But nevertheless, potential wells are
under no current litigation and we could proceed if we chose
to.
MR. ZAKIAN:  The East Maui wells are subject to
litigation.
MR. CRAVALHO:  They are under litigation.
MR. ZAKIAN:  If the Water Department and the Board
want to proceed to drill other wells, they would have to follow
the EIS law, they would have to get appropriations.  They can
proceed with that as they see fit.
MR. DUNN:  So my question to the Board is why can we
not do that?  We need reliable ground water source.
MR. CRAVALHO:  Ipso facto it will not result in
digging if there is any kind of a challenge, so we have to keep
the caveat that an environmentalist or anyone, for that matter,
could issue a challenge to the courts which we have in
existence today with respect to East Maui.
MR. DUNN:  But that doesn't mean we shouldn't
proceed and try.  We need the water.
MR. CRAVALHO:  I agree with you.  I have no problem
with that, but it is not going to result immediately
 automatically.
MR. DUNN:  But it needs to be started.  We need to
start now.
The EIS statement which for East Maui, which was challenged in
the court and the County was ruled against, that the court said
that the program was really a developmental program rather than
something else.  That decision was reached five years ago.  And
to this date, we do not yet have an updated EIS statement.  And
even when that EIS statement comes out, it is still subject to
a review by the courts and by people who have appealed, so it
is a cumbersome kind of activity.  A case in point, forget the
wells just temporarily, just temporarily, the H-3 highway of
Oahu took how many years and $1 billion through these constant
challenges.
Once you got the EIS requirement being set by the
court, it is open to a challenge.  And it has been challenged
that H-3 highway was challenged 20 or 30 years and at the cost
of $1 billion, so this is what we have to be aware of.  So it
is very, very important that whatever programs or plans we
develop, we get public participation in early.  So people who
may have some objections or questions, they will be in on the
ground floor rather than waiting to go to court to challenge
everything and tie everything up.
MR. DUNN:  Just about anything we do in life is
subject to challenge, but the fact is if we don't initiate a
plan to develop more storage to utilize the free water that's
out there and ground water to alleviate the system during
periods of droughts, it will never happen.  And you're never
going to have a better time to --
MR. CRAVALHO:  In fairness to the Department, 20
years ago or thereabout, our deliverable capacity of water to
the Kula area was approximately $950,000 up to maybe a million,
million one.  Today we're delivering -- what the Department is
delivering is approximately 6 million.  This still doesn't meet
the need, but I think it illustrates the fact that the
Department has not been just totally doing nothing.  It hasn't
been moving as fast as it should, I agree, yeah.  But it hasn't
been totally noncompus mentis.
MR. DUNN:  I agree.  But growth in Maui is an issue
that concerns everybody, and growth is, in fact, being mandated
by the powers to be.  And growth upcountry is going to
escalate, especially when the road from Kihei goes in because
there are a lot of people down there that don't want to live in 
the heat and they only do because they work there.  Growth
upcountry is going to put considerable strains that I don't
think are even being considered on water and other
infrastructure.  And I think it behooves us in the midst of
this drought which is the best time to get people's attention
to initiate plans to take care of it for the long range.  We
need to start now.  We should have started a long time ago.
We should take care of the litigation problems with
the East Maui water plan, and we should do what we can outside
of that because there's nothing stopping us other than the
threat of litigation.
MR. CRAVALHO:  Six of us out of the nine are new
people, and if one year from now, yeah, you come back with the
same kind of argument or same kind of observation and we've
done nothing, then all of us should be out.  We should be out.
MR. DUNN:  You have a tremendous opportunity here to
do the right thing.
MR. CRAVALHO:  We need here one vote.  We need four
more.
MR. DUNN:  I'll say one more thing.  I don't know
what the numbers are, but we had a drought emergency last year
and suddenly it just disappeared.  The two H'Poko wells just
suddenly became a non-issue.  Nothing happened.  We started
getting more rain and water meters were being issued.  And so
now we have another drought, and because X number of water
meters were issued since last year, our demand is higher.
MR. CRAVALHO:  That's one of the reasons I'm
saying --
MR. DUNN:  It doesn't make sense we continue to
issue water meters even though we have free water without
developing additional water sources.
