County of Hawaii 1997 - 1998 Annual Report: Department of Water Supply

Milton D. Pavao, Manager, was born and raised in Keaau (formerly known as Olaa). He attended Keaau Elementary & Intermediate School, Hilo High School, and the University of Hawaii, Hilo and Manoa Campuses, where he received his Bachelor of Science degree in Civil Engineering in 1972. Mr. Pavao began his career with the Department of Water Supply in July of 1972 and he worked for the Department of Water Supply as a summer student for four years prior to that. He was the Engineering Section head prior to being appointed Manager on January 3, 1995. Mr. Pavao is a member of the Hawaii Water Works Association and the American Water Works Association. He and his son, Anthony, reside on Pohaku Circle, Keaau.

Quirino Antonio, Jr., Deputy Manager, is a Big Island native. He grew up in Pepeekeo and attended Pepeekeo Elementary and Kalanianaole Intermediate schools. After graduating from Hilo High School in 1969, Mr. Antonio attended the University of Hawaii at Hilo. He went on to the University of Hawaii at Manoa and received a Bachelor of Science degree in Civil Engineering in 1974. During the summers in his college years, Mr. Antonio worked for the County's Planning and Water departments. Official government service began in 1974 with the Planning Department as a Planner-Engineer. Shortly after that, he transferred to the Department of Water Supply in the Water Resources and Planning Branch of the Engineering Division. He headed that branch as a Civil Engineer V for 12 years until the end of 1994. Upon selection by newly appointed Manager, Milton D. Pavao, and confirmation by the Water Commission, Mr. Antonio began serving as Deputy Manager in January 1995. Quirino and his wife, Audrie, have three sons and two grandchildren. They reside in Hilo.

ROLE AND DUTIES The Department of Water Supply of the County of Hawaii is a semi-autonomous agency charged with the responsibility of operating and maintaining its public water systems. The Department's primary purpose is to provide potable water in adequate quantities and safe quality to its customers. The duties of the Manager are to serve as the chief advisor to the Water Commission and as the top administrator for the Department. Among other things, the Manager directs the staff of the Department in activities in fulfilling its primary purpose. Operations Division The Operations Division has the responsibility of providing high-quality drinking water on a 24-hour basis through the operation and maintenance of water sources, transmission and distribution waterlines, reservoirs, pumping stations, treatment facilities, and communications equipment. Engineering Division The Engineering Division is responsible for the planning and construction of the public water systems, compliance with State and Federal drinking water requirements, and land surveys. Finance Division The Finance Division is charged with the responsibility of customer services, accounting and financial reporting, and data processing. STAFF The Department has a staff of 127 employees operating from several locations around the island. In addition to its main office in the County Building and the Operations Center in Hilo, the Department maintains district offices and baseyards in Waimea, Keauhou, and Waiohinu. Other than its administrative personnel, the Department is organized into three major divisions. Operations Division Head Mr. Kenneth Ikemori, born and raised on Maui, heads the Operations Division. After graduating from the University of Washington in Seattle with a bachelor's degree in mechanical engineering, Mr. Ikemori has worked with McDonnell-Douglas Astronautics and the Hilo Gas Company-BHP. His career with the Department began in 1975 and he has headed the Division since January 1995. Mr. Ikemori is a member of the American Waterworks Association, National Society of Professional Engineers, and the American Society of Mechanical Engineers. He and his wife, Joanne, have a daughter and a son. Engineering Division Head Mr. Owen Nishioka, born and raised in Hilo, currently heads the Engineering Division on temporary assignment. Mr. Nishioka received his bachelor's degree in civil engineering from the