Engineer grilled over estimates on water bills

A plan to ask Oahu voters if they want to take away the Honolulu Board of Water Supply’s ability to recover "back payments" from customers who are undercharged gained preliminary approval from the City Council’s Executive Matters and Legal Affairs Committee on Tuesday.

A number of Council members grilled board Chief Engineer Ernest Lau about a spate of estimated bills issued by the agency during the first nine months of the year.

Lau, in response, promised to make changes to the way the agency issues estimated bills to its customers.

Nearly 4 out of 5 of the board’s 166,000 customers received at least one bill this year that was based on estimated water use, meaning they were either undercharged or overcharged for at least a month. Of those approximately 130,000 ratepayers, 79 percent received underestimated bills while 21 percent were overcharged.

BWS officials reiterated on Tuesday that they did not know how widespread the estimated bills had become until several weeks ago when asked by the Honolulu Star-Advertiser.

Council Chairman Ernie Martin noted that the largest number of estimated bills was sent from February through April.

"It’s hard to believe … that no one at the Board of Water Supply found that alarming at that time or had any knowledge," Martin said. "Something as substantial as 94,000 (customers receiving underestimated bills), how come nobody knew about it?"

Lau reiterated that he and his top officials were too busy ensuring staffing was in place to meet the demands caused by the flood of overestimated bills to take the time to examine the root causes.

Officials said they still don’t how many customers received multiple estimated bills that compounded the problem and led to what some customers called outrageous charges in the thousands of dollars.

Virgie Jaralba testified that her father, Melecio Cuaresma, was hit with bills totaling more than $7,500 for the family’s Kalihi home several weeks ago as the result of estimated bills. Both Cuaresma and his 89-year-old wife, Lorenza, are retired hotel workers on fixed incomes, Jaralba said, as she teared up before Council members.

A BWS investigator visited the home a few days before the series of bills arrived, but the family otherwise had no warning of the debt, Jaralba said. Eventually, the family was told it would have two years to pay off the bill, she said.

BWS spokeswoman Tracy Burgo said late Tuesday that the family’s house was found to have a leak of about 8,000 gallons a day. "We are working with them to determine what the adjustment to their bill should be," she said.

Councilwoman Kymberly Pine, who introduced the resolution for the Charter amendment, suggested she might be amenable to changing it to allow for the board to "back-bill" but only for a single month.

But Lau said he didn’t think that was a good idea.

Political activist James Anthony testified in favor of the resolution, arguing that BWS has long been "inefficient and, in a sense, corrupt." He added: "Ninety- four thousand got mis-billed? If this happened in the private sector, Ernest Lau would be looking for a new job."

Lau testified that while the number of estimated bills issued earlier this year was large, those problems have subsided. He also argued that barring the board from issuing estimated bills would tie the agency’s hands by inhibiting its ability to recover money owed for water used. He noted that the Council recently adopted a resolution asking the city auditor to conduct a performance audit of the agency, something he and other leaders at the board support.

Councilman Ikaika Anderson and Executive Matters Chairman Ron Menor said the method of estimating bills should be changed soon. "You need to correct it, you need to make substantial changes to it," Menor said.

Lau promised to change the way estimated bills are calculated, although when pressed, he could not say how quickly such a change could happen pending a study of the cost and work involved. "We will get back to you on a date for the conversion," Lau said.

Currently, estimated bills are issued when the agency cannot read a customer’s meter. If subsequent visits do not net a reading, the agency attempts to create an estimate by looking at the customer’s bills from the previous year, the previous month, and then the usage of "comparable" customers in the same general area.

Lau and other officials said there are a number of reasons so many bills needed to be estimated.

"I can say with relative confidence that the public’s perception of the Board of Water Supply, its confidence in the Board of Water Supply, is extremely low," Council Chairman Martin said.

Menor said he is not ready to support the amendment but recommended advancing it so more customers can come forward with their stories. Menor said he prefers no Charter amendments pertaining to the water board be approved until the audit is completed.