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On October 17, 1995, the parties in Save Our Bays and Beaches et al. v.City and County of Honolulu, Federal Civil No. 92-00263 entered into a Consent Decree to resolve the litigation brought by four groups against the City and County of Honolulu to address the lack of compliance with the federal Clean Water Act. The Consent Decree established the Kailua Bay Advisory Council (KBAC). KBAC is comprised of eight members, four member are selected by the plaintiff organizations and four members are selected by the City and County of Honolulu. Parties may elect to sit on the KBAC, thus, need not appoint a representative.

The Consent Decree outlines KBAC's goals and objectives:

These objectives are to be fulfilled through three programs: the Volunteer Water Quality Monitoring (VWQM) Program, the Technical Report Program, and an Implementation Program. In addition to the creation of KBAC, the Consent Decree allots funding for each of these three components: $300,000 for the VWQM Program, another $300,000 for the Technical Report Program, $1.5 million for the Implementation Program, and an additional $1.0 million, to be disbursed by the City upon request by KBAC to be spent at follows: $.5 million for the Implementation program and $.5 million for any of the three above programs. KBACs strength rests with its Council and its organizational infrastructure as a private organization. With its small size and private standing, KBAC can focus its efforts and streamline its actions to facilitate the goals and objectives of the Consent Decree. KBAC also will remain open to refining its processes to ensure access to the information it obtains about the watershed, to provide physical improvements, and to foster stewardship opportunities throughout the watershed that improve water quality.