University of Hawaii at Manoa. Normally, Mr. Nishioka is the Section Head for the Engineering Design and Construction Section of the Division. He and his wife, Jan, have a daughter and a son. Waterworks Controller Mr. Richard S. Tsunoda, born in Hilo and raised in Papaikou and Paukaa, heads the Finance Division. Mr. Tsunoda graduated from the University of Hawaii at Manoa with a BBA degree in accounting. Mr. Tsunoda joined the Department in 1985 after working for Hilo Coast Processing Company. He is a member of the Hawaii Works Association, the American Waterworks Association, and the Government Finance Officers Association of the United States and Canada. He and his wife, Linda, have two daughters. Assistant Waterworks Controller Mr. Richard Sumada, born on Kauai and raised in Hilo, assists the Waterworks Controller. Mr. Sumada graduated from Washington State University with a bachelor's degree in accounting and from the University of Hawaii at Manoa with a MBA degree. Prior to joining the Department, Mr. Sumada was employed by the Legislative Auditor's Office of the County Council and by the accounting firm of Deloitte & Touche. Mr. Sumada is Certified Public Accountant. He and his wife, Carolyn, reside in Hilo. Number of Employees by Division and Bargaining Units DIVISION BARGAINING UNIT EMPLOYEES Administration Appointed 2 Excluded-13 1 Excluded-03 1 Unit 03 2 Subtotal 6 Finance Exempt 2 Unit 03 15 Unit 04 1 Unit 13 3 Subtotal 21 Engineering Exempt 1 Unit 03 11 Unit 04 1 Unit 13 11 Subtotal 24 Operations Exempt 1 Unit 01 54 Unit 02 8 Unit 03 11 Unit 13 2 Subtotal 76 Department Total 127 Water Commission The Water Commission consists of nine members who are appointed by the Mayor and confirmed by the County Council. Members serve five-year staggered terms and are representative of the nine political districts of the island. The Commission elects its Chairman and Vice-Chairman at the beginning of each calendar year. In accordance with the County Charter, the charge of the Water Commission is to manage, control, and operate the waterworks of the county. The Commission meets regularly on the fourth Tuesday of each month when it conducts the business affairs of the Department. In addition to these meetings, the Commission conducts a public hearing annually on the Department's operating and capital improvement projects budgets. The Commission may also conduct public hearings periodically on the Department's water rates and Rules and Regulations. Currently and since January 1997, Fred T. Yamashiro of South Kohala and John R. Souza of the Hamakua, respectively, serve as Chairman and Vice-Chairman of the Commission. Anna Cariaga of Ka'u left on an expired term in December 1997. Also at the same time, Malcolm Saxby of Puna also completed an expired term formally left by Debbie Makaweo. Kenneth Sowden filled an At-Large position in 1997, replacing Tom Poy. John Clark filled the position for Puna in early 1998. One position, representing Ka'u, remains vacant as of the end of the fiscal year. The following is a current list of members and term expiration: John Clark 12/31/02 George W. Harai 12/31/00 Edmund W. Hohu 12/31/99 John R. Souza 12/31/99 Kenneth Sowden 12/31/01 Yukio Takeya 12/31/01 Thomas P. Whittemore 12/31/98 Fred T. Yamashiro 12/31/98 1997-1998 BUDGET Operating Budget: Operating Revenues $19,844,000 Operating Expenditures $15,901,300 CIP Budget: $11,000,000 HIGHLIGHTS The following highlights the Department's activities for the fiscal year 1997-1998. Engineering Division The following major capital improvement projects were under construction, were in various stages of contract award, or, were in the planning and design phases during the fiscal year. Puna: Keaau-Pahoa Pipeline Replacement - This project will involve a 12-inch waterline installation aproximately 2,900 feet along the Keaau-Pahoa Road from the County's Solid Waste Transfer Station to the new Keaau Elementary School. The water system flow capacity will improve. Estimated Cost: $240,000 Olaa Station No. 5 to No. 6 Water System Improvements - This project consists of the installation of a new 12-inch waterline along the Volcano Highway from the Olaa Station No. 5 to the Olaa Station No. 6 reservoir and booster pump