Agronomics tax bill deferred

LIHUE — A county bill aimed at taxing crop-research land separate from other agricultural land was deferred on Wednesday until Aug. 20, killing any chance of it going into effect during fiscal year 2015-2016.

I’m disappointed that the council didn’t chose to continue work on a very important issue,” Kauai County Councilman Tim Bynum, who introduced the measure, said after the decision.

Tempers flared during Wednesday’s special meeting, when the council’s Finance and Economic Development Committee — absent of its chair Mason Chock — took up the proposed legislation. If passed, Bill 2456 would establish “agronomics” as a new and separate real property tax class and exclude lands used primarily for crop research or parent seed production from the county’s definition of “agricultural use.”

Despite recommendations from council members Bynum and Gary Hooser to instead defer for two weeks, which would have given the bill a chance of taking effect by FY 2016, the committee voted 3-1 to push it back until the August date — 11 days after the primary election.

When Committee Vice Chair JoAnn Yukimura cast the deciding vote, Bynum (who is not a member of the committee) threw his pencil and stormed out of the room.

“I can’t think of any obstacle whatsoever that would preclude us from going ahead with the normal process and revisiting this in two weeks,” he said before the vote. 

The council’s discussion and public testimony was reminiscent of talks about Ordinance 960 (formerly Bill 2491), a county law slated to take effect in August that governs the use of pesticides and genetically modified crops on the island. 

Adam Killerman, a former employee of McBryde Sugar Co., called Bill 2456 another “assault on agriculture” by the council.

Hooser clarified that the bill itself would not actually raise taxes, but merely create another category of agricultural use. However, he recognized that raising taxes for that new use could come down the road.

Fern Rosenstiel testified the county should be working harder to make things easier for the small farmers. She said she finds it “appalling” that large, multi-billion dollar corporations doing experimentation and research are taxed at the same or lower rates as the small people.

Bynum said his proposal is about addressing the question of whether crop research, which does not produce a product that is sold to consumers, either wholesale or retail, should be eligible for tax incentives. The practices of seed companies on Kauai, he said, are “far different” than the agricultural production practices the county has traditionally chosen to support. 

“They are experiments, not food,” he said, adding that the nature of Kauai ag “changed under our feet.”

Not everyone agreed. Councilman Mel Rapozo said crop-research is still ag, just a different type. And the issue is not about tax rates, he said, but rather the ag dedication process and that the county administration is not enforcing current laws properly. 

“That’s the root problem that we need to fix,” he said. “Passing this bill does absolutely nothing.”

For Hooser, it came down to equity and implementing the law. Referencing a tax property summary for DuPont Pioneer, he said the company operates 4,000 acres valued at $12 million, but pays only $4,180 per year in taxes on it. 

“It seems that something is wrong with the picture in my opinion,” he said. 

Yukimura told her colleagues that she isn’t convinced an agronomics tax category is the right answer. 

“But,” she said, “I am intrigued by this idea that there’s only two categories (of ag) under regulation right now — crop and pasture — which, to me, biotech research does not fall under.” 

If eventually passed, the agronomics rate classification would include parcels that are “used for no other purpose than science, research and development of crops” and which “do not directly gain monetary profit from the ultimate consumer,” according to the bill.

Additionally, the bill would require the county director of finance to submit annual reports involving all agricultural dedicated properties to the mayor and county council. The reports would include the name of the landowner, Tax Map Key of dedicated area, period of dedication, size of dedicated area, description of the agricultural use and taxes resulting from the dedication compared with their market value.

 

Chris D’Angelo, environment writer, can be reached at 245-0441 or cdangelo@thegardenisland.com.

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