Opinion ID: 6493113
Heading Depth: 2
Heading Rank: 4

Heading: The Commission Violated The Public Trust In Its Treatment Of Diversions.

Text: Hui/MTF argues that the Commission erred in its estimation of HC & S, MDWS, and WWC’s diversions. Hui/MTF alleges that the Commission did not hold the divert-ers to their burden of proof and then “penalized the public trust” for the absence of data, that the Commission failed to consider variable offstream demands in setting the IIFS, and that the Commission did not properly require the diverters to justify system losses. Both Hui/MTF and OHA argue that the Commission erred in its consideration of Well No. 7; Hui/MTF also argues that the Commission erred in its consideration of recycled water as an alternative source. Finally, Hui/ MTF contends that the Commission erred in calculating HC & S’s acreages. The following sections consider each argument in turn.
Hui/MTF argues that the Commission erred because it did not hold the diverting parties to a burden of proof; they argue that Waidhole I requires noninstream users to justify their diversions in light of the water uses protected by the public trust. The flaw of their argument is that the portions of Waidhole I that they cite apply to the WUPA process. In the context of IIFS petitions, the water code does not place a burden of proof on any particular party; instead, the water code and our case law interpreting the code have affirmed the Commission’s duty to establish IIFS that “protect instream values to the extent practicable” and “protect the public interest.” In re Water Use Permit Applications “Waiāhole II ”, 105 Hawai'i 1, 11, 93 P.3d 643, 653 (2004); HRS § 174C-71 (2)(A). Accordingly, our review of the Commission’s analysis of the stream diversions must focus on whether or not the Commission properly discharged this duty. Where the Commission’s decisionmak-ing evinces “a level of openness, diligence, and foresight commensurate with the high priority these rights command under the laws of our state,” the decision satisfies close look review governing public trust resources. Wai’ola, 103 Hawai'i at 422, 83 P.3d at 685.
Hui/MTF argues that the Commission erred in its treatment of testimony from Dr. Ali Fares, a hydrologist who testified as an expert witness for Hui/MTF, OHA, and MDWS. Dr. Fares is an Associate Professor in the Department of Natural Resources and Environmental Management at the University of Hawaii, Mánoa. Dr. Fares testified regarding his estimation of the optimal irrigation requirements for HC & S’s sugar cane fields. Dr. Fares’s model considered historical rainfall data, evapotranspiration or pan evaporation data 20 , and data regarding the soil; he then calculated, over the historical period covered by the rainfall data, how much irrigation water would have been required to grow the sugar crop. Dr. Fares statistically analyzed the results to calculate the average amount of irrigation water needed in the wettest year and the driest year, as well as the amount of water that would have supplied the irrigation requirement between the two extremes. Dr. Fares calculated the optimal irrigation requirements using the 80 percent probability standard because it’s the industry standard utilized in both government and the private sector. Under the 80 percent probability standard, water meeting or exceeding requirements is available four out of every five days. HC & S employees testified that they used a different model called a water balance model, which differs from Fares’s model in that it uses “real-time data” collected from four rain stations and two evaporation stations located in the west Maui fields. The Commission found that real-time data is more reliable than long-term daily averages to calculate irrigation requirements. Both models also consider irrigation efficiency, or the percentage of water that is actually delivered to the plants, as opposed to the amount that is channeled through, and possibly lost in, the irrigation system. Fares used an 85 percent irrigation efficiency figure for his calculations; this is industry standard. HC & S’s estimations takes into account the different types of tubing, the length of tubes, and variations in topography; HC & S’s estimations utilize an 80 percent efficiency standard. The Commission accepted Fares’s use of 85 percent irrigation efficiency. HC & S stressed the importance of basing water management on actual field conditions, rather than models. The Commission found that Fares had not personally visited the HC & S fields or inspected the HC & S irrigation system; he also never studied actual water usage for sugar cane. Moreover, HC & S representatives testified that Fares’s model does not account for several factors increasing water usage, including