stations. Connections to existing waterlines, fire hydrant installations, service lateral relocations, booster pump installations, pump control building construction, and reservoir construction and demolition are other work that make up the project. Estimated Cost: $1,500,000 Olaa Road G.I. Pipeline Replacement - A new 6-inch waterline will replace leaking, galvanized iron pipe near the Hay Subdivision in Kurtistown. The new waterline will also provide fire protection to the properties in the proximity of the project. Estimated Cost: $50,000 South Hilo: Honolii Bridge Waterline Replacement - A new 8-inch waterline will replace the leaking 6-inch cast iron waterline crossing the Honolii Bridge. Estimated Cost: $144,000 Haaheo Booster Pump Replacement - This new booster pump station will provide increased pumping efficiency and will replace an older out-of-date facility. The work includes demolition of the existing pump station. Estimated Cost: $700,000 Waiakea Homesteads Waterline Improvements - This project involves the installation of 8-inch waterlines at two separate locations near Hoomalu Street. The Department will benefit from operating and maintenance cost savings upon completion of the project. Estimated Cost: $60,000 North Hilo: Ookala Production Well - Wellsite improvements include paving and chainlink fence installations. The well will be outfitted with connecting pipelines and electrical controls for its deepwell pump. A pump control building will be constructed to house the instruments that monitor and control the deepwell pump. The well will be the major water source for the Ookala community. Estimated Cost: $500,000 North Kohala: North Kohala Water System Improvements - New waterlines will be installed along portions of Kynnersly Road and Akoni Pule Highway. In addition, other miscellaneous water system upgrade work will be performed to improve the dependability of the water system in the Halaula area. Estimated Cost: $1,000,000 South Kohala: Waimea Treatment Plant Filter Upgrade - To comply with current surface water source treatment regulations, the existing water filter media will be removed and replaced. In addition, a air scouring system will be installed which utilizes air and water to clean the filter aggregate. Once in place, the treatment plant's filtering process will become more efficient. Estimated Cost: $500,000 Kawaihae 12-inch Waterline Replacement - Approximately 12,000 feet of 12-inch ductile iron waterline will replace an existing leaking and undersized 6-inch waterline. The project extends from the Queen Kaahumanu Highway-Kawaihae Road intersection to the Kawaihae-Mahukona Road (Akoni Pule Highway) intersection, including the Kawaihae Boat Harbor Road. Estimated Cost: $1,200,000 North Kona: Alii Drive Pipeline Replacement - New 12-inch waterlines will be installed along Alii Drive and along Hualalai Road from Kuakini Highway to Alii Drive. The project includes water service connections, fire hydrant installations, and other waterline appurtenances installations to improve the dependability of the Kailua Village area water system. Estimated Cost: $750,000 Holualoa 0.5 MG Reservoir - A new reinforced concrete reservoir will replace the existing steel water tank. The new reservoir has a larger storage capacity and will enhance the operation of the water system in the Holualoa area. Estimated Cost: $700,000 Ka'u: Pahala Exploratory Well - An exploratory well will be drilled and tested to determine the feasibility of using it as a stand-by source of drinking water for the Pahala area. Estimated Cost: $800,000 Finance Division REVENUES AND CUSTOMER SERVICES - Operating revenues totaled $20.4 million compared to $17.8 million the previous year, an increase of $2.6 million or 14.6%. This increase is due to the water rate increase that went into effect at the beginning of the year. The number of services increased by 314 or 0.9%, from 33,402 to 33,716 customers. Water consumption increased from 7.8 billion gallons or 21.4 million gallons per day last year, to 8.2 billion gallons or 22.4 million gallons per day this year. OPERATING EXPENSES - Operating expenses, including depreciation, increased by $1.9 million or 10.8 %, from 17.9 million last year to $19.8 million this