IN THE MATTER OF THE APPLICATION OF HAWAII-AMERICAN WATER COMPANY FOR APPROVAL OF RATE INCREASES
AND REVISED RATE SCHEDULES AND RULES

DOCKET NO. 2007-0180

The PUBLIC UTILITIES COMMISSION of the STATE OF HAWAII (“Commission”), pursuant to Hawaii Revised Statutes §§ 269-12 and 269-16, HEREBY GIVES NOTICE that it will hold a public hearing on Monday, April 14, 2008, 7:00 p.m. at Hahaione Elementary School Cafeteria, 595 Pepeekeo Street, Honolulu, Hawaii, 96825 relating to the Application of HAWAII-AMERICAN WATER COMPANY (“HAWC” or “Applicant”) filed on October 29, 2007, for Commission approval of its proposed rate increases and revised rate schedules and rules for service. This is the second public hearing in this matter.
HAWC is a public utility authorized to provide wastewater collection, treatment, and disposal service to the residences, condominiums, and commercial establishments in the Hawaii Kai community on the island of Oahu, State of Hawaii.
Regarding its Hawaii Kai operations, HAWC, in effect and through its Application, seeks Commission approval of a general rate increase of up to approximately $1,324,488, or approximately 15.9 percent (15.9%), over total revenues at present rates for the calendar 2008 test year (“Test Year”). HAWC\u00D5s current rates and charges are based on interim rates that were approved by the Commission and became effective as of July 25, 2006 in its pending 2005 rate case proceeding in Docket No. 05-0103, as well as positions taken by HAWC with respect to the Public Authority – Other and Public Authority – Dwelling classifications as further discussed below. HAWC states that its requests for approval to increase its authorized revenues are necessary at this time to allow HAWC to cover increases in its operating costs since the time of its 2005 rate case proceeding and to allow it to continue to invest in system improvements and upgrades in the Hawaii Kai area.
HAWC\u00D5s current and proposed rates and charges are as follows:

Customer Class Current Proposed Percent Increase
Residential Units:

Single-Family Residential Unit $54.55 $63.65 16.68%
(monthly service charge per
dwelling unit)
Multi-Family Residential Unit $45.75 $53.40 16.72%
(monthly service charge per
dwelling unit)
Commercial (Non-Residential):
Food Service Operation $13.10 per $14.24 per 8.70%
1,000 gallons 1,000 gallons
of water of water
consumed consumed

Non-Food Service Operation $7.90** per $9.20 per 16.46%**
(including Public Authority – Other*) 1,000 gallons 1,000 gallons
of water of water
consumed consumed

Public Authority – Dwelling*** $2.93** per $3.26 per 11.26%**
1,000 gallons 1,000 gallons
of wastewater of wastewater
produced produced

*Public Authority – Other refers to the sewerage services provided by HAWC to the City and County of Honolulu (“City”), State of Hawaii (“State”) and other facilities (including parks, schools, fire station and Lunalilo Homes).
**The current rates of $7.90 per 1,000 gallons for Public Authority – Other and $2.93 per 1,000 gallons for Public Authority – Dwelling are based on HAWC\u00D5s positions taken in the 2005 rate case proceeding as well as in another proceeding before the Commission. However, and as acknowledged by HAWC in its Application, the actual ratemaking treatment for the Public Authority – Other and Public Authority – Dwelling class has not yet been determined by the Commission as a result of an unresolved dispute between HAWC, the City and the State. See Exhibit 4 of HAWC\u00D5s Application for an additional discussion of the current rates utilized by HAWC for purposes of this Application.
*** The Public Authority – Dwelling class refers to the services provided by HAWC to the City for the City\u00D5s residential customers in Hawaii Kai, including Kuliouou Valley, Portlock, Paiko and other areas which fall outside of HAWC\u00D5s service territory, but which are served directly by the City\u00D5s sewerage system and then connected to HAWC\u00D5s wastewater system for distribution and processing.

The Commission will investigate whether the proposed increases in HAWC\u00D5s rates and charges noted above are just and reasonable. The total revenue requirement for the Test Year will not exceed the approximately $1,324,488 amount over revenues at present rates that Applicant requests. However, the overall increases in rates and charges to be finally approved by the Commission, if any, may be higher or lower than HAWC\u00D5s proposed rates and charges noted above.
All interested persons are urged to attend the public hearing to state their views orally, in writing, or both. Written statements may be submitted prior to or at the public hearing. Statements may be mailed or delivered to the Public Utilities Commission, 465 South King Street, #103, Honolulu, Hawaii 96813. Statements may also be sent by electronic mail to the Commission\u00D5s e-mail address at Hawaii.PUC@Hawaii.gov. All written statements should reference Docket No. 2007-0180 and include the following information: (1) name of the person submitting the written statement; (2) organization the person submitting the written statement represents (if any); and (3) address of the person submitting the written statement.
Motions to intervene or participate in this proceeding shall comply with Subchapter 4, Rules of Practice and Procedure before the Public Utilities Commission, Hawaii Administrative Rules, Title 6, Chapter 61. A motion to intervene or participate in this proceeding shall be filed with the Commission by April 24, 2008.
Copies of the Application and supporting documents are available for public inspection during regular business hours at the following locations:
PUBLIC UTILITIES COMMISSION DEPARTMENT OF COMMERCE
465 South King Street, #103 AND CONSUMER AFFAIRS
Honolulu, Hawaii 96813 DIVISION OF CONSUMER ADVOCACY
Phone: (808) 586-2020 335 Merchant Street, Room 326
Honolulu, Hawaii 96813
Phone: (808) 586-2800

HAWAII-AMERICAN WATER COMPANY
6700 Kalanianaole Highway, Suite 206
Honolulu, Hawaii 96825
Phone: (808) 394-1280

Special arrangements to accommodate persons with disabilities can be made if reasonably requested in advance of the public hearing by contacting the Commission\u00D5s Honolulu office at the address listed above.