Panel presses Young Brothers and PUC on overtime, oversight and automatic rate adjustments

HB2386 HD1, considered March 4, 2026, would authorize the Public Utilities Commission to establish automatic adjustment mechanisms (index‑linked adjustments) for water carriers, including an inflationary cost index and exemptions. The hearing evolved into an extended examination of Young Brothers’ financial condition, overtime and operational fixes, prior audit findings and the PUC’s role in oversight.

Mickey Knox, the state consumer advocate, stood on written comments. The PUC’s Andrew Cave explained prior efforts (AFRA and zone‑of‑reasonableness programs) and said the commission needs clearer statutory authority to implement an automatic adjustment outside of full rate cases. Young Brothers’ representatives, including David Belveltry and David Faltry, discussed initiatives to reduce double and triple overtime, hiring increases and operational investments such as a $1.5 million Lai harbor investment intended to reduce schedule uncertainty.

Committee members pressed Young Brothers on the 2021 audit findings and the persistence of high overtime; members repeatedly asked for more granular percentage data on overtime, hiring and the independent observer’s assessments. Industry groups and the consumer advocate warned that automatic adjustments without guardrails could allow unchecked price increases for essential inter‑island shipping and urged mandatory performance metrics and periodic full rate reviews.

The committee added a provision to require the PUC to appoint a special overseer by July 1, 2026, and asked the PUC and Young Brothers to provide further analysis of auditor findings, progress against benchmarks, and proposed performance metrics. Several members recorded reservations on the automatic‑adjustment language; the committee nevertheless advanced the bill with amendments and directed follow‑up oversight.