year. Purchased power costs, accounting for 33.9% of total operating expense, increased 8.4% from last year to $6.7 million this year. Depreciation expense increased by 16.4% to $5.2 million, and labor costs increased 6.6% to $4.6 million, accounting for 26.4% and 23.1% of total operating expense, respectively. NET LOSS AND RETAINED EARNINGS - The Department recorded a net income of $1.0 million for the year. The adjustment for depreciation on contributed utility plant amounted to $3.8 million resulting in an increase in retained earnings of $4.8 million. This compares to a net income of $108 thousand and increase in retained earnings of $3.6 million the year before. Other income decreased $42 thousand. Other deductions decrease $282 thousand due to ''book'' gains from the retirement of utility plant assets. Operations Division Drought conditions seem to be an annual event that the Operations Division faced at the beginning of each year for the past several years. There were numerous improvements made over these years; however, the ''privatization issue'' set back scheduled improvements for as long as a year. This was coupled with a more severe drought lasting for a longer period of time. At this time, areas of Ka'u are still dealing with effects of the drought. It is to the credit of the Operations Division employees, with the assistance of the Micro Lab personnel, that the effect of the drought was minimal to the public. Assistance from the County Civil Defense Agency was valuable in having resources available to us in addition to radio announcements to alert the consumers of the areas affected and potential fire hazards, which in itself, jeopardized our stretched resources. Noted Division Projects were: 1. Keei Well ''C'' Repair. 2. Emergency Repair to Keonepoko Nui Deep Well. 3. Queen Liliuokalani Deep Well Variable Speed Drive Repair (motor control center). 4. Emergency Repair to Naalehu Deep Well motor and system restoration. 5. Kona Baseyard gasoline and diesel oil station - partially done in-house and partly contracted out. In-House Projects: 1. Huina Road 2,200 l.f. of G.I. pipe main replaced by 8'' D.I. pipeline. 2. For Alii Drive main replacement, relocated 24 service laterals from the existing 4'' G.I. pipe to the new 8'' D.I. main. 3. Waimea Treatment Plant, floc tank/paddle assembly repair. 4. Honalo Rubbish ''Pump Station'' - booster pump replacement. 5. Waiakea Uka Camp 7 Booster pump repair. 6. Naalehu Submersible booster pump repair. 7. Renovate existing building at the Saddle Road Tank site building for our Micro Lab water quality monitoring equipment. 8. Repainting of 0.01-MG Honomu Concrete Reservoir and chlorinator building. 9. Repair to building at Hawi Deep Well control building. 10. Relocate entrance gate and fence at Panaewa Well Site. 11. Renovate and repair Naalehu Deep Well building. 12. Replacement of fencing at 150-MG Waikoloa Reservoir No. 2. Drought - Related Projects: 1. Installation of temporary booster pump at Piihonua No. 1, Kahoama, and Lyman tanks. 2. Temporary hook-up of Parker Ranch Well behind Kamuela's Church row. 3. Temporary line hooked up to private well at Waimea Country Club. 4. Repair of Kohakohau Dam. 5. Installation of 5400 l.f. of 2'' plastic Drisco pipe from Kapue stream to our Kaieie Springs box. 6. Installation of emergency spigots and supporting stands at numerous locations. Deepwell pump production was 8.98 billion gallons as compared to last year's 8.85 billion gallons with the resulting electrical power costs increasing to $6,583,700 from last years $5,883,000, attributable to HELCO rate increase and the pumpage increase. OPERATIONS DIVISION WORK SUMMARY July 1, 1997 to June 30, 1998 PLANT REPAIR SUMMARY WATER SERVICE SUMMARY TANK: NEW SERVICE: 564 Mechanical Repairs 56 Electrical Repairs 258 CHANGE METERS: 1228 PUMPS: LOCK/REMOVE METERS 741 Motor Repairs 189 Control Repairs 765 UNLOCK/REINSTALL METERS 491 CHLORINATION: RELOCATE SERVICE/METERS 81 System Repairs 154 Pump/Motor Repairs 22 SERVICE LATERAL: Control Repairs 24 Changes 66 Repairs 620 PRV REPAIRS: 108 MAIN REPAIRS/CONNECTIONS: 375 BUILDING STRUCTURE REPAIRS: 358 HYDRANTS: 194 RESERVOIR STRUCTURE REPAIRS: 758 METER BOX REPAIRS 291 TELEPHONE ANSWERING SERVICE CALLS: 1207