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HomeMy WebLinkAboutREP GOEAC 141 2026-06-16 2024-2026REPORT OF THE COMMITTEE ON GOVERNMENTAL OPERATIONS AND EXTERNAL AFFAIRS DATE: June 16, 2026 PLACE: Council Chambers Kailua-Kona, Hawaii TIME: 9:01 a.m. Council Chair and Members Hawaii County Council Hilo, Hawaii 96720 Re: Comm. No. 935/Res. No. 592-26 Your Committee on Governmental Operations and External Affairs, to which was referred Resolution No. 592-26, reports as follows: Resolution No. 592-26, transmitted by Deputy Corporation Counsel Diana Mellon -Lacey, via Communication No. 935, dated June 3, 2026, authorizes the Mayor to enter into an amended administrative order on consent agreement with the United States Environmental Protection Agency (EPA) under Section 309 of the Clean Water Act. Resolution No. 592-26 authorizes the Mayor to enter into an agreement with the EPA for a five-year extension for the Kula`imano Waste Water Treatment Plan Rehabilitation and Replacement Project and a three-year extension for the Papa`ikou Waste Water Treatment Plan Rehabilitation and Replacement Project. Ms. Mellon -Lacey was present in the Kona Chambers to share slides regarding this resolution. She said this is an amendment to a previously agreed upon consent agreement from 2022. She said this request for extended time requirements was initiated by the County. She went over the proposed amended deadlines for three-year extensions for these two projects. She said that these time extensions were primarily due to financial concerns. Finance Director Diane Nakagawa was present in the Kona Chambers to further explain the proposed schedule and financial implications to help even out the spending across the course of the next decade. She explained how this will help decrease the expected debt service payments. Committee Member James E. Hustace asked to clarify if the scale was in the thousands of dollars. Ms. Nakagawa said it is millions of dollars. Committee Member Dennis "Fresh" Onishi asked several questions about anticipation of additional changes in price. Ms. Nakagawa said that this project does account for inflation over the next decade. Member Onishi asked Environmental Management Director Daniel Girvan, who was present in the Hilo Chambers, if his office will be making sure that this project doesn't go over budget. Mr. Girvan said yes, they would do that. Member Onishi asked about accountability for these assurances. Mr. Girvan said that the funds in the repair budgets would be covering some of the upcoming work that is planned. GOEAC Report No. 141 GOEAC-141 Page 2 June 16, 2026 Member Onishi asked how they are anticipating adjusting for changes in technology. Mr. Girvan said that they don't anticipate shifting to different technology. Member Onishi asked if they have someone in the Department who might be monitoring upcoming legislation on these topics. Mr. Girvan said yes and that person is Kelly Hartman. Committee Member Heather L. Kimball asked Mr. Girvan about some of their environmental mitigation measures. Mr. Girvan discussed various repairs connected to the plant improvements, including trimming and removing overgrowth/vegetation surrounding the plants and potentially causing hazards to the power supply. Member Kimball asked Ms. Nakagawa what the overall estimated cost was. Ms. Nakagawa said that she can talk directly to the Council Members regarding the scale of these projects but that she cannot release numbers until after they receive bids. Member Kimball asked instead if there are expected increased costs for the long-term on these projects than what was originally projected. Ms. Nakagawa said yes. Committee Member Ashley L. Kierkiewicz asked Ms. Mellon -Lacey if she could upload corrected slides into Laserfiche. Ms. Mellon -Lacey said she would do so. Member Kierkiewicz asked Ms. Nakagawa what the original prevailing thoughts were regarding front -loading the costs rather than spreading them out. Ms. Nakagawa said that she wasn't involved in those conversations at that time but they believe these adjustments are necessary at this point in time. Member Kierkiewicz asked if this frees up any of the County's bond capacity for other projects. Ms. Nakagawa said yes, but as far as how much specifically was much harder to answer, as there are a lot of complexities. Member Kierkiewicz asked if the County is limited on how many extensions they can ask for. Ms. Mellon -Lacey said that we can always ask for reconsideration of a date for good reasons. She added that the longer dates get pushed out, the longer the County remains under the consent order. Member Kierkiewicz asked what the County would be doing to remain committed to this timeline. Mr. Girvan said that the department has been more successful with that lately, which has created a good standing with the EPA and has allowed them to make this adjusted agreement. He said that as Director he would be working towards meeting the deadlines. Member Kierkiewicz reminded Ms. Nakagawa that in the past she has requested regular updates on these projects and did not receive them. Ms. Nakagawa said that she would be happy to provide regular updates moving forward. Member Kierkiewicz asked when the public could expect to see updates on these projects available online. Ms. Nakagawa said that those updates are in the works and explained some of the steps involved with getting there. Ultimately, she said they were about a year out on having this information available. Member Hustace said that the request for regular updates should really be coming from the Department of Environmental Management and not from Finance. Member Hustace said that even with the revised schedule this is still approaching a financial capacity that the County has never been in before. Ms. Nakagawa said yes, they will be in a position where their debt services will exceed ten percent of the operating budget. Member Hustace asked if there GOEAC Report No. 141 GOEAC-141 Page 3 June 16, 2026 was anything else they were trying to plan or predict for beyond inflation costs. Ms. Nakagawa said that all of the potential rising costs are being considered and they will adjust where they need to. Committee Member Matt Kaneali`i-Kleinfelder asked when the conversations about the extensions began. Ms. Nakagawa said that they have been on -going for about a year. He said that this is the result of "kicking the can down the road" for twenty years. Ms. Nakagawa responded by saying that the progress to date has been moving forward with the recognition of the EPA due to the County making commitments for as much as $150 million. He then asked several questions around the timeline for the past execution of projects and agreements. Ms. Mellon -Lacey provided some dates and additional information. Chair Kagiwada asked about the projected deficit numbers and asked how these new dates would impact that. Ms. Nakagawa said that if all other factors remain the same, they would be decreasing, but that they would be providing updates when available. Chair Kagiwada said that she would like to see an updated chart including the current spending to see the whole picture at the next meeting. Ms. Nakagawa said that they have been working on getting that information and that expecting it by the next meeting may be too soon. She wants to be assured that the information she is sharing is as precise and accurate as possible. Your Committee on Governmental Operations and External Affairs is in accord with the purpose and intent of Resolution No. 592-26, and recommends its adoption. slm AYES NOES ABS EX GALIMBA X HUSTACE X INABA X KAGIWADA X KANEALI'I-KLEINFELDER X KIERKIEWICZ X KIMBALL X ONISHI X VILLEGAS X Respectfully submitted, COMMITTEE ON GOVERNMENTAL OPERATIONS AND EXTERNAL AFFAIRS JE A A, CHAIR OEAC REPORT NO.: 141 ADOPTED: JUL F 88 2026