water run through irrigation lines to detect leaks and irrigation water that is “lost” because it is applied just before it rains. HC & S also testified that it is impractical to assume that HC & S can irrigate to restore soil moisture exactly when necessary; this is not always the case for several reasons, including the facts that only a fraction of the fields actually receive water at any given time, and sometimes fertilizers and herbicides preclude watering. In its FOF/COL D & 0, the Commission accepted Fares’s estimates of irrigation requirements, but added five percent to account for the above-listed factors identified by HC & S that Fares’s model does not incorporate. Hui/MTF argue that this was error because the five percent increase is “random” and accounts for “unsubstantiated excuses.” HC & S responds that the Commission was not limited to choosing between Dr. Fares’s model and HC & S’s estimates, but rather that the Commission was empowered to utilize the information presented as it saw fit, as long as its decision was supported by the evidence. The court has held that, due to the fact that the Commission must articulate an IIFS at an “early planning stage” of water management, the Commission “need only reasonably estimate instream and offstream demands.” Waiāhole I , 94 Hawai'i at 155 n. 60, 9 P.3d at 467 n. 60. The court also explained that the IIFS may be based “not only on scientifically proven facts, but also on future predictions, generalized assumptions, and policy judgments.” Waiāhole I, 94 Hawai'i at 155, 9 P.3d at 467. In this case, the Commission concluded, based on the above-listed facts showing an incongruity between Fares’s model and field conditions, that the model would be insufficient to quantify actual irrigation requirements. The Commission then added five percent to Fares’s figures to account for this difference. The Commission fully explained its logic in predicting the irrigation requirements, and it settled on a figure that is a small deviation from the Hui/MTF expert’s proposal. Faced with the question of whether the record lacks substantial evidence to support the estimates, the answer must be no; the court therefore concludes that the Commission did not err in its use of Fares’s model numbers as a starting point in articulating irrigation requirements for HC & S’s fields.
Hui/MTF argues that the Commission erred in including fields 921 and 922 when calculating HC & S’s acreage. Hui/ MTF alleges error on two grounds: first, the Commission wrongfully took judicial notice of facts affecting an alternative water source for the fields, and second, the soil quality of fields 921 and 922 is poor and it is unreasonable to provide fresh water to cultivate them. As the Commission found, fields 921 and 922 are sandy “scrub land” that HC & S had never cultivated until sometime between 1995 and 1997 when it entered into an agreement with Maui Land and Pine (“MLP”), under which MLP delivered wastewater from its pineapple cannery to irrigate the fields for seed cane. After the close of evidence, the Commission took judicial notice of newspaper reports that: (1) MLP announced that it would cease pineapple operations, (2) Halii-maile Pineapple Company would “revive” the fresh fruit operations, and (3) this “should not result in a restoration of the wastewater source.” Hui/MTF argues that it was error for the Commission to take judicial notice of these three “facts”. Hawai'i Rules of Evidence (“HRE”) Rule 201, limits the scope of judicial notice to facts “not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court, or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” HRE Rule 201(b). In this case, the Commission took judicial notice of facts presented in two newspaper articles. There is precedent for taking judicial notice of facts as reported by newspapers. Application of Pioneer Mill Co., 53 Haw. 496, 497 n. 1, 497 P.2d 549, 551 n. 1 (taking judicial notice that a land court judge had announced his candidacy for public office, based upon newspaper articles submitted by the parties). In this case, however, the Commission went further than taking notice of facts reported in newspapers: it predicted the impact of those facts on HC & S’s water supply. HRE Rule 201 does not permit the Commission to take judicial notice of a possible effect of a change in ownership in the pineapple cannery. First, this prediction fits neither prong of the relevant rule of evidence; the effect of the change of ownership on HC & S’s water supply is neither “generally known within the territorial jurisdiction” nor “capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” HRE Rule 201(b). Second, the prediction that wastewater will no longer be available is purely speculative. In fact, one of the Commission’s FOF contradicts this speculation, stating “due to the shutdown of MLP’s cannery operation, MLP mill wastewater will only be able to supply approximately half of the irrigation requirements of Fields 921 and 922 in the future.” Furthermore, it is entirely possible that the company that “revived” operations also “revived” the practice of providing wastewater to HC & S. Hui/MTF are correct that the Commission’s taking judicial notice in this instance was improper. Hui/MTF also argues that the Commission erred in permitting HC & S to include fields 921 and 922 in its acreage because it is marginal farm land, or, as found by the Commission, “sandy ‘scrub land.’ ” Hui/MTF argues that the burden is on HC & S to show “the propriety of draining water from public streams” to irrigate this land which had been uncultivated until a wastewater source was available. The Commission found that fields 921 and 922 are similar to field 920, another “sandy ‘scrub land’ ” field on which HC & S ceased cultivation because it “has a very sandy soil and has consumed more water than other fields.” The Commission also explicitly excluded field 920 from HC & S’s acreage and water duty calculations, “because it has consumed more water because of the porosity of its sandy soil and its use for seed cane.” HC & S points to testimony from HC & S’s agronomist that HC & S is able to grow sugar on those fields because the sandy area has loam soil underneath it, thus permitting HC & S to achieve “good crop growth.” Though HC & S draws the court’s attention to this testimony in its briefing, this testimony is not included in the Commission’s FOP/ COL D & 0. In fact, the Commission found no explicit facts regarding the propriety of cultivating the fields; instead the Commission included fields 921 and 922 in HC & S’s acreage without explanation. As evinced by HC & S’s and the Commission’s treatment of field 920, the wisdom of irrigating fields 921 and 922 with Ná Wai ‘Ehá water is questionable. The record does not contain sufficient analysis to support the conclusion that fields 921 and 922 should be treated differently from field 920. Similarly, the record does not contain sufficient analysis showing that the Commission considered these fields with “a level of openness, diligence, and foresight” required when authorizing the diversion of our public trust res. On remand, the Commission must reevaluate its determination that HC & S should be permitted to divert Ná Wai ‘Ehá water to irrigate fields 921 and 922.
Hui/MTF also argues that the Commission erred in failing to hold HC & S and WWC to their burdens of proof regarding losses. Hui/MTF contends that diverting parties bear a burden of justifying losses and adopting practicable mitigation. WWC argues that there is no burden of proof on diverting parties in an IIFS proceeding; WWC also notes that “[n]othing within HRS § 174C-71(2) mandates that the Commission consider or not consider system losses. Likewise nothing within the public trust doctrine mandates that the Commission consider or not consider system losses.” HC & S responds that “some system loss, such as evaporation from open ditches and reservoirs, is unavoidable and not unreasonable,” and that the Commission’s determination of system losses is reasonable and not clearly erroneous. With regard to losses, the Commission found: 375. The great majority of WWC’s ditches are open and unlined. All of WWC’s reservoirs are unlined. 376. WWC did not address the feasibility of minimizing the losses from its system except to state that it “may ... in the future” have plans to line the unlined portions of their system. [...] 423. HC & S estimates that it loses 6-8 mgd through seepage from the Waiale reservoir, depending on the level of the reservoir. Seepage throughout the rest of the HC & S ditch and reservoir system is estimated to be 3-4 mgd. [ ... ] 425. HC & S acknowledges that “high density polyethylene lining could negate much of the seepage, not all of it” and that concrete lining “is obviously another option.” HC & S has no estimates of the cost to line Waiale Reservoir or the other reservoirs and ditches and has undertaken no engineering or financial analysis of what it would take to reduce the losses. The Commission concluded that WWC and HC & S have “not established the lack of practicable mitigating measures to address these losses.” The Commission then “as-sum[ed]” that “losses could be halved” by lining most of WWC’s reservoirs, and concluded that WWC’s reasonable losses are 2.0 mgd. The Commission also deemed HC & S’s reasonable losses to be 2.0 mgd, after estimating that HC & S could line the Waiale Reservoir to prevent 6-8 mgd, and, like WWC, could halve remaining losses. First, in considering these losses, it is necessary to recognize the magnitude of the losses. If the Commission’s estimates are correct and system losses run between 13-16 mgd 21 , then the minimal estimation of that loss is approximately twice the 6.84 mgd the Commission estimated for deliveries to all kuleana system users in Ná Wai ‘Ehá. The lowest estimation of losses, 13 mgd, is higher than the total volume that the final IIFS restore to the Waihe'e and Waiehu Streams. 