MR. CRAVALHO:  In 1998, the Governor did proclaim a
drought emergency situation.  The County went to court for
clarification to see with respect whether they would be
exempted from the East Maui development court case of the early
'90s.  And that decision was given by the court.  And the
permission was given by the court.  In between, yeah, in
between, the rains came and the Department then did nothing to
proceed with the planning process.
And who said that, Mr. Craddick?  You did.  That
question was raised, and you did.  And you allowed it to pass,
and this is what you told us.  I asked that question.  And I
believe the question with respect to five years of the EIS was
asked by Member Jonathan.
CHAIRMAN TAKITANI:  Mr. Craddick, do you wish to
respond?
MR. CRADDICK:  The EIS for these wells or EA we
expect is going to be completed next month.  Now, granted
there's going to be a court challenge on it, and this is going
to be stopped.  But that EA is completed.  What happened last
year is we got all this operational to put water into that
reservoir right here, HC&S's, and all of that work was
completed within the time allotted by the Governor.  Since that
time, HC&S said they will not allow us to put the contaminated
water in the reservoir because of liability.
So what is going on this year is we are now putting
this granular activated carbon filter and putting a pipeline in
the rest of the way to put it directly into the system without
having to be some reduction in the amount of water we have
because of leakage over here and evaporation and things like
that.  So I take real exception to somebody saying that we have
done nothing because we have done quite a bit.  The well in
Haiku was drilled by myself in 1979.  From 1979 to -- when I
came to work at the Water Department, the Water Department did
not know the well existed.  And it took -- Fong is gone from
here right now.  He got the job that turned that into a pump
station, took us from 1992 until June of this year to get that
well on line, again, because of the litigation.
But I appreciate a Board that is really willing to
step up to the plate and stop this court action.  But that
court action, when it was started in 1994, the head litigator
from the County as he was going out the door said get that
 order clarified.  And to this date, that order is not
clarified.  And that's not something the department can do.
That's a legal matter.  And I take real offense to people
saying we're not doing anything.
MR. MAYER:  I'll change the tone of the discussion
for a second here.  I have a letter, David, Director.  The
letter is written July 8th to the Board to Mr. Takitani
concerning the well, the Kulamalu.  And the first sentence
reads, "We recommend your approval of Kulamalu Limited
Partnership's request to have the option to increase well
production."
Is that still your recommendation, or would you give
a different direction to the Board now after you've heard all
the testimony this evening?
MR. CRADDICK:  Again, as far as increasing the
production, if the well proves out, yes, that would still be my
recommendation to increase.  Why would you have a well that
would produce at a higher rate and not use it as the maximum
efficiency?  Now, the policy issue of who that water may go to
or whether the Board can negotiate some kind of an agreement to
use the water in the interim, what water that Dowling is not
using, and I'm not talking about this incremental increase that
will draw the well down to below sea level.  That's certainly
an option that the Board can explore.
MR. MAYER:  And do you have a recommendation?
MR. CRADDICK:  I don't have any recommendation on
that.  We have the Haiku well which is our own well which has
its own EA completed paid for with water system development
fees that is water that can go on line immediately after the
drought is called off.
So that is water that we can give out of our own
water.  Again, another thing here that was said about the water
meters being given out, what the ruling is that says because
there is an empty lot somebody can have a meter, it's not in
our rules.  That's something that corporation counsel has said
can happen.  Those are probably the majority of the meters that
have been given out and subdivisions that were approved back in
the '70s and '80s.  Since 1993, new subdivisions, unless there
was additional water coming into the system, have not got
approved.  That's why we currently have a list of over 600
names.
The meters that were given out immediately after the
Kula rule amounted to about 150 meters a year.  When Vince
Bagoyo came in as director in 1984-'85, that shot up to about
370 meters a year.  When Rae Shikuma came in and we implemented
that shortage, it has dropped to about 100 meters per year that
have been passed out, the lowest number of meters per year
given out during my time since 1977 when the Kula rule was put
in place.
MR. FEVELLA:  Mr. Craddick, is that something to be
proud of?
MR. CRADDICK:  Yes, it is.
MR. FEVELLA:  I don't believe so.
MR. CRADDICK:  Yes, it is, because it's family
subdivisions that were getting all the meters that were allowed
during the Kula rule.  And it hurt all the farmers.  All the
farmers, it only affected the upper Kula line and the lower
Kula line.  Meanwhile, development was going unabated in Haiku,
Makawao, Pukalani.
