Some $43 million earmarked for critical sewage treatment projects is being held up by the Honolulu City Council Budget Committee because of concerns over the future of a substance and mental health treatment facility that is on land proposed to be used for expansion of the Sand Island Wastewater Treatment Plant.

Withholding the funding could result in state and federal fines tied to consent decrees the city agreed to in 2010 to make sewage improvements in order to settle lawsuits filed by environmental groups claiming the city violated the U.S. Clean Water Act due to wastewater spills and other mishaps.

But Budget Committee members said Tuesday that they intend to restore funding for five projects in the 2017 capital improvements budget that are related to the consent decrees — as soon as officials with the Department of Environmental Services meet with operators of the Kline-Welsh Behavioral Health Center, better known as the Sand Island Behavioral Health Center.

The Sand Island plant funds being held: $25 million for return flow treatment units, $7 million for expansion of primary treatment facilities, $6.1 million for outfall equipment, $4 million for secondary treatment upgrades and $802,000 for odor control improvements.

On Tuesday the committee sent the city’s $2.3 billion operating budget and the $800 million capital improvements budget to the full Council for a final vote June 1. The new budget year begins July 1.

The behavioral health center, which first began in 1960, has 123 residential treatment beds and, including outpatient programs for clients and family members, serves more than 1,000 people annually.

Environmental Services Director Lori Kahikina said a meeting has been scheduled for Monday among her agency, treatment center representatives, area Councilman Joey Manahan and Council Chairman Ernie Martin.

But the threat to withhold the money appears to have jarred officials with the U.S. Environmental Protection Agency, the Sierra Club of Hawaii Oahu Group and Kahikina, who told the Budget Committee before its vote on the budget items that “this is very concerning for us on so many levels.”

EPA representatives in town for an annual consent decree review also are “extremely concerned” and asked to meet with her on the matter today.

Her department and the EPA have a carefully crafted timetable for improvements at the plant that’s sensitive to the city’s financial constraints. “But if we show that we, as a city, we’re not committed to this consent decree stuff, they’re going to start pulling funding, they’re going to not trust us anymore,” she said. If that happens, they could choose to accelerate the schedule, she said.

“That’s a major risk that we have,” Kahikina said. “We have a good schedule … but if we fail to continue to hold their trust, they have it in their power to go back to the courts” and force the city to immediately improve the treatment system.

Additionally, Kahikina said, “the Sierra Club has already met with us, and they said they will sue, they will come after the city for that.”

Kahikina asked Council Budget Chairwoman Ann Kobayashi what she should tell EPA officials.

Kobayashi responded, “Well, once you meet (officials) about the halfway house, I’m sure it will be settled.”

After the meeting, Manahan told the Honolulu Star-Advertiser he also had no intention of holding the funding for the sewer projects.

Manahan told committee colleagues that the current plans for the Sand Island plant’s expansion would force the drug treatment facility to close or relocate from its 1-acre site. Besides clients and their families, about 50 full-time staff employees would be affected if it is forced to close or relocate.

“These are probably some of the toughest cases anywhere in the state, and they really have nowhere to go,” Manahan said. “What needs to happen is a discussion between the Department of Environmental Services and the folks at the drug treatment facility.”

Officials from the facility did not testify Tuesday. But in a prepared statement on the situation, clinic director L. Mason Henderson said, “Even if everything went smoothly and on schedule, it would require an expenditure of roughly $10 million (to relocate) and a substantial two-year reduction in the availability of critically needed services.”

“The great majority of the clients we admit are either homeless, indigent, confined to the State Hospital or our prison system, and have no other resources,” Henderson wrote.

Anthony Aalto, chairman of the Sierra Club Oahu Chapter, said he was baffled by the controversy.

“We ought to be able to chew gum and walk at the same time,” he said. “I have a lot of respect for public officials; they have a difficult task to do … but I just think this is kind of an unnecessary way of approaching this. These are essential infrastructure projects, they are fully funded and you can’t spend the money on anything else. Let’s not run the risk of falling afoul of the EPA.”