Bill Aims to Require Certain Homes to Convert From Cesspools to Septic

A bill proposing to require certain homes with cesspools to convert or connect to a septic system by a year after their sale is moving through the legislative process, with the goal to protect Hawai‘i’s ground and surface waters.

House Bills 1805, introduced by Hawai‘i Island Rep. Nicole Lowen, also aims to provide a tax credit up to $15,000 for homeowners who upgrade or convert a cesspool to a department-approved wastewater or sewage system.

It identifies homes on cesspools within 1,000 feel of a coastline, wetland, drinking well and other eco-sensitive areas as the properties that would have to convert.

The bill, should it become law, would go into effect in 2024.

The original bill proposed to mandate all homes on cesspools to convert by that date at the time of sale, but was amended this week to narrow the types of homes and expand the timeline to a year after the transaction.

The amended version passed the House’s Energy and Environmental Protection Committee Thursday, on which Lowen sits. The proposal must still pass the full House before heading to the Senate for approval before it could become law.

“It’s very early in the process,” Lowen said on the likelihood of the proposal becoming law. “It’s hard to make that sort of prediction. It’s too early.”

Lowen told Big Island Now that she brought the issue forward because it’s an important one that’s been a long standing issue on Hawai‘i Island, specifically.

“Hawai‘i has nearly 88,000 cesspools that release more than 50,000,000 gallons of raw sewage into the state’s groundwater and surface waters every day,” the bill states. It calls cesspools “an antiquated technology for disposal of untreated sewage that have the potential to pollute groundwater and harm streams and coastal resources, including coral reefs.”

The state approved in 2017 Act 125, Session Laws of Hawaii 2017, which established a requirement for the conversion of all cesspools in the state to DOH-approved wastewater management systems by 2050. Lowen said her bill would spring that law into action earlier for certain homes that will one day have to get there anyway. Time is of the essence, she said, because everyday homes with cesspools that don’t convert, “we still have severe environmental impact.”

Other bills are also being considered, Lowen explained, that could provide financial assistance via grants for low or financially qualified families. Whichever bill or bills come out of the process, the proposals are important because it forces stakeholders to “come to the table and talk about it instead of talking about it in hypothetical,” she said.

The West Hawai‘i Realtors Association opposes the proposal on grounds, among other reasons, that it will prove a financial burden to some homeowners because it would fast-track a rule change already approved in 2017.

A major difference would be that homeowners who thought they had more time to comply with the conversion would be on the hook financially for the improvements much sooner, should they want to sell their home in a few years.

The mandate infringes on property rights, the board’s president said. And with 55,000 cesspools on Hawai‘i Island alone, the law would hit the Big Island market hardest of all the islands.

“It is a cost that will be passed on to the buyer, no matter which way you paint it, the buyers pay in the end, even if it is done before it goes on the market, the sellers add on the costs to the home,” said Lance Owens, board president, but also speaking as an individual realtor with concerns about the bill. “It will make it a nice selling point, but still at a cost to the buyer. The more the buyers pay, the higher the rent is.”

Taking a snapshot of the local market, 211 homes were sold during the month of January 2022 and 130 of those will need the conversion by the 2050 standards. Taking the average cost of $15,000 to convert to septic, even if a fraction of the remaining 742 homes fall under the specified eco-sensitive areas, that would still be a fair amount of homes that would be required to pay for the change quicker than they had anticipated. And a sizeable portion of those home would fall on home that are below the median home sale price.

“Realtors want a clean environment like the rest of the world, we live here, raise our kids hear and care about the future like everyone else,” Owens said. “The most important point to make is that this legislation is premature.”

The bill recognizes the goal established by the Legislature in regards to conversion in 2050. However, the draft bill states, to achieve such a goal by then, the state must begin to take action now. The mechanism commonly used by other states that have faced similar challenges is to require that existing cesspool are converted at the point of sale, which the original bill did prior the amendments. While the scope of affected homes has been narrowed in the latest bill version, the mechanisms are still there, as would be financial support options through tax credits.

Rhode Island, New York, Massachusetts, and New Jersey are examples of states that have enacted such legislation.

“The Legislature also finds that the cost of cesspool conversion can be a challenge for low- and middle-income residents and that offering an income tax credit to offset the cost of cesspool conversion would help to mitigate the financial burden on these individuals,” the draft bill states.

The income based credit would be up to $15,000 for individual dwellings.

The bill also calls for appropriate funds for additional positions for the Department of Health to assist with monitoring and enforcing cesspool upgrades, conversions, and connections.