MR. CRADDICK:  That was in 1993 that that situation
was changed.
MS. OHLMSTED:  My name is Susan Ohlmsted.  I live in
Ulupalakua.  I would like to say to the Board I'm really
interested in money and time and energy going into our upper
Kula water system and getting a lot more collection and
delivery going on because out in Ulupalakua, Kanaio, Kahikinui,
we don't have water.  And it's really, really depressing and
it's really frustrating and it's really hard to grow things.
It's really hard to raise your family, all of it, and there's a
lot of people that have wanted water for a long, long time.
And like Mr. Dowling, for example, and other
developers, I think when these guys come in and want to develop
an area, I think it's really important somehow to get some
money from them, some energy from them to improve systems in
our County so that, for example, he has a certain amount of
water.  And if we can pull the 2 million gallons a day, he
wants X more amount of water, that might go to various
developments.  But what about people that have been asking for
water in Kanaio and Ulupalakua and Kahikinui for 30 years?
What about getting some money towards those things
before developers are allowed to put in more developments to
bring in more people in other areas upcountry, and somehow I
would like that to be addressed for all of our communities so
that it can be more fairly distributed, not just the guy with
the major bucks being able to bring in more new people for
their developments, granted that they are doing some good
things too, you know.
MR. STARR:  I want to comment on that.  Where I
recently was at a session on ethics in the water industry at
the National Water Conference in Chicago, and I took a poll of
the group to see which of the different water systems, there
were about 60-some-odd different organizations represented at
 that meeting, which of them were in the same type of situation
we were where there's development taking place beyond the point
of adequacy.  But the development is creating its own source
for itself and no good is coming to the community.  And
meanwhile, people have been waiting 10 or 20 years and they see
hundreds of houses go in next to them.
And the answer I got was that every other system
represented there, when a developer develops beyond the point
of adequacy, they are made to develop an additional amount of
water that goes to the community and that amount ranges from 20
percent, which is what most of the Midwest, Ohio, Illinois,
Indiana, up to 50 percent is what a lot of places on the west
coast do.
So right now we don't have any rules that would --
that would cause this to happen.  There's no way that we could
ask Mr. Dowling to do this.  And it's not his fault that he's
not doing it because there's no concept of that.  But this is
  -- your question and statement is a very good point, and
that's what's done in most other places.  And this is an area
that in our strategic planning I for one would like us to look
toward.
I would also like to clarify one issue that's been
very confusing to the community.  And I know before I was on
the Board, I was confused by it after listening to the Director
at one point, and that was the concept that 45 percent of the
installed pump capacity is the amount of water that will be
issued under credits to the developer in this case and other
situations.
And I know there are people who think that that
means there is 55 percent additional that's going to the
community or going for that some other purpose, but in truth,
that 55 percent doesn't exist.  If you install a pump with say
a 1-million-gallon-per-day capacity, the amount of water that
it will actually produce and be usable in terms of issuing
meters would only be 450,000 gallons.  And the basis of that is
that there is a normal day demand which we consider I believe
it's 600 gallons per day per household.  Am I correct, David?
MR. CRADDICK:  For a five-eighths inch meter.
MR. STARR:  For a five-eighths meter at 600 gallons
per day, there are some hours a day that will actually draw
double, maybe a lot Labor Day or whatever.  So there's some
days that may actually take 1,200 gallons, but there will be a
longer period when it will average 900 gallons, in other words,
50 percent over the basic utilization.  That's pretty much
standard throughout the industry.
So to issue a 600-gallon meter, a five-eighths
meter, that has to be made available for a dry day, 900
gallons, so that's 50 percent more.  Or if you derate it, it's
two-thirds of the million gallons.  That also covers a need for
fire protection.  Then at certain times, one pump out of a
system may go -- may go down or a certain amount of wells in a
system may salt up.  So again, it has to be derated by another
one-third.
So to cover the fact that the entire -- all of the
pumps will not always be working for one reason or another and
experience has shown that is a factor of about another 50
percent up or 33 percent down, so if you take two-thirds of 100
percent and then two-thirds of that, you get 45 percent.  So to
clarify the situation, that 45 percent is the real amount.
MS. OHLMSTED:  That's all the water?
MR. STARR:  That's all the water.
