Reducing tax bills has been on the minds of many folks across the island, but only two people showed up at a public hearing the Kaua‘i County Council held Thursday to consider a proposal to bring more tax relief. The
Reducing tax bills has been on the minds of many folks across the island, but only two people showed up at a public hearing the Kaua‘i County Council held Thursday to consider a proposal to bring more tax relief.
The hearing, held at the historic County Building, dealt with Mayor Bryan Baptiste’s request to the council to consider revising tax bill caps for the county’s permanent-home-use dedication program.
The program benefits thousands of residents who own their homes and live in them. Modification of the program would enable many people to wield more control over their tax bills, and would allow many to keep their properties.
The current legislation, successfully pushed through by Councilmembers Daryl Kaneshiro and Jay Furfaro, provides a 6-percent yearly cap on taxes from what one paid the year before.
Baptiste is proposing to reduce the cap to 2 percent as a way to help residents keep their properties in the face of skyrocketing property assessments caused by a hot real estate market on Kaua‘i.
Prices have gone up partly because of the low inventory of homes for sale, a situation that has pushed up home prices, some residents have complained.
County administration officials have said dropping the rate from 6 to 2 percent would result in about $450,000 in less revenues going into county coffers in a year’s time, and savings of some $7 million, taking into account the benefits of the 6 and 2 percent tax caps.
Some speakers at Thursday’s council meeting said voicing support for the lower cap “is, of course, a no-brainer,” but stressed that approval of the lower tax cap was vital to residents who wished to be able to keep their properties and to remain on Kaua‘i.
Hanalei resident Ray Chuan said he declared his support for Baptiste’s proposal during the public hearing.
“Lowering the rate to 2 percent is a logical thing,” Chuan, a government watchdog, said following the meeting. “6 percent is way above the cost of living index. I think that the cost of living in Honolulu is under 2 percent, so 2 percent is certainly compatible with inflation.”
From his point of view, Chuan said the 6 percent cap was too high to begin with, and that he voiced opposition to it when government leaders considered it.
Wailua resident and government watchdog Glenn Mickens contended the bill contains “conflicting and ambiguous language which should be corrected.”
In a written text he presented to the council, he objected to a bill provision he contended called for the legislation to be temporary in nature.
Mickens noted that the provision recommends that the legislation, if approved by the council and Baptiste, would remain in effect until the council enacted legislation based on recommendations from a county real property tax task force.
Mickens said the bill provision should be changed so that the legislation will “continue in effect indefinitely.”
Mickens said he was opposed to the bill provision for numerous reasons.
“The real property tax task force made a number of recommendations,” he wrote. “It is ambiguous whether the adoption of one or more bills which were approvals of only some of the recommendations would trigger the termination of the 2 percent cap.”
In addition, the recommendations by the tax task force were intended for tax reform, not tax relief “as they were intended to be revenue neutral,” Mickens wrote.
Kaneshiro and Furfaro supported the current the current legislation providing a 6 percent tax bill cap because of a public outcry for government to begin making serious attempts at tax relief.
Furfaro recently noted that the measure he coauthored with Kaneshiro opened the door for lowering the 6 percent tax cap in succeeding years.
Baptiste’s measure is anticipated to be discussed by a council committee before it is acted upon by the full council.
