A fight between local authorities and the federal government over how intensely Honolulu should upgrade two major sewage treatment plants has been brewing for decades, but there are strong indications that it has now reached the boiling point.

The work could take years and cost more than $1 billion — on top of many other costly repairs the city must make to long-neglected sewer pipes that feed into the plants. That's a price tag that, in the words of senior Hawai'i Sen. Daniel K. Inouye, could "bankrupt" the city.

As it is, the city is on the verge of approving a $300 million deal with the U.S. Environmental Protection Agency to replace four major pipes and perform other sewer work.

Those projects were already on the city's to-do list, but last year's disastrous rupture of a major pipe in Waikiki — which prompted the city to flush 48 million gallons of raw sewage into the Ala Wai Canal — triggered federal demands to complete the work as soon as possible.

Meanwhile, a behind-the-scenes push for a "global settlement" with the EPA, to include the disputed treatment plants, has been unsuccessful so far.

City officials through several administrations have maintained that the facilities here should not have to treat sewage to the same level as nearly all do on the Mainland.

Such "secondary treatment" is unnecessary here because Honolulu's plants discharge partially treated sewage into deep water far off shore, they argue.

Most other plants discharge into inland rivers or lakes, or into shallower ocean waters along coastlines that stretch for thousands of miles. The secondary treatment they perform typically uses microorganisms to consume most organic matter from wastewater before it is discharged.

For years, the argument won Honolulu special waivers to operate treatment plants on Sand Island and at Honouliuli, between 'Ewa and Kalaeloa, with lower treatment standards.

But updated environmental regulations — and more attention to sewage problems after the Waikiki disaster — may have seriously eroded that position. And all other municipal sewage plants in Hawai'i already perform secondary treatment.

Last month's EPA announcement that the waiver for Honouliuli should not be renewed sent shock waves through City Hall that continue to reverberate.

Officials were well aware that the waiver might be denied, but were hoping a "global" deal would buy time to prepare.

A similar — but far more significant — waiver denial is expected in October for the Sand Island plant, the city's largest and costliest sewage facility. A major expansion, and disinfection upgrade, has already been under way there for more than five years, costing more than $400 million.

The city has known the likelihood that waivers for both plants will be denied "was great and imminent," Inouye wrote in a letter to the EPA last month.

"Such action by the EPA would bankrupt the city, and would — as a defensive posture — force the city to court," Inouye wrote.

Such a dire scenario is far from certain, and could hinge on how much time the city would have to upgrade the plants, and where the money would come from. Federal funding could be an option.

Mayor Mufi Hannemann has warned that upgrading both plants could force the city to raise household sewer fees to an average of $300 per month within 20 years. The current average charge is less than $45.

Hannemann and Inouye quietly met with EPA officials in Washington, D.C., last month to seek a deal that would require replacement of major pipes in the sewage collection system but give the city a year to develop a plan for the treatment plants.

Talks initially went well, but the EPA and the Justice Department later took the waivers off the table, according to Inouye's letter to the EPA.

"There was no interest in arriving at a settlement which would include the collection system and the two wastewater treatment plants," Inouye wrote. "The city was given an ultimatum on the collection system and the meeting ended without further discussion on the waivers."

It appears that the EPA "has been, and is prepared for, a court battle rather than trying to solve a long-standing problem," Inouye complained.

The decision on Honouliuli is not binding — yet.

Hannemann is working to rally public opinion against the EPA's findings, and is hoping for a large and vocal turnout at a May 15 public hearing the agency must hold before making a final ruling.

In an unusual move, the city spent $26,000 to buy full-page advertisements in this newspaper and the Honolulu Star-Bulletin to draw attention to the hearing and call on residents to oppose demands to upgrade the sewage plants.

"An over-zealous expenditure to solve a questionable environmental 'problem' is not fiscally prudent or environmentally sensitive," argued the ads, which appeared over the past two weeks.

The environmental risks have long been a complex and hotly disputed subject, but new EPA standards for recreational waters put the Honouliuli plant in clear violation.

A 1995 study — forced by a lawsuit — concluded that secondary treatment was not necessary at Sand Island because discharged wastewater was quickly diluted in deep ocean waters.

But the study found that some additional treatment was necessary, and prompted the city to add a disinfection unit that is years behind schedule and not yet fully operational.

The EPA recently found that bacteria levels around the Honouliuli plant's discharge outfall were higher than national standards adopted in 2004 to protect swimmers, surfers and others from gastrointestinal diseases.

Testing also found that wastewater from the plant often proves toxic to sea urchins, and produced excess ammonia that can promote algae growth that depletes oxygen and harms other aquatic organisms.

The hearing on the EPA's denial of the plant's secondary treatment waiver will be at 7 p.m. May 15 at Kapolei Middle School. The exact date of a decision on the Sand Island plant has not been set.

Reach Johnny Brannon at jbrannon@honoluluadvertiser.com.