MS. OHLMSTED:  So he's not putting anything into the
community water with that well?
MR. STARR:  Mr. Dowling.
MR. DOWLING:  As I said earlier, we're putting 1.6
million gallons into the system this year.  This year we'll
probably pull out 15,000 gallons.
MS. OHLMSTED:  But potentially, he's saying that 45
percent of 1.64 million is the water that you use, and that's
all that will really come from that well?
MR. DOWLING:  Correct.
MS. OHLMSTED:  So it isn't like you're putting the
other 55 percent into the Haiku water system or any other water
system?
MR. DOWLING:  It's all going into the system.  The
County of Maui says you can only use 45 percent of it.
UNIDENTIFIED SPEAKER:  Forty-five percent of the
water that goes into the system.
MS. OHLMSTED:  And Jonathan, you weren't just saying
that what happens is at any given time all you can ever get out
of that well is that 45 percent?
MR. STARR:  That is what is -- that's the amount
that is considered.
MS. OHLMSTED:  Available?
MR. STARR:  Available, yes.  And, you know, a well
usually works into a surge tank, in other words, a tank, and
that tank fills up and supplies demand and then the pump turns
on and off to feed it.  It's not really a situation where the
pump goes all the time.  And there are times when the pump will
need service as well.  And then there are times when there will
be a fire and that will be additional to what house is used, so
the 45 percent figure is held throughout the industry to be the
realistic number.  So I do not feel that we can issue more
meters than would be allocable under 45 percent of the pump
capacity, and that's what this organization has been using.
CHAIRMAN TAKITANI:  It gets to, Ms. Ohlmsted, what's
called the operating factor and the demand factor.  And those
factors come into the two-thirds of two-thirds ratio to 45
percent.
MS. OHLMSTED:  So any time you have a well or water
source like that, you're figuring that at 45 percent, that's
what you can guarantee there will be for it, anything else is
extra, but at any given time, that might be all there really
is?
MR. STARR:  Yes, and over long, long term, it seems
to be about what it really is in practice.  So in theory, it
works that way.  In practice, it also has proven out to be.
CHAIRMAN TAKITANI:  David.
MR. CRADDICK:  For the short term, I don't know if 
you understood what Everett was saying, but for the next one or
two years, something like that, their demand is going to be
very, very low.  That pump is still going to be in there.  That
pump is still going to supply the Haiku, you see in that paper
there, it says about 1 million gallons.  It will be able to
supply that demand.  That demand is going to be cut off the
existing system.  There's two things that can happen.
You can get meters off of that, which I wouldn't
recommend, or that is dropped back up for that time.  If the
Board does nothing in those two years, then eventually his
demand picks up and we get back into a problem situation
again.  But the first few years when his well is on line, we've
got a much stronger system.  His well alone at 1.5 million
gallons is producing approximately 20 percent of the total
upcountry demand.  If our drought restrictions are 25 percent,
then we can live with it.  We've almost beat the drought system
right there by that well alone.
These wells here are one-and-a-half-million gallons
a day that takes it up to almost 40 percent of the total
upcountry demand that we can supply on an average day.  Now, on
peak days I think Jacky said was something close to 30
percent.  But be that as it may, we do get a big help for the
short term.  And if we do nothing, then eventually we eat into
that.  There's an allocation up here for 400,000 gallons a
day.
These wells here can easily back up that demand
without getting the system in any worse shape than what it is.
Again, Hawaiian Homes is not going to immediately be taking
400,000 gallons a day.  It's going to take a number of years
before it builds up to that.  If we don't get anymore ground
water into the system, we'll eventually get back to the
situation where we don't have the water to supply us, but short
term having one, two, three and the Kulamalu well, four wells
on line, that's a big help.  It takes them way over the 25
percent cutbacks that we've had to endure.
MR. STARR:  Mr. Craddick, I believe you're
misinforming the public here and I do not want to sit quietly
while it's happening.
MR. CRADDICK:  Jonathan.
MR. STARR:  Please allow me to speak.
MR. CRADDICK:  Jonathan, you butted in on me, so let
me finish.  What Jonathan is talking about there is an
agreement with HC&S.  I don't expect we have any final
agreement with HC&S how we are going to operate the system, and
I don't expect that any final agreement is going to have us
putting water in a ditch that we cannot use.  So I would expect
that when the time comes to negotiate that agreement, we will
be addressing that situation and that meeting is set up for the
2nd of September.
