HILO — Mayor Harry Kim’s first major borrowing — $20 million to begin the closure process for the Hilo landfill — is scheduled for a County Council vote Tuesday.
The county Department of Environmental Management expects to finish design plans by the end of the year to close the landfill. The county then must get the closure plans approved by the state Department of Health.
The landfill has an estimated two years left. Once the landfill is closed, the county will rely on waste diversion and trucking garbage to the West Hawaii landfill at Puuanahulu rather than building a new landfill on the east side of the island.
Environmental Management Director Bill Kucharski estimates the county will truck 17 tons per day, two refuse trucks’ worth, across Saddle Road from Hilo to Puuanahulu, or about 500 tons annually.
The county is voluntarily undergoing an environmental assessment for the landfill closure plan, Kucharski said Wednesday.
“We wanted to get it out to the public and make sure the issues are addressed,” Kucharski said. “It’s not a requirement, but we felt it was appropriate.”
The design will include two liners and some kind of covering atop the landfill, a passive gas monitoring system and continued groundwater monitoring for 20 years. The landfill, built before bottom liners were required, has so far displayed surprisingly clean groundwater discharge, he said.
The money is expected to come from the state water pollution control revolving loan fund, but the council, meeting as the Finance Committee at 10 a.m. Tuesday, is asked in Bill 32 to authorize a bond issue to pay back the low interest loan.
The bond authorization serves as a pledge of security in qualifying for the loan, but it’s unlikely to be issued, said Deputy Finance Director Deanna Sako. The state revolving loan fund is preferred because interest rates are as low as one-quarter to one-half percent, she said.
It’s the second borrowing that’s come before the council this year. The first, for sewer improvements in Kulaimano and Papaikou, was a $2.7 million borrowing from the revolving loan fund.
The projects are the first in what looks like a year of meat-and-potatoes borrowing, primarily for necessary infrastructure such as sewer, solid waste and roads. Kim’s $173.9 million capital improvement budget assumes $67 million in state revolving loan funds and $97 million from new or existing bonds.
The county’s net funded bond debt as of December was $411.3 million, costing the county an annual payment of $48.6 million this year in principal and interest.
The Government Finance Officers Association recommends a ceiling of no more than 15 percent of expenditures to go toward repaying bond debt. In Kim’s budget for the fiscal year beginning July 1, debt service is estimated at 9.6 percent of expenditures, which would rise to 12.6 percent if all bonds already authorized by the council were issued.