22 Briefly stated, losses in the water system of Ná Wai ‘Ehá are massive. The Commission’s order that HC & S line the Waiale Reservoir to prevent a large portion of these losses is commendable and shows the “diligence” and “foresight” expected of the Commission in its management of the public trust. Second, WWC contends that the Commission, when setting an IIFS, does not have to consider system losses. The Commission does not respond to the argument in its answering brief, but the water code indicates that a diverter’s system losses may factor into the Commission’s estimations of nonin-stream uses when it sets an IIFS. The statute articulating the IIFS standards mandates that the Commission “weigh the importance of the present or potential instream values with the importance of the present or potential uses of water for noninstream purposes, including the economic impact of restricting such uses[J” HRS § 174C-71(2)(D). The plain meaning of the word “importance” requires the Commission to judge the value of a party’s noninstream use against the other present or potential uses. The value of diverting water, only to lose the water due to avoidable or unreasonable circumstances is unlikely to outweigh the value of retaining the water for instream uses. Therefore, the Commission did not err in considering losses. However, it appears that the Commission erred in its articulation of the burden of proof regarding losses. The Commission’s FOF/COL D & 0 twice cites Waiahole I and Waiahole II for authority that “[o]ffstream users have the burden to prove that any system losses are reasonable-beneficial by establishing the lack of practicable mitigation measures, including repairs, maintenance, and lining of ditches and reservoirs.” The Commission erred placing the burden of proof on the parties in the IIFS proceeding, as the authorities cited by the Commission apply in the context of a WUPA. In Waiahole I, the cited discussion of losses considered Waiahole Irrigation Company’s (“WIC”) request for 2.0 mgd to compensate for the losses of its ditch system. 94 Hawai'i at 118, 9 P.3d at 430. There, the Commission denied WIC’s request, but suggested that WIC could draw “non-regulated” surface water to cover the losses; on appeal, this court concluded that the Commission’s suggestion was erroneous for several reasons, and held that the Commission must consider the 2.0 mgd as a “‘use’ pursuant to the permitting process.” 94 Hawai'i at 118, 173, 9 P.3d at 430, 485. On remand, the Commission found that “Operational losses are a normal component of any water delivery system” and therefore issued a permit to WIC’s successor in interest, Agribusiness Development Corporation (“ADC”), to cover the losses. Wa iāhole II, 105 Hawai'i at 27, 93 P.3d at 669. When that decision returned to this court on further appeal, this court held that the Commission’s decision was incomplete because it did not include findings that ADC met its burden as a permit holder pursuant to HRS § 174C-49(a) 23 . Id. This burden is articulated in the WUPA statute, but is absent from the statutes governing IIFS. The Commission erred when it imposed a WUPA burden on the diverting parties in the IIFS CCH. As noted above, the burden in setting an IIFS is on the Commission to “protect instream values to the extent practicable.” Waiāhole II, 105 Hawai'i at 11, 93 P.3d at 653; HRS § 174C-71(2)(A). The court concludes that the Commission did not meet this burden when it “as-sum[ed]” that WWC’s and HC & S’s losses could be halved. As discussed above, the court has held that, due to the fact that the Commission must articulate an IIFS at an “early planning stage,” the Commission “need only reasonably estimate instream and offstream demands.” Waiāhole I, 94 Hawai'i at 155 n. 60, 9 P.3d at 467 n. 60. Though reasonable estimates are permitted at this stage, the Commission did not provide any analysis on how it reached that figure to show that it had “reasonably estimate[d]” that half of the losses could be eliminated. In choosing a number that appears to be arbitrary, the Commission could have significantly over- or underestimated the potential for mitigation of losses in HC & S’s and WWC’s water systems. On remand, the Commission must “reasonably estimate” losses, mindful of its duty to “protect instream values to the extent practicable.”
