HB306 SD1

SECTION 1. The legislature finds that in 1987, the state water code was adopted to protect the precious water resources of the State. To better enable the department of land and natural resources and commission on water resource management to carry out that mission, the legislature further finds that the water code's penalties and fines must be amended and increased to serve as an effective deterrence to violators.

The legislature further finds that increasing potential fines for water code violations will also:

(1) Help to preserve water resources by ensuring the sustainable management and conservation of limited water resources for future generations, particularly in areas facing over-extraction or misuse;

(2) Protect the ecosystems by safeguarding wetlands, rivers, and aquifers that depend on healthy water systems to maintain biodiversity and environmental balance;

(3) Promote public health and safety by preventing contamination of drinking water supplies and reducing health risks associated with waterborne diseases and pollutants;

(4) Promote climate change resilience by regulating water usage and protecting vulnerable water sources to address challenges posed by prolonged droughts, erratic rainfall, and rising sea levels;

(5) Promote economic stability by helping to avoid economic losses in agriculture, tourism, and other industries that rely heavily on consistent and clean water supplies;

(6) Promote enforcement of equity and justice to ensure fair access to water resources for all, including marginalized communities that may be disproportionately affected by water scarcity or poor water management;

(7) Increase accountability for violations to deter illegal activities such as unauthorized diversions, pollution, or overuse of water resources by imposing stricter penalties and fines; and

(8) Increase compliance with federal and state mandates to meet legal obligations under federal or state environmental protection laws, ensuring alignment with broader water management and conservation goals.

The purpose of this Act is to:

(1) Ensure that all violators of the state water code are held accountable for their violations by adding a minimum penalty and amending the maximum penalty, with scheduled incremental increases, per violation of the state water code and clarifying what constitutes a separate offense; and

(2) Require the commission on water resource management to consider certain factors when imposing penalties.

SECTION 2. Section 174C-15, Hawaii Revised Statutes, is amended to read as follows:

"§174C-15 Penalties and common law remedies. (a) The commission may enforce its rules and orders adopted pursuant to this chapter by suit for injunction or for damages or both.

(b) Any person who [~~violates any~~]:

(1) Violates any provision of this chapter[~~, or any~~];

(2) Violates any rule adopted pursuant to this chapter[~~, may~~];

(3) Violates any order of the commission regarding the enforcement or application of any provision of this chapter or rule adopted under this chapter;

(4) Fails to obtain a permit when a permit is required under this chapter;

(5) Fails to comply with permit conditions; or

(6) Fails to comply with standardized water audit requirements pursuant to Act 169, Session Laws of Hawaii 2016,

shall be subject to a fine imposed by the commission. [~~Such fine shall not exceed $5,000. For a continuing offense, each day during which the offense is committed is a separate violation.~~] as provided under subsection (c). Each day that a violation exists or continues to exist may be considered a separate offense. Penalties for continuing violations shall be assessed from the earliest known date of the violation. The earliest known date of a violation shall be determined by the commission by a preponderance of the evidence; provided that if the earliest known date cannot be determined by a preponderance of the evidence, penalties for continuing violations shall be assessed from the earliest date the commission is made aware of the violation.

(1) $5,000 per violation; provided that the commission has fined the violator within the five years preceding the violation; provided further that the violation does not cause harm to other water users, the environment, or water source; or

(2) $25,000 per violation; provided that the commission has fined the violator within the five years preceding the violation; provided further that the violation causes harm to other water users, the environment, or water source.

(d) When imposing a fine, the commission shall consider the following factors, including but not limited to:

(1) The nature, circumstances, extent, gravity, and history of the violation and of any prior violations;

(2) The economic benefit to the violator, or anticipated by the violator, resulting from the violation;

(3) The opportunity, difficulty, and history of corrective action;

(4) The violator's good faith efforts to comply;

(5) The violator's degree of culpability;

(6) The quantity of water affected by the violation, including the quantity of water unlawfully diverted, wasted, or contaminated;

(7) The potential or actual harm to other water users, the environment, or water source caused by the violation; and

(8) Any other matters as justice may require.

[~~(c)~~] (e) No provision of this chapter shall bar the right of any injured person to seek other legal or equitable relief against a violator of this chapter.

[~~(d)~~] (f) Except as otherwise provided by law, the commission or its authorized representative by proper delegation may set, charge, and collect administrative fines [or]; may bring legal action to recover administrative fees and costs as documented by receipts or affidavit, including attorneys' fees and costs; [or] and may bring legal action to recover administrative fines, fees, and costs, including attorneys' fees and costs, or payment for damages resulting from a violation of this chapter or any rule adopted pursuant to this chapter.

(g) The maximum fine per violation pursuant to subsection (c)(2) shall increase to:

(1) $30,000 beginning January 1, 2030;

(2) $35,000 beginning January 1, 2035;

(3) $40,000 beginning January 1, 2040; and

(4) $45,000 beginning January 1, 2045."

SECTION 3. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 4. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 6. This Act shall take effect on July 1, 2040.

HOUSE OF REPRESENTATIVES	H.B. NO.	306
THIRTY-THIRD LEGISLATURE, 2025		H.D. 2
STATE OF HAWAII		S.D. 1