Honolulu residents should prepare for a substantial increase in water bills to pay for the settlement of lawsuits caused by an insufficient sewage treatment system.

When the price of the settlement is made public later this month, the city will need to reveal a way to pay for improvements without devastating homeowners trying to survive the recession.

Mayor Mufi Hannemann and Jared Blumenfeld, Pacific Southwest regional administrator of the U.S. Environmental Protection Agency, announced the settlement last Monday, and a City Council committee unanimously recommended approval two days later behind closed doors.

The City Council is likely to approve and make public the terms of the settlement July 14.

The litigation has been brewing for years, costing the city $10 million in legal fees. Hannemann said three years ago that such improvements would cost more than $1 billion and would require raising household sewer fees to $300 a month. That is unacceptable, and the city will need to create a lengthy timetable and pursue federal aid, available to the nation’s cities in previous years, to avoid such a debacle.

"Yes, there will be increases, but increases, I believe, on a schedule that we can afford," said Hannemann, who is running for governor and should recognize that the state is in no financial position to help.

While the federal agency has rescinded exemptions in past years, it has given the city wide latitude for nearly two decades.

The EPA recognized last year that cost and financial capability "could be a relevant tool" in arriving at a schedule for the city to reach compliance with the 1970 Clean Water Act.

The proposed settlement presumably would allow the city to take longer than previously insisted by the EPA to improve treatment of waste water at Oahu’s two main plants at Sand Island and Honouliuli.

Hannemann resisted EPA’s demand for removing organic matter from sewage and the agency’s opposition to allowing minimal treatment in pumping it less than two miles out to sea. The mayor is realistic in dropping his insistence that the city had scientific proof that pumping the minimally-treated wastewater to sea was not harming the environment.

Blumenfeld said the proposed settlement includes "aggressive near-term actions to improve critical aspects" of the system and a "longer-term schedule of construction" aimed at providing satisfactory secondary treatment of wastewater at the two plants.

Hannemann recognized the long neglect of the city’s sewer system at the beginning of his first term as mayor. When he leaves office in a few weeks, he may cite the EPA settlement as an accomplishment — but only if it includes an affordable payment system.