RELATING TO DAM AND RESERVOIR SAFETY.

SB2164

THE SENATE

S.B. NO.

2164

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

Relating
to dam and reservoir safety
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION 1.
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The legislature finds that while the current
dam and reservoir safety rules, regulations, guidelines, and laws move in the
direction of fulfilling several public safety initiatives, the aggregation of
these regulations are producing a significantly negative impact on the owners
and operators of existing dams.
�
These
negative impacts are often significant, latently observed, and experienced
solely by the dam owners.
�

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The legislature further finds that several
underlying issues impede dam owners' ability to implement the necessary repairs
to dams located on their property.
�
The
weight of the current regulations place a significant burden on dam owners who
do not possess the reserve capital or funding capability to satisfy the
requirements issued by the department of land and natural resources.
�
These regulations are inherently onerous and
represent an unfunded mandate on independent dam owners.

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The
legislature additionally finds that the current dams, reservoirs, and spillways
in the State function as key agricultural components to the overall
environmental health of the State, providing conventional and practical
benefits of water storage; the potentiality of tying into water delivery
systems; erosion control; reductions in sediment loading; wildfire management
capabilities; and structures that can serve as a reserve supply of potable
water sources.
�
However, as the legislature
has argued and demonstrated in previous legislative sessions, these benefits
are often offset by the increases in compounding costs that are experienced by
owners over time, in the form of higher costs for materials, shipping,
manufacturing, and labor, which are considered in excess of the existing
operating costs that owners experience.
�
Furthermore,
access to the necessary capital to implement improvements is consistently out
of reach for private dam owners, and cost estimates often fluctuate according
to economic shifts in the cost of goods and services.

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The
legislature notes that Act 232, Session Laws of Hawaii 2024, established a
special fund to receive funds for the dam and appurtenance improvement or
removal grant program and to reappropriate program funds to financially assist
owners of private dams to improve or remove these structures.
�
However, private dam owners still face
significant barriers to maintaining dams or reservoirs in the interest of
public safety.
�
Private dam owners may
not possess the specialized knowledge, financial capacity, or ability to locate
assessment firms to conduct rigorous unbiased risk assessments, which may lead
to potential delays in improvement and removal projects or inaccurate
reporting.
�
In contrast, the legislature
finds that the department of land and natural resources is uniquely positioned
to assess the risks posed by dams, spillways, and reservoirs in the State due
to its access to technical resources, comprehensive oversight capabilities, and
public safety mandates.
�
By shifting the
burden of proof in risk assessments to the department of land and natural
resources, the State can ensure that assessments are performed uniformly, free
of conflicts of interest, and truly aligned with public safety standards.
�

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Therefore,
the legislature asserts that in the interest of public safety and efficient
resource management, the department of land and natural resources should assume
the burden of proof regarding the determinations of risk assessment associated
with dam ownership, thereby establishing a multi-level partnership between the
State, the department, and private dam owners to ensure an equitable and
efficient process where the safety of Hawaii's infrastructure and communities
are prioritized by the most suitable entity.

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The
legislature concludes that the department of land and natural resources is the
most appropriate entity to assess risks posed by dams, spillways, and
reservoirs, because it has the necessary expertise in hydrology, civil
engineering, and environmental science to accurately and consistently evaluate
the safety of these critical structures.
�

The legislature acknowledges that the intent of this measure is to
balance public safety, ensure financial feasibility, and adequately address the
persistent challenges that dam and reservoir owners face in the process of
maintaining critical infrastructural water resources for the State.

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Accordingly,
the purpose of this Act is to:

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(1)
�
Require the department of land and
natural resources to incorporate into their assessment process the possession
of dam liability insurance or the active seeking of dam liability insurance by
private dam owners, as part of their valid mitigation measures, in conjunction
with approved modifications or repairs;

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(2)
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Authorize the
department of land and natural resources to relax any restrictions and
stringent standards on a dam or appurtenance upon verification of certain
insurance coverage;

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(3)
�
Authorize
the department of land and natural resources to consider a dam, reservoir, or
appurtenance safe absent certain documents;

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(4)
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Shift
the burden of proof onto the department of land and natural resources to find
that a dam is categorized as high
hazard;

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(5)
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Revise the definition of "hazard
potential" to include the consideration of dam liability insurance as a
hazard mitigation measure;

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(6)
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Expand the definition of "high
hazard" to include major economic losses; and

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(7)
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Establish additional requirements for
the department of land and natural resources and board of land and natural
resources regarding the dam and appurtenance improvement or removal grant
program.

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SECTION

2
.
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Chapter 179D,
Hawaii Revised Statutes, is amended by adding a new section to part II to be
appropriately designated and to read as follows:

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"
�
179D-
�
Inspections;
risk assessment; risk mitigation; insurance coverage; burden of proof; high
hazard.
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(a)
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In conducting investigations pursuant to this
part, the department shall consider:

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(1)
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Whether an owner has or is in the
process of obtaining insurance coverage that:

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(A)
�
Subjects the dam, reservoir, or
appurtenance to reclassification; and

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(B)
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Mitigates the risks associated with
the dam, reservoir, or spillway;

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(2)
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Whether the owner has other
financial assurances to mitigate the risks associated with the dam, reservoir,
or spillway; and

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(3)
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The results of any engineering risk
assessments conducted pursuant to subsection (d).