Hui/MTF argues that the Commission arbitrarily minimized Well No. 7’s potential contributions. OHA raises a similar challenge regarding Well No. 7; it contends that the Commission did not properly weigh HC & S’s potential use from the well. More specifically, OHA claims that HC & S did not demonstrate that Well No. 7 is not a practicable alternative, and that the Commission’s lowering of Well No. 7’s yield was arbitrary and capricious. Well No. 7 is the only one of HC & S’s sixteen brackish water wells on its plantation that is able to introduce water into HC & S’s internal ditch system. From 1927 until the 1980s, Well No. 7 was HC & S’s primary source of irrigation water for the 3,650-acre Waihe‘e-Hopoi Fields; HC & S pumped an average of about 21 mgd from Well No. 7 until 1988, when a competing sugar company ceased operations, freeing up a great amount of Na Wai ‘Eha water for HC & S use. For the past twenty-five years, HC & S has minimized use of Well No. 7, but it has occasionally used the well; in fact, it used the well heavily on two occasions: for six months from June through November of 1996, HC & 5 pumped an average of 25 mgd, and for six months from May through October 2000, HC 6 S pumped an average of 18.9 mgd. Well No. 7 is currently configured with three pumps: pumps 7A and 7B are at water level and can each pump 17.5 mgd to ground level, for a total of 35 mgd, which it can distribute to about 800 acres of the 3,650 acres of the Waihe‘e-Hopoi Fields. The third pump, Pump 7C, is a booster pump at ground level that HC & S claims can pump 14 mgd 24 from pump 7A to Waihe‘e Ditch for distribution to all of the Waihe'e-Hopoi Fields except for the 175-aere Field 715. During the hearings, HC & S offered four explanations for its argument that it would be impracticable to rely heavily on water pumped from Well No. 7. First, HC & S estimates that it would incur an estimated $1 million dollars in capital costs to install new pipelines and pumps. Second, HC & S claims that it does not have adequate electrical power to run the pumps on a consistent and sustained basis because of its power contract with Maui Electric Company (“MECO”). HC & S estimates it would incur costs of $777,650 to upgrade its pumps and electrical equipment to meet MECO’s standards for servicing such equipment; HC & S also claims it would cost $7,440 per day for energy to run Well No. 7, and that HC & S would lose $1.8 million in revenues under its contract with MECO as well as a decrease in HC & S’s avoided cost rate and penalties three times the power rate for power it does not deliver. Third, HC & S claims that increased pumping would exacerbate the degree to which sustainable yield is already being exceeded and reduce the recharge from the imported surface water that Sustains the Kahului aquifer. Fourth, HC & S claims that increased pumping of the well would increase the salinity of the water. The Commission’s Final D & 0 considered the first three factors listed above (the capital costs, energy costs, and aquifer recharge) and determined that HC & S must pump only 9.5 mgd from Well No. 7. The Commission determined that Well No. 7 is an alternative that most likely would not be available on a daily basis, citing the uncertainties about the recharge rate and electrical power. In determining that HC & S must pump 9.5 mgd, the Commission required that HC & S pay additional energy costs to pump the water, but did not require HC & S to accrue any capital costs. The D & 0 requires HC & S to provide monthly ground water use reports documenting the volume of water pumped from Well No. 7, along with ground water levels and salinity measurements. In his dissent, Dr. Miike criticized the Commission majority for its treatment of Well No. 7, writing that the 9.5 mgd figure is “without any credible foundation.” This is a main point of error on appeal for Hui/MTF and OHA; they argue that the Commission arbitrarily minimized Well No. 7’s potential contributions as an alternative source to Na Wai ‘Eha water. The Commission’s response is contradictory and makes it clear that guidance is necessary in this area. First, the Commission responds that “neither the statutes nor the administrative rules require an analysis of practicable alternatives in setting the IIFS.” The Commission then asserts that Well No. 7 “had a place” in the IIFS analysis because it is a consideration