Molokai: residents forced to pay 178% more for water

Posted by kahea at Sep 05, 2008 01:20 PM |

From Marti:
Big Mahalos to the people of Molokai for making the journey to Honolulu to raise awareness about Molokai Ranch’s new ploy to exploit cash for water.  I was shocked to hear that Gov. Lingle allowed Molokai Ranch to raise residents’ water rates 178% or risk losing all water services.  HEWA!  Access to clean water is a basic human right.  Molokai Ranch took on the responsibility of providing water to people (for a profit) all these years and now that profits are down they just want to close up shop.  That’s just wrong.

Rep. Carroll (D-Molokai) said it herself, “Molokai Ranch should not simply walk away from legal and moral obligations” to provide water service to the residents of Molokai.

There is word for what Molokai Ranch is doing, it’s called: extortion.  Good for Molokaiians for sticking up for themselves.  If this ridiculous rate increase is allowed to stand, then it sets a bad precedent for all of us in Hawaii who pay to have water pumped into our homes. Someday soon they are going to come knocking on all of our doors threatening to cut off our water if we don’t pay them a hundred times more.

A statement from the residents of Molokai:

In May, Molokai Ranch, citing financial impossibility but providing no financial evidence, suddenly announced the company would terminate its water and sewage utility services at the end of August. In July, The Department Of Health said: “The lack of a sustained and reliable source of safe drinking water in West Molokai will create a substantial danger…an imminent peril to the public health and safety.” By threatening to cut off an essential lifeline to the Molokai community, Molokai Ranch created a manmade and calculated crisis in order to avoid financial responsibility.

Without conducting a physical or financial audit of the utilities, the PUC bought into the Ranch’s threats, sided against the ratepayer, and claimed it “had no choice” but to raise the rates of Waiola O Molokai, Inc water utility by an unprecedented 178%.  The people of Molokai cannot afford to pay such exorbitant rate increases, and should not be forced to subsidize mismanaged utilities.

Not only was the rate increase unprecedented and unjustified, but the rate review and approval process was fundamentally flawed.  The PUC, which should be acting as a regulatory agency for the utilities, assumed an unprecedented role and filed for the rate increase on behalf of the utilities, as the Ranch claimed poverty (while still refusing to disclose financial records) and refused to file its own proceedings for a rate increase.  The PUC also disallowed Molokai ratepayers to intervene as a formal party to the proceedings.

Compounding the PUC’s procedural errors, the DCCA then failed to advocate on behalf of the affected ratepayers.  A 25% increase is normally the cap for a rate increase; instead of upholding this policy on behalf of the local consumer, the government agencies appeased the demands of a foreign-owned business and arbitrarily approved a 178% increase knowing that Molokai ratepayers cannot afford to pay such an egregious rate increase.

The Molokai community has filed a formal complaint with the Office of the Ombudsman to investigate the PUC for breaching a duty to ensure that all rates, fares, and charges are “just and reasonable” and to investigate the DCCA for breaching a duty to “represent, protect, and advance the interests of all consumers, including small businesses, of utility services”. The Molokai community asks that the August 14, 2008 rate increase approval be considered null and void.

The Molokai community asks that Governor Lingle, who oversees both the PUC and the DCCA, overturn the PUC’s rate approval and demand a fair and just rate review process. Molokai Ranch should be asking for a rate increase instead of the PUC, and the people of Molokai should be granted legal standing as a participant in the rate review process.

(photo by Trevor Atkins)

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