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(b)
�

The department shall consider proof of insurance or financial assurances
pursuant to subsection (a)(1) or (2) a valid hazard mitigation measure.
�
The department shall not classify a dam,
reservoir, or appurtenance as high hazard based only on the department's
findings pursuant to subsection (a)(3).

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(c)
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The department shall have the burden of proof
to affirmatively establish that a dam, reservoir, or appurtenance is a high
hazard dam, reservoir, or appurtenance, including when the owner does not
possess dam liability insurance or other financial assurances acceptable to the
department.

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(d)
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Any finding that a dam, reservoir, or appurtenance
qualifies as high hazard shall be supported by:

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(1)
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An engineering report from a
licensed engineer of the department that finds that the failure of the dam, reservoir,
or appurtenance will result in probable loss of human life; and

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(2)
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An engineering study or report from
a certified hydraulic engineer that considers:

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(A)
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Distances, including the distance to
potentially threatened residences and properties;

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(B)
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Natural water courses;

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(C)
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Percolation rates of the soil; and

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(D)
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A realistic assessment that the
failure of the dam, reservoir, or appurtenance will result in probable loss of
human life.

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(e)
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The department may consider, as part of their
assessment process, that any dam, reservoir, or appurtenance is safe absent the
documents required under subsection (d).

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(f)
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The department may relax any restrictions and
stringent standards on a dam, reservoir, or appurtenance; provided that the
owner verifies valid insurance coverage that meets the conditions of subsection
(a).

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(g)
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Nothing in this section shall be construed to
relieve an owner or operator of any legal duties, obligations, or liabilities
incident to the ownership, operation, or maintenance of a dam or reservoir.
"

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SECTION

3
.
�
Section 179D-3,
Hawaii Revised Statutes, is amended as follows:

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1.
�
By amending the definition of "hazard
potential" to read:

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""Hazard
potential" means the possible adverse incremental consequences that result
from the release of water or stored contents due to the failure of the dam or
reservoir or the misoperation of the dam, reservoir, or appurtenances.
�
The hazard potential classification of a dam
or reservoir shall not reflect in any way on the current condition of the dam
or reservoir and its appurtenant works, including the dam's or reservoir's
safety, structural integrity, or flood routing capacity.
�
The hazard potential classification of a
dam or reservoir shall take into consideration the presence of dam liability insurance
as an acceptable, viable, and valid hazard mitigation measure.
"

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2.
�
By amending the definition of "high
hazard" to read:

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""High
hazard" means a dam's or reservoir's failure will result in probable loss
of human life[
.
]
, and major economic loss that is not mitigated by
dam liability insurance.
"

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SECTION

4
.
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Section
179D-27, Hawaii Revised Statutes, is amended by amending subsection (f) to read
as follows:

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"
(f)

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If, upon inspection or upon completion
to the satisfaction of the board of all work that may be ordered, the board
finds that the dam and reservoir are safe to impound water, a certificate of
approval to impound shall be issued.
�
The
board may find that the dam or reservoir will not safely impound water
,
taking into consideration both structural and non-structural factors, including
whether the owner possesses dam liability insurance as a recognized hazard
mitigation measure pursuant to section 179D- (b),
and may refuse
to issue a certificate of approval to impound[
.
]
where the board
finds that the mitigating measures are insufficient to minimize hazard
potential.
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Upon finding that the dam
or reservoir is unsafe to impound water, the board shall issue a written notice
to the owner.
�
After receipt of the
notice, the owner shall no longer cause or allow the dam and reservoir to
impound water[
.
]
until the board, upon further inspection and
consideration of remedial actions or mitigating measures, including but not
limited to the purchase of dam liability insurance, determines that the dam, reservoir,
or appurtenance is eligible for a certificate of approval to impound.
"

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SECTION

5
.
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Section
179D-31, Hawaii Revised Statutes, is amended to read as follows:

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"
�
179D-31
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Dam and appurtenance
improvement or removal grant program; special fund; established
.
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(a)
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There is established a dam and appurtenance improvement or removal grant
program, to be developed and administered by the department for the improvement
or removal of deficient dams in the State.

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(b)
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The dam and appurtenance improvement or
removal grant program shall provide funding to owners of private dams for
plans, design, construction, and equipment to improve or remove deficient dams
and appurtenances, as determined by the department.

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(c)
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Each award shall be approved by the board
before disbursement and shall be subject to conditions imposed by the board.
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The board shall consider any
existing insurance policy in its assessment of risks associated with a dam.