MR. STARR:  I would like to state clearly that the
H'Poko wells under the present agreement will not actually add
any water directly to the system.  And they will not alleviate
the drought problems.  Because if we add water into the system,
we have to cut back the amount that we're allowed to take from
the ditch so that it's not -- unless a different agreement is
made under the current agreement, it will not help in any way,
shape or form.
Similarly, I've heard it said that Mr. Dowling has
been kind enough to allow us emergency use of the well for the
time being, but there is an emergency pump in there, I believe
and that's capable of pumping water but only into the ditch
system and not into our system.  And I also believe that in
exchange for that, we're going to be trucking water to the
school.  We've already been trucking water to the school.  So
there's a price we're paying for that, however, it's something
that we would only use in the very direst straits.
So I do wish the public is able to understand this
clearly.  There is no silver bullet going to fix this drought
right now.  In the interest to try and understand this
generally, I'm trying to simplify this in my mind so I can
follow the water course.
UNIDENTIFIED SPEAKER:  The Kaupakalua well, whatever
water is coming out of it is going to the Kamole Weir,
correct?
MR. CRADDICK:  No.
UNIDENTIFIED SPEAKER:  It's not going into the
Kamole Weir?
MR. CRADDICK:  No, it's going into what I call our
clear well which is below the treatment plant, and what
Jonathan is talking about why we can't take more water is
because even though we put more water into that clear well, the
chlorine contact time, and, Paul, help me out here.  Paul is
our treatment plant manager.
But under the surface water treatment rule, as long
as we're putting surface water into that tank, it doesn't
matter what other kind of water we put in there.  We need to
look at the total flow in the tank that determines the chlorine
content time.  And if we do not meet that contact time, we go
into violation and we have a water notice.  And that is a short
term problem that can easily be fixed by putting a larger
reservoir there and increasing that chlorine contact time, so
we do not have to do what Jonathan is alleging is going to
happen for the long term.  I don't expect we're going to sit by
and keep that chlorine contact time, what is it, 300,000-gallon
reservoir there?
MR. SEITZ:  Yeah, 300,000-gallon reservoir but
there's also the Pookela tank.  We can increase the efficiency
of that by putting baffles in up at Pookela and that will allow
us to flow more water through the tanks.
MR. CRADDICK:  And then when that happens, any
ground that we put into that system once we've got two tanks
there or something like that so that the surface water can have
its own contact time, not be affected by any surface water, we
can deliver as much ground water into the system provided it
meets health department requirements without affecting that
temporary requirement for the health department.
UNIDENTIFIED SPEAKER:  But that's going to be a
permit arrangement?
MR. CRADDICK:  I would expect that's going to be a
permit arrangement, and it would not affect what we could get
out of the ditch.  I don't expect that we're suddenly going to
reduce what we can take out of the ditch because we are
supplying ground water into the system.
MR. LaFOND:  The 738,000 gallons credit from Mr.
Dowling, is that a guaranteed agreement?
MR. CRADDICK:  When you say guaranteed, I'm not sure
what you mean by that.
MR. LaFOND:  Is he going to get the 738,000 gallons
at any time that he needs it?
MR. CRADDICK:  Up to 15 years.
MR. STARR:  No, no, forever, yes, it is guaranteed.
He has 15 years to ramp up to utilizing it.
MR. LaFOND:  And that's only to come from Piiholo
system and the storage tank of Oskie Rice Arena, or can he
acquire his 738,000-gallon-credit from any source?
MR. STARR:  Below 2,000 feet.
MR. LaFOND:  Below 2,000 feet?
MR. CRADDICK:  Yes.
MR. LaFOND:  And for the time being, it's -- he's
figuring that his development is going to pull half a million
of the Piiholo system and then the remaining 238,000 could come
from anywhere; is that correct?
MR. DOWLING:  I'm sorry?
MR. LaFOND:  In full build out of Kulamalu, it's
expected to be a demand of about half a million?
MR. DOWLING:  Approximately.
MR. LaFOND:  Meaning 238,000 that could come from
anywhere or conceivably the Piiholo system.  At this time,
there's a certain amount of draw on the Piiholo system, and is
it correct that people who are now on the Piiholo system are
under water restrictions?
