Tax exemption amendment goes to council
LIHUE — The value of land on Kauai, particularly beachfront properties, has soared over the years.
Family members who have lived on these properties for generations but whose names are not on title could soon qualify for real property tax exemptions. A public hearing for a bill that proposes an amendment to alter the definition of property owners to include family members will be held on Wednesday.
Bill No. 2756, if approved, would allow family members to apply for real property tax exemptions based upon their own eligibility, as long as there is no living person on title.
The amendment also proposes that family members include not only those related by blood but also by marriage, “reciprocal beneficiary relationships” or step-relatives.
Councilmember Felicia Cowden did not propose the bill but said she is “enthusiastically” supportive of it. Some families have lived on properties located in areas like Haena, Hanalei, Anini, Kekaha and Poipu, for years, but can’t lay claim to any property rights because their name is not on title.
“These families are often vulnerable to an extreme rise in property values,” Cowden said.
A grandparent or other relative, for example, could have died prior to establishing a will or transferring rights. While the bill does not clear title for ownership, which can also be cost-prohibitive, family members residing on the premises may be eligible for tax relief.
If the bill passes, a family member, for example, could potentially assign a real property tax rate classification of homestead or commercialized home use.
“Which are very valuable exemptions offered by the county,” said Kauai County Finance Director Reiko Matsuyama.
Additionally, if an applicant can prove they are a lineal descendant of the original titleholder, and if they can prove there is no living person on title, they can apply for the kuleana exemption, rather than paying higher “residential” or “residential investor” rates. But even if they can’t meet the first criteria, they would still be eligible to apply for other provisions, such as the homestead class.
“It gives them a chance to hold on to their land,” Cowden said. “The goal behind this is to help our long-standing population not get taxed off their land because of clouded titles.”
The draft bill, proposed by councilmembers Luke Evslin and Mason Chock, passed its first reading last month. The public may provide comments at 1:30 p.m. Wednesday at Council Chambers at the Historic County Building.
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Coco Zickos, county reporter, can be reached at 245-0424 or czickos@thegardenisland.com.