Water For Life

As Maui‘s economy surges ahead, Mayor Alan Arakawa has big plans to resolve its water supply issues for future generations

September, 2004

The Maui water department’s tagline reads, “By water, all find life.” By extension, those who control Maui’s water resources influence the life of industries ranging from Upcountry farms to Central Maui housing developments. Following a 2002 charter amendment that downshifted the Board of Water Supply’s powers from decision-making to advisory, control of this precious resource now falls under the Office of the Mayor. “Now we can have a more cohesive plan and better coordinate the water department’s plans within a structure that everybody is a part of,” says Mayor Alan Arakawa.

Water supply has long been a challenge on Maui, where environmental groups, such as Earthjustice, have sought to return water from former plantation lands back into Maui streams, noting that demand for unchecked development outstrips the existing water supply. Arakawa says the problem is not supply, but delivery. On average, the water department provides 35 million gallons per day to all users on Maui and Molokai. However, the State Commission on Water Resource Management has determined that the total sustainable yield – the amount of water that can be withdrawn without damage – from all aquifers on Maui island is 476 million gallons per day. Arakawa says, “I don’t want to destroy the ecology to get to it. It’s a question of cost vs. what we want as an end product for our entire community.” Instead, Arakawa wanted to first get a handle on water consumption by allowing Iao Aquifer to become a state-designated ground water-management area – which the previous Board resisted – and restricting new reservations for water meters in Central and South Maui, which obligates the County to provide water service, until new water sources could be brought online.

Arakawa is negotiating with private landowners, such as C. Brewer and Alexander & Baldwin, for access to additional surface water. Long term, Arakawa says the cornerstone of future water supplies will be a desalinization plant in Central Maui. “We believe that, by going to desal, actually planning out our future, we will be able to provide water sources to our community for hundreds, if not thousands, of years,” says Arakawa.

In the meantime, the mayor has assumed responsibility for a water department that serves five main sections: Central Maui (Wailuku System), Upcountry (Makawao, Lower/Upper Kula System), West Maui, East Maui, and Molokai. Each section relies in varying degrees on a combination of surface water from streams and ditches and ground water from underground aquifers (formed by the fresh water floating on salt water and moving in volcanic rock voids). Each section also has a variety of demands for water. These range from residential and commercial developments to small farm and large ranch agriculture operations.


Of Maui’s many industries, agriculture holds a prime spot on the mayor’s priority list. Says Arakawa, “There’s no reason we cannot reinvigorate our agriculture industry to service our own community, as well as develop exports.” The mayor has his work cut out for him. According to the U.S. Department of Agriculture, Maui ranks third among the state’s four counties in the market value of agricultural products sold: $124.5 million in 2002, a 3 percent decrease from five years prior.

Building up the water delivery in rural Upcountry is a good place to start. Area farms’ and residences’ reliance on surface water from East Maui’s streams and ditches make it vulnerable to seasonal droughts. The most recent drought, which ended this March, lasted six years. As a result, Upcountry residents have been on waiting lists for years to receive water meters. Anticipating a new well next summer, Arakawa says, “By [September], we will be releasing water meters for the Upcountry area. This is a major shift. If things go according to our projections, we will exhaust the entire waiting list for water meters,” says Arakawa.

That should be good news for Thomas Kafsack, owner of Surfing Goat Dairy. Says Kafsack, “The need is already urgent. Families cannot subdivide their lots, because they can’t get water meters.” He hopes the mayor will see the water issue holistically rather than as separate systems: “If we combine the systems that’s a different way of thinking – a lot of cities have done it, the Middle East has done it, why can’t we?” Like many farmers in the area, he had instituted water conservation measures, lowering water usage by 30 percent. Likewise, Paula Hegele, president of Tedeschi Winery, says that the winery looks at everything from plant-ing drought-tolerable varieties to designing a more self-sufficient system that can reutilize water. Although drought conditions have been alleviated by increased rainfall, she says, there are additional concerns. “It’s a crumbling infrastructure that needs to be fixed. The piping and everything has not been changed for years; there’s been a lack of continuous maintenance,” she says.


A different kind of water challenge exists in Central Maui and South Maui, which have borne the brunt of the County’s population growth and development. The U.S. Geological Survey reports that demand for water has risen as the island’s population has doubled over the past 30 years. More recently, the U.S. Census pegged Maui’s growth rate at 6 percent, twice that of Oahu, and reported an estimated population of 135,605 for 2004. That’s within striking distance of the state Department of Business Economic Development and Tourism’s projection of 136,400 in 2010 (see chart above).

Population growth has resulted in demand for housing at all levels, says Maui County Council Chair Dain Kane: “There’s no contention that affordable housing is needed. But there’s demand throughout the scale, from high-end to the middle.” This demand is reflected in the escalating median price of homes. For May 2004, Maui Realtors reported that the median price for a single-family home was $620,000, 66 percent higher than the $372,500 median reported for the same month in 2003.