MR. CRADDICK:  Everybody is except ag.
MR. LaFOND:  That's before the 738,000 or even half
a million is being pulled out of the system?
MR. CRADDICK:  That's right.
MR. LaFOND:  Everett, there's property adjacent to
Kulamalu that's zoned hotel.  Have you acquired that?
MR. DOWLING:  One is not adjacent, no, we have not
acquired it.
MR. LaFOND:  I understand there was something in the
water agreement about if acquired, that some of the water could
go to that property.
MR. DOWLING:  Right.
MR. LaFOND:  And why would the County not want to
buy the credits to prevent worsening of a drought situation,
238,000 that could be prevented from exiting the system and
worsening other people's situations?
MR. CRADDICK:  That's the purpose of the meeting
tonight to see what the community feels so the Board can make
that decision in that type of matter.  But the other thing that
you said about getting water permanently, I think everybody who
gets a meter expects water to permanently come out that meter
once issued to them.  And in that respect, the water is
perpetually given.  There's no doubt about that.
And, you know, whether the ground water is going to
be dry or the aquifer ruined, if that's ruined, he has turned
the thing over to us for our operation.  And if it's ruined, it
will be ruined by us, not from his operation.  So he has to use
whatever water he can use in the 15 years, but granted once we
issue a meter, the water has to go to that meter for the rest
of the time.
MR. LaFOND:  I understand that.
MR. CRADDICK:  Just like anybody anywhere who gets a
meter expects water to come out of their faucet when they turn
the faucet on.
MR. CRAVALHO:  Mr. Chairman, let me clarify what Mr.
Craddick said.  He made reference that the allocation would
have to be used in 15 years.  That is correct up to a point.
There's a comma there, not a period.  And that 15 years may be
extended.  And there is no time limit as to how many times it
can be extended.  So from a theoretical point of view, it can
be extended ad infinitum and in effect become in perpetuity.
And this is what we need to understand.  In addition
to that, if the system is -- the water is turned over to us,
and for one reason or another, the quality of the water does
not meet the standards that are required, the person who
receives the credit, in this particular case the developer, as
I understand it, will have to adjust the consumption, but the
credits, the credits that were issued based on the original
figure of productivity of that well, those credits remain
intact.  They do not get reduced and they can be assigned and
they can be transferred.
So when you put all the little pieces together, if
one isn't careful, A, you end up with a system of extensions
that could be in perpetuity and raises the question of proper
public policy.  Any contract that is in perpetuity I believe
court cases have indicated that these contracts are illegal
because they do not meet the public trust.  That's one element
of it.  Secondly, the transfer or the assignment to the
assignees of the credits for any development below the 2,000
foot elevation, if one isn't careful as to where these
transfers are made, you can possibly end up with a land
development monopoly between a developer and whatever areas or
whatever party becomes the assignee of some of these credits.
So it's to look not just at the provisions of the
contract.  It's to look at how these contracts will work and
how they can be utilized and I'm reasonably sure I am correct
in what I am saying on these two items.  And these are the
dangers of -- that I expressed.  Now, I am not trying to say
that these things were inserted into the contract as something
deliberate or of malice.  I'm not saying that at all.  What I
am saying is whatever provisions are in that contract, if
operated as I think they could be operated, these are the kinds
of results you could have.  And this does require a review to
see that the basic intent that was involved with the Board of
Water Supply and the developer are carried out so that we don't
have these kinds of things happening 10, 15, 20 years down the
road when you and I are gone from the scene and some other
person will be acquiring control or ownership of a development
of this name, can utilize a whole variety of things.
And I'm particularly concerned if we're dealing with
so-called absentee owners who have very little, if any, concern
or could conceivably have very little, if any, concern as to
the total impact.  So it's to correct these kinds of things I
believe that we need to put our heads together and see how we
can get these assets used to carry out what we need to carry
out and do not put something in which inadvertently, not in our
intention, but inadvertently may serve as a drain of the water
supply for the upcountry farmers and agricultural pursuits.
And I think if we're not careful, there may be some provisions
in there.  And what I will say again and again and again, hey,
let's go look at them.  Let's go look at them.  And this is the
time to do it when we have all these negotiations going on, all
these discussions going on, the water utilization, the tanks,
the well, everything.  And I'm sure, I'm very sure we can reach
agreements on all of these items.
