Department of Water Supply Contingency Plans Follow-up

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Executive Summary

Background

The Department of Water Supply (DWS) is a semi-autonomous agency of the County of Hawaiʻi that operates by rules and regulations adopted by the Water Board. The Department operates and maintains its water systems with revenues generated solely through billings for water service. The primary function of the Department is to provide safe drinking water through its 23 individual water systems distributed around the island. Attachment 1.1.

DWS continuously strives to provide dependable, uninterrupted, high quality, potable water at a reasonable cost in compliance with the Safe Drinking Water Act. DWS services nine districts using four baseyards located in Hilo, Kona, Waimea, and Kau.

DWS can draw on its 23 water systems to support any of its out-of-service deepwells.

The Office of the County Auditor has completed a follow-up engagement with the County of Hawaiʻi’s Department of Water Supply Contingency Plans. We initiated the audit on request of the Hawaiʻi County Council (Resolution 287-17) and numerous constituent concerns regarding repair delays and water restrictions for the North Kona areas.

As required by federal law, DWS developed the Continuity of Operations Plan (COOP) (August 2010), which addressed operational procedures for disaster events. DWS also developed three contingency plans in 2017 when four wells became inoperable. These contingency plans included:

Kona Operations Initial Plan
North Kona Response and Responsibilities
North Kona Operations Emergency Action Plan

The prior audit found gaps in DWS’ COOP and three contingency plans. Specifically, contingency plans should contain sufficient detail including prioritizing and clearly documenting emergency procedures for all districts, three types of water usage restrictions to address water shortages, clearly documenting communication procedures. In addition, DWS should list complete vendor names and/or contact information that provide an essential function in their COOP.

As of September 2022, DWS confirmed 12 of the 14 deepwells in North Kona are operable, with the exception of:

Wai’aha Deepwell
- Pending negotiations over incomplete repair contract (Job No. 2016-1056)
Makalei Estates Deepwell
- Awaiting developer redesign and construction of pump and motor (warranty issue)

In this follow-up, we tested three recommendations to determine if DWS implemented our contingency plan recommendations. We determined two recommendations were implemented and one was resolved. We found:

DWS Status of Recommendations - Contingency

History and Repair Status of North Kona Deepwells

Since January 2017, up to five of DWS’ deepwells were intermittently in and out of service, restricting water service to residents, businesses, and the public throughout North Kona. In response, DWS provided the public with a history and repair status for five deepwells located in North Kona: Honokōhau, Hualālai, Keōpū, Palani, and Wai‘aha. Attachments 1.2 – 1.6a.

In January 2018, DWS reported the schedule for Wai‘aha Deepwell repair was unknown. Attachment 1.6b.

In June 2022, DWS reported 25% mandatory water restriction measures were needed due to the failure of Hualālai Deepwell and approved the expedited purchase of replacement parts in efforts to return Hualālai Deepwell back to service. DWS stressed that water quality was not threatened by the loss of the well. Attachment 1.7.

Subsequently in July 2022, DWS reported interim repairs were made to the Kalaoa Deepwell, downgrading North Kona areas to 10% voluntary water conservation. DWS said they are confident that the water needs of the community will be met with the voluntary conservation in effect and will continue to monitor the water system and adjust as necessary. Attachment 1.8.

Conclusion

Contingency and continuity plans are similar: they both require specific procedures in instances where things go wrong to allow for continuing operations. A continuity plan is a broader plan that includes steps on the prevention and recovery of operations in the event of a disaster. Whereas a contingency plan is a vital part of the continuity plan that helps organizational leaders prepare for all kinds of worst-case scenarios. In other words, contingency plans cover in-the-moment procedures in an emergency while a continuity plan covers how an organization will recover to normal operations.

Best practices say that contingency plans should address specific criteria for the initiation and termination of water shortage stages, procedures for notification and education of the public, and procedures for monitoring the situation during water shortage stages.

We commend the Department of Water Supply for their efforts to improve contingency plans and providing water to customers during a disruption of deepwell operations. To further strengthen internal controls over contingency plans, we’ve identified the following opportunities:

DWS should:

Review and update written plans accordingly
Consolidate applicable guidance
Make plans accessible to appropriate DWS staff
Re-certify Continuity of Operations Plan annually

About Us

Mission

It is our mission to serve the Council and citizens of Hawai‘i County by promoting accountability, fiscal integrity, and openness in local government. Through performance and/or financial audits of County agencies and programs, the Office of the County Auditor examines the use of public funds, evaluates operations and activities, and provides findings and recommendations to elected officials and citizens in an objective manner. Our work is intended to assist County government in its management of public resources, delivery of public services, and stewardship of public trust.

Audit Authority

Hawai‘i County Charter §3-18 establishes an independent audit function within the Legislative Branch through the Office of the County Auditor.

Purpose

The purpose of this engagement is to follow-up and monitor the responses to audit recommendations by audited entities by evaluating if the Department of Water Supply has adequate contingency plans to provide water to customers even during a disruption of deep well operations.