when weighing instream values with offstream purposes when establishing the IIFS. The analysis with regard to alternative sources is similar to the analysis with regard to system losses, supra. The water code requires the Commission to “weigh the importance of the present or potential instream values with the importance of the present or potential uses of water for noninstream purposes, including the economic impact of restricting such uses[.]” HRS § 174C-71(2)(D). The plain meaning of the word “importance” requires the Commission to judge the value of a party’s noninstream use against the other present or potential uses. Furthermore, as the water code’s Declaration of Policy explains, “[t]he state water code shall be liberally interpreted to obtain maximum beneficial use of the waters of the State....” HRS § 174C-2(c) (1993). Allowing a water user to divert water from the public trust res when that user has exclusive access to an alternative water source that is currently un- or under-used would not effect the Legislature’s policy as expressed in the water code. This suggests that the Commission’s second argument is correct; Well No. 7, as an alternative source, “has a place” in the analysis of setting an IIFS because the availability of alternative water sources necessarily diminishes the “importance” of diverting Ná Wai ‘Eha water for noninstream use. Hui/MTF, OHA, HC & S, and WWC do not dispute the relevance of Well No. 7 water to the IIFS analysis; they do, however, disagree on whether the diverting party bears a burden of proof with regard to this point of analysis. Hui/MTF argues that HC 6 S bears a burden to prove that using Well No. 7 is not practicable, and that the Commission is “duty bound” to hold HC & S to its burden. OHA agrees that the burden falls to HC & S to demonstrate that Well No. 7 is not a practicable alternative. HC & S and WWC both argue that the burden falls to the Commission to determine IIFS that best serve the public interest. The Commission’s FOF/COL D & 0 does not specify a burden of proof for alternative sources, as it did for system losses. In its introduction, however, the Commission does specify a general standard that “[f]or those seeking private, commercial uses of water, there is a higher level of scrutiny. In practical terms, this means that the burden ultimately lies with those seeking or approving such uses to justify them in light of the purposes protected by the trust.” More specific to alternative sources, the Commission stated that it “is not obliged to ensure that any particular user enjoys a subsidy or guaranteed access to less expensive water sources when alternatives are available and public values are at stake,” and also that “[a]n applicant’s inability to afford an alternative source of water, standing alone, does not render that alternative impracticable.” In evaluating Well No. 7 and HC & S’s four arguments listed above, the Commission found the following: 494. [... ] From 1927 until additional Na Wai ‘Ehá water became available in the 1980s, HC & S’s primary source of irrigation water for its Waihe‘e-Hopoi Fields was Well No. 7, [ ... ] a brackish water well. 495. Between 1927 and 1985, HC & S pumped an average of about 21 mgd from Well No. 7. Since the additional Na Wai ‘Ehá flows became available. HC & S has minimized its use of Well No. 7 but used it heavily on to occasions: e.g., for the six-month period from June through November of 1996, an average of 25 mgd was pumped; and for the six-month period from May through October of 2000, an average of 18.9 mgd was pumped. [...] 497. According to HC & S, as currently configured, Well No. 7 can supply only 14 mgd to the Waihe'e-Hopoi Fields, with the exception of Field 715. However, HC & S’s records do not indicate that Well No. 7 was ever configured differently than its current configuration. 498. HC & S estimates that it would cost approximately $525,000 to add another booster pump and additional distribution pipeline to increase the volume that can be pumped from Well No. 7 to HC & S’s Waihe'e Ditch from 14 mgd to 28 mgd; and the cost of an additional pipeline to reach Field 715 would be $475,000. 