CHAIRMAN TAKITANI:  Yes.
MR. LaFOND:  I've got to identify myself for the
record Richard LaFond, and I'm a resident of Ulupalakua.
UNIDENTIFIED SPEAKER:  I'm just curious if somebody
has water credits and there's a drought, do their credits get
restricted like say 25 percent?
MR. CRADDICK:  If you have a credit, you don't have
any meter.  If you have a credit, nobody has been issued a
meter.  Once a meter is issued, your credits are reduced, and
whoever has that meter will be subject to the same restrictions
as anybody else.
UNIDENTIFIED SPEAKER:  So that other 738,000 gallons
will be cut back by 25 percent or whatever?
MR. CRADDICK:  Potentially, yes.
UNIDENTIFIED SPEAKER:  If it were metered out?
MR. CRADDICK:  Yeah.
UNIDENTIFIED SPEAKER:  It would be?
MR. CRADDICK:  The drought guidelines could change,
but under the current situation, yes, correct.
CHAIRMAN TAKITANI:  Mr. Blietz.
MR. BLIETZ:  The one thing I hear left out of this
process of Mr. Dowling using his water credits later is the
political process of him having to go through the planning
commission, having to go through maybe the council and the
normal procedure you would have to go through in the
development.  I don't think the fact that he's given a water
credit here means that he's going to get exactly what he wants
where he wants it without any overseeing later on in the
political process that he's going to have to.
And I know he understands that and it's just
something again probably that he took into consideration in
making this original agreement with you folks.  But don't think
that he's going to be able to carte blanc do what he wants to
do where he wants to do it without having the other processes
in the political or the planning or whatever else that's got to
be done, so I think you're leaving out that as one of the
ingredients in this procedure that he's going to have to go
through.
MR. CRAVALHO:  With all due respect to you, sir, the
process is there even if it does require the consent of the
planning department, et cetera.  And these things do take
place, that's true, but the process is also there and the
authority for the transferability of the credits is written
into the agreement.
And I have never seen any other agreement yet that
has this particular type of provision.  And it does not in my
estimation, I could be wrong, but in my estimation, this does
not meet public scrutiny and public awareness at all times and
does not protect the public because these agreements in effect
would be ad infinitum forever.
MR. BLIETZ:  Mr. Cravalho, whether he assigns it to
myself or to you or to anyone else, this person that gets this
credit, you can correct me if I'm wrong, they're still going to
have to go through the normal procedures of development.  And I
appreciate what you're saying about being able to transfer it
forever, but there's still going to be some -- there's going to
be some restrictions on what they're going to be able to do
with it.
MR. CRAVALHO:  Hypothetically, yes.  Actually, no,
and that's why politics and politicians do not have the best
reputations in the community.
MR. BLIETZ:  That's probably why the Water
Department was made independent sometime ago I think maybe
about the time that you were the mayor.
MR. CRAVALHO:  It became independent during my time
with the support of the administration.
MR. STARR:  My concern --
CHAIRMAN TAKITANI:  Mr. Starr would like --
MR. STARR:  My concern here is about the -- I would
feel a lot more comfortable if we knew where this extra water,
the additional 200-and-some-odd-thousand-gallons-plus, the
additional water that Mr. Dowling is asking for, if the pump
capacity were increased were to go to.  And I have a definite
concern since it can go to anyone any place below 2,000 feet.
My concern is that it might even be transported out
of the upcountry area perhaps down this new road, and some of
it may end up down by Kihei or who knows where, so I know, once
again, I know this question was asked before.  But I just would
really like to know where the current intention is for this
water to be used if you wish to answer that.
MR. DOWLING:  Kahoolawe.
MR. STARR:  I would go for that.
MR. DOWLING:  Below 2,000.  We don't know where it's
going to go at this point.  We've gotten 50 phone calls.  We're
looking at properties that we might acquire and we might use it
on those properties.  I don't know.  It's going to be -- to a
large extent it's going to be where we can receive the highest
return.
MR. DUNN:  I have one other aspect or facet of the
water situation that I would like to ask the Board to consider,
and that is with the population upcountry approaching some sort
of critical mass which changes the balance of the need between
sugar cane and pineapple and people that they consider or that
you consider the County bidding and acquiring the rights to the
water from East Maui.  I think this is -- this is truly not
right that we be at the mercy of East Maui Irrigation any
longer.