Performance Audit Definition

Performance audits provide objective analysis, findings, and conclusions to assist management and those charged with governance and oversight with, among other things, improving program performance and operations, reducing costs, facilitating decision making by parties responsible for overseeing or initiating corrective action, and contributing to public accountability.

Introduction

Objective

Did the Department of Water Supply implement the 2020 contingency plan audit recommendations?

Scope

The prior audit evaluated contingency and continuity plans from October 2017 to August 2019.

The follow-up evaluated contingency and continuity plans from April 2022 to September 2022.

This follow-up audit was limited to reviewing and reporting on the implementation of the recommendations. We did not consider new or previous issues that did not relate to our original recommendations.

Methodology

To verify the Department of Water Supply implemented the 2020 contingency plans recommendations, we:

Corroborated information with appropriate staff to follow-up on the responses to audit recommendations
Reviewed applicable laws and other relevant governance
Reviewed contingency, continuity, and communication plans
Reviewed Water Board Minutes
Reviewed, as needed, information pertinent to deepwell operations
Was mindful of potential fraud, waste, and abuse during the audit
Noted exceptions and identified areas for improvements

We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Definitions

Implemented: Department has fully completed the audit recommendation. We reviewed sufficient and appropriate evidence to support all aspects of the recommendation.

Resolved: Although the department did not implement the audit recommendation, it implemented an alternative solution/mitigating/compensating control that fully addressed the applicable audit finding or risk.

Partially Implemented: Department has made significant progress. We reviewed sufficient and appropriate evidence to support key aspects of the recommendation.

Not Implemented: Sufficient and appropriate evidence was unavailable to support key aspects of the recommendation or department has no plans to implement the recommendation.

Not Applicable: The risk associated with the recommendation no longer exists or is no longer applicable.

Public Water System (PWS): A public water system provides water for human consumption through pipes or other constructed conveyances to at least 15 service connections or services an average of at least 25 people for at least 60 days a year. A public water system may be publicly or privately owned.

Status of Recommendations

Develop and Implement a Complete Contingency and Communication Plan By District

Develop and Implement a Complete Contingency and Communication Plan by District

Condition and Cause

DWS did not have formalized emergency contingency plans for all districts. Subsequently, three contingency plans were developed in 2017 when four deepwells became inoperable. However, these plans only applied to the North Kona areas or one district.

Effect of the Condition

The lack of detailed procedures and clear guidance increases difficulty managing water systems.

Recommendation 1

“We recommend the Department of Water Supply develop a written contingency plan by district to address emergency situations to mitigate potential impact on any community. Or, at a minimum, include contingency plan that address important risk scenarios into their existing Continuity of Operations Plans.”

Department Action

As required by the American Water Infrastructure Act (AWIA) and Federal Emergency Management Agency
- Completed Emergency Response Plan for seven water systems (Hilo, N. Kohala, N. Kona, Olaa-Mountain View, South Kohala, South Kona, and Haina) identifying threat scenarios serving these communities
- Completed Risk and Resiliency Assessment and Preparedness Assessment Technical Memorandum for seven water systems to further strengthen water systems resiliency
Plan to update contingency plans accordingly
Updated Continuity of Operations Plan (COOP)
- Implemented pandemic response
- Distributed COOP to Civil Defense, Police, Fire, and the Department of Public Works
Clarified smaller public water systems (PWS), such as DWS, used “district-level” contingency plans, that are general in nature to allow flexibility and to let staff determine the most prudent and appropriate response for an event
- Adopted best practice by the PWS which is regulated by the State of Hawai‘i, Department of Health, Safe Drinking Water Branch

Developed spare pump and motor priority list program
- Having spare pumps and motors on-island saves time and prevents extended delays in returning deepwells to service
- Procured pumps and motors
Implemented recommendations from Water Board’s Permitted Interaction Group (PIG) to ensure resilience of our water systems and to improve operations
Worked with Civil Defense to update the County’s Hazard Mitigation Plan

Audit Activity

To verify status, we reviewed, corroborated sufficient and appropriate evidence, and found:

DWS’ 2017 contingency plans have not been updated in the last five years nor address emergency situations to mitigate potential impact for nine districts
DWS’ 2020 Continuity of Operations Plan was updated once in the last ten years, does not address important risk scenarios for nine districts, and was not re-certified annually
Review of Emergency Response Plan (ERP) for seven water systems found no exceptions
Review of Risk and Resiliency Assessment (RRA) Report and Preparedness Assessment Technical Memorandum for seven water systems found no exceptions

Although we noted contingency plans and COOP could be further developed to address risk scenarios, we determined this recommendation resolved because only seven water systems require an RRA and ERP to be completed by AWIA compliance requirement

Review of public water systems (PWS) found DWS belongs to community water system (CWS): A public water system that supplies water to the same population year-round and found there are no Federal, State, or local statues that exempts municipalities with smaller water systems from not having completed, detailed, and written contingency plans
Review of Notice of Awards found no spare pumps and motors were ordered for three out-of-service North Kona Deepwells: Honokōhau, Palani, and Wai’aha

Although DWS developed a spare pump and motor priority list program, some spares are at risk of losing warranty if the unit sits too long