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(d)
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The department [
may
]
shall

award grants based on criteria that shall be developed by the department.
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The criteria developed by the
department under this section shall be made publicly available.

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(e)
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Each applicant shall meet the following
requirements:

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(l)
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The applicant shall be an owner of a
high hazard or significant hazard dam or appurtenance that is regulated under
this chapter;

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(2)
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The applicant shall be the owner of a
regulated dam or appurtenance that has been determined to have one or more
deficiencies; provided that priority shall be given to dams or appurtenances
rated to be in poor or unsatisfactory condition;

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(3)
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The applicant shall indicate on the
application that the proposed plans, design, construction, and equipment shall
be intended for remediation or removal of the dam or appurtenance;

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(4)
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If the applicant is an entity other
than an individual, the applicant shall:

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(A)
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Be licensed to conduct business in the
State; and

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(B)
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Have bylaws or policies that describe
the manner in which business is conducted, prohibit nepotism, and provide for
the management of potential conflicts of interest;

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(5)
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The applicant shall agree to comply
with all applicable federal and state laws prohibiting discrimination against
any person on the basis of race, color, national origin, religion, creed, sex,
age, sexual orientation, disability, or any other characteristic protected
under applicable federal or state law;

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(6)
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The applicant shall agree that grant
moneys are not to be used for purposes of entertainment or perquisites;

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(7)
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The applicant shall agree that all
activities and improvements undertaken with funds received shall comply with
applicable federal, state, and county laws, including statutes, ordinances,
applicable building codes, and rules;

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(8)
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The applicant shall agree to make
available to the department all records that the applicant may have relating to
the grant and allow state agencies to monitor the applicant's compliance with
the purpose of this chapter;

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(9)
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The applicant shall establish, to the
satisfaction of the department, that sufficient funds are available for the
completion of plans, design, and construction, or equipment needed for the
purpose for which the grant is awarded; provided that the grant amount shall be
included among the calculation of sufficient funds; and

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(10)
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The applicant shall comply with other
requirements or conditions as the department or board may prescribe[
.
]
;
provided that:

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(A)
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The board shall prescribe other requirements
or conditions in a manner that is consistent with the principles of fairness
and equal treatment;

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(B)
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The other requirements or conditions
shall be:

��������������
(i)
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Based on reasonable and justifiable
grounds and relevant to the purpose for which the grant is awarded;

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(ii)
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Communicated to the applicant in a
clear, transparent, and reasonable manner; and

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(iii)
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Readily available to the applicant
in writing, with one copy submitted to the applicant and another made publicly
available; and

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(C)
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The applicant may seek clarification
of the other requirements or conditions prescribed.

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(f)
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The applicant may appeal the board's
determination of its application in accordance with section 179D-7.

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[
(e)
]

(g)
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Notwithstanding any provision
to the contrary, there is established in the department a special fund to be
designated as the dam and appurtenance improvement or removal grant program
special fund.
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The fund shall be
administered by the department.
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The
following shall be deposited into the dam and appurtenance improvement or
removal grant program special fund:

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(1)
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Appropriations by the legislature;

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(2)
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Moneys derived from public or private
sources to benefit dam and appurtenance improvement or removal;

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(3)
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Any other moneys collected pursuant to
this section or any rules adopted pursuant to this section; and

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(4)
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Moneys derived from interest,
dividends, or other income from other sources.

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[
(f)
]

(h)
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The department may expend
moneys from the dam and appurtenance improvement or removal grant program
special fund in accordance with this section and
�
other purposes for the administration of the dam and
appurtenance improvement or removal grant program under this section or any
rule adopted pursuant to this section, including but not limited to funding for
permanent or temporary positions.
"

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SECTION
6.
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Statutory material to be repealed is
bracketed and stricken.
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New statutory
material is underscored.

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SECTION
7.
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This Act shall take effect upon its
approval.

INTRODUCED BY:

_____________________________

Report Title:

DLNR;
BLNR; Dam and Reservoir Safety; Inspections; Hazard Assessment;
Hazard
Mitigation; Dam Liability Insurance; High Hazard; Burden of Proof; Dam and
Appurtenance Improvement or Removal Grant Program

Description:

Requires the Department of Land and Natural Resources to incorporate
into their assessment process the possession of dam liability insurance or the
active seeking of dam liability insurance by private dam owners, as part of
their valid mitigation measures, in conjunction with approved modifications or
repairs.
�
Prohibits the DLNR from
classifying a dam as high hazard based only on its engineering risk assessment
results.
�
Authorizes the DLNR to relax
any restrictions and stringent standards on a dam or appurtenance upon
verification of certain insurance coverage.
�

Authorizes the DLNR to consider a dam, reservoir, or appurtenance is
safe absent certain documents.
�
Shifts
the burden of proof to the DLNR to find that a dam is categorized as high-hazard.
�
Establishes additional requirements for the
DLNR and Board of Land and Natural Resources regarding the Dam and Appurtenance
Improvement or Removal Grant Program.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.