499. HC & S also claims that it does not have adequate electrical power to run the pumps for Well No. 7 on a consistent and sustained basis because of its power contract with Maui Electric Company (“MECO”) and limitations of its capacity to generate electricity through its system of burning bagasse and other supplemental fuels in its power plant and the operation of its hydro power turbines on its ditch system which are supplied by East Maui water[.] 500.HC & S also claims that any increased pumping of water from the Kahu-lui aquifer to replace surface water being imported from the West Maui Ditch System would both exacerbate the degree to which the sustainable yield is already being exceeded and reduce the recharge from imported surface water that sustains the aquifer. These findings of fact are plainly descriptions of testimony. In its conclusions of law section examining “Reasonable Offstream Uses,” the Commission restated several of these “findings,” indicating that the Commission adopted the testimony as fact. The Commission then stated The combined facts that the current sustainable yield of the aquifer is already being exceeded; that increased pumping from Well No. 7 may exacerbate that strain; and that the historically higher levels of pumping occurred during a period where furrow irrigation methods were affecting recharge rates for the aquifer, the practical alternative from Well No. 7 is lower than historic rates. Considering these uncertainties in combination with the Commission’s decision to place the full burden of remedying losses immediately upon HC & S, discussed intra, the practical alternative from Well No. 7 is deemed 9.5 mgd. This alternative will not require capital costs, only the costs of pumping. The Commission erred in adopting HC & S’s testimony without any assessment of the evidence on the record that contradicted HC & S’s arguments. As the court explained in Wai&hole I, where “the record demonstrates considerable conflict or uncertainty in the evidence, the agency must articulate its factual analysis with reasonable clarity, giving some reason for discounting the evidence rejected.” 94 Hawai'i at 163-64, 9 P.3d at 475-76. The record shows that the Commission did not explain its analysis with “reasonable clarity” regarding any of the “facts” recited above. For example, OHA shows that, with regard to HC & S’s claim that pumping Well No. 7 would result in a diminished aquifer, HC & S had represented the exact opposite to the Commission in another context but around the same time as the hearings in this ease. OHA’s exhibit C-90 is a letter dated January 11, 2008 to the Commission from HC & S’s Senior Vice President, Rick Vol-ner, regarding the Public Review Draft Water Resource Protection Plan (“WRPP”) for parts of West Maui, including the Kahului aquifer. In its letter, HC & S states that it has five wells in the Kahului aquifer and eleven wells in the Pa‘ia aquifer. HC & S writes Over the last twenty years, the daily average rate of withdrawal, by year, for all 16 of these wells combined has ranged from approximately 40 mgd to as much as 112 mgd far in excess of the combined sustainable yield of between 7 and 8 mgd for the Kahului and Pa‘ia aquifers recommended in the Draft WRPP. Several of these wells have been in operation for more than a hundred years, and all have been in place and operated for many decades without any long term deterioration in water quality. Though these written comments contradict the evidence it presented regarding its inability to pump Well No. 7 due to the alleged recharge problem, the Commission does not explain why it disregarded the written comments in favor of HC & S’s evidence supporting the existence of a recharge problem. The Commission attempted to analyze the economic impact of requiring HC & S to augment Na Wai ‘Eha water with water from Well No. 7. HC & S claimed that the economic consequences of reduced allowable diversion or increased requirements to pump Well No. 7 would result in HC & S discontinuing all operations on Maui. The Commission found that: HC & S had not “done any economic analysis on how a reduction of available surface water in this case would force HC & S to shut down”; Mr. Holiday[, President of HC & S’s Agricultural Group,] “[could not] say yes or no” when asked whether shifting 9 mgd of Ná Wai ‘Ehá surface water to another purpose would prevent HC & S from being viable, but testified that HC & S is “assuming” that impact “for planning purposes.” As the Commission recited in its FOF/COL, Catherine Chan-Halbrendt, Professor in the Department of Natural Resources