In June 2022, DWS approved expediated purchase of replacement parts in efforts to return Hualālai Deepwell back to service

Four deepwells awaiting bid submittals with one-year manufacture warranty:

Halekii Deepwell power cable
Keōpū #1 Deepwell pump, motor, and power cable
Parker Ranch Deepwell pump, motor, power cable, and shroud assembly
Waimea Deepwell pump and motor

Halekii Deepwell pump and motor picked up for refurbishment

As of September 2022, DWS confirmed 12 of the 14 deepwells in North Kona are operable, with the exception of:

Wai’aha Deepwell
- Pending negotiations over incomplete repair contract (Job No. 2016-1056)

Makalei Estates Deepwell
- Awaiting developer redesign and construction of pump and motor (warranty issue)

Review of Water Board Minutes and Permitted Interaction Group (North Kona) – Strategies and Actions Moving Forward found standardized materials, pumps, and motors and alignment survey were completed to ensure proper size equipment were being installed

Review of County’s 2015 Hazardous Mitigation Plan (HMP) found although water wells are categorized as a critical lifeline facility to the County, one of the County’s HMP goals is to ensure that lifeline infrastructures can withstand hazardous events or contingency plans to expedite recovery was not in place.Currently, there is no contingency plan to provide water during a disruption of deepwell operations for nine districts

To further strengthen internal controls over contingency plans, DWS should:

Review and update written plans accordingly
Consolidate applicable guidance
Make plans accessible to appropriate DWS staff
Re-certify Continuity of Operations Plan annually

Status: Resolved

Condition and Cause

DWS did not have formalized communication plans and procedures to effectively notify the public to reduce water usage during emergency and non-emergency events.

Effect of the Condition

Public confidence declines without reliable communications during immediate, impending, or extensive disruptions of water service.

Recommendation 2

“We further recommend the Department of Water Supply develop and implement a communications plan to notify the public, administration, stakeholders, and all governmental agencies that rely on information that may affect them or a community. The plan should include but not limited to timely notices and updates status of water events and holding community public meetings timely.”

Department Action

Developed and implemented communication plans and workflows for:
- Emergencies
- Fire hydrant flow tests
- Scheduled water shutoff
- Water conservation/restriction
- Water main break
Provided notices by:
- Radio
- Social media
- Email
- DWS website
- Hand-carry
- Civil Defense alerts
- Phone outreach
Ensured continuity of messaging through DWS’ Communications Branch
Plan to update communications plan accordingly

Audit Activity

To verify status, we reviewed guidelines for small water systems, drought triggers, water storage information charts, communication plans, flowcharts, workflows, voluntary and mandatory water restriction notices, and found no exceptions. We also reviewed Water Board Minutes, bulletin boards, social media, DWS website and found various forms of media were used to notify the public.

To further strengthen the communication plan, DWS should consolidate written guidance such as drought triggers and three stages of water shortage conservation into their communication plan.

Status: Implemented

Update Continuity Operations Plan (COOP)

Condition and Cause

DWS did not document critical vendor contact information that performs an essential function in 2010 Continuity of Operations Plan.

Effect of the Condition

It is difficult for DWS staff to respond during emergencies with incomplete vendor contact information.

Recommendation 3

“We recommend the Department of Water Supply update their Continuity of Operations Plan (COOP) to include essential vendor contact information to ensure that quick reference information is accessible and available during emergencies.”

Department Action

Added contact information for essential vendors to 2020 COOP
Plan to review and update vendor contact information on a routine basis to keep current

Audit Activity

To verify status, we compared 2010 COOP to 2020 COOP Table 10 Critical Vendors, sole source manufacturer letter, approved Notice and Request for Sole Source for specialized water quality testing supplies, and found no exceptions.

Status: Implemented

Fraud, Waste, and Abuse

Conclusion

The primary function of DWS is to provide safe drinking water service through its 23 individual water systems distributed throughout the island. The Department of Water Supply continuously strives to provide dependable, uninterrupted, high quality, potable water at a reasonable cost in compliance with the Safe Drinking Water Act.

Contingency and continuity plans are similar: they both require specific procedures in instances where things go wrong to allow for continuing operations. A continuity plan is a broader plan that includes steps on the prevention and recovery of operations in the event of a disaster. Whereas a contingency plan is a vital part of the continuity plan that helps organizational leaders prepare for worst-case scenarios. In other words, contingency plans cover in-the-moment procedures in an emergency while a continuity plan covers how an organization will get up and running again.

We commend the Department of Water Supply for their efforts to improve contingency plans to provide water to customers during a disruption of deepwell operations. To further strengthen internal controls over contingency plans, we’ve identified some opportunities:

DWS should:

Review and update written plans accordingly
Consolidate applicable plans
Make plans accessible to appropriate DWS staff
Re-certify Continuity of Operations Plan annually

In closing, to improve government accountability and ensure audit recommendations are implemented or resolved, we will continuously monitor the status of recommendations using our remediation tracker. To view the department’s status, visit us at: https://www.hawaiicounty.gov/our-county/legislative/office-of-the-county-auditor.

Management Response