The Waiahole Ditch is owned by Waiahole Irrigation Co., which is itself a subsidiary of Amfac/JMB-Hawai`i, Inc. Bert Hatton, vice president of WIC, told the Water Commission about the company’s expectations and plans for continued operation of the ditch.
The company has agreements with leeward users to deliver water at the rate of 35 cents per 1000 gallons, Hatton said. At that rate, the company would need to carry 17 million gallons a day to paying customers. In addition, Hatton said, WIC was obligated to provide some 6 million gallons a day total to Dole/Castle & Cooke and Bishop Estate, in return for easements on their lands, and would have to allow 2 mgd to 3 mgd for “system losses.”
Of the 28 million gallons that flows through the ditch on an average day, then — assuming no windward diversions — Hatton testified that all but 2 million was needed in order to ensure that WIC’s operations would be profitable.
Under questioning last November, Hatton placed annual operating costs at around $930,000. Revenues generated from sale of 17 mgd at 35 cents per thousand gallons comes to just under $2.2 million per year. Even after capital costs associated with repairing the ditch are figured in — amounting to $1 million or more — Hatton allowed that the returns on investment would be approximately a million dollars a year.
The ditch was built between 1912 and 1916 for a total cost, at the time, of $3 million. Denise Antolini, an attorney for the Sierra Club Legal Defense Fund, which represented windward parties, asked Hatton if WIC “has more than amortized the capital cost that it invested in this system over the years through its charge for the transportation of this water.”
Hatton responded: “I can’t answer that question, because I have not done the calculation on the continuing capital investments in the system.”
Antolini: “You have no idea whether or not WIC has paid for the system by now, 80 years later?”
Hatton: “No ma’am, I don’t.”
A Conundrum
Hatton would not commit WIC to providing water to farmers indefinitely at 35 cents a gallon. Several times during testimony, it was brought out that sales of water to the golf courses, at $1.20 or more per thousand gallons, would help keep costs of water low to agricultural users.
But what would occur if golf courses took water that farmers needed? This question was posed to Grant Hamachi, president of the Hawai`i Farm Bureau Federation, by Commissioner Lawrence Miike:
“Would you prefer agriculture being charged 35 cents a gallon because golf course users are being charged $1.20, or would you rather all that water go to agriculture and you get charged 50 cents?”
“I prefer a low price,” Hamachi responded.
Volume 7, Number 2 August 1996