MR. STARR:  Good idea.
CHAIRMAN TAKITANI:  We've been at it for three hours
just about.  And we have meetings on Wednesday, Thursday and
Friday coming up, and you are all invited tomorrow to our
meeting.
MR. DUNN:  Time and place?
CHAIRMAN TAKITANI:  David K. Trask, Junior, Building
at 9 a.m. tomorrow morning.
MS. NAGO:  In Room 207.
MR. DUNN:  And, if you please, where is that?
CHAIRMAN TAKITANI:  That's right across from Ichiban
going up to the County building on Kaohu Street.
MR. CRADDICK:  I don't know the gentleman's name
back here, but he was coming very, very close to something in
the agreement.  The extensions that are allowed in the
agreement must be approved by the Board.  Each request for
credit by the developer must be approved by the water
director.  So they do not have a carte blanc to just do
anything they want to do.  Even the approval by myself can be
taken away from me and approved by the Board where I've got to
go to the Board and get their approval prior to me signing off
on these things, so there are I think checks and balances in
there, not to say that the Board Member is not correct in
saying that that could be abused.
There is also the chance for abuse, too, and if that
can be cleaned up, that's certainly something that we didn't
consider.
MR. CRAVALHO:  If one puts a drop-dead period, if
you want to extend it for another 15 years, as long as there is
a definitive drop-dead time because to place the fate in the
hands of five people or whatever the case may be I think could
be begging the question.  And if we put a drop-dead, you want
to extend it just as Mr. Craddick, not Mr. Craddick, but Mr.
Dowling wants an extension on the construction of his well,
he's coming in for the extension.  It can be done.  But we
cannot continue extending ad infinitum.  So say he has 15 years
to utilize his allocation of his credits and another 15 years
to be within reason, 30 years.  If he can't finish in 30 years,
forget it.
UNIDENTIFIED SPEAKER:  I just want to say about
these three issues that I think are going to be voted on, the
one that I have a feeling about from listening to you talk is
the fact of the matter is that anybody that develops a well or
whatever is planning to get about 45 percent usage of about 45
percent, so Mr. Dowling is getting basically the usage of that
well.  And there will be some extra, but that's not guaranteed
to really be providing anything else for the community beyond
his development.  That's my understanding.
In that case, I think that if we do get to pull the
200 million gallons out, I don't think you should get the extra
45 percent of the other 46 million that would come over the 164
million because something should go to the community.  Because
all of our developers, all the big hotels in Wailea, and I work
for them, all these places though, they get to bring in water
to their point of adequacy.  And they aren't responsible for
anything to better our community.
And I touch tons of these multimillionaire people
that come through all these big hotels and talk to them and
have intimate interaction, and they all say in my community, it
doesn't go that way.  Just like Mr. Starr was saying, in most
places, there's something set up by the County or the State
that does, that has to demand a certain amount of development
for the community for various important services for
developments to go in.  And I would say that my feeling when
the Board votes on it is, at least on that aspect, we need
something from him.  And I'm sorry it cost you so much, but I'm
hoping that in your businessman way, you're going to make your
money back on it.
MR. DOWLING:  We all pay taxes.
MR. CRAVALHO:  Mr. Chairman, may I come to the
defense of Mr. Dowling.  I've had some discussions with him
with respect to this water, et cetera, and my understanding is
can be made available to the County.  Am I right or wrong?
MR. DOWLING:  For a price.
MR. CRAVALHO:  Yeah, that's right.  So I think if we
move again in these directions of keeping a good, fine balance
and correct things that may be questionable so that we end up
in the positions that we all collectively would like to be,
then I think we're on the right track.
CHAIRMAN TAKITANI:  Okay.  I think you've seen the
Board in action.  You've seen it to be an open Board that wants
to be reaching out and feeling where you're at and knowing your
concerns.  And I think I speak for the rest of them that this
Board appears to be a visionary Board that's going to move out
and touch areas that heretofore have not been touched.
So by your contact, by your coming even tomorrow,
you're showing us and you're telling us the things you want
done.  So we appreciate your coming.  We hope that we can reach
some reasonable solutions tomorrow and we again thank you for
coming and we want to thank everybody who participated, our
staff.  And so w