Arakawa considers low interest rates and rising market prices for homes as pluses for affordable housing, “[Developers] make less money on the affordable housing, but the escalating values of the open market more than compensate for revenue. In order to take advantage of the market, many developers are willing to work with us to fast-track their projects.” Maui County is able to do this via a state statute that waives requirements for affordable housing projects and requires the county council to process applications within 45 days. To keep the units affordable for buyers, the price now starts at 120 percent of median income instead of 160 percent, and there will be a 10-year minimum requirement that units be owner-occupied. Adding to the mix will be affordable rentals. “We are creating and allowing the combination of rentals and single-family homes in almost all of these projects, to be managed at federal Housing and Urban Development-affordable levels in perpetuity, so we will always have this inventory,” says Arakawa.

He says the County’s partnership with developers is essential because the most expensive component of building homes is installing the infrastructure. “We’re addressing those infrastructure needs by working with developers,” he says, who will pitch in to fund everything from bridges to road improvements to sewer systems. Because of this partnership, four affordable housing projects are in the pipeline for the Wailuku-Waihee area, which are expected to add 2,200 affordable units to Maui’s inventory in the next two years. Arakawa says he is also working with the Department of Hawaiian Homelands to develop affordable housing. “We’re trying to combine all the resources within the community as a group to address the severe situation we have to deal with,” he says.

When it comes to affordable housing, water supply is virtually a non-issue, says County Housing and Human Concerns Director Alice Lee, “I am not aware of any one project that has been stalled because of a lack of water. It’s pure speculation to say that it would, in the future.”


In the meantime, Barry Lewin, Maui Hotel Association president and Hyatt Regency Kaanapali general manager says, hotels have had conservation plans for the past five years. Still, he says, “We are concerned with long-term viability of our water sources. [The County has] experts in the field, and we ask questions that help us to make good decisions. But we trust the County’s research and support their efforts.” So far, he says, the hotels and their visitors have not been adversely affected by water supply issues.

That’s evident among Mainland visitor arrivals, which have remained steady, according to Maui Visitors’ Bureau Executive Director Terryl Vencl: “The West Coast continues to be our strongest market, but the East Coast is picking up, and most direct flights from places like Chicago and Atlanta help a lot. That’s where we see the growth coming from.” The Japanese market is another story. In 2003, the number of Japanese visitors to Maui dropped by 29.5 percent, the third year of decline, twice the 15 percent annual declines reported in 2001 and 2002. “The challenge for us is to get them from Honolulu to the Neighbor Islands, because we don’t have direct flights,” says Vencl. (see chart on page 32)

Lani Correa, executive director of the Maui Hotel Association, says that a stronger domestic economy means a growing number of Mainland visitors view owning a timeshare unit as an affordable alternative to owning a vacation home. By converting sections of their existing properties into timeshares, hotels have been able to tap into this trend without giving up their traditional hotel clientele. While hotel occupancy rates increased by 3.4 percent between 2002 and 2003, the occupancy still has not reached pre-9/11 levels (see chart on page 32). After 9/11, Correa says, some hotels’ dependence on the Asian market gave way to timeshare conversions, as the domestic market became a stronger source of visitors: “[Timeshare became] a way to meet the bottom line and for employees to continue to keep their jobs.” Visitor-related construction projects, such as the $25-million Kaanapali Ocean Resort, have helped boost commercial building permits by 292 percent, from $38.4 million in 2002 to $150.4 million in 2003. (see chart on page 32)

The impact of cruise ships is another matter. This month, the Mayor’s Cruise Ship Task Force is expected to issue its recommendations to limit potential negative environmental and economic impact from the industry. Correa says not all hotel association members are open to collaborating with the cruise-ship industry. “Some hotels are more cautious, because they feel that the ships can come and go [if they don’t make money here], while hotel general managers are stuck with the infrastructure issues that cruise ships don’t have to deal with.” Cruise ships might be considered floating hotels, but, unlike hotels, they are not required to pay the transient accommodation tax (TAT). “Counties get a share of the TAT, but we don’t know how much of what the cruise ships pay to the state comes back to the counties,” says Correa.

Economic development officer Lynn Araki-Regan, a member of the task force, considers cruise ship presence as a two-edged sword, because it can impact other industries that use the harbor. “If we had a harbor specifically for cruise ships, that would be fine. But it’s shared with all the other ships that come in and dock at Kahului Harbor. That’s an issue, because if there’s an overnight cruise, then the other ships may not be able to dock,” she says. On the plus side, first-quarter 2004 and 2003 figures from DBEDT show that, among Maui’s cruise ship visitors, East Coast visitors outnumbered those from the West Coast by two to one, supplementing visitor growth from direct flights.

If the mayor has his way, the ocean will do more than transport visitors. As of late June, he was investigating a Florida desalinization plant that uses modular filters, each with a capacity of 4.2 million gallons. “We would just keep adding filters up to the amount we need,” says Arakawa. While the number of filters in Maui’s future plant is still unknown, in this case, depleting the water source won’t be an issue. “Theoretically, the water resource from a desalinization plant is limited only by how much water the ocean can provide,” he says, with a laugh.

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