and Environmental Management at the University of Hawai'i, Mánoa, testified that “the lack of any economic analysis, or the data required to conduct such an analysis, prevents anyone, including this Commission, from evaluating HC & S’s claims of economic impact.” The Commission agreed that the record was insufficient, stating “It would have been more helpful to the Commission if either or both parties had provided information on incremental decreases in surface water to the 5,000 acres of HC & S’s West Maui Fields.” Nonetheless, the Commission stated that “the lack of such analyses does not prohibit the Commission from its duty of weighing instream values with non-instream uses.” The record shows, however, that the Commission did not merely weigh instream values with noninstream uses; rather, the Commission’s own explanation of how it arrived at the 9.5 mgd requirement shows that cost to HC & S was the determinative factor. The Commission concluded first that there were uncertainties regarding the aquifer recharge, and that therefore “the practical alternative from Well No. 7 is lower than historic rates.” That is, even though the Commission found that historical rates for Well No. 7 showed that “[b]etween 1927 and 1985, HC & S pumped an average of about 21 mgd from Well No. 7,” the Commission decided that a lower number would be more appropriate. Then, in determining that lower number, the Commission explained: Considering these uncertainties [regarding aquifer recharge] in combination with the Commission’s decision to place the full burden of remedying losses immediately upon HC & S, discussed intra, the practical alternative from Well No. 7 is deemed 9.5 mgd. This alternative will not require capital costs, only the costs of pumping. (emphasis added). That is, since the Commission already required HC & S to pay to eliminate some of its system losses, it would not require HC & S to incur any capital costs to improve Well No. 7. The Commission erred when it made its decision regarding Well No. 7 based on cost while explicitly acknowledging that it did not have the data it needed to truly analyze cost. “[T]he Commission must not relegate itself to the role of a mere ‘umpire passively calling balls and strikes for adversaries appearing before it,’ but instead must take the initiative in considering, protecting, and advancing public rights in the resource at every stage of the planning and decisionmaking process.” Waiāhole I, 94 Hawai'i at 143, 9 P.3d at 455 (citations). When such critical information is missing, the Commission must “take the initiative” to obtain the information it needs. Where the Commission’s decisionmaking does not display “a level of openness, diligence, and foresight commensurate with the high priority these rights command under the laws of our state,” the decision cannot stand. Wai’ola, 103 Hawaii at 422, 83 P.3d at 685. On remand, the Commission must revisit its analysis of Well No. 7 as an alternative source to diverting Ná Wai ‘Ehá water, as explained in this opinion.
Hui/MTF argues that the Commission erred in failing to consider the practicability of using recycled wastewater from the Wailuku/Kahului wastewater treatment plant. In its FOF/COL D & 0, the Commission concluded that at least 5 mgd of recycled wastewater “is currently disposed of via underground injection.” In response to Hui/ MTF’s urging that HC & S be required to utilize this water, the Commission found that “the County currently has no existing infrastructure to deliver recycled wastewater to HC & S’s fields.” The Commission also heard testimony that “private parties could construct their own pipeline to the plant.” The Commission appears to have concluded that this alternative did not merit consideration, based solely on the current lack of infrastructure. This decision does not evince “a level of openness, diligence, and foresight commensurate with the high priority these rights command under the laws of our state.” Wai’ola, 103 Hawai'i at 422, 83 P.3d at 685. The recycled wastewater was quantified as “at least 5 mgd”; 5 mgd is nearly enough water to satisfy all kuleana users in Ná Wai ‘Ehá and would be a significant contribution to HC & S’s water needs. On remand, the Commission must evaluate this alternative with “openness, diligence, and foresight” to determine whether it is a viable alternative to diverting